(1) If the payment of a debt due by a debtor is guaranteed by a surety or if a debtor is otherwise jointly and severally liable for any debt along with any other person and if the surety or such other person is not a debtor, the debtor may make an application under section 4 for relief in respect of such debt and the Court may after consideration of the facts and circumstances of the case proceed with the adjustment of debts under this Act in so far as such applicant is concerned.
(2) Whenever the debts due by a debtor which are guaranteed by a surety are adjusted under sub-section (1), the surety shall be discharged from liability in respect of the debts or portion of the debts of such debtor which are extinguished under sub-section (1) of section 15, sub-section (3) of section 17, sub-section (5) of section 26, section 34 or sub-section (2) of section 35; and the surety shall not be entitled to proceed against the debtor in respect of such debts or portion.