Andhra HC (Pre-Telangana)
Male Venkateswarlu And Anr. vs State Bank Of India, Ongole Branch And ... on 9 June, 2005
Equivalent citations: 2005(5)ALD62, III(2006)BC563, [2005]128COMPCAS572(AP)
JUDGMENT P.S. Narayana, J.
1. Defendants 2 and 3 in O.S. No. 16 of 1987 on the file of the Court of the Additional Subordinate Judge, Ongole are the appellants. The first defendant in the suit is the second respondent in the present appeal and the plaintiff in the suit, the State Bank of India, Ongole is the first respondent in the present appeal.
2. The first respondent-plaintiff bank instituted the suit O.S. No. 16 of 1987 on the file of the Additional Subordinate Judge, Ongole, for recovery of Rs. 61,549-80 ps. being the balance of principal and interest due on account copy got maintained by the bank on a mortgage deed and on a promissory note dated 16-2-1983 executed by defendants in favour of the plaintiff for Rs. 40,000/- payable with interest at 15.5% with quarterly rests.
3. The trial Court on the respective pleadings of the parties settled the issues and recorded the evidence of PW-1 and D.Ws.1 and 2 and marked Exs.A-1 to A-15, and ultimately came to the conclusion that the first respondent-plaintiff bank is entitled to a decree with costs with subsequent interest at 6% per annum from the date of suit till the date of realization and five months time was granted for redemption. Aggrieved by the same, the defendants 2 and 3 preferred the present appeal.
4. Sri M.R.S. Srinivas, learned Counsel representing the appellants would maintain that inasmuch as the revival letters were not executed by the appellants-defendants 2 and 3 in the suit, the original guarantee if any given came to an end and it would amount to alteration of the original agreement of guarantee to which no doubt defendants 2 and 3 were also parties and in view of the said alteration or changed position the guarantee cannot be said to be a continued one and there would of cessation of the liability of the guarantors since the unilateral act n the part of the principal debtor in between the principal debtor and the bank at the best can bind the principal debtor alone and definitely not the guarantors especially in view of the clear language of Section 133 of the Indian Contract Act, 1872 (for short, 'the Act'). The learned Counsel also made certain comments relating to the peculiar procedure adopted by the bank; the first defendant executing promissory not in favour of the defendants 2 and 3 and the defendants 2 and 3 in turn endorsing the same in favour of the bank. The learned Counsel had taken this Court through the evidence available on record and would contend that in the light of the ratio laid down in Pratap Singh v. Keshavlal, AIR 1935 PC 21, it is clear that the guarantors cannot be made liable. The learned Counsel had also taken this Court through the evidence available on record, the respective pleadings of the parties and the findings recorded by the trial Court in this regard.
5. Per contra, Sri M. Narendra Reddy, learned Counsel representing the first respondent-bank would maintain that it is a cash credit account and absolutely there are no variations in the terms and conditions which had been agreed upon between the principal debtor and the guarantors on one hand and the banking institution on the other. The learned Counsel had also drawn the attention of this Court to Sections 128 and 129 of the Act and would maintain that it is a well settled principle of law that the liability of a surety or a guarantor would be coextensive to that of a principal debtor. The learned Counsel had also drawn the attention of this Court to the conditions specified in Ex.A-5, the original agreement of guarantee and would contend that in the light of the same separate specific subsequent revival letters may not be necessary and it must be taken that the original guarantee given in favour of the bank by the defendants 2 and 3 would continue unless otherwise it had been put to an end to and the mere fact that the revival letter was executed only by the first defendant would not alter the situation in any way and it cannot be said that the liability on the part of the appellants-defendants 2 and 3 would come to an end or automatically it would cease in the facts and circumstances of the case. The learned Counsel had also placed reliance on certain decisions to substantiate his contentions. However, it is also brought to the notice of this Court that a final decree application was moved and the same ended in dismissal. Certain submissions in this regard were advanced by both the Counsel relating to the executability of the preliminary decree straight away. This aspect need not be gone into in the present appeal for the reason that the same need not be germane for the present litigation.
6. Heard Counsel, perused the pleadings, the evidence of PW-1 and DWs.1 and 2 and other documentary evidence and the findings recorded by the trial Court.
