NIKUNJA KISHORE PRADHAN Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) THE core question that arises for determination in this case is whether the decree -holder should b'e directed to first proceed against the principal debtor for realisation of the decretal dues before proceeding against the guarantor.

(2.) IN this revision petition, a challenge is raised to the order dated July 12, 1989, of the Subordinate Judge, Talcher, in Execution Case No. 2 of 1984 whereby he rejected the petitioner's application for the aforementioned direction to the decree -holder. The relevant facts giving rise to the present proceeding may be shortly stated as follows :

(3.) SHRI B. Rath, learned counsel appearing for the petitioner, placing strong reliance on the decision of the Supreme Court in Union Bank of India v. : AIR1987SC1078 , and the decision in A firma "Agenda Nacional Limitada" v. A. Sociedade "Chowgule and Cia Limitada, AIR 1967 Gau 88, and Lima Leitao and Co. Ltd. v. Union of India, [1968] 70 ITR 518 :, AIR 1968 Goa 29, urged that the liability of the guarantor comes into existence only on default by the principal debtor. Shri M.M. Das, learned counsel appearing for the opposite party -bank, relying on the decision of this court in the case of Orissa Agro Industries Corporation Ltd. v. : AIR1985Ori270 , and the stipulations in the decree in the present case, submitted that it is open to the decree -holder to proceed against either the principal debtor or the guarantors or any one of the guarantors.