Legal Question in Credit and Debt Law in India
I would be lending money to one of my friend. which would be a better legal collateral, back dated cheque or Pro Note. I would like to understand the ease of legal action and obtaining legal result on the borrower for both back dated cheque or Pro Note.
3 Answers from Attorneys
don't break your friendship.cheque is the better option
both pronote and cheques are dealt under negotiable instruments act and almost effects the same .i wuld suggest pronote as in that case the person accept the receivng of amount and accepts the liability to pay too . through cheque though u can show the transaction but for what purpose that wuld not be proved
Draft a loan agreement between you and your friend and get it sighed by your frien and top it up with the cheque giving reason that why he has issued cheque to you.
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