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DELHI HIGH COURT
VIBHU BAKHRU
BSP - SHC (JV) – Appellant
Versus
Dedicated Freight Corridor Corporation of India Limited – Respondent
| Table of Content |
|---|
| 1. factual background of the case (Para 1 , 2 , 3 , 4 , 5 , 6 , 7) |
| 2. petitioner's claims and arguments regarding delays (Para 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15) |
| 3. court's analysis of bank guarantees and fraud (Para 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26) |
| 4. dismissal of the petition (Para 27) |
| 5. conclusion and order (Para 28) |
JUDGMENT
[Hearing held through video conferencing]
Vibhu Bakhru, J. (Oral)--The petitioner has filed the present petition under Section 9 of the Arbitration and Conciliation Act, 1996 (hereafter `the A&C Act'), inter alia, praying as under:
"i. In view of the above facts and circumstances mentioned hereinabove, it is most respectfully prayed that the Hon'ble Court may graciously be pleased to allow the present petition and restraint by way of injunction the Respondent No. 1 from invoking and encashing the following Bank Guarantees:
(i) Performance bank Guarantee No. 0767ILG004020 dated 14.08.2020 amounting to Rs.1,59,88,000/- issued by Respondent No. 2.
(ii) Bank Guarantee No. 0767ILG004220 dated 24.08.2020 amounting to Rs.2,56,39,000/- deposited in lieu of release of Security Deposit.
(iii) Bank Guarantee No. 0767ILG001519 da
The court reinforced that unconditional bank guarantees cannot be restrained unless egregious fraud or irretrievable injustice is established, which was not proven by the petitioner.
Bank guarantees cannot be interdicted on account of contractual disputes between the parties, and exceptions for interdicting bank guarantees include cases of egregious fraud and irretrievable injust....
A party seeking to restrain the invocation of a bank guarantee must demonstrate either clear fraud or irretrievable injustice; mere contractual disputes do not suffice for injunctions.
Bank guarantees can be invoked regardless of disputes, unless fraud or irretrievable harm is clearly established.
Bank guarantees cannot be interdicted due to contractual disputes unless fraud or irretrievable injustice is established.
A confirmed Bank Guarantee/irrevocable Letter of Credit cannot be interfered with unless there is established fraud or irretrievable injustice involved in case.
Unconditional bank guarantees may only be reviewed for egregious fraud or irretrievable injustice; disputes over contract performance must be resolved through arbitration.
Bank guarantees are independent and unconditional contracts, and courts should refrain from interfering with their invocation unless exceptional circumstances such as fraud or irretrievable injury ar....
Bank guarantees can only be interdicted in exceptional circumstances such as fraud or irretrievable injustice. Mere contractual disputes do not give rise to special equities for interdicting a bank g....
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