This C.R.P. which came on for disposal before one of us in the first instance was referred to a Bench in view of the importance of the point raised and the absence of any decision of this Court on the question involved.

The facts of the case have been set out sufficiently in the order of reference and we feel it not necessary to repeat them. Bereft of unessentials, the question raised for our consideration is whether a surety for a debt for which a minor made himself liable could be proceeded against on his contract of guarantee. The District Munsif has held in the affirmative, and it is the correctness of this position that has been canvassed before us in this petition.

The minor was of course not liable and the suit has been dismissed as against him. As regards the surety who is the petitioner before us, section 128 of the Indian Contract Act enacts:

"128. The liability of the surety is coextensive with that of the principal debtor, unless it is otherwise provided by the contract."

That the section refers to the quantum of a surety’s obligation is beyond dispute. But the question to be considered by us is whether the obligation of a surety becomes a primary one when no liability was ever fastened on the principal debtor by reason of his minority at the time of the contract.

In this connection it is necessary to draw a distinction between a contract of indemnity on the one hand and a contract of guarantee or suretyship on the other. Section 124 of the Indian Contract Act defines a contract of indemnity thus.

"Section 124.-A contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself or by the conduct of any other person, is called a ‘contract of indemnity’."

The rights of a promisee in a contract of indemnity are set out in the section following:

"Section 125.-The promisee in a contract of indemnity, acting within the scope of his authority is entitled to recover from the promisor-

(1) all damages which he may be compelled to pay in any suit in respect of any matter to which the promise to indemnify applies;

(2) all costs which he may be compelled to pay in any such suit if, in bringing or defending 5t, he did not contravene the orders of the promisor and acted as it would have been prudent for him to act in the absence of any contract of indemnity, or if the promisor authorised him to bring or defend the suit;

(3) All sums which he may have paid under the terms of any compromise of any such suit, if the conpromise was not contrary to the orders of the promisor, and was one which it would have been prudent for the promisee to make in the absence of any contract of indemnity, or if the promisor authorised him to compromise the suit.“

In cases, therefore, where the contract is on its proper construction one of indemnity, there is no doubt that the non-liability of the principal debtor does not affect the obligation undertaken by the indemnifier which is primary and in several cases it was the possibility of this non-liability that was the occasion for this contract of indemnity.

Every contract of guarantee, however, is not a contract of indemnity having this effect. The nature of the obligation in this type of cases is set out in section 126 as a contract to perform the promise, or discharge the liability of a third person in case of his default. So then a ‘default’ of a third person is posited as the foundation for the liability of the guarantor or surety.

Turning now to the bond in suit Exhibit A-1 we are clearly of opinion that it embodies a contract of guarantee and not one of indemnity. The relevant clause by which the petitioner undertook his liability runs;

"It has been settled that if the 1st executant commits any default in paying the amount due for the respective instalments at the due time. . . the second executant in his capacity as surety. . . shall be liable for the entire amount payable."

The contract is tripartite-an indication that it is a guarantee rather than