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CONTRACT OF GUARANTEE

Could u plz explain....

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GOKULA LAKSHMI

GOKULA LAKSHMI

CA Inter

1K+

17-Mar-21 13:21

26

Answers (1)

Surety has a right to recover from principal debtor whatever amount he pays under the guarantee to the creditor. Upon payment or performance of the guaranteed duty, the surety steps into the shoes of the creditor. But it may happen that creditor refuses to sue the debtor or ask the debtor to pay or perform the obligation of contract. The attached statement means that surety's right of recovery from principal debtor remains intact in such cases and surety himself can sue / demand the amount from principal debtor whatever he has paid to creditor.


Sahibdeep Singh

Sahibdeep Singh

Moderator

17-Mar-21 16:02

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