7. The parties hereinafter would be referred to as arrayed in the suit for the purpose of convenience.
8. The plaintiff-bank filed the suit for recovery of Rs. 61,549-80 ps. being the balance of principal and interest due on account maintained by the plaintiff-bank. It was pleaded in the plaint that for the purpose of fertilizers and pesticides business the first defendant represented by its sole proprietor approached the plaintiff-bank for sanction of loan of Rs. 40,000/- and the same was sanctioned and the first defendant executed a promissory note for Rs. 40,000/- on 16-2-1983 in favour of the defendants 2 and 3, who in turn transferred the same in favour of the plaintiff-bank. It is also pleaded that the first defendant executed a delivery letter and agreement for cash credit and the defendants 2 and 3 executed a letter of guarantee. In addition to the aforesaid documents immovable property security was also created by the defendants 2 and 3 in respect of the suit schedule properties by way of deposit of title deeds dated 27-7-1967 with the plaintiff-bank by creating equitable mortgage. Thus the first defendant availed loan of Rs. 40,000/- but he has committed default in repayment. Hence, all the defendants are jointly and severally liable. It was specifically pleaded that a charge had been created relating the loan transaction of the suit schedule property. It was further pleaded that the first defendant had executed revival letter dated 10-2-1986 and it was also pleaded that though the defendants 2 and 3 had not signed the revival letters as guarantors they continued to be liable till the entire loan amount was discharged.
9. The third defendant filed a written statement in elaboration, which was adopted by the second defendant. The allegations were denied. However, the first defendant approaching the plaintiff-bank for grant of loan and the execution of the letter of guarantee and creating immovable property security by way of equitable mortgage and availing the loan of Rs. 40,0007- had not been seriously controverted. It was also further pleaded that the first defendant is a resident of this defendant's village, the first defendant asked these defendants to help him to get loan from the plaintiff bank. These defendants followed the first defendant to the plaintiff-bank. The plaintiff officials asked these defendants to identify the first defendant and asked these defendants to show the status. Then the defendants send the documents dated 27-7-1967 to the plaintiff through first defendant. Later the first defendant stated that the documents would be returned later after finishing the technical formalities. In fact the plaintiff granted the loan to the first defendants only on the status and property of the first defendant, these defendants never contemplated to execute guarantee letter or equitable mortgage. The documents alleged to have been executed by these defendants were never read over to these defendants or explained to them about the conditions and their binding nature. It is absolutely false to say that first defendant executed a promissory note on 16-2-1983. There is no debtor or guarantors relationship between D-1, D-2 and D-3. Hence the transaction on which the plaintiff relies is null and void. The first defendant carried a business on behalf of the joint family. The plaintiff-bank has not impleaded the father and brother of the first defendant who are joint family members. Hence the suit is bad for non-joinder of necessary parties. The documents were not received by these defendants, hence the suit is barred by time. The revival letters executed by the first defendant does not bind these defendants and does not save limitation against these defendants. On enquiries the defendant came to know that the first defendant never submitted stock report or accounts to the plaintiff. The plaintiff has not verified the hypothecated goods or stock at any point of time. The plaintiff has not performed its duties and there is gross negligence on the part of the plaintiff-bank. The plaintiff wilfully violated the conditions of hypothecation on which they are making the liability of the defendant. The first defendant is in possession of the stock hypothecated. The plaintiff is not entitled to file suit against these defendants till they exhausted all the remedies against the first defendant. The account filed by the plaintiff is not correct. The plaintiff calculated with excessive rate of interest. The interest claimed is excessive. The plaintiff filed the suit against these defendants without exhausting the remedies available to them against first defendant, hypothecated properties and his properties.
10. The first defendant had not chosen to contest the suit.
11. The trial Court settled the following issues:-
(1) Whether the plaintiff is entitled for the relief asked for?
(2) To what relief?
12. The Field Officer of the plaintiff-bank was examined as PW-1 and Exs.A-1 to A-15 were marked. The third defendant was examined as DW-1 and the second defendant was examined as DW-2. On appreciation of the evidence the suit was decreed as referred to supra and aggrieved by the same, the present appeal was preferred.
13. On strength of the material available on record and the submissions made by both the learned Counsel, the following points emerge for consideration in the present appeal-
(1) Whether the original guarantee agreement entered into by the appellants-defendants 2 and 3 would automatically come to an end by virtue of the non-execution of any revival letters by these defendants at the subsequent point of time?
(2) If so, to what relief the parties are entitled to?
