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1. The plaintiff in O. S. No. 170 of 1983 is the appellant before us. The first and second respondents, who were the contesting respondents are the fifth and eighth defendants respectively in the said suit.

2. The appellant/plaintiff is the State Bank of India established under the State Bank of India Act, 1955, and the Karur branch of the bank filed the suit for recovery of Rs. 6,43,708.30 for a mortgage decree in respect of A, B, C, D and E schedule properties, for a personal decree against defendants Nos. 2, 5 and 8, for a charge over the handloom goods, stock-in-trade for the custody of the plaintiff-bank and for realisation of the amounts due from defendants Nos. 1 to 8. Defendant No. 9 was subsequently added because after the filing of the suit, defendants Nos. 2 to 4 were adjudicated insolvents, on applications taken out by other creditors. The plaint case is that defendants Nos. 2 to 8 approached the plaintiff-bank and sought for financial accommodation for the first respondent's business. The first respondent is a partnership firm comprising defendants Nos. 2 to 4 as partners. According to the plaintiff, defendants Nos. 2 to 4 executed a general agreement on December 19, 1980, for the grant of advances on the hypothecation of movables, book debts and other assets to the limit of Rs. 5,25,000. On the same day, defendants Nos. 1 to 4 had executed an ancillary agreement to pay interest at a specified rate for loan accommodation to the tune of Rs. 4 lakhs under the head cash credit bill against demand documentary bills accompanied by lorry/railway receipts. A third agreement was executed by defendants Nos. 1 to 4 for financial accommodation under pledge of goods and other assets to the tune of Rs. 1 lakh. The fourth agreement related to demand draft purchases up to a maximum limit of 85 per cent. of the face value of the bills. All the documents were executed on December 19, 1980.

6. Defendants Nos. 1 to 4, 6 and 7 remained ex parte. Defendants Nos. 5 and 8 alone contested the suit along with the ninth defendant (as receiver). In his written statement, the fifth defendant, at the outset points out that the plaintiff had committed a mistake in the plaint and that he did not approach the plaintiff-bank for any financial accommodation. He denies that he had given guarantee for the advances made to defendants Nos. 1 to 4 to the tune of Rs. 5,25,000. To his knowledge the guarantee was only to the tune of two lakhs. He further alleges that he had no knowledge of the figures in the guarantee agreement raising the guarantee limit to Rs. 5,25,000 and denies having given any guarantee for the said sum of Rs. 5,25,000. He also denied the accounts relied on by the plaintiff, to prove the liability of the first defendant-firm. The further case of the fifth defendant is that the plaintiff did not act diligently in realising the outstanding from the principal debtors. He complained that he had not been informed about the dishonour of bills and the grant of extension of time to the first defendant for making payments. To the letter sent by the plaintiff on June 22, 1982, he had sent a suitable reply on August 20, 1982. So far as the third defendant is concerned, who happened to be the wife of the fifth defendant, it was stated that she was only a dormant partner. He cannot, therefore, be imputed with knowledge relating to the dealings of the first defendant. He once again repeated that each and every entry in the accounts of the plaintiff should be strictly proved. He questioned the sale of goods which were recalled by the plaintiff on the ground that proper advertisement had not been given.

7. The eighth defendant filed a separate written statement. He also contended that he did not approach the bank for any financial accommodation. He also complained that the plaintiff had not acted diligently and carefully in making advances to the first defendant. According to him, the laches on the part of the plaintiff-bank in taking prompt action against the first defendant, the eighth defendant, as guarantor cannot be made liable. He also insisted on the plaintiff proving each and every entry in the account books. Though the eighth defendant has toed the same line as the fifth defendant in charging the plaintiff-bank with negligence, ultimately, he put forward a plea as follows :

23. Before adverting to the other points of Mr. Gopalrathinam, we will refer to exhibit A-5. This is a four-page printed document captioned "guarantee agreement for small industrial advances". It says that the partners of the first defendant firm had entered into a general agreement and a supplemental agreement on December 19, 1980, for the grant of advances to the borrower and that one of the terms of the financial accommodation was that the amounts shall be secured by the guarantee of the fifth defendant. The fifth defendant as guarantor, guarantees the bank the repayment by the borrower the loan amounts etc., all monies not exceeding Rs. 5,25,000. The words Rs. 5.25,000 in figures and words are filled up in ink. There are considerable blanks regarding the particulars of the general and supplemental agreement in the preamble portion and regarding the father's name etc., of the fifth defendant. When we come to the last page, Clause 15 says that the guarantee given under exhibit A-5 is in addition to the guarantee given by the executant to the bank. The cash credit limits are mentioned in the last page in ink as CC Bills Rs. 4 lakhs CC MT (mundy transactions) Rs. 1 lakh and D. D. purchase Rs. 25,000. The signature of the fifth defendant is found in two places at the last page. All the three partners defendants Nos. 2 to 4 have signed. On the side of the bank, the field officer one, R. Gopalan, is said to have witnessed the document. As against the word, "place", Karur is mentioned in rubber stamp and against the word "date" December 19, 1980, is mentioned in rubber stamp. One thing which cannot escape our attention is that on the very last page Clause 15 contains the words which we have referred to already. In other words, the fifth defendant must have clearly known that it is a guarantee in addition to the guarantees already given. His contention is that the particulars of cash credit limits were not filled up at the time of execution. Even assuming everything in favour of the fifth defendant, he must be deemed to have known that he was signing" an additional guarantee document. Should he not have enquired into the matter and should he not ask the officer of the bank to fill up the blanks, after he noticed the blanks at the time of execution ? Even assuming that he did not make any enquiries, and he signed a blank additional guarantee agreement, should he not be imputed with knowledge that the blanks can be filled up against his interest ? While that being so, it surprises this court as to why he did not take any action to recall the said agreement executed on December 19, 1980.