( 1 ) THIS appeal came before Ramchandra Rao, J. for hearing. Before him, Shri C. Poorniah, the learned counsel for the appellant-Bank contended that it is not necessary for the plaintiff-Appellant to file a suit under Order 21, Rule 63, C. P. C. as by the date of the withdrawal of the claim petition filed under Order 21, Rule 58 the plaintiff had already filed a regular suit with regard to the declaration of its title. In support of his contention, the learned counsel for the appellant relied upon the decisions reported in K. Palaniappa Chettiar v. Ramswami Servai AIR 1937 Mad 582 and P. Umanath Bhandary v. Pedru Souza, AIR 1950 Mad 19. He also brought to the notice of the learned Judge a decision of the Division Bench of the Madras High Court in Sivaraman v. P. M. Shanmugasundara Mudaliar AIR 1969 Mad 166 in which it was observed that the earlier decisions in Palaniappa Chettiar v. Ramswami Servai AIR 1937 Mad 582 and P. Umanath Bhandary v. Pedru Souza AIR 1950 Mad 19 must be deemed to have been overruled in view of the Full Bench decision of the Madras High Court in Seethamma v. Kotareddi, AIR 1949 Mad 586 (FB ). Ramachandra Rao J. felt that a question of law of consideration importance was involved and that it should be decided by a Division Bench and accordingly he made a reference for the same. The appeal thus came before a Division Bench consisting of Chinnappa Reddy, J. (as he then was) and one of us (Punnayya J. ). One of the contentions that was raised by Shri Poorniah in the Second Appeal is that it was not necessary for the plaintiff to file a suit under Order 21 Rule 63 as it had already, i. e. even before the dismissal of the claim petition "as not pressed" filed a suit to declare its title. Mr. Poorniahs contention was supported by the decisions of the two single Judges of the Madras High Court in K. M. M. Pallaniappa Chettiar v. Ramswami Servai AIR 1937 Mad 582 and P. Umanath Bhandary v. Pedru Souza AIR 1950 Mad 19. However in Sivarams case AIR 1969 Mad 166 it was pointed out that these two decisions must be deemed to be bad law in view of the Full Bench decision in Seethamma v. Kotareddi AIR 1949 Mad 586 (FB ). The decisions of the two learned single Judges were not expressly overruled by the Full Bench. They were not even considered by the Full Bench. Having regard to the importance of the question, the Division Bench considered it desirable that this case should be heard by a Full Bench and the Honourable Chief Justice was, therefore addressed for the same. The reference has thus come before us.

( 2 ) BEFORE we answer the reference it is necessary for us to state the relevant facts leading to the Second Appeal. The appellant-Bank granted a loan upto a limit of Rs. 7,500. 00 to the defendant Y. Narasayya on the hypothecation of the goods in his shop bearing No. 7-2-871 Subhash Road, Secunderabad after obtaining an agreement Ex. A-1, dated 8-5-1959, from him. The plaintiff came to know by about 20-3-1961 that the defendant was not conducting his business satisfactorily and hence it called upon the defendant Narsayya by a letter the original of Ex. A-2 dated 21-2-1961 (sic) to pay the amount due on the cash credit or give pledge under Banks lock and key of the stock of cotton goods already hypothecated to the Bank. The defendant Narsayya gave a reply under Ex. A-3 agreeing to give pledge of the goods to the plaintiff and executed a pledge agreement, Ex. A-4. In pursuance of Exs. A-3 and A-4, the goods were shifted to the plaintiffs godown bearing Municipal No. 1920 situated at Pawn Bazaar, Secunderabad. Later, defendants 10 to 12 who were the creditors of Narasayya filed three Small Cause suits Nos. 217, 218 219 of 1961 in the Court of the First Judge. , City Small Causes, Hyderabad and obtained attachment of goods before Judgment under the orders of the said Judge as if the goods stocked therein belonged to Narasayya free of encumbrances. The plaintiff filed three petitions I. A. Nos. 68, 69 and 7