14. Point No. l: At the outset, it may be stated that in the very plaint it was pleaded that the defendants 2 and 3 had not signed the revival letters and the first defendant alone executed the revival letters and it was also specifically pleaded that as guarantors they continued to be liable till the entire loan amount is discharged. This is the specific stand taken in the plaint and there is no serious controversy in relation thereto. The appellants-the defendants 2 and 3 also had taken a plea in paragraph 7 of the written statement that the documents were not revived by these defendants and hence, the suit is barred by time and the revival letters executed by the first defendant do not bind these defendants and those documents do not save the limitation as against these defendants. The evidence of PW-1, Field Officer and the evidence of the defendants 2 and 3 as DW-2 and DW-1 also is available on record. Ex.A-5 is the deed of guarantee executed by the defendants 2 and 3 for the loan amount sanctioned in favour of the first defendant by the plaintiff-bank on 16-2-1983. Ex.A-4 is the agreement for cash credit executed by the first defendant in favour of the plaintiff-bank dated 16-3-1983. Ex.A-6 is the title deed standing in the name of the defendants 2 and 3 dated 27-7-1966 deposited with the plaintiff-bank. Likewise Ex.A-7 is the Memorandum of title deed dated 16-2-1983 executed by the defendants 2 and 3 in favour of the plaintiff-bank. Exs.A-8 and A-9 are the debt confirmation letters executed by the first defendant. Ex.A-10 is the debt revival letter dated 10-2-1986 executed by the first defendant in favour of the plaintiff-bank. Ex.A-11 is the debt revival letter wherein the defendants 2 and 3 refused to sign as guarantors. Ex.A-12 is the office copy of the registered notice. Exs.A-13 and A-14 are the postal acknowledgments. Ex.A-15 is the statement of account relating to the loan account of the first defendant maintained by the plaintiff-bank.
15. The oral evidence of PW-1 and DWs.1 and 2 need not be discussed elaborately since the only question argued in elaboration by both the Counsel is in relation to the liability of the appellants-defendants 2 and 3, in the light of the absence of any revival letter executed by them in favour of the plaintiff-bank. No doubt some comment was made in relation to the procedure, which had been adopted in execution of promissory note and. in turn taking guarantors endorsements on the same in favour of the bank. It is pertinent to note that this is a matter of advancement of loan in favour of the first defendant. It is also not in controversy that the first defendant approached the bank and the second and third defendants also accompanied and executed the original guarantee agreement. Apart from this aspect of the matter, it is pertinent to note that there had been deposit of title deeds too. This is yet another crucial aspect, which cannot be lost sight of. This Court is not inclined to express any opinion relating to the procedure followed by the bank relating to the execution of promissory note by the principal borrower in favour of the guarantors and the guarantors in turn endorsing the same in favour of the bank. Be that as it may, apart from the promissory note in question there are other documents, the guarantee agreement Ex.A-5 and also creation of equitable mortgage by deposit of title deeds. It is true that at a particular point of time for certain reasons, the defendants 2 and 3 became unwilling to be continued as guarantors, but, however, the original guarantee agreement as such continues. This aspect is amply established by the terms and conditions, which had been agreed by the appellants-defendants 2 and 3 as can be reflected from Ex.A-5. Section 133 of the Act reads as hereunder-
"133. Discharge of the surety by variance in terms of contract.-Any variance, made without the surety's consent, in the terms of the contract between the principal debtor and the creditor, discharges the surety as to transactions subsequent to the variance."
16. In Pratap Singh's case (supra), their Lordships of the Privy Council observed:
"It appears to their Lordships that the law on the discharge of sureties has been somewhat obscured by the emphasis laid in the cases on an agreement between the parties to vary the terms of the original agreement. The principle is that the surety, like any other contracting party, cannot be held bound to something for which he as not contracted. If the original parties have expressly agreed to vary the terms of the original contracts no further question arises. The original contract has gone, and unless the surety has assented to the new terms, there is nothing to which he can be bound, for the final obligation of the principal debtor will be something different from the obligation which the surety guaranteed. Presumably he is discharged forthwith on the contract being altered without his consent, for the parties have made, it impossible for the guaranteed performance to take place. In the vast majority of cases a different performance of the original contract is due to an express variation of the terms between the parties; and it is natural that the reported cases should mainly deal with this situation. But it is important that the underlying principle should not be obscured. A good illustration of the essential rule is afforded by the case of 4 De G. F, & J. 367 (1) at p.376. In that case the surety had guaranteed the payments by a baker to the flour merchant for flour to be delivered to the baker for the purpose of baking bread that he supplied for army requirements. The flour was to be of specified quality. The merchant delivered flour which was not of the contract description. The surety commenced a suit in Chancery to have it declared that the surety bond was void in equity by reason of misrepresentations and "by reason of the conduct of the parties." After dealing with the case based upon misrepresentation, the Lord Chancellor, Lord Westbury, proceeded as follows:
"It must always be recollected in what manner a surety is bound. You bind him to the letter of his engagement. Beyond the proper interpretation of that engagement you have no hold upon him. He receives no benefit and no consideration. He is bound therefore merely according to the proper meaning and effect of the written engagement that he has entered into. If that written engagement is altered in a single line, no matter whether it be altered for his benefit, no matter whether the alteration be innocently made, he has a right to say: The contract is no longer that for which I engaged to be surety; you have put an end to the contract that I guaranteed, and my obligation therefore is at an end.' Now, I construe this engagement to be an engagement to be answerable for flour supplied in conformity with the requisitions of this contract. Then I ask de facto was any flour supplied to Millar in conformity with the requisitions of the contract. The answer of the defendants themselves is an admission that none such was supplied. The conclusion is plain therefore that no legal obligation so far as the surety is concerned arises upon what has been done under this contract so construed, as I hold it ought to be construed, and as involving the representation that I have stated."
