SANJAY KISHAN KAUL, J. ( 1 ) THE plaintiff, a company incorporated under the Companies Act, 1956, filed the present suit under Order XXXVII of the Code of Civil Procedure, 1908 (hereinafter referred to as the "said code") for the recovery of Rs. 85,60,000. 00 along with interest @ 20 per cent per annum. ( 2 ) IT is stated that one Dany Dairy and Food Engineers Ltd. (for short, "dany dairy"), which used to deal, inter alia, in the manufacture and sale of dairy equipments submitted proposals and offers for the supply, erection and commissioning of evaporating plant pursuant to which a meeting took place at the head office of the plaintiff and a formal purchase order was issued on 25. 05. 1998 to the local office and registered office of Dany Dairy. ( 3 ) THE terms and conditions included the furnishing of a bank guarantee and the defendant bank furnished three guarantees to the plaintiff, the details of which are as under: S. No . Bank Guarantee Number ? Amount Date of Issue Valid up to 1. 614 (Ex. P-3) Rs. 50. 00 lakh 9. 6. 1988 (reduced to ????? 13. 6. 1988 Rs. 25. 00 lakh ) 8. 12. 1988 extended on 10. 12. 1988, 27. 5. 1989, 5. 12. 1989 up to 8. 6. 1990 2. 615 (Ex. D-5) 16. 5 lakh ?? 9. 6. 1988 8. 6. 1989 extended on 27. 5. 1989 and 5. 12. 1989. Valid up to 8. 6. 1990 3. 626 (Ex. P-5) 12. 00 lakh 12. 9. 1988 11. 3. 1989 extended on 13. 4. 1989, 27. 5. 1989 and 5. 12. 1989. Valid up to 11. 6. 1989 ( 4 ) IT is claimed that there was a default on the part of Dany Dairy consequent to which a demand notice was sent on 21/3/1990 for the encashment of the bank guarantees but the defendant failed to make payment. ( 5 ) A suit is stated to have been filed in the Court of the 1st Additional Civil judge Saharanpur in which the defendant was also impleaded. In the said suit, an injunction is stated to have been granted on 17/1/1991 restraining the defendant from making payments which was vacated on 13/2/1992. ( 5 ) A suit is stated to have been filed in the Court of the 1st Additional Civil judge Saharanpur in which the defendant was also impleaded. In the said suit, an injunction is stated to have been granted on 17/1/1991 restraining the defendant from making payments which was vacated on 13/2/1992. Thereafter, a telex is stated to have been sent on 4/6/1992 indicating approaches made to the head office, zonal office and other offices to which no reply was received. Thus, the present suit. ( 6 ) IT is claimed that the defendant works for gain at Delhi, the letters of guarantee were addressed to the plaintiff"s Delhi office and the sum guaranteed was payable at Delhi and thus, this court has the jurisdiction in the present matter. ( 7 ) THE defendant filed an application being. A. 8213/1993 for leave to defend, which was allowed vide order dated 7/7/1993 and the defendant was granted unconditional leave to defend. ( 8 ) THE defendant in the written statement has taken the stand that the present suit is liable to be stayed in view of the provisions of Section 10 of the said code. It is stated that a suit has been filed by Dany Dairy in the court of civil Judge, Saharanpur against the plaintiff and the defendant, inter alia for the grant of a decree of Rs. 66,901. 00 against the plaintiff and permanent injunction restraining the plaintiff from realizing the amounts towards bank guarantees which is being contested by the plaintiff. In that suit it is the case of Dany Dairy that the terms and conditions of the agreement had been fulfilled and on reconciliation of accounts between Dany Dairy and the plaintiff, a balance of Rs. 66,901. 00 was found to be due to Dany Dairy from the plaintiff. It is averred that the question whether there was any breach on the part of Dany Dairy in the performance of the contract is a question pending adjudication in that suit, which was instituted prior to the present suit. It is thus claimed that the present suit is liable to be stayed pending adjudication of the Saharanpur suit. It is averred that the question whether there was any breach on the part of Dany Dairy in the performance of the contract is a question pending adjudication in that suit, which was instituted prior to the present suit. It is thus claimed that the present suit is liable to be stayed pending adjudication of the Saharanpur suit. ( 9 ) ANOTHER plea taken in the written statement is of lack of territorial jurisdiction of this court to try the present suit as the applications for the issue of the bank guarantees were received by the defendant at its branch in saharanpur and the said bank guarantees were also issued and were payable at saharanpur. Besides, all communications were also received in Saharanpur. ( 10 ) IT is claimed that the suit is barred by limitation. It is stated that the bank guarantee no. 615 was sought to be encashed by the plaintiff vide the letter dated 6/12/1989 wherein it had been stated that failure by Dany Dairy to meet its commitment left the plaintiff with no option but to present the bank guarantee. The other