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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
G. S. Kulkarni, Advaith M. Sethna, JJ
Qatar National Bank Alahli – Appellant
Versus
Man Industries (India) Limited – Respondent
JUDGMENT :
1. This appeal is directed against an ex-parte order dated 9 February 2023 passed by the learned Single Judge on interim application (L) No.31678 of 2023 filed in the Commercial Suit in question. By the impugned order, the learned Single Judge has granted an ex parte injunction in terms of prayer clause (a) and (b) of this application. The relief as granted by the impugned order in terms of prayer clause (a) and (b) is required to be noted which reads thus:
“(a) That this Hon’ble Court be pleased to pass appropriate orders granting ex-parte stay on the invocation by respondent no. 1 dated 7 November, 2023 of the Bid Bond/Performance Guarantee (Exhibit X).
(b) That the Hon’ble Court be pleased to pass an ex-parte order of temporary injunction restraining the respondent no. 2 by themselves and/or through their branches or howsoever otherwise in any manner whatsoever from making payment on the Bid Bond/Performance Guarantee and/or cause further costs and expenses to be incurred by the applicant.”
2. At the outset, we may observe that a coordinate Bench of this Court considering the fact that the impugned order was an ex parte order by its order dated 9 February 2024 disposed of
A bank guarantee is an independent contract, and injunctions against its invocation require clear evidence of fraud or irretrievable injustice, which were not established in this case.
An ex-parte injunction on a bank guarantee is impermissible unless egregious fraud or irretrievable injustice is established; the bank guarantee is an independent contract governed by its terms.
A bank guarantee is an independent contract, and courts will not interfere with its execution unless there are exceptional circumstances such as fraud or irretrievable injustice.
Courts should not interfere with the invocation or payment under an unconditional bank guarantee unless there is egregious fraud or special equity.
The court clarified that injunction against unconditional bank guarantees requires proof of egregious fraud, irretrievable injustice, or special equities, none of which were sufficiently substantiate....
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