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DELHI HIGH COURT
VIBHU BAKHRU, AMIT MAHAJAN
Container Corporation of India Ltd. – Appellant
Versus
Shivakriti International Ltd. – Respondent
| Table of Content |
|---|
| 1. introduction of appeal and initial orders (Para 1 , 2) |
| 2. background of contractual obligations and disputes (Para 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11) |
| 3. legal standards for enjoining bank guarantee invocation (Para 12 , 13 , 14) |
| 4. court's findings on special equities and fraud (Para 15 , 16 , 17 , 18 , 19) |
| 5. sustainability of the learned judge's order (Para 20 , 21 , 22 , 23 , 24) |
| 6. final orders and disposition of the appeal (Para 25 , 26 , 27 , 28 , 29) |
JUDGMENT
Vibhu Bakhru, J. (Oral)--The appellant has filed the present appeal impugning an ex-parte order dated 12.03.2021 passed by the learned District Judge, inter alia, directing that the status quo be maintained in respect of the Performance Bank Guarantee no. 3178120BG0000192 dated 21.08.2020 and the Security Deposit Bank Guarantee No.3178120BG0000272 dated 06.10.2020 (hereafter `the PBG' and `SDBG' respectively).
2. Respondent no.1 (M/s Shivakriti International Ltd. - hereafter `SIL') filed a suit, inter alia, praying for a decree of permanent injunction restraining the appellant (hereafter `Concor') from invoking and encashing the PBG and SDBG. SIL further sought a decree of permanent injunction restraini
Encashment of unconditional bank guarantees is permissible unless accompanied by established fraud or irremediable injustice; financial difficulties do not justify injunctions against such guarantees....
The main legal point established in the judgment is that unconditional bank guarantees cannot be interdicted except in cases of established fraud or irretrievable harm to one of the parties. Financia....
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 - Bank guarantee cannot invoke - Bank guarantees cannot be interdicted on account of disputes between parties and any allegation that respondent has been reluctant to join proceedings for an ami....
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....
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....
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....
Bank guarantees are independent contracts and should be honored as per their terms, and any dispute between the parties does not affect the invocation of the bank guarantee.
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