IVRCL LTD Vs. IOT UTKAL ENERGY SERVICE LTD

JUDGEMENT

(1.) BY this petition, petitioner seeks injunction in respect of the bank guarantee issued by IndusInd Bank, Secunderabad branch dated 4th June 2010 for the sum of Rs.52,58,33,000/ on behalf of the petitioner in favour of the respondent under clause 14.3.1 of the contract towards mobilization advance given by the respondent to the petitioner.

(2.) THE bank guarantee was due to expire on 23rd November 2012. Since the petitioner did not renew the bank guarantee before 23rd November 2012, the respondent by its application dated 22nd November 2012 invoked the said bank guarantee by addressing a letter to the bank and demanded payment in respect thereof. The petitioner vide its letter dated 20th November 2012 to the respondent contended that as the work had been completed to the extent of 96.14% which according to the petitioner was substantial completion of work, further extension of bank guarantee was not required and requested the respondent to return the same. The respondent not having returned the bank guarantee, petitioner filed this petition under Section 9 and seeks injunction in respect thereof.

(3.) RELYING upon this clause, the learned counsel submits that the petitioner had already completed work to the extent of 96.14% and thus, in view of the petitioner completing substantial completion of work, respondent was liable to return the performance of bank guarantee and could not have applied for invocation thereof. In the alternative, it is submitted that another bank guarantee of Rs.10.97 crore has already been furnished by the petitioner by way of performance guarantee which is still valid and subsisting and lying with the respondent. The learned counsel submits that in view of clause 14.3.1, respondent thus, cannot insist for payment under the said bank guarantee.