This appeal is at the instance of the defendant in O.S. 35/88 before the Principal Sub Court , Alapuzha. The respondent- plaintiff, Canara Bank, Mullaickal Branch, represented by its Manager filed the suit for realization of money. The plaintiff bank advanced the cash credit facilities including documentary bills purchase limits to Sri. A.G. Sudhakaran, the proprietor of M/S. Eastern Trading Corporation, Zakeria Bazar, Alapuzha, and Smt. K.S. Radhamoni the appellant wife of Sri. Sudhakaran (the principal debtor), executed a continuing guarantee on 5.8.1980. When there was default in paying an amount, the bank filed O.S. 233/83 against Sri. Sudhakaran for Rs. 16,668.92/- and the decree was obtained him on 29.6.84. At the time of filing O.S. 233/83, the appellant - guarantor was not made a defendant in the above suit. It was the case of the bank that the guarantee executed by the appellant was a continuing one and the above guarantee was not revocked by the guarantor by issuing any notice as provided in the deed of the guarantee and as such the suit was not barred by limitation and accordingly the bank filed the suit O.S. 35/88 for realization of a total sum of Rs. 30,671.92. The appellant-defendant admitted the execution of the guarantee, but contended that the suit was not maintainable as it was hit by order 2 rule 2 C P C and that the suit was barred by limitation. The court bellow framed four issues. Considering the evidence the court bellow found that the suit was maintainable and it was not barred by limitations and accordingly the suit was decreed.

2. Heard the learned counsel for the appellant and the respondent.

3. The appellant's husband Sri. Sudhakaran had availed of credit facilities including documentary bill purchase limits from the respondent bank and the appellant executed a continuing guarantee on 5.8.80. As per the above guarantee Ext. A1 the appellant was liable to pay all the amounts outstanding in the account of M/S Eastern Trading Corporation. As an amount of Rs. 16,668.92 was outstanding and payable, the bank filed O.S 233/83 against Sri. Sudhakaran, the principal debtor alone, without impleading the appellant, the surety. The present suit was filed onky on 22.3.88 i.e. nearly five years after the filing of the earlier suit. Though an argument was advanced by the learned counsel for the appellant that the suit was hit by Order 2 Rule 2 C.P.C., the counsel could not substantiate the same as it was not a case of forgoing or relinquishing a part of the claim and filing a suit for the remaining claim, but it was a case where the creditor had failed to implead the guarantor or the surety along with the principal debtor at the time of filing the earlier suit. The court below had taken the view that the guarantee being a continuing one and as the appellant had not revoked the guarantee as stipulated therein and the liability of the principal debtor was kept alive consequent on the decree obtained by the bank, the suit was not barred by limitation.

4. The learned counsel for the appellant submitted that the liability of the guarantor was co-extensive with that of the principal debtor and the cause of action for filing a suit as against the principal debtor as well as surety would arise when there was a default in the payment of the amount by the principal debtor and a suit had to be filed against the principal debtor as well as the surety within three years from the date of default i.e. from the date of the cause of action. It was further argued that as the suit was not filed against the surety within three years from the date of arising the cause of action, the suit was barred by limitation and there cannot be any exclusion of time on the basis of a decree obtained against the principal debtor. The learned counsel for the respondent bank submitted that the suit was not barred by limitation as the appellant had executed a continuing guarantee and that would be continuing till it was revoked by the surety