Surety can be discharged by creditors, without discharging Debtor
Sir,
I, Mohan, was a co-surety of a loan to the creditors. Creditors filed recovery case into a court then it filed another case of cheque bouncing into another court to recover principal debtor’s loan in full.
Recently creditor has compromised the case with me into the court where cheque bouncing case was running and his recorded statement is that “I am authorized to settle the case and I have received a compromised amount against bond no. XXX, as a guarantor there is nothing unsettled and I will not make any claim in future. This settlement is full and final settlement with Mr. Mohan. This settlement will not affect my claim towards the principal debtors and I will remain capable to receive the balance amount from the principal debtors.”
Now the Creditors is threatening me that he will recovery the amount from the court where recovery case is running against the same bond no, if principal debtors is unable to repay his full dues. He is saying there is no law that creditor can release the surety. Surety’s liability cannot be ended without ending principal’s liability.
My statement was that "I have paid a compromised amount and there is nothing unpaid and unsettled. I have received my all blank cheques also."
Please help and suggest if the creditor can revoke his settlement/compromised deed or there is any weak point in the statements, if principal debtors fail his debts now.
Thanks and regards
Mohan