bank guarantees being no. 614 and 626 were invoked on 21/3/1990. It is thus averred that as the present suit has been filed only on 22/5/1993, it is barred by time. ( 11 ) IT is averred that Dany Dairy is a necessary and proper party in the present suit and the present suit cannot be adjudicated without the impleadment of Dany dairy. The defendant has also taken the plea that a bank guarantee cannot be permitted to be used as a means for unjust enrichment and can be interdicted on a prima facie demonstration of fraud on the part of the beneficiary. ( 12 ) IT is also alleged that the plaint has not been verified and filed by a duly authorized person. ( 13 ) INSOFAR as the merits of the case are concerned, the stand of the defendant is that the plaintiff is not entitled to any monies. It is claimed that the amounts advanced by the plaintiff to Dany Dairy covered by bank guarantee nos 614 and 615 were to be proportionately refunded by Dany Dairy to the Plaintiff. It is averred that against the said two guarantees, the plaintiff made a cash advance and had adjusted in their books of accounts the cash advance and the bank commission charges. It is averred that against the said two guarantees, the plaintiff made a cash advance and had adjusted in their books of accounts the cash advance and the bank commission charges. It is averred that in a statement provided by the plaintiff it has been declared that as against the purchase order dated 25. 05. 1988 a nil balance was found due from Dany Dairy. And thus no cause arose for the invocation of the bank guarantees. ( 14 ) IT is further claimed that the plaintiff would be entitled to invoke bank guarantee no 615 only upon the failure of Dany Dairy to meet its contractual obligations and such non performance would be conclusive after the plaintiff has demanded the amount of the bank guarantee from Dany Dairy. It is averred that the letter invoking the said bank guarantee does not indicate any conclusive proof of failure of Dany Dairy to meet its obligations and the invocation was thus improper. As regards bank guarantee no 626, again it is averred that the demand of invocation was not made in accordance with the terms and conditions of the said bank guarantee and thus the defendant rightly refused to accept the same. It is also pleaded that the entire equipment required to be delivered as per the contract dated 25. 05. 1988 was admittedly delivered and the non performance relates to a contract dated 19. 10. 1988 which is not the subject matter of the bank guarantee nos 614 and 615 and thus the plaintiff cannot claim to be entitled to any amount under the said bank guarantees. The defendant has also alleged a possibility of collusion between the plaintiff and Dany Dairy. ( 15 ) ON 27. 03. 1997, issues were framed in the suit which are as under: 1. Is the present suit not maintainable for the reasons disclosed in the preliminary Objection No. 1" OPD 2. Is there no territorial jurisdiction of this Court to try and entertain the suit for the reasons disclosed in the Preliminary Objection No. 2" OPD 3. Does the present suit suffer from misjoinder of cause of action and multifariousness as disclosed in Preliminary Objection No. 3" OPD 4. Is the suit barred by limitation qua Bank Guarantee No. 614, 615 and 626 for the reasons disclosed in Preliminary Objection No. 5 and 6" OPD 5. Does the present suit suffer from misjoinder of cause of action and multifariousness as disclosed in Preliminary Objection No. 3" OPD 4. Is the suit barred by limitation qua Bank Guarantee No. 614, 615 and 626 for the reasons disclosed in Preliminary Objection No. 5 and 6" OPD 5. Is the plaint not signed and verified by duly authorised persons" OPP 6. To what amount Plaintiff is entitled to recover" OPP 7. To what amount is the Plaintiff is entitled to interest; if so, at what rate" opp 8. Relief" ( 16 ) ON behalf of the plaintiff, Sh. Pradip Sachdeva appeared as PW1, Sh. S. P. Khurana as PW 2 and Sh. Harmesh Mohan Sood as PW 3. An affidavit was also filed of Mr. Sudhir Avasthi (PW 4) but on 11. 04. 2005, the same was withdrawn. On behalf of the defendant Mr. P. K Maheswari was examined as DW 1 and Mr. R. K. Gupta was examined as DW 2. ( 17 ) LEARNED counsels for the parties were heard at length on various dates. Issue 1: Is the present suit not maintainable for the reasons disclosed in the preliminary Objection No. 1" OPD ( 18 ) THE first issue pertains to the objection taken by the defendant under section 10 of the said code in view of the suit filed by Dany Dairy in saharanpur. Insofar as the said suit is concerned, the same is stated to have been filed in late 1990 and an injunction was granted on 17. 01. 1991 which was thereafter vacated on 13. 02. 1992. On 29. 07. 1993 the said suit is stated to have been dismissed in default. It is also stated that Dany Dairy was ordered to be wound up by the Allahabad High Court in C. P. No. 4/1992 vide an order dated 18. 03. 