RELIANCE SALT LTD Vs. COSMOS ENTERPRISES

JUDGEMENT

(1.) Leave granted.

(2.) The 1st respondent herein was appointed as a Consignment Agent by an agreement dated 23-12-1993 in regard to the sale of products of the appellant-company-plaintiff, namely, Salt and Tea in South and Central Bihar. In terms of the said agreement it was required to furnish a Bank guarantee for a sum of Rs. 5 lakhs. The transactions between the parties started in January, 1994. Some of the clauses in the said Bank guarantee are as under :

(3.) Pursuant to or in furtherance of the agreement entered into by and between the parties herein, the 1st respondent furnished a Bank guarantee of Rs. 5 lakhs issued by respondent No. 2, Bank of India, Muradpur, Chouhatta Branch, Patna on 12-1-1994.