Mishra, J.

For the Defendants 2 to 4 (third defendant has been substituted by this legal representatives) have appealed. It is not in dispute that the plaintiff-Bank entered into a contract of cash credit loan as well as medium term loan on the hypothecation of the schedule of properties with the principal debtor Messrs. Discon Foods (P) Ltd., (first defendant), a company incorporated under the Indian Companies Act and carrying on business in processing and exporting sea foods. The cash credit limit was Rs. 3, 00, 000/- and medium term loan limit was Rs. 75, 000/- Defendants 2 and 3, who were at the relevant time, Directors of the first defendant-company, stood surety for the cash credit loan to the first defendant-company and defendants 3 and 4 stood surety for the medium term loan. This was, however, in April, 1974, and continued until, it is said, the second defendant resigned from the directorship of the first defendant Company on 19.7.1974 and the third defendant resigned from the directorship with effect from 27.10.1975. It appears that one M. C. Agarwal and Mrs. Pushpa Agarwal as entered new directors and passed a letter dated 22.11.1975 to defendants 2 and 3 with