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1997 Supreme(Mad) 951

High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE S. JAGADEESAN
Kandasamy
Versus
Valluvar Financiers rep. by its Managing Partner, Cheyyar
C.R.P. No. 980 of 1995 & C.M.P. No. 5367 of 1995
Decided On :Decided on : 02-09-1997

Advocates Appeared:
For the Petitioner:P. Mani, Advocate.
For the Respondent:S. Balasubramanian, Advocate.

Due to discharge of principal debtor by operation of law liability of guarantor cannot be excluded.

Headnote:Contract Act, 1872-Sections 128 and 124-Making principal debtor and guarantor liable jointly and severally liable suit decreed for the debt-Held, due to operation of law discharge of principal debtor will not exclude liability of guarantor to pay the decree-debt.

       

Judgment :-

1. By consent of both the sides, the Civil Revision Petition itself is taken up for final disposal.

2. The Revision has been filed against the order or arrest in E.A. No. 154 of 1994. The counsel for the petitioner contended that the decree was passed on 4-5-1991 and thereafter the decree-holder filed E.P. No. 371 of 1991 for arrest of both the principal debtor and the guarantor, the petitioner being the guarantor. Subsequently, the principal debtor took out Insolvency proceedings and the same is pending. In view of this, the decree-holder gave up the principal debtor in the E.P. and proceeded against the petitioner alone. When the Insolvency proceeding against the principal debtor is pending, the liability of the principal debtor is under doubt and as such the decree cannot be executed against the guarantor, the petitioner herein. Further, the principal debtor himself has paid the decree amount. Having given up the principal debtor, the decree-holder cannot proceed against the guarantor alone.

3. The counsel for the respondent contended that both the pleas are raised for the first time before this Court and hence, the same cannot be entertained. Earlier, the petitioner was arrested on 29-4-1994, and he paid a sum of Rs. 100/- and thereafter released. Subsequently, the petitioner filed E.A. No. 154 of 1994 to stay the execution proceedings. In the meanwhile it is admitted that a revision has been filed before this Court on the ground that arrest was ordered without any reason and there is no finding with regard to the means of the petitioner. The said Revision was allowed, and the matter was remitted to the Executing Court. Now, once again arrest was ordered and the same is being challenged here. When the dismissal of the E.A. No. 154 of 1994 has not been challenged, it is not open to the petitioner to challenge the order of arrest.

4. I have carefully considered the contentions of both the counsel. E.A. No. 154 of 1994 has been filed by the petitioner, seeking for the stay of the execution proceedings on the basis of the pendency of I.P. No. 2 of 1992. Admittedly, the said application has been dismissed on 13.2.1995 and the order of dismissal has not been challenged. When that order has not been challenged, now it is not open to the petitioner to plead that due to the pendency of the I.P., the execution cannot be proceeded with. Having allowed it to become final, it is not open to the petitioner once again to raise the same issue before this Court. So far as the order of arrest is concerned, the lower court has passed the order only on the ground that the decree is joint and several and hence, the petitioner is liable to pay the decree debt and further, the said petition filed by the petitioner in E.A. No. 154 of 1994 has been dismissed and hence, the lower court ordered the arrest.

5. When the order of arrest is sought for, admittedly the earlier C.R.P. has been allowed and the matter has been remitted to the Executing Court to consider the matter on merits. To consider the matter on merits means not only the objection raised by the petitioner with regard to the executability of the decree but also with regard to the means in respect of the petitioner. The lower court has considered the objections raised with regard to the executability of the decree and did not give any finding with regard to the means of the petitioner and that he is evading to discharge of the decree debt in spite of having such means. In the absence of such finding, I am of the view that the order of arrest cannot be sustained.

6. Since the objection has been raised with regard to the executability of the decree also and in order to avoid any doubt before the executing Court, that question has also to be decided. It is the contention of the counsel for the petitioners that in view of the pendency of the Insolvency petition and in view of the giving up of the principal-debtor, the present Execution Petition is not maintainable.

7. Mr. S. Balasub















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