Falshaw, J. - (1.) The Federal Bank of India Limited in liquidation instituted this suit in the Court of the Senior Sub-Judge at Amritsar on 28-1-1949 for the recovery pi Rs. 18,4969- 0 from the three defendants. Som Dev Grover, his wife Chandar Prabha and the firm Tansuk Das Nanak Chand through its proprietor Durga Das Kapur, on the allegations that first two defendants had opened an account with the Amritsar branch of the Bank in which they borrowed Rs. 15,000/- on 26-3-1945, with an agreement to pay interest at 6 per cent, per, annum. The loan was secured by the execution of a pronote and also by the deposit of the title deeds of a house at Amritsar, which constituted an equitable mortgage. Defendant 3 was impleaded as surety for the debt as being under a general contract with the Amritsar branch of the Bank a guarantee broker, and also as having specifically guaranteed the account in suit. It was, however, admitted by the Liquidator in the plaint that the documents relating to this account including the pronote, the title deeds the deposit of which constituted the equitable mortgage, and the broker's letter of guarantees bad been taken away from the Manager to the Amritsar branch by a trick, and in the circumstances the claim was brought merely for a simple money decree against the defendants.
(2.) As a result of the enactment of Ordinance No. 23 of 1949, which came into force after the institution of the suit, and the effect of which was to make High Court generally the forum for deciding disputes between a bank in liquidation and other parties, the suit was transferred to this Court early in 1950.
(3.) The defendants denied liability on various grounds giving rise to the following issues:- (1) Whether defendants Nos. 1 and 2 executed the pronote in suit in favour of the plaintiff? (2) If so whether the pronote is without consideration? (3) What was the agreement with regard to the payment of interest and what is the rate of interest to which the plaintiff is entitled? (4) Whether the suit is within limitation? (5) Whether the plaintiff has a cause of action against defendant No. 3 as surety? (6) Relief. (7) Whether the suit cannot proceed in the present form?;