Reading: My colleague needs to borrow over Rs. 2 lakhs from me and promises to repay within 6 months. If he doesn’t, he’ll pay 18% annual interest. Should I use stamped paper (Rs. 10, Rs. 20) or plain paper for this agreement? What’s the right way to write it up so I can take legal action if he doesn’t pay? His father and brother are also involved in the transaction. Can you advise me on the best way to handle this?

My colleague needs to borrow over Rs. 2 lakhs from me and promises to repay within 6 months. If he doesn’t, he’ll pay 18% annual interest. Should I use stamped paper (Rs. 10, Rs. 20) or plain paper for this agreement? What’s the right way to write it up so I can take legal action if he doesn’t pay? His father and brother are also involved in the transaction. Can you advise me on the best way to handle this?

Last updated: August 25, 2025 1:09 pm

Apni Law

2 years ago

Law Forum › Category: Documentation › My colleague needs to borrow over Rs. 2 lakhs from me and promises to repay within 6 months. If he doesn’t, he’ll pay 18% annual interest. Should I use stamped paper (Rs. 10, Rs. 20) or plain paper for this agreement? What’s the right way to write it up so I can take legal action if he doesn’t pay? His father and brother are also involved in the transaction. Can you advise me on the best way to handle this?

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Apni Law Staff asked 2 years ago

My colleague needs to borrow over Rs. 2 lakhs from me and promises to repay within 6 months. If he doesn’t, he’ll pay 18% annual interest. Should I use stamped paper (Rs. 10, Rs. 20) or plain paper for this agreement? What’s the right way to write it up so I can take legal action if he doesn’t pay? His father and brother are also involved in the transaction. Can you advise me on the best way to handle this?

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Apni Law Staff answered 2 years ago

For a loan exceeding Rs. 100,000, a registered agreement on Rs. 100 stamp paper is mandatory under Indian law. Include clear details like the loan amount, repayment schedule, interest rate, and the involvement of his father and brother as guarantors. Consult a lawyer to draft the agreement ensuring it adheres to legal requirements for enforceability.