Legal Question in Criminal Law in India

case against guarantor compromise between borrower and creditor

A loan of Rs.50000/-on 01.04.2000 payable in 18 monthly instalments of Rs.3200/- by postdated cheques of �B� was given to borrower �B� on basis of guarantee agreement alongwith A cheque of Rs.50000/- dated 1.9.2002 given by G. Only three cheques of Rs.3200/- was got passed, and remaining 15 got dishonored. So four complaints for 15 cheques were lodged, in one of them of Rs.22300/-, B was convicted with Rs.44600/- plus six month sentence and against this an appeal pending at Session Court. During 1.4.2000 to 4.8.2006 Rs.38000/- was given by B and at stage of appeal a compromise was made on 04.08.2006 for Rs.63000/-by giving Rs.8000/- and remaining Rs.55000/- was to be paid in Rs.7000/-+ per month within six month completely. But again borrower defaults by not paying further even single instalment as compromised. Guarantor was also convicted three month sentence and Rs.35000/- by trial Court for his cheque of Rs.50000/- dated 1.9.2002 dishonoured and appeal pending at Session Court. Now guarantor argues, since there is a compromise between borrower & creditor without my consent, So I (guarantor) should be relieved from my liabilities without taking it into consideration whether borrower gave or not remaining Rs.55000/-. Clarify law


Asked on 10/30/06, 3:51 pm

2 Answers from Attorneys
sheena VC legalalia

Re: case against guarantor compromise between borrower and creditor

I understand that the appeal is still pending,so there is no cause for u to bother unlike civil matters the liablity does not rest on the out of court settlement and part payments but on the crime committed..As long as you do not withdraw the complaint and report your intention to the court the sentence will remain.Thank You.

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Answered on 10/31/06, 12:05 am

Re: case against guarantor compromise between borrower and creditor

dear sir,

in reply it is stated that a new contract was formed when borrower and creditor entered into compromise and the old contract in which guarantor was party cease to exist when compromise was effected.since guarantor was not a party to new contract hence he has no libility in case of any breach in respect of new contract.For any other assistance contact on 9873343288(Delhi).

thanks.

siddharth

[email protected]

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Answered on 10/31/06, 12:32 am


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