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DELHI HIGH COURT
C.HARI SHANKAR
World Window Infrastructure Pvt. Ltd. – Appellant
Versus
Central Warehousing Corporation – Respondent
| Table of Content |
|---|
| 1. details of rfp and contractual obligations (Para 3 , 4 , 5 , 6 , 7) |
| 2. payment history and escalation clause impact (Para 8 , 9 , 10 , 11 , 12 , 13) |
| 3. invocation of force majeure and contractual performance (Para 17 , 18 , 19 , 20) |
| 4. court's assessment of injustice and fraud in bank guarantee invocation (Para 21) |
| 5. judgment reasoning on contractual obligations and force majeure (Para 27 , 28 , 30 , 32 , 33) |
JUDGMENT
1. This appeal, under Section 37 (2)(b) of the Arbitration and Conciliation Act, 1996 ("the 1996 Act") challenges orders dated 17th June, 2020 and 15th August, 2020, passed by the learned arbitrator on applications preferred by the appellant M/s World Window Infrastructure and Logistics Pvt. Ltd. under Section 17 of the 1996 Act.
2. The appellant had, in fact, filed three applications before the learned arbitrator under Section 17 , on 21st May, 2020, 18th June, 2020 and 26th June, 2020. The application dated 18th June, 2020 was, later, withdrawn. The orders impugned adjudicate the applications dated 21st May, 2020 and 26th June, 2020.
Facts
3. On 26th April, 2004, the respondent, Central Warehousing Corporation (CWC) issued a Request for Proposal
Point of Law : Non-payment of escalation - Issue of whether the circumstances in which the appellant was placed, entitled him to plead force majeure, or not, is a pure question of fact.
Invocation of an unconditional bank guarantee cannot be restrained unless fraud or irretrievable injustice is established; the nature of bank guarantees is independent and absolute.
Courts should not interfere with the invocation or payment under an unconditional bank guarantee unless there is egregious fraud or special equity.
Bank guarantees cannot be interdicted due to contractual disputes unless fraud or irretrievable injustice is established.
Bank guarantees can be invoked regardless of disputes, unless fraud or irretrievable harm is clearly established.
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