ARUMUGAM CHETTIAR Vs. SADASIVAM PILLAI AND ORS.

JUDGEMENT

(1.) THE third defendant in O.S. No. 629 of 1964 on the file of the District Munsif's Court, Nagercoil, is the applicant herein. There was a decree in the suit on 31st March, 1965, for a sum of Rs. 2,700 on the basis of a promissory note executed by the first defendant in respect of which the second and third defendants were sureties. In execution of the decree in E.P. No. 411 of 1965, the appellant's properties were attached on 30th June, 1965. The appellant contended before the Courts below that the decree had made it clear that his liability was only as a surety and not as a principal debtor, and that the execution could be levied against him only after exhausting the remedies against the first defendant who is shown as the principal debtor in the decree. Both the Courts below overruled the objection raised by the appellant and allowed the execution to proceed. They had taken the view that as the liability of the sureties is co -extensive with that of the principal debtor, it was not necessary for a creditor to exhaust his remedies against the principal debtor before he proceeds against the sureties.

(2.) IN this appeal, the learned Counsel for the appellant, brings to my notice a decision of this Court in Srinivasa v. Subramaniam, (1965) 2 M.L.J. 502, wherein Anantanarayanan, O.C.J. has observed as follows:

(3.) BUT it is seen that a recent judgment of the Supreme Court in Bank of Bihar v. Damodar Prasad : [1969] 1 SCR 620 , has put an end to the controversy in the matter. The Supreme Court has, while dealing with a similar question, held that under Section 128 of the Contract Act, save as provided in the contract, the liability of the surety is coextensive with that of the principal debtor, that the surety thus becomes liable to pay the entire amount immediately on the passing of the decree and that it is not deferred until the creditor exhausts his remedies against the principal -debtor. The learned Judges have also quoted with approval a passage from the observations of Lord Elden in Wright v. Simpson, 31 E.R. 1272 .