https://www.taxtmi.com/caselaws?id=172822 A surety is not discharged merely because the principal debtor's undertaking is nationalised or its assets vest by operation of law. The guarantee remains enforceable where the statute preserves prior liabilities, and the creditor's suit against the guarantors is maintainable. Discharge for loss or impairment of securities applies only when the creditor, by a voluntary act attributable to him, loses or parts with security without the surety's consent; loss by operation of law does not suffice. The contract of guarantee was also not frustrated, because the supervening statutory vesting did not make performance legally impossible. The appeal succeeded and the decree for the creditor was restored. en-us Fri, 12 Apr 2002 00:00:00 +0530 Wed, 07 Feb 2018 16:26:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=172822 A surety is not discharged merely because the principal debtor's undertaking is nationalised or its assets vest by operation of law. The guarantee remains enforceable where the statute preserves prior liabilities, and the creditor's suit against the guarantors is maintainable. Discharge for loss or impairment of securities applies only when the creditor, by a voluntary act attributable to him, loses or parts with security without the surety's consent; loss by operation of law does not suffice. The contract of guarantee was also not frustrated, because the supervening statutory vesting did not make performance legally impossible. The appeal succeeded and the decree for the creditor was restored. Case-Laws Indian Laws Fri, 12 Apr 2002 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=172822