CENTRAL BANK OF INDIA Vs. S CHATTANATH KARAVALAR

JUDGEMENT

(1.) THIS appeal arises out of restitution proceedings in O. S. 114 of 1957 of the Sub court. Alleppey

(2.) SHORTLY stated the facts giving rise to this proceeding are as follows : the appellant (plaintiff) had filed a suit Order 8. 114 of 1957 before the sub Court twalnst the respondent and two others for recovery of amounts due under an over-draft account. The respondent resisted the suit on the ground that he was only a surety and not a co-obligant and that his liability as surety was discharged on account of the plaintiff's violation of the terms pf the contract between himself and the bank. Learned Subordinate Judge look the view that the respondent was not merely a surety but a co-obligant and naturally did not go into the question whether he was absolved from liability as a surety and passed the decree as prayed for. Against the judgment and decree the respondent filed A. S. 561 of 1961 D/- 18-7-1962 (Ker) In the High court, but the appeal was dismissed. The matter was taken up in appeal to the Supreme Court as Civil Appeal 405 of 1964 (SC ). The Supreme court allowed the appeal holding that the respondent was not liable as co-obligant that he was only a surety and sent back the case to the High court for determination of the question whether the respondent's liability as surety was discharged. The High Court in its judgment dated 1-41965 remitted the suit to the trial court for derision of this question and for fresh disposal

(3.) PURSUANT to the first court decree certain shares which stood in the name of the appellant were sold in execution of the decree and an amount of Rs. 56,799-91 was realised by the plaintiff The respondent had deposited a sum of rupees one lakh on 13-12-1961 under the orders of the High Court and he also furnished security as a condition precedent to the obtaining of stay. He had, on that account, to incur an expenditure of Rs. 7,674 for purchase of stamp paper and to meet the registration charges. Now. after the disposal of the appeal by the Supreme Court when the decree was set aside and the case was remitted for fresh hearing and disposal the respondent presented an application I A. 1410 of 1965 out of which this appeal arises for restitution of the above said amounts and also a sum of Rs 10,000 which he claimed by way of damages. The plaintiff opposed the application on various grounds. The subordinate Judge ordered restitution in respect of rupees one lakh which the respondent had deposited in court and also Rs. 7,671 spent for executing the security bond, but disallowed the claim for damages. In respect of rs. 56,799. 91 realised by the sale of shares it was held that as the shares were held as security the respondent was not entitled to the amount realised by the sale of such shares. The court, however, directed the plaintiff to produce the shares in court and the plaintiff was given the right to hold the same as security. The plaintiff has come up in appeal challenging the correctness of the order