HIRALAL CHHOTALAL SHAH Vs. CENTRAL BANK OF INDIA

JUDGEMENT

(1.) This appeal is filed by original defendant No. 2 in regular civil suit No. 1552 of 1971 filed in the court of the 3rd Joint Civil Judge (Junior Division) Surat by respondent No. 1 Bank for recovering an amount of Rs. 433.7-48 paise against appellant defendant No. 2 as well as respondent No. 2 original defendant No. 1.

(2.) The trial court decreed the suit against respondent No. 2 but dismissed it against the appellant defendant No. 2. The appellate court allowed the appeal of respondent No. 1 plaintiff bank and also passed a decree against the present appellant original defendant No 2. That has brought dissatisfied defendant No. 2 to this court by way of the present second appeal.

(3.) Now a look at a few relevant facts. Respondent No. 1 is a banking company registered under the Banking Companies Act 1913 and it is transferred under the Acquisition and Transfer of Undertakings Act 1969 and it is functioning in the name of Central Bank of India. Respondent No. 1 bank filed the aforesaid suit on a promissory note against respondent No. 2 original defendant No. 1 as the principal debtor and the present appellant-defendant No. 2 as a surety. It is the case of the plaintiff bank that defendant No. 1 had borrowed an amount of Rs. 5 0 on 19/09/1968 from the plaintiff bank by opening an account and the present appellant defendant No. 2 had stood surety and guarantee for defendant No. 1 and both the defendants had executed a promissory note for Rs. 5 0 on 19/09/1968. Defendant No. 1 paid some amount and after giving credit for the said amount an amount of Rs. 4 337 was found outstanding from defendant No. 1 in 1971. As the said defendant had not paid the said amount the plaintiff bank served the said defendant with a notice on 27/09/1971. Defendant No. 1 acknowledged the debt by his letter dated 10/10/1971. As the amount was ultimately not paid up by the defendants the plaintiff bank filed the aforesaid suit for recovery of Rs. 4 337 from both the defendants with running interest at 12% per annum.