1993 and an official liquidator was appointed. ( 19 ) IN view of the dismissal of the said suit, the objection is no longer pressed by the defendant. The issue thus does not survive for consideration. Issue 2. 03. 1993 and an official liquidator was appointed. ( 19 ) IN view of the dismissal of the said suit, the objection is no longer pressed by the defendant. The issue thus does not survive for consideration. Issue 2. Is there no territorial jurisdiction of this Court to try and entertain the suit for the reasons disclosed in the Preliminary Objection No. 2" OPD ( 20 ) THE case of the plaintiff as regards the issue of territorial jurisdiction Is that all three bank guarantees were issued by the defendant in favour of the plaintiff at Delhi and though the same were issued by the Saharanpur Branch of the defendant, they were addressed to the plaintiff at Delhi and also were accepted by conduct, by the plaintiff at Delh. Further, the extensions of the bank guarantees were also addressed to the plaintiff at Delh. ( 21 ) IT was submitted that the contract between the plaintiff and Dany Dairy was executed at Delh. In this behalf a reference was made to the examination in chief of PW 2 wherein it has been stated that the contract was executed between the parties at the Delhi office. ( 22 ) IT was further submitted that all the three bank guarantees were invoked by the plaintiff at Delhi and the defendant was obliged to make payment of the same at Delhi and in view of the failure of the defendant to make payment, the breach took place at Delh. ( 23 ) IT was submitted by the plaintiff that the defendant admittedly has its zonal office as well as various branches at Delh. It was thus contended that in view of the Explanation to Section 20 of the said code whereunder a corporation is deemed to carry on business in respect of cause of action arising at any place where it has a subordinate office, this court has territorial jurisdiction in the present matter. In this behalf, learned senior counsel referred to the judgment of the Apex Court in M/s Patel Roadways Limited, Bombay v. M/s Prasad trading Company AIR 1992 SC 1516. In this behalf, learned senior counsel referred to the judgment of the Apex Court in M/s Patel Roadways Limited, Bombay v. M/s Prasad trading Company AIR 1992 SC 1516. wherein it was observed in the context of the explanation to Section 20 of the said code that the clear intendment of the explanation is that where a corporation has a subordinate office in the place where the cause of action arises, it cannot be heard to say that it cannot be sued there because it does not carry on business at that place. It would be a great hardship if inspite of the corporation having a subordinate office at the place where the cause of action arises, such plaintiff is compelled to travel to the place where the corporation has its principal place of business. The explanation provides an alternative locus for the corporation"s place of business, not an additional one. The Explanation to section 20 of the said code is as under: "20. Other suits to be tried where defendants reside or cause of action arises. . . . . . . . . . . . . . . . . . . . . . . . . [explanation].-A corporation shall be deemed to carry on business at its sole or principal office in [india] or, in respect of any cause of action arising at any place where it has also a subordinate office, at such place. " ( 24 ) LEARNED counsel for the plaintiff submitted that though the bank guarantees do not expressly state the place of payment, by necessary implication the place would be Delhi from where the plaintiff invoked the said guarantees. In support of his submission, learned counsel referred to the cross examination of DW 2 wherein it was stated that the bank guarantees were to be paid by the Saharanpur branch but they could be paid at any place at the request of the plaintiff. It was thus averred that other than the execution of the bank guarantee document which took place at Saharanpur, all other aspects of the cause of action including place of performance, place of breach and place of payment are at delh. It was thus averred that other than the execution of the bank guarantee document which took place at Saharanpur, all other aspects of the cause of action including place of performance, place of breach and place of payment are at delh. ( 25 ) LEARNED counsel placed reliance on the judgment of learned single judge of this court in V. A. Tech Esheer Wyss Flovel Ltd. V. Nippon Power Ltd and Ors (2002) III AD (Del) 948 in support of the proposition that in matter of contracts part of the cause of action arises where the money is expressly or impliedly payable under the contract. ( 26 ) LEARNED counsel for the plaintiff contended that even in the absence of a covenant in the agreement for the place of payment, courts have consistently applied the English common rule that the place of payment is where the plaintiff is stationed as the obligation to pay a debt involves the obligation of the debtor to find the creditor