JUDGMENT

SEN, J.:— The short and narrow point involved in this appeal by special leave is whether upon the principles laid down in United Commercial Bank v. Bank of India, (1981) 3 SCR 300, the Court should not interfere in a transaction between a banker and a beneficiary of a letter of guarantee or indemnity by grant of an injunction at the instance of the buyer restraining the beneficiary from enforcing the liability under the letter of indemnity executed by the banker which was absolute and upon a demand being made by the beneficiary the bank became liable to honour the same, regardless of any controversy between the parties i.e. the appellant who is the buyer, and respondent No. 1, the sellers, as to whether the contract of sale had been performed.

2. Briefly stated, the facts are that the appellant, the buyer, covenanted to purchase and respondent No. 1 Messrs Vinmar Impex Inc., Singapore, the sellers, agreed to sell and supply 100 M.T. of High Density Polythene Powder called HDPE @$ 565 per M.T. CIF, Calcutta on an irrevocable letter of credit being opened by the appellant in favour of respondent No. 1, the sellers. One of the terms of the contract as per the letter of intent