JUDGMENT

Kirpal, J.-The main question which arises in this appeal by special leave is whether the suit for recovery of money filed by the appellant bank was properly instituted.

2. The appellant s branch at Ambala Cantt. had instituted a suit in the Court of Sub-ordinate Judge, Ambala Cantt. for recovery of Rs. 1,40,553.91 from the respondents. The case of the appellant was that on 12th April, 1984 a sum of Rs. 50,000/- was advanced as loan to respondent No. 1 for the purposes of his business and on that date he had executed a demand promissory note, hypothecation of goods agreement and other documents. Respondent No. 2 and one Sh. Suresh Kumar, husband of respondent No. 3 had stood as guarantors for the repayment of the loan. The respondents were stated to have agreed to pay interest at the rate of 18 per cent per annum with quarterly rests. When default in payment of the money was committed the aforesaid suit was filed for the recovery of the principal amount and the interest thereon. The sum total came to Rs. 1,40,553.91.

3. In the written statement filed by respondent No. 1 the plea which was taken was that he had never taken loan as alleged by the appellant bank and respondent No