at the place he is when the money becomes payable. ( 27 ) IN support of his submissions learned counsel placed reliance on a judgment of learned single judge of this court in Boston Scientific International B. V. v. Metro Hospital 136 (2007) DLT 278. In this case it was observed that even if it assumed that Delhi was not the expressly contracted place of payment, Delhi would still be the presumed place of payment because of the general rule that in the absence of a contract to the contrary, a debtor is bound to find the creditor for making the payment. The place of payment is where the creditor resides. Reference was also made to the judgment of a division bench of the calcutta High Court in State of Punjab v. A. K. Raha (Engineers) Ltd. AIR 1964 cal 418 ; judgment of learned single judge in Gappulal S/o Chandarlal v. Kanderwal Brothers AIR 1955 M. B. 96 and of learned single judge of this court in l. N. Gupta v. Smt. Tara Mani AIR 1984 Delhi 49 wherein the rule that the debtor must find the creditor and pay the debt where the creditor resides was held applicable in India. ( 28 ) LEARNED counsel for the plaintiff also sought to contend that the rule of forum conveniens guides the court in deciding objections relating to territorial jurisdiction. ( 28 ) LEARNED counsel for the plaintiff also sought to contend that the rule of forum conveniens guides the court in deciding objections relating to territorial jurisdiction. In Lohia Starlinger Limited and Anr v. Govt of NCT of Delhi and ors. (2006) V AD (Del) 732, learned single judge of this court observed that so far as civil litigation is concerned, it has been held that the same can be instituted in any court where even a part of the cause of action has arisen. However, it has been held by the Apex court that it is not every fact pleaded by a litigant which gives rise to a cause of action and only such facts as are necessary to adjudicate upon the lis would constitute a cause of action conferring territorial jurisdiction. Even if it was found that a part of the cause of action has arisen within the jurisdiction of the court, on the principles of forum non conveniens, or otherwise, it may refuse to exercise jurisdiction in the matter. ( 29 ) LEARNED counsel for the defendant, on the other hand, submitted that the request for issuance of the bank guarantees was received by the defendant from dany Dairy at Saharanpur and the said bank guarantees were issued from the saharanpur Branch. The bank guarantees were invocable in accordance with the tenor of the respective instruments at the Saharanpur Branch and the payments, if warranted under law were also to be made at the Saharanpur Branch. Further it was submitted that the notice invoking the guarantees was also received at the saharanpur Branch and did not stipulate payments at Delh. ( 30 ) IT was contended the Bank Guarantees, being "credits" within the meaning of the Uniform Customs and Practices of Documentary Credits (for short, UCP), each branch of the bank is considered to be a separate bank for the said purposes. Learned counsel for the defendant made a reference to the UCP. Article 2 of the ucp pertains to the meaning of credits and provides inter alia, that "for the purposes of these articles, branches of a bank in different countries are considered another bank". Learned counsel for the defendant made a reference to the UCP. Article 2 of the ucp pertains to the meaning of credits and provides inter alia, that "for the purposes of these articles, branches of a bank in different countries are considered another bank". ( 31 ) LEARNED counsel for the defendant referred to the cross examination of DW 2 wherein DW 2 admitted that the defendant has a zonal office at Delhi but stated that the zonal office has control over branches of regional office Delhi, chandigarh, Jalandar and Jaipur. It was thus contended that the Saharanpur branch is not under the administrative control of the Delhi Zonal Office. DW 2 in his affidavit of evidence has stated that the defendant Bank"s regional office at Meerut had administrative control over the Saharanpur Branch. ( 32 ) LEARNED counsel further referred to the cross examination of DW 2 wherein the stand taken is that the bank guarantees were to be paid only by the Saharanpur branch of the defendant but could be paid at any place on the request of the plaintiff. The said witness has also taken the stand that he was unaware of the place from where the plaintiff had sent the letters invoking the bank guarantees but they were to be invoked at Saharanpur. When asked whether the guarantees mention any place where the guarantees were to be invoked, DW 2 referred to bank guarantee no. 614 the second paragraph of which mentions "we, Union Bank of india do hereby undertake to pay the amount due and payable under this guarantee" and stated that "we" means the issuing branch is defendant which is the Saharanpur Branch. ( 33 ) LEARNED counsel referred to the judgment of learned single judge of this court