A similar application of the principle may be found in (1929) 1 Ch.14 (2). There a number of persons as co-sureties has deposited their tide deeds with the creditor to secure a debt of the principal debtor. The creditor allowed one of them to create a prior charge in favour of a third person. It was held that though the creditor had not released his charge yet he had permitted a prior charge to be created which interfered with the rights of the other co-sureties to have the securities marshalled: and that performance being altered in this way they were all discharged. It is unnecessary to consider whether the case might not have been treated as one where a security was sacrificed, in which case the sureties might only have been discharged to the extent of the value of the security lost. Its value for the present purpose is that without any agreement between the creditor and the surety to vary the contract, the fact that the creditor stood by and permitted something to be done which made the original performance impossible discharged the other sureties whose consent had not been obtained. In their Lordships' opinion, therefore the sureties are being sued in respect of an obligation which they did not contract to make good, and are entitled to succeed".
17. There cannot be any serious dispute or controversy relating to the preposition laid down by Their Lordships of the Privy Council in Pratap Singh's case (supra). If there had been any variance made without sureties consent in the terms of the contract between the principal debtor and creditor, it would result in the discharge of the surety from transaction subsequent to the variance. The term or expression of variance is lot of importance in the present case. It is not the case of either of the parties that subsequent thereto in the terms and conditions there had been alteration or there had been change.
18. Section 128 of the Act deals with surety's liability, which reads as under:
"128. Surety's liability.--The liability of the surety is co-extensive with that of the principal debtor, unless it is otherwise provided by the contract".
19. Section 129 of the Act deals with continuing guarantee, which reads as under:
"129. Continuing guarantee.--A guarantee which extends to a series of transactions is called a "continuing guarantee".
Illustration (b) and (c) of Section 129 of the Act would clarify the position, which read as hereunder:
"(b) A guarantees payment to B, a tea-dealer, to the amount of 100, for any tea he may from time to time supply to C. B supplies C with tea to above the value of 100, and C pays B for it. Afterwards B supplies C with tea to the value of 200. C fails to pay. The guarantee given by A was a continuing guarantee, and he is accordingly liable to B to the extent of 100.
(c) A guarantees payments to B of the price of five sacks of flour to be delivered by B to C and to be paid for in a month. B delivers five sacks to C. C pays for them. Afterwards B delivers four sacks to C, which C does not pay for. The guarantee given by A was not a continuing guarantee, and accordingly he is not liable for the price of the four sacks."
