P. C. MISRA, J.

( 1 ) THIS appeal arises out of a suit for recovery of money said to have been advanced by the State Bank of India (Respondent 1) under a cash credit agreement from the present appellant (Defendant 2) and the present respondent 2 (defendant. 1 ).

( 2 ) THE plaintiffs case in short is that the first defendant was carrying on the business in ready-made clothes, hosiery goods etc. in Berhampur town and had approached the plaintiff-Bank for a loan accommodation under a cash credit account for the purposes of his business. The second defendant (the present appellant) offered to stand as a guarantor for repayment of the loan by defendant 1. On 20-4-1970 the plaintiff-Bank granted a loan accommodation to defendant 1 for a sum of Rs. 5,000/- under a cash credit account. The amount of Rs. 5,000/- was secured by the first defendant by executing a promissory note on 20-4-1970 in favour of the second defendant as the guarantor for the loan and the latter duly endorsed the said promissory note to and in favour of the plaintiff-Bank on the same day. The first defendant also hypothecated his stock of mercantile in ready-made cloths, hosiery, etc. in favour of plaintiff-Bank by e