in Association of Corporation and Apex Societies of Handlooms v. State of bihar and Another AIR 2000 Delhi 106, which involved a bank guarantee. In this case, the bank guarantee was executed at Patna, the main contract was entered into at Patna and the performance was to be enforced at Patna. It was held that this court did not have the necessary jurisdiction to entertain the suit. In this case, the bank guarantee was executed at Patna, the main contract was entered into at Patna and the performance was to be enforced at Patna. It was held that this court did not have the necessary jurisdiction to entertain the suit. Learned counsel for the plaintiff sought to distinguish the judgment in association of Corporation and Apex Societies of Handlooms case (supra) by submitting that the facts of the case are different and in that case, there was a specific term in the bank guarantee that the court at Patna shall have jurisdiction. In the judgment of the Supreme Court in South East Asia Shipping co. Ltd v. Nav Bharat Enterprises Pvt. Ltd (1996) 3 SCC 442, which was referred to in that judgment, it was observed that merely because the bank guarantee was executed at Delhi and transmitted for performance to Bombay does not constitute a cause of action to give rise to the respondent to lay the suit on the original side of the Delhi High Court. It was thus contended that there must be a cause of action other than the execution of the bank guarantee for the court to entertain the suit. ( 34 ) A perusal of the aforesaid as also the bank guarantees shows that while all three bank guarantees were issued by the Saharapur Branch of the defendant, the said bank guarantees did not specify any place of payment. In his cross examination, DW 2 has also affirmed that though the said bank guarantees are payable only by the Saharanpur branch of the defendant, the same could be paid at any place. Thus, Delhi is certainly one of the places where the bank guarantees were payable. ( 35 ) FURTHER the letter dated 9. 06. 1988 (Ex. P-6) which is the covering letter sent with bank guarantee No. 614; letter dated 13. 06. 1988 (Ex. P-4) for the amendment of bank guarantee no 614,letter dated 09. 06. 1988 with regard to issue of bank guarantee no 615 (Ex. D-3), letter dated 12. 09. 1988 (Ex. P-11) with regard to the issue of bank guarantee no. 626 as also letters for the extension of the bank guarantees (Ex. P-7, Ex. P-9, Ex. P-10, Ex. P-13, Ex. P-14 ) etc are addressed to the plaintiff at Delh. The letters of the plaintiff invoking bank guarantee no 615 (Ex. D-3), letter dated 12. 09. 1988 (Ex. P-11) with regard to the issue of bank guarantee no. 626 as also letters for the extension of the bank guarantees (Ex. P-7, Ex. P-9, Ex. P-10, Ex. P-13, Ex. P-14 ) etc are addressed to the plaintiff at Delh. The letters of the plaintiff invoking bank guarantee no 615 (Ex. D- 1) has been written by the plaintiff from Delh. ( 36 ) IT is not disputed that the defendant has a zonal office at Delh. This has been admitted by DW 2 in his cross examination though the stand taken is that the Saharanpur Branch of the defendant which was to make the payment was not under the administrative control of the zonal office at Delh. ( 37 ) THE legal position as set out in M/s Patel Roadways Limited Bombay case (supra) is that in view of the Explanation to Section 20 of the said code, where a corporation has a subordinate office at a place where the cause of action arises, it can be sued at that place. ( 38 ) THE judgment in V. A. Tech Esheer Wyss Flovel Ltd case (supra) is to the effect that a part of the cause of action arises at the place where under the contract, the money is expressly or impliedly payable. The bank guarantees did not specify any place as the place of payment and were in fact payable at any place at the request of the plaintiff. The plaintiff invoked the said guarantees at Delh. ( 39 ) AS regards the plea of the plaintiff that the debtor is bound to find the creditor for making the payment, there is no dispute in the legal principle recognized in the judgments in Boston Scientific International B. V. , State of punjab and L. N. Gupta cases (supra ). The amount would be payable where the creditor resides. In view of the principle that the debtor must pay the creditor where the creditor resides, Delhi which is the place at which the creditor/plaintiff 'resided' and from where the plaintiff wrote the letters invoking the bank guarantees would be the place at which the same were payable. The amount would be payable where the creditor resides. In view of the principle that the debtor must pay the creditor where the creditor resides, Delhi which is the place at which the creditor/plaintiff 'resided' and from where the plaintiff wrote the letters invoking the bank guarantees would be the place at which the same were payable. ( 40 ) INSOFAR as the contention of the defendant that as per the UCP branches of a bank are considered to be a separate bank for the purposes of