1. The plaintiff, a private Limited Company duly incorporated under the Companies Act, 1956, has filed the present suit for the recovery of Rs. 11,90,711.10 paise against the two defendants on the following averments : -
The plaintiff is engaged in the business of manufacture and sale of electric resistance pipes, welded M.S. Blocks and galvanised steel tubes of various diameters. It is also engaged in the business of undertaking job works for slitting and galvanising of black steel tubes etc. The defendant No. 2, who was having regular business dealings with the plaintiff, in the year 1987, introduced defendant No. 1 as a prospective customer. The defendant No. 1 was desirous in the purchase of steel tubes and also for getting the work of slitting, rolling and galvanising of black steel tubes etc. done. Since the plaintiff did not have any dealings with the defendant No. 1, it was reluctant in having dealings with defendant No. 1. However, defendant No. 2 assured the plaintiff about the financial standing of defendant No. 1 and also offered guarantee of defendant No. 1 for the amount which may be due from defendant No. 1 and not paid by it. Acting on the assurance and guarantee of