Cooperative bank loan recovery

Querist : Anonymous (Querist) 19 October 2020 This query is : Resolved
My father and another person were guarantor for a borrower from a cooperative bank.My father died 10 years ago.The borrower is untraceable.Now we did not know this situation.But bank has asked us to be responsible for the repayment after 10 years .Is it fair or legal.How do we deal in this situation

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A guarantor's family is being asked to repay a cooperative bank loan after the borrower became untraceable and the guarantor passed away 10 years ago. Legally, a guarantor steps into the borrower's shoes if the loan isn't repaid, and their estate can be liable. However, if the bank was not informed of the guarantor's death 10 years ago and no renewal or acceptance of liability has occurred from the legal heirs, the loan may be time-barred under the Limitation Act, potentially preventing recovery.

Isaac Gabriel (Expert) 19 October 2020
The loan could have been got decreed against,wherby the guarantor too is liable for the repayment. As per law, the surety/guarantor enters the shoes of the borrower if the loan is not repaod.Therefore try to locate the borrower to repay.

Rajendra K Goyal (Expert) 19 October 2020
The guarantor is liable to pay the Bank loan.
In the present situation the guarantor has expired, loan can be recovered from his assets.

Loan is 10 years old, if no renewal / acceptance of liability was given by the legal heirs of the guarantors it is time barred loan. Bank has no right to recover.

Advocate Bhartesh goyal (Expert) 19 October 2020
Both borrower and guarator are liable to repay the loan amount jointly or severally.if borrower is untraceable then bank can recover it from the assets of guarantor.

kavksatyanarayana (Expert) 19 October 2020
Yes. Agreed with the above-learned experts.

Dr J C Vashista (Expert) 21 October 2020
The decree / Award / order is executable from the estate left behind by traceable as well as untraceable deceased guarantor besides principle borrower.

Rajendra K Goyal (Expert) 21 October 2020
You have not clarified, whether legal heirs of the deceased have accepted any liability of this time barred loan.

Hemant Agarwal (Expert) 21 October 2020
INTROSPECT ON THIS:
1. IF Bank was duly informed 10 years ago about demise of Guarantor (Father), THEN under the "Law of Estoppel" Bank was legally duty bound to seek another Guarantor from the principal Borrower. IF Bank did not do this THEN Bank is barred by Limitation Act to seek any amount from the Legal Heirs of the deceased Guarantor, more so AFTER 10 years.

Keep Smiling .... Hemant Agarwal
VISIT: www.chshelpforum.com

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