ANANTANARAYANAN, J.

This appeal is instituted by the third defendant in the court below, the Nadar Bank Ltd., Madurai, against the judgment and decree of the learned Subordinate Judge of Madurai in O.S. No. 155 of 1952, which was a suit instituted by the Canara Bank Ltd. [plaintiff] for recovery of a sum of Rs. 21, 017-6-0, from two merchants, first and second defendants, which was decreed with costs. As the appeal involves certain interesting questions of law and fact relating to the priority of what are known in mercantile and banking practice as loans upon the security of goods under the "open credit" system, as against similar advances under the "key loans" system, we shall first set forth the broad and indisputable facts, before formulating the points that arise for our determination

The facts are that defendants Nos. 1 and 2 are members of an undivided Hindu family carrying on business in grains and cereals under the name and style of "V.M. Sankarapandia Nadar" at Madurai. The Madurai branch of the Nadar Bank Ltd. [hereinafter termed the appellant bank] was giving credit facilities to defendants Nos. 1 and 2, as regular customers, for the past nearly 15 years. The a