RAMPUR ENGINEERING COMPANY LIMITED Vs. NTPC

JUDGEMENT

(1.) The appellant seeks a direction that the respondent No. 1 NTPC should not realise and respondent No. 2 Canara Bank should not pay the amount under the Bank Guarantee No. 10 of 1990.

(2.) The appellant furnished a Bank guarantee of Rs. 20 lakhs in connection with supply of steel with NTPC on loan/returnable basis, in 1990. The Bank guarantee was valid initially till 30th June, 1990. It appears that subsequently it has been extended from time to time. The relevant terms of the Bank guarantee are as under:

(3.) The respondent No. 1 supplied steel against account and they were charging interest also as is evident from Annex. 1 at p. 6 in the list of documents. According to the appellants, only a sum of Rs. 3,47,000.00 was due. According to NTPC, a sum of Rs. 19,07,176.00 was due towards interest and Rs. 10,30,245.00 was due towards the value of the steel.