IMPORTANT POINT
The liability of the guarantor under Section 128 of the Indian Contract Act, 1872 was a key legal principle discussed in the judgment, emphasizing that the guarantor's liability is coextensive with that of the principal debtor unless explicitly provided otherwise in the contract.

JUDGMENT :

1. The petitioner has preferred present petition, under Articles 14, 19, 226 and 227 of the Constitution of India and challenged judgment and order dated 21.9.2012, passed by Gujarat State Cooperative Tribunal, Ahmedabad in Appeal No. 291 of 2002 as well as judgment and order dated 23.1.2002 passed in Lavad Suit No. 307 of 1997 passed by the Board of Nominees, Rajkot with below mentioned prayer:-

"6(A) The Hon'ble Court be pleased to issue a writ of certiorari or in the nature of certiorari or any other appropriate writ, direction or order, quashing and setting aside the judgment and order dated 21.09.2012, passed by the Gujarat State Cooperative Tribunal, Ahmedabad in Appeal No.291 of 2002, at Annexure-A to this petition, and also judgment and order dated 23.01.2002, passed in Lavad Suit No.307 of 1997 by the Board of Nominees, Rajkot, at Annexure: B, so far as it rejects the suit against respondent No.2.

3) Pending final hearing and disposal of the petition, the Hon'ble Court be pleased to stay further execution, operation and implementation of the judgment and order dated 21.09.2012, passed by the Gujarat State Cooperative Tribunal, Ahmedabad in Appeal No.291 of 2002, at Annexure-A to this petition, and also judgment and order dated 23.012002, passed in Lavad Suit No.307 of 1997 by the Board of Nominees, Rajkot, at Annexure: B, so far as it rejects the suit against respondent No.2.

(C) Pending final hearing and disposal of the petition, the Hon'ble Court may be pleased to direct the respondent No.2 to secure the amount of suit with interest at the rate of 18% accruing as on today.

D) Such other prayer as may be deemed just and proper may be granted in the facts of present case.

2. The brief facts giving rise to present petition are that the petitioner is a specified society registered with various objects. Therefore an agreement came to be executed between the petitioner and the respondent No.1 for the period between 01.01.1981 to 31.12.1981 for distribution of fertilizer by the respondent No.1. As per the said agreement the respondent No.1 came to be appointed as agent and the fertilizer shall be supplied as per the indent sent by the respondent No.1 and on cash payment/bank guaranty only the fertilizer may be supplied. Therefore, as per the agreement, bank guarantee was also required to be executed. Therefore, respondent N .2 executed bank guarantee in favour of the petitioner federation for an amount of Rs.3 lacs and thereby respondent No.2 agreed to pay on demand by the the petitioner federation for the fertilizer supplied to the respondent No.1 to the extent of Rs.3 lac. The amount of supply of fertilizer was to be paid by the respondent No.1 to the petitioner but the respondent No.1 failed to pay the same regularly and therefore, the petitioner heard upon the respondent No.1 to pay the outstanding amount of fertilizer supplied to respondent No.1 on various occasions and therefore, respondent No.1 accepted the liability and had also made part payment. Inspite of admission of liability respondent No.1 did not pay the outstanding amount and therefore, petitioner called the respondent No.2 by way of letter dated 3.3.1983 to pay outstanding amount as per the bank guarantee executed in favour of the petitioner. The said letter was replied by respondent No.2 stating that since the fertilizer was supplied to the respondent No.1 without any prior intimation to the respondent No.2, the respondent No.2 is not liable to pay the amount of bank guarantee. Said letter was replied by the petitioner stating that all the indents were sent with prior intimation to the respondent No.2, however, respondent No.2 did not repay the amount and therefore, the petitioner sent notice through his advocate on 13.8.1994 upon respondent Nos. 1 and 2 to repay the outstanding amount of Rs.2,75,585.09 with interest accrued thereon. Instead of that notice the amount was not forthcoming and therefore, the petitioner filed Lavad Suit No. 60 of 1987