The dismissed writ petition challenged a notice under Section 29 of the State Financial Corporation Act, 1951. The court held a creditor can proceed against a surety even without exhausting remedies against the principal debtor.
Writ petition dismissed; no order as to costs.
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THE HON'BLE SRI JUSTICE C.Y.SOMAYAJULU Writ Petition No.8419 of 2003
ORDER:
1 Petitioner, who stood surety for the loan taken by the third respondent from the A.P. State Financial Corporation (Corporation) filed this Writ Petition questioning the notice dated 10.12.2002 issued to him under Section 29 of the State Financial Corporation Act, 1951, informing him that the property belonging to him was advertised for auction in Eenadu newspaper on 07.12.2002, on the ground that the Corporation unless and until it exhausts the remedies available to it against the third respondent, who is the principal debtor, and fails to recover the amount from him, it cannot proceed against him, who is but a surety.
2 The point for consideration in this Writ Petition is not res integra because a Division Bench of this Court in Grandhi Kamaraj and another Vs. Government of Andhra Pradesh, rep. By Secretary and other s[1] c learly held that it is open to the creditor to proceed either against the debtor or the surety or both.
3 In view thereof, I find no merit in this Petition and hence the same is dismissed. No order as to costs.
C.Y.Somayajulu, J.
07.02.2008 kvsn
[1] 1996 (2) ALD 1193 (D.B)
1 issue framed by the court
Whether a surety can challenge a notice for auction of his property without exhausting remedies against the principal debtor.
Colour shows how this judgement treated each authority
Grandhi Kamaraj and another Vs. Government of Andhra PradeshDistinguished¶4
Grandhi Kamaraj and another Vs. Government of Andhra Pradesh, rep. By Secretary and other
1 provisions across 1 enactments
Petitioner
A.P. State Financial Corporation (Corporation)
Third Respondent
C.Y.Somayajulu
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