20. In Margaret Lalita v. Indo Commrl. Bank Ltd., , no doubt while dealing with the aspect of limitation and reckoning the period of limitation, the Apex Court at Paragraph 10 observed as follows:
"We may first consider the question of limitation. As already mentioned by us, the submission of Shri Bal was that every item of an overdraft account was an independent loan, limitation for the recovery of which was determined by Article 57 of the Schedule to the Limitation Act, 1908. Limitation, according to the learned Counsel, started to run from the date of each loan. He relied on Basanta Kumar Mitra v. Chota Nagpur Banking Association Ltd., AIR 1948 Pat. 18; Brojendra Kishore Ray Chowdhury v. Hindustan Co-operative insurance Society Ltd., ILR 44 Cal. 978 : AIR 1918 Cal. 707, National and Grindlays Bank Ltd. v. Tikam Chand Daga, and Uma Shankar Prasad v. Bank of Bihar Ltd., AIR 1942 Pat. 201. In our view it is unnecessary for the purposes of the present case to go into the question of the nature of an overdraft account. The present suit is in substance and truth one to enforce the guarantee bond executed by the defendant. In order to ascertain the nature of the liability of the defendant it is necessary to refer to the precise terms of the guarantee bond rather than embark into an enquiry as to the nature of an overdraft account. Exhibit 57 is the guarantee bond executed by the defendant and her husband on 23rd Oct., 1944. It is addressed to the Indo Commercial Bank Ltd., Madras, and is in the following terms:
"Dear Sirs, In consideration of your having agreed to allow overdraft accommodation up to Rs. 10,00,000/- (Rupees Ten Lakhs only) to the Modern Hindustan Food Products Ltd., Poona, We, C.B. Samuel and M.L. Samuel, the undersigned do hereby jointly and severally guarantee to you, the Indo-Commercial Bank Limited the repayment of all money, which shall at any time be due to you from the said Modern Hindustan Food Products Ltd., on the general balance of their accounts with you or on any account whatever such balances to include all interest, charges, commission and other expenses which you may charge as bankers and also the due payment at maturity of any promissory note or other negotiable instrument on the security or in respect of which any credit or advance shall be made.
And we hereby declare that this guarantee shall be a continuing guarantee to the extent at any one time for Rupees 10,00,000/-(Rupees Ten Lakhs only) and shall not be considered wholly or partially satisfied by the payment at any one time or at different times of any sums of money due on such general balance of account but shall extend and cover and be a security for every and all further sums at any time due to you thereon. And we further declare that you may grant to the Modern Hindustan Food Products Ltd., any indulgence without discharging our liability."
The guarantee is seen to be a continuing guarantee and the undertaking by the defendant is to pay any amount that may be due by the company at the foot of the general balance of its account or any other account whatever. In the case of such a continuing guarantee, so long as the account is a live account in the sense that it is not settled and there is no refusal on the part of the guarantor out carry out the obligation, we do not see how the period of limitation could be said to have commenced running. Limitation would only run from the date of breach under Article 115 of the Schedule to the Limitation Act, 1908. When the Bombay High Court considered the matter in the first instance and held that the suit was not barred by limitation, J.C. Shah, J. speaking for the Court said:
"On the plain words of the letters of guarantee it is clear that the defendant undertook to pay any amount which may be due by the Company at the foot of the general balance of its account or any other account whatever....We are not concerned in this case with the period of limitation for the amount repayable by the Company to the bank. We are concerned with the period of limitation for enforcing the liability of the defendant under the surety bond....We hold that the suit to enforce the liability is governed by Article 115 and the cause of action arises when the contract of continuing guarantee is broken, and in the present case we are of the view that so long as the account remained live account, and there was no refusal on the part of defendant to carry out her obligation, the period of limitation did not commence to run." We agree with the view expressed by Shah, J. The intention and effect of a continuing guarantee such as the one with which we are concerned in this case was considered by the Judicial Committee of the Privy Council in Wrigth v. New Zealand Farmers Co-operative Association of Canterbury Ltd., (1939 AC 439). The second clause of the guarantee bond in that case was in the following terms:
"This guarantee shall be a continuing guarantee and shall apply to the balance that is now or may at any time hereafter be owing to you by the William Nosworthy and Robert Nosworthy on their current account with you for goods supplied and advances made by you as aforesaid and interest and other chargers as aforesaid."
A contention was raised in that case that the liability of the guarantor was barred in respect of each advance made to the Nosworthys on the expiration of six years from the date of advance. The Judicial Committee of the Privy Council expressed the opinion that the matter had to be determined by the true construction of the guarantee. Proceeding to do so, the Judicial Committee observed (at p.449):
"It is no doubt a guarantee that the Association will be repaid by the Nosworthys advance made and to be made to them by the Association together with interest and charges; but it specifies in Column 2 how that guarantee will operate namely, that it will apply to (i.e., the guarantor guarantees repayment of) the balance which at any time thereafter is owing by the Nosworthys to the Association. It is difficult to see how effect can be given to this provision except by holding that the repayment of every debit balance is guaranteed as it is constituted from time to time, during the continuance of the guarantee, by the excess of the total debits over the total credits. If that be the true construction of this document, as their Lordships think it is the number of years which have expired since any individual debit was incurred is immaterial. The question of limitation could only arise in regard to the time which had elapsed since the balance guaranteed and sued for had been constituted."