credits is concerned, a perusal of the relevant portion of Article 2 shows that the same pertains to branches of a bank in different countries. ( 41 ) AS regards the principle of forum conveniens, the position is that the plaintiff's choice of forum is usually not disturbed unless the balance of convenience is strongly in favour of the defendant. In determining whether a more appropriate forum exists, connecting factors, such as those effecting the convenience of parties, expenses involved and the law governing the relevant transactions are to be looked into. The mere fact that a part of the cause of action has arisen within the jurisdiction of the court may itself not be considered to be a determinative factor compelling the court to decide the matter on merits. In determining which of the available forums is the forum conveniens in a given matter, the convenience of all the parties had to be seen. In this behalf, reference may be made to the recent judgment of this court in (India TV) Independent News Service Pvt. Limited v. India Broadcast Live LLC And ors (. A Nos. 651/2007, 1336/2007 and 2611/2007) decided on 10. 07. 2007. In the present case, both the plaintiff and the defendant have branches/offices at delh. The bank guarantees were payable at any place including Delh. Thus, delhi cannot be said to be a forum non conveniens in the present matter. ( 42 ) THERE is also no dispute that all three bank guarantees were issued by the saharanpur branch of the defendant and were payable by the said branch. The covering letters with the bank guarantees as also the letters of extension of the bank guarantees were addressed to the plaintiff at Delh. The said bank guarantees could be paid at any place including in Delh. The covering letters with the bank guarantees as also the letters of extension of the bank guarantees were addressed to the plaintiff at Delh. The said bank guarantees could be paid at any place including in Delh. The bank guarantees did not specify any place for payment or invocation of the same. The letters invoking the bank guarantees were written by the plaintiff from Delh. The defendant does have branches and a zonal office at Delh. It thus cannot be said that a suit cannot be filed against the defendant at Delh. In view of the aforesaid, Delhi courts will have jurisdiction in the present matter. The issue is thus decided accordingly. Issue 3 Does the present suit suffer from misjoinder of cause of action and multifariousness as disclosed in Preliminary Objection No. 3" OPD ( 43 ) THE issue was not pressed by learned counsel for the defendant. 4. Is the suit barred by limitation qua Bank Guarantee No. 614, 615 and 626 for the reasons disclosed in Preliminary Objection No. 5 and 6" OPD ( 44 ) THE case of the defendant in this behalf is that under Article 55 and Article 113 of the Limitation Act, 1963 (hereinafter referred to as the 'limitation act'), the cause of action arises when the contract is breached or when the right to sue arose. The right to payment was asserted by the plaintiff by the notice dated 21. 03. 1990 and non payment of the same triggered the right to sue as the contract stood breached. Syndicate Bank v. Channaverappa JT 2006 (4) SC 579 was a case in which the guarantee deeds specifically stated that the guarantors agree to pay and satisfy the bank on demand and in a case where the guarantee is payable on demand, the limitation begins to run when the demand is made and the guarantor commits breach by not complying with the demand. The court considered the meaning of the words on demand and observed that if while making the demand for payment no period is specified within which the payment should be made, the breach occurs or the right to sue accrues when the demand is served on the guarantor. The relevant observations are as under: 12. We will examine the meaning of the words "on demand". The relevant observations are as under: 12. We will examine the meaning of the words "on demand". As noticed above, the high Court was of the view that the words "on demand" in law have a special meaning and when an agreement states that an amount is payable on demand, it implies that it is always payable, that is payable forthwith and a demand is not a condition precedent for the amount to become payable. The meaning attached to the expression "on demand" as "always payable" or "payable forthwith without demand" is not one of universal application. The said meaning applies only in certain circumstances. The said meaning is normally applied to promissory notes or bills of exchange payable on demand. We may refer to Articles 21 and 22 in this behalf. Article 21 provides that for money lent under an agreement that it shall be payable on demand, the period of limitation (3 years) begins to run when the loan is made. On the other hand, the very same words "payable on demand" have a different meaning in Article 22 which provides that for money deposited under an agreement that it shall be payable on demand, the period of limitation (3 years) will begin to run when the demand is made. Thus, the words "payable on demand" have been given different meanings when applied with reference to "money lent" and "money deposited". In the context of Article 21, the meaning and effect of those words is "always payable" or payable from the moment when the loan is made, whereas in the context of Article 22, the meaning is "payable when actually a demand for payment is made". 