Legal Question in Banking Law in India
wholly blank signed cheque
if a creditor takes a wholly blank signed cheque from the
guarantor of a borrower and borrower is not paying the amout ,can the said cheque taken from the guarntor can be filled up for remaing due amout and date now
and can be presented in bank for payment?
3 Answers from Attorneys
Re: wholly blank signed cheque
Yes, the cheque may be filled in for the remaining balance amount, as the gaurantor is co-liable equally alongwith the principal borrower.Rajendra Babbar,Advocate.
Re: wholly blank signed cheque
The said cheque issued by the Guarantor is considered asa Security and cannot be presented and proceeded u/s.138-142 of the N.I.Act. However, a recovery suit on the said cheque will lie as the guarantor guarantees the payment if the principal Borrower defaults in payment.
Re: wholly blank signed cheque
if cheque is given as 'security' with signing of some deed etc, the action under section 138-142 of NI act is not possible
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