⚖️ SHRI GANPATI JURISTS — LEGAL LEARNING ⚖️
**📚 Bhagyalaxmi Co-Operative Bank Ltd. v. Babaldas Amtharam Patel (Supreme Court)
✅ Key Legal Principle — Liability of Surety
🔹 A surety’s liability is coextensive with the principal debtor unless the guarantee contract provides otherwise.
🔹 If the creditor changes contract terms without the surety’s consent, the surety is discharged only for future transactions, not for the original guaranteed liability.
🔹 The surety remains liable for the sanctioned loan amount and agreed interest, but not for excess or unauthorized withdrawals allowed by the creditor.
🔹 A surety is discharged only when the creditor’s acts actually impair the surety’s legal remedy against the principal debtor — mere allegations are not enough.
📖 Relevant Law:
• Section 126 — Contract of Guarantee
• Section 133 — Variance in Contract
• Section 139 — Discharge of Surety
(Indian Contract Act, 1872)
✨ Legal Insight:
A creditor cannot enlarge liability beyond agreed terms and still bind the surety — consent of the surety is essential.
— Shri Ganpati Jurists
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