O.M.P. (I) (COMM.) 158/2021 Page 1 of 14

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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O.M.P.(I) (COMM.) 158/2021

KUBER ENTERPRISES

..... Petitioner

Through Mr Tarkeshwar Nath, Advocate.

versus

DOOSAN POWER SYSTEMS INDIA

PVT LTD

..... Respondent

Through

CORAM:

HON'BLE MR. JUSTICE VIBHU BAKHRU

[Hearing held through videoconferencing]

VIBHU BAKHRU, J. (ORAL)

IA Nos. 6495/2021, IA 6496/2021

1.

Allowed, subject to all just exceptions.

O.M.P.(I) (COMM.) 158/2021

2.

The petitioner has filed the present petition under Section 9(1)

of the Arbitration and Conciliation Act, 1996 (hereinafter the „A&C

Act‟), inter alia, praying as under:-

“i)

Direct the Respondent not to invoke

and/or encash the Performance Bank

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O.M.P. (I) (COMM.) 158/2021 Page 2 of 14

Guarantees No. 003GT02180720033 of

Rs. 1,18,75,000/- dated 13.03.2018. till

further orders;

ii)

Direct the Respondent not to encash the

HDFC bank cheque bearing No. 000209

amounting to Rs. 1,18,75,000/- till

further orders;

iii)

Restrain the Respondent from taking

any coercive steps against the Petitioner

in relation to the Contract dated

27.12.2017.”

3.

Mr Nath, learned counsel appearing for the petitioner has,

essentially, stressed on two reliefs. First, that this Court should restrain

the invocation of the bank guarantee in question (Performance Bank

Guarantee No. 003GT02180720033 of ₹1,18,75,000 –hereinafter „the

Bank Guarantee‟); and second, that the respondent be directed not to

encash the cheque furnished by the petitioner (Cheque bearing No.

000209 amounting to ₹1,18,75,000/-) till further orders.

4.

On 27.12.2017, the parties had entered into an Agreement

(Contract No: DPSI-HO-Jawa-15 –hereafter „the Agreement‟)

whereby the respondent sub-contracted CHS Civil Works of

Jawaharpur Super Thermal Power Station (2 x 660 MW Project) to the

petitioner. In terms of Clause 9.1 of the Agreement, the petitioner

furnished the Bank Guarantee as a Performance Guarantee. The

petitioner claims that it also issued a cheque for an equivalent value.

5.

Clause 9.1 of the Agreement is relevant and set out below:-

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O.M.P. (I) (COMM.) 158/2021 Page 3 of 14

“9.1 Performance Bond

a)The Subcontractor shall submit to the Contractor

as a guarantee of the faithful performance of the

obligations under this Subcontract and a guarantee

of the quality of Works and materials provided by

the Subcontractor, an unconditional Performance

Bond acceptance to the Contractor In the following

manner

Performance Bank Guarantee equivalent to

Two point Five percent (2.5%) of Contract

Value.

In leu of Performance Bank Guarantee

equivalent to Two point Five percent (2.5%)

of Contract Value, Signed Cheque without

date equivalent to Two point Five percent

(2.5%) of Contract Value and Five Percent

payment hold from progressive payment.

Contractor shall return the cheque and hold

amount

once

Subcontractor

submits

Performance Bank Guarantee equivalent to

Two point Five percent (2.5%) of Contract

Value.

The Performance Bond shall expire after expiry

date of Warranty Period as defined in Clause 12

[WARRANTY] in this Sub-contract. Such guarantee

shall be binding notwithstanding any variations,

alterations or extensions of time that may be given

or be agreed upon. No interest shall be paid for this

bond.

b)The Performance Bond shall be provided by a first

class bank of the Country at Contractor‟s

2021:DHC:1645

O.M.P. (I) (COMM.) 158/2021