Decree Holder Can Execute Award Against Guarantor Even If Execution Against Principal Borrower Is Pending: Andhra Pradesh High Court

"Section 145 CPC does not create a bar for filing the execution petition for enforcement of liability of the surety by filing Execution Petition in addition to the filing of EP against the Borrower," High Court of Andhra Pradesh, in a significant ruling, held that the pendency of an execution petition against a principal borrower does not constitute a legal bar to instituting a separate execution petition against a guarantor.

A Division Bench comprising Justice Ravi Nath Tilhari and Justice Balaji Medamalli observed that a decree-holder is not mandatorily required to exhaust all remedies against the primary borrower before proceeding against the surety under Section 145 of the Code of Civil Procedure (CPC).

The petitioner, a guarantor and judgment debtor, challenged the registration of an execution petition (E.P. No. 1003 of 2024) filed by M/s. Sundaram Finance Ltd. following an arbitration award. The finance company had previously initiated an execution petition against the principal borrower, which was still pending at the time the second petition was filed against the petitioner. The petitioner contended that the decree-holder must first satisfy the award from the assets of the borrower before seeking recovery from the guarantor.

The primary question before the court was whether Section 145 of the CPC prohibits the filing of an execution petition against a guarantor during the pendency of execution proceedings against the principal borrower. The court was also called upon to determine if a decree-holder must necessarily exhaust remedies against the primary debtor before proceeding against a surety.

No Statutory Bar Under Section 145 CPC Against Simultaneous Execution

The court analyzed the provisions of Section 145 of the CPC, which deals with the enforcement of the liability of a surety. The Bench noted that the statute provides for the execution of a decree or order against a person who has furnished security or given a guarantee for the payment of money or performance of a decree. The court emphasized that the language of the section does not impose any restrictive sequence on the decree-holder.

The Bench clarified that the law does not prevent a decree-holder from seeking the enforcement of a surety's liability while simultaneously pursuing the principal debtor. The court noted that "Section 145 CPC does not create a bar for filing the execution petition for enforcement of liability of the surety by filing Execution Petition in addition to the filing of EP against the Borrower."

Pendency Of One EP No Bar To Filing Another Against Other Judgment Debtors

Addressing the petitioner’s primary grievance, the court held that the existence of a pending execution proceeding against one judgment debtor does not preclude the institution of another proceeding against the remaining judgment debtors. This is particularly relevant in cases arising from arbitration awards where multiple parties are often held jointly and severally liable.

The court observed that the petitioner was a party to the original arbitration proceedings and the final award was passed against her as well. Consequently, as a judgment debtor under the award, the petitioner cannot demand that the decree-holder must satisfy the debt through the borrower's property in the first instance.

"Pendency of one execution petition against one of the Judgment debtors is not a bar to institute other execution petition against the remaining Judgment debtors."

Guarantor’s Right To Raise Objections Before The Execution Court

The Bench further noted that the current challenge was directed merely at the registration of the execution petition. It held that no case for interference was made out at this stage simply because the petition had been registered by the lower court. The judges pointed out that the petitioner maintains the legal right to participate in the execution proceedings.

The court highlighted that the petitioner is at liberty to raise any valid legal objections before the Execution Court as may be available under the law. "The petitioner has the opportunity before the Execution Court to raise such valid objections as may be open to him under law and as may be advised," the Bench remarked while dismissing the revision petition.

The High Court dismissed the Civil Revision Petition, affirming that a decree-holder has the right to proceed against a guarantor regardless of the status of execution proceedings against the principal borrower. The ruling reinforces the principle that the liability of a surety is co-extensive with that of the principal debtor, and the procedural framework of the CPC does not mandate a specific order of recovery.

Date of Decision: 23 April 2026