V. KANAGARAJ, J.

For the The above appeal suit is directed against the judgment and decree dated November 9, 1983, made in O.S. No. 9313 of 1981 by the VIth Additional judge, City Civil Court, Madras, thereby decreeing the suit in favour of the plaintiff-Corporation directing the defendant-bank to pay Rs. 40, 000 with interest thereon at 20 per cent. per annum from August 7, 1981, till the date of decree and at 6 per cent. per annum from that date onwards till the date of realisation and with proportionate costs.

The suit filed by the respondent herein in the court below is for a decree directing the defendant to pay the plaintiff a sum of Rs. 68, 000 together with interest on Rs. 40, 000 at 20 per cent. per annum from the date of plaint till the date of realisation and with costs.

So far as the averments of the plaint are concerned, the plaintiff-Corporation entered into a contract dated August 29, 1977, with Indecor, Broadway, Madras, for supply of timber of certain specifications with the condition that the said company should furnish performance guarantee in the form of a bank guarantee of a nationalised bank and the defendant-bank offered the guarantee in No. 33 of 19