1. - The first appeal is directed against the judgment and decree passed by Additional District Judge No, 3, Jaipur City, Jaipur dated 10.12.1990 by which the learned trial Judge has decreed the suit filed by the present respondent-Rajasthan State Electricity Board, Jaipur (for short ‘RSEB’).

2. The respondent RSEB instituted a suit being Civil Suit No. 72/86 for recovery of Rs. 4,27,500/- with interest from the present appellant, original defendant in the said suit. According to the plaintiff, an order was placed with M/s. U.R Cables Co. Pvt. Ltd., New Delhi (hereinafter referred to as ‘the Contractor’) to supply 500 Km. of particular type of wire. According to the plaintiff, the delivery was to commence from 22.10.1979 and the contractor was to supply entire goods within ten months from 22.10.1979. For performance of the said work, the plaintiff insisted upon the security from the contractor and the defendant (present appellant) furnished a security guarantee No. 12/108 for an amount of Rs. 1,90,000/- on 29.07.1980. As per the guarantee, it was agreed between plaintiff and the defendant that in case the contractor fails to supply the goods, the Bank will make payment of aforesaid guarantee amount of Rs. 1,90,000/- on demand to the plaintiff-RSEB. As per the stipulation in the agreement, the guarantee was to remain in force upto 30.6.1981. It is also the case of the plaintiff that the defendant-State Bank of India further executed a performance guarantee No. 12/115 on 23.8.1980. According to this guarantee, it was agreed that in terms of contract between RSEB and contractor, the contractor should furnish bank guarantee of 5% of the total contract value by way of security for supplying free of costs any material that may be required to be supplied due to defects arising from faulty material, design and workmanship. At the request of contractor, the Bank agreed to execute performance guarantee. It is the case of the plaintiff that the contractor did not supply the total quantity of goods but he supplied only 163.65 Km. on 4.7.1980 and thereby failed to perform the contract. It is the case of the plaintiff that vide a telegram dated 28.9.1981, the plaintiff asked the Bank to remit the amount of security guarantee i.e. Rs. 1,90,000/- and a letter of confirmation was also sent to Bank on the same day i.e. 28.9.1981. It is also the case of the plaintiff that the contractor failed to perform the contract, therefore, the plaintiff sent another telegram on 28.12.1981 to the defendant Bank to remit the amount of Rs. 2,37.500/- towards the performance guarantee and a letter of confirmation was also sent in this behalf of 28.12.1981. According the plaintiff, the Bank has failed to remit the amount in question and therefore, the suit for recovery of Rs. 4,27,500/- with interest was filed by the plaintiff against the defendant-Bank.

3. The said suit was resisted by the defendant-Bank by filing written statement. The defendant, in the written statement, has admitted the fact about the execution of security guarantee and performance guarantee, but denied the factum of receiving any telegram dated 28.9.1981 or 28.12.1981. It is the case of the defendant that neither such telegram nor any letter was issued by the plaintiff within the time limit. It is also the case of the defendant that as per the terms of the guarantee, in so far as the security guarantee is concerned, the period of guarantee was only upto 30.9.1981 and in case of performance guarantee, the period of guarantee was only upto 30.12.1981 and that since no intimation prior to these dates was received by the Bank from the plaintiff for making payment in connection with the aforesaid two guarantees, the Bank cancelled the said guarantees after the expiry of the claim period i.e. on 11.8.1982 and, therefore, the plaintiff is not entitled to receive any amount. It is also the case of the defendant that the suit is barred by limitation and that M/s. U.P Cables, who is necessary