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Home » Indian Contract Act MCQs –… » | Guarantee, Indemnity, and Bailment
Module: | Guarantee, Indemnity, and Bailment

Q11: In a standard bank loan guarantee, who are the three parties involved?

A
The bank, the borrower, and the registrar
B
The principal debtor (borrower), the creditor (bank), and the surety (guarantor)
C
The bank, the customer, and the indemnifier
D
The pledgor, the pawnee, and the principal debtor
✅ Correct Answer: B
A contract of guarantee involves three parties as per Section 126 of the Indian Contract Act: 1. Principal Debtor: The person who borrows (borrower). 2. Creditor: The person who lends (the bank). 3. Surety: The person who gives the guarantee (the guarantor).
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