Later it was again observed (at P.450) "That document, in their opinion, clearly guarantees the repayment of each debit balance as constituted from time to time, during the continuance of the guarantee, by the surplus of the total debits over the total credits, and accordingly at the date of the counterclaim the Association's claim against the plaintiff for payment of the unpaid balance due from the Nosworthys with interest, was not statute-barred."
21. Likewise in R. Lilavati v. Bank of Baroda, , it was held at Paragraph 9 as follows:
"So far as the question of limitation is concerned, the learned Counsel Shri Raghavan argued that the acknowledgment given by the judgment-debtors defendants 1 to 3 would not save limitation so far as she was concerned. Normally it is so. But Para 4 of the surety bond executed by her reads as:
"And for all the purposes of this claim the Principal is empowered to give consent on my/our behalf and any consent given by the Principal shall be deemed to have been given by me/us and shall bind me/us in all respects as if the same had been expressly given by me/us in writing."
By this she has constituted defendants 1 to 3 as her agents. Therefore when she has specifically empowered defendants 1 to 3 to give consent, any consent given by defendants 1 to 3 would be binding on her. This is also the principle laid down in Dorothy Valentine Burnard v. William Douglas Lysnar, AIR 1929 PC 273. Therefore though she might not have been personally a party to the acknowledgment she on account of constituting defendants 1 to 3 as her agents, will be bound in law by the acknowledgment given by defendants 1 to 3.
22. Apart from these two decisions reliance was also placed in the decision in State Bank of India v. Indexport Registered, AIR 1982 SC 1740, to convince the Court that the decree-holder cannot be forced to exhaust his remedy against the principal debtor only and he is at liberty to proceed as against the principal debtor as well as the sureties or the guarantors as well,
23. Serious attempt was made by the learned Counsel representing the appellants to distinguish the decisions in Margaret Lalita's case and R. Lilavati's case (supra) on the ground that these are cases where certain of the guarantors were parties to the subsequent letters, and on the peculiar facts that the other guarantors, who were non parties in the context of reckoning the period of limitation, those observations have been made and hence, those decisions cannot be said to be binding decisions and the view expressed by their Lordships of the Privy Council in Pratap Singh's case (supra) may have to be followed.
24. On a careful scrutiny of these decisions, this Court is of the considered opinion that there is absolutely no conflict between the view expressed by their Lordships of the Privy Council and the decisions in Margaret Lalita's case and R. Lilavati's case (supra), since the ratio laid down in these decisions cover different aspects altogether, one has nothing to do with another. Their Lordships of the Privy Council were deciding the question relating to the variance made in terms of the contract without sureties consent. Even otherwise by virtue of Article 141 of the Constitution of India, the law declared by the Supreme Court shall be binding on all Courts within the territory of India. All Courts in India are bound to follow the decision of the Supreme Court even though there are contrary decisions of House of Lords or the Privy Council. See : Punjabi v. Sharao, AIR 1955 Nagpur 293 and Dwarakdas v. Sholapur Spinning and Weaving Company, . As already observed in the decision of the Privy Council in Pratap Singh's v. Keshavlal, (supra) and the decision of the Supreme Court in Margaret Lalita v. Indo Commercial Bank Limited, (supra) deal with different aspects and hence it cannot be said that there is any conflict whatsoever or it cannot be said that some contrary view was taken by their Lordships of the Privy Council in the aforesaid decision and hence in view of the same this Court has no hesitation in holding that the decision in Margaret Lalita v. Indo Commercial Bank Limited, (supra) is the binding decision on this Court.
25. On facts in the present case, in the light of Ex.A-5 which is definitely a binding contract it cannot lie in the mouth of the appellants-defendants 2 and 3 to contend that there is any variance or change unless it is shown that there had been sanction of additional amounts in deviation of the original guarantee agreement or totally fresh terms and conditions entered into by virtue of the revival letters without the consent of the appellants-defendants 2 and 3. That is not the case of either of the parties. Hence this Court is of the considered opinion that, on facts, there is no change or there is no variance as such or deviation from the original agreement of guarantee and hence, it cannot be said that the liability of the guarantors would automatically cease or would come to an end and hence this Court is not inclined to accept with the contention raised by the learned Counsel representing the appellants.
26. Point No. 2: In view of the findings recorded above, the appeal fails and accordingly the same shall stand dismissed. However, in the peculiar facts and circumstances of the case, taking into consideration that the appellants are only guarantors, this Court makes no order as to costs.