Decided on January 28,2003

CANARA BANK Respondents


- (1.) This appeal is at the instance of the defendant in O.S. 35/88 before the Principal Sub Court, Alappuzha. The respondent plaintiff, Canara Bank, Mullakkal Branch, represented by its Manager filed the suit for realisation of money. The plaintiff Bank advanced cash credit facilities including documentary bills purpose limits to Sri A.G.Sudhakaran, the proprietor of M/s. Eastern Trading Corporation, Zacheria Bazar, Alappuzha, and Smt. K.S. Radhamony, the appellant, wife of Sri. Sudhakaran (the principal debtor), executed a continuing guarantee on 5.8.1980. When there was default in paying an amount, the bank filed O.S. 233/83 against Sri. Sudhakaran for Rs. 16668.92 and a decree was obtained against him on 29.6.84. At the time of filing O.S. 233/83, the appellant guarantor was not made a defendant in the above suit. It was the case of the bank that the guarantee executed by the appellant was a continuing one and the above guarantee was not revoked by the guarantor by issuing any notice as provided in the deed of guarantee and as such the suit was not barred by limitation and accordingly the bank filed the suit O.S. 35/88 for realisation of a total sum of Rs.30671.92. The appellant defendant admitted the execution of the guarantee, but contended that the suit was not maintainable as it was hit by O.2 R.2 C.P.C. and that the suit was barred by limitation. The court below framed four issues. Considering the evidence the court below found that the suit was maintainable and it was not barred by limitation and accordingly the suit was decreed. Aggrieved by the above judgment and decree, the defendant has come up in appeal.
(2.) Heard the learned counsel for the appellant and the respondent.
(3.) The appellant's husband Sri. Sudhakaran had availed of credit facilities including documentary bill purchase limits from the respondent bank and the appellant executed a continuing guarantee on 5,8.80. As per the above guarantee Ext. A1, the appellant was liable to pay all the, amounts outstanding in account of M/s. Eastern Trading Corporation. As an amount of Rs. 16668.92 was outstanding and payable, the bank filed O.S. 233/83 against Sri. Sudhakaran, the principal debtor alone, without impleading the appellant, the surety. The present suit was filed only on 22.3.1988 i.e. nearly five years after the filing of the earlier suit. Though an argument was advanced by the learned counsel for the appellant the suit was hit by O. II R.2 C.P.C., the counsel could not substantiate the same as it was not a case of forgoing or relinquishing a part of the claim and filing a suit for the remaining claim, but it was a case where the creditor had failed to implead the guarantor or the surety along with the principal debtor at the time of filing the earlier suit. The court below had taken the view that the guarantee being a continuing one and as the appellant had not revoked the guarantee as stipulated therein and the liability of the principal debtor was kept alive consequent on the decree obtained by the bank, the suit was not barred by limitation.;

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