Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Bank Guarantee |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Dismissed |
Headnote | Bank Guarantee - Invocation of - Contract between parties - One of the parties furnishing Bank Guarantee in favour of the other Guarantor seeking injunction of invocation of the Guarantee as there existed a dispute between the contracting parties - Permissibility of - Held: In the facts of the case, the Guarantee was an unconditional one - Hence the same could be invoked by the beneficiary despite pendency of the dispute - Bank Guarantee is an independent contract between the Bank and the beneficiary - bank is obliged to honour its guarantee so long as it is unconditional and irrevocable - The case also does not fall under exceptions - Allegations of fraud and plea of 'special equities' are vague and not supported by any evidence.Appellant entered into agreement with the respondent whereby respondent agreed to buy UPS systems from the appellant. Despite supply of all the equipments, respondent defaulted in making the full payment. Respondent agreed to pay the balance sum provided the performance Bank Guarantee of 10% value was furnished. The same was furnished. It was later amended making the same unconditional. Even after furnishing the Bank Guarantee, respondent did not make full payment. Appellant filed injunction application on the ground that respondent was not entitled to invoke the Bank Guarantee without paying the balance amount as the same had become inoperative as the condition precedent for is invocation was not complied with. Trial Court in view of the fact that the Bank Guarantee was made unconditional by its amendment, dismissed the application. Division Bench of High Court confirmed the order. Hence the present appeal. |
Judge | Hon'ble Mr. Justice B. Sudershan Reddy |
Neutral Citation | 2007 INSC 1124 |
Petitioner | Vinitec Electronics Private Ltd. |
Respondent | Hcl Infosystems Ltd. |
SCR | [2007] 11 S.C.R. 897 |
Judgement Date | 2007-11-02 |
Case Number | 5121 |
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