13. What then is the meaning of the said words used in the guarantee bonds in question" The guarantee bond states that the guarantors agree to pay and satisfy the Bank "on demand". It specifically provides that the liability to pay interest would arise upon the guarantor only from the date of demand by the Bank for payment. It also provides that the guarantee shall be a continuing guarantee for payment of the ultimate balance to become due to the Bank by the borrower. The terms of guarantee, thus, make it clear that the liability to pay would arise on the guarantors only when a demand is made. It also provides that the guarantee shall be a continuing guarantee for payment of the ultimate balance to become due to the Bank by the borrower. The terms of guarantee, thus, make it clear that the liability to pay would arise on the guarantors only when a demand is made. Article 55 provides that the time will begin to run when the contract is "broken". Even if Article 113 is to be applied, the time begins to run only when the right to sue accrues. In this case, the contract was broken and the right to sue accrued only when a demand for payment was made by the Bank and it was refused by the guarantors. When a demand is made requiring payment within a stipulated period, say 15 days, the breach occurs or right to sue accrues, if payment is not made or is refused within 15 days. If while making the demand for payment, no period is stipulated within which the payment should be made, the breach occurs or right to sue accrues, when the demand is served on the guarantor. 14. We have to, however, enter a caveat here. When the demand is made by the creditor on the guarantor, under a guarantee which requires a demand, as a condition precedent for the liability of the guarantor, such demand should be for payment of a sum which is legally due and recoverable from the principal debtor. If the debt had already become time-barred against the principal debtor, the question of creditor demanding payment thereafter, for the first time, against the guarantor would not arise. When the demand is made against the guarantor, if the claim is a live claim (that is, a claim which is not barred) against the principal debtor, limitation in respect of the guarantor will run from the date of such demand and refusal/non-compliance. Where guarantor becomes liable in pursuance of a demand validly made in time, the creditor can sue the guarantor within three years, even if the claim against the principal debtor gets subsequently time-barred. To clarify the above, the following illustration may be useful: let us say that a creditor makes some advances to a borrower between 10-4-1991 and 1-6-1991 and the repayment thereof is guaranteed by the guarantor undertaking to pay on demand by the creditor, under a continuing guarantee dated 1-4-1991. To clarify the above, the following illustration may be useful: let us say that a creditor makes some advances to a borrower between 10-4-1991 and 1-6-1991 and the repayment thereof is guaranteed by the guarantor undertaking to pay on demand by the creditor, under a continuing guarantee dated 1-4-1991. Let us further say a demand is made by the creditor against the guarantor for payment on 1-3-1993. Though the limitation against the principal debtor may expire on 1-6-1994, as the demand was made on 1-3-1993 when the claim was "live" against the principal debtor, the limitation as against the guarantor would be 3 years from 1-3-1993. On the other hand, if the creditor does not make a demand at all against the guarantor till 1-6-1994 when the claims against the principal debtor get time-barred, any demand against the guarantor made thereafter say on 15-9-1994 would not be valid or enforceable. ( 45 ) INSOFAR as the aforesaid judgment is concerned, learned counsel for the plaintiff contended that the same is not applicable as in that case, the question before the court was with regard to a letter of guarantee given by the borrower in which ultimate balance due to the bank was guaranteed. It was not a case of performance guarantee issued by a bank. It was contended that the ratio of case must be considered in the background of the facts of the case. In support of his submission, learned counsel placed made a reference to the judgment of the Supreme Court in Bhavnagar University v. Palitana Sugar Mills (P) Ltd. (2003) 2 SCC 111 in which it was observed that it is well settled that a little difference in facts or additional facts may make a lot of difference in the precedential value of a dec