CENTRAL BANK OF INDIA vs C. L. VIMALA .

The Supreme Court ruled that a guarantor's consent is essential for any settlement affecting their liability, as per the principles of contract law. The Court held that the award passed by the Lok Adalat, which was signed only by the borrower and not by the guarantor C.L. Vimla, was invalid concerning her. Consequently, the Court upheld the High Court's decision to allow Vimla's writ petition, thereby setting aside the auction proceedings initiated by the Central Bank of India.