The court emphasized the independence and unconditional nature of bank guarantees, while recognizing exceptions such as fraud, irretrievable injustice, or special equities.

JUDGMENT

Chandra Dhari Singh, J. The instant petition has been filed on behalf of the Petitioner seeking urgent intervention of this Court for restraining the Respondent from invocation/encashment of the Petitioner's Bank Guarantee under Section 9 of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as "the Act") and praying for the following reliefs:

"(i) Direct the Respondent to deliver up Bank Guarantee bearing No. 05BG091 dated 25.01.2006, issued by Canara Bank for a sum of Rs.26,13,51,850/- (Rs.Twenty-Six Crores Thirteen Lakhs Fifty-One Thousand Eight Hundred Fifty Only) to the Petitioner in view of the Respondent having not paid to the Petitioner a sum of Rs.360.30 Crores which has already been adjudicated upon by 5 Arbitral Awards in Respondents of the Project.

(ii) In the alternative, restrain the Respondent by way of an order and injunction, from encashing/invoking or taking any precipitative steps or receiving any monies under the Bank Guarantee of the Petitioner bearing No. 05BG091 dated 25.01.2006, issued by Canara Bank for a sum of Rs.26, 13,51,850/- (Rs.Twenty-Six Crores Thirteen Lakhs Fifty-One Thousand Eight Hundred Fifty Only), for the Project as per Contract dated 10.05.2006 along with Agreement dated 03.12.2014, during the pendency and until conclusion of the petitions under Section 34 of the Act;

(iii) Pass ad interim and interim ex parte reliefs in terms of prayer (i)-(ii) above;

(iv) Order costs of the Petition to be borne by the Respondent; and

(v) Pass such further and other reliefs as a nature and circumstances of the case may require."

FACTUAL MATRIX

2. The Petitioner is a Company incorporated under the Indian Companies Act, 1913 having its Registered Office at Hincon House, Lal Bahadur Shastri Marg, Vikhroli (W), Mumbai-400083.

3. The Respondent (formerly known as National Hydroelectric Power Corporation Limited) is a Public Sector Enterprise incorporated and registered under the Companies Act, 1956 having its Registered Office at NHPC Office Complex, Sector-33, Faridabad, Haryana and also at 2, Pragati Bhawan, Jai Singh Road, New Delhi.

4. The Respondent was desirous of setting up a 160 MW Hydroelectric Power Project in the state of West Bengal, known as Teesta Low Dam H.E. Project. On 19.01.2006, the Petitioner's bid for the "Construction of Diversion Arrangement, Concrete Gravity Dam along with Spillway, Roller Compacted Concrete (RCC) Dam, Intake Structure, Surface Power House, Tail Race Channel, Switch Yard and other associated Civil Works of Teesta Low Dam H.E. Project, Stage IV" (hereinafter referred to as "the Project") was accepted by the Respondent for a contract price of Rs.395.90 crores by issuing the Letter of Acceptance.

5. On 10.05.2006, the contract agreement was signed and formally executed between the parties, and the date of commencement was agreed to be 01.05.2006. The originally stipulated time of completion was reckoned at 41 months. However, the work could not be completed till the scheduled completion date of 30.09.2009 and came to be finally completed on 29.02.2016. Meanwhile, there were a series of arbitral disputes that arose between the parties which led them to enter into several arbitral proceedings. Claims and counter-claims of the parties were adjudicated and the Awards therein came to be subsequently challenged by both of the parties as per the findings therein.

6. In due course, the Petitioner approached this Court seeking the aforesaid reliefs and this Court partly restrained the Respondent, under Section 9 of the Act from invoking the Petitioner's Bank Guarantee, directing the Respondent to inter alia provide one week's notice before invoking the same.

7. On 20.05.2014, the Respondent terminated the contract vide letter of termination issued on 26.05.2014 which, as per the statements made by the counsels, was stayed by the Calcutta High Court in Writ Petition bearing W.P.(C) No. 15740/2014 with direction to Respondent to revisit the termination.

8.