Should Performance Review be done on a blank paper or by answering series of questions & filling up areas in a predefined format? why do you think so?

It should be on a proper printed questionair not on the blank paper.

Performance review should be printed paper because it will be documented for further development of the employees.

In my opinion, performance review may be done by answering series of questions and filling up areas in a predefined format. This is recommended because of followings:

1. Individual may portrait himself/herself in a sequential way.
2. Chronological development and easy to follow.
3. Fields/points are not missed out by the individual.  
4. Assessment by the supervisor is easier.
5. Subsequent change of the individual may be monitored.

I think that performance review is better done based on daily work and not at one point during the year. If you have to do it once a year, predefined format ensures consistency for all staff and full coverage of skills to be assessed. Predefined formats are much easier to be automated as well.