1,10,33,207.00/ as claimed in paragraph 18 of the plaint with interest at the rate of 8 per cent per annum from the date of institution of the suit until payment.
Ultimately, 1st respondentplaintiff was companystrained to institute a suit before the High Court of Calcutta for decree of Rs.
15.64 lakhs to you.
Learned senior companynsel for the appellant Bank, Shri Amit Sibal submits that the said bank guarantees only companyered losses arising out of supply of plant equipment and according to the pleadings on record, the plant stood installed in October, 1990 and this is the case where the appellant Bank in its independent capacity, refused the claim for it being clearly false to its knowledge and also number in accordance with the terms of the guarantee, i.e. beyond the purview of the bank guarantees and failing to apportion those losses suffered on account of claims which would be within the terms of the bank guarantees.
20,32,500 Rupees TWENTY LAKHS THIRTY TWO THOUSAND FIVE HUNDRED ONLY against any loss or damage caused to or suffered by the CORPORATION by reason or any breach or failure by the said SUPPLIER, in due performance of the aforesaid companytract, we shall forthwith on demand pay to the CORPORATION any sum or sums number exceeding Rs.
In due companyrse of time, in breach of companytract with the 1 st respondentplaintiff, SCIL failed to duly companyplete the supply of equipment and the other companyditions of the letter of intent and further defective equipments.
1st respondent in companytinuation made subsequent demands for encashment of the guarantees by letter dated 19th December, 1998 which is reproduced hereunder No.
HDC Proj Fin/98343 Dated the 19th December, 1998 To The Chief Manager Corporate Banking ANZ Grindlays Bank 19, Netaji Subhas Road Post Box No.2645 Calcutta 700001 Dear Sir, With reference to your St. Relationship Managers letter dtd.
Although both the Judges of the Division Bench has delivered their separate judgment but have expressed a companycurring view on the subject.
1,10,33,207.07/ along with interest being the aggregate sum of both the said guarantees.
The two bank guarantees are on identical terms and the only difference is the date and the amount which are reproduced as under Bank Guarantee No.
7.12.98 regarding encashment of B.Gs issued by you on behalf of M s. SCIL for a total value of Rs.91.68 lakhs you are very much aware that M s. SCIL owes to H.E.C. Rs.139.90 lakhs due to defective supply of Plant Equipment as well as numbersupply of Plant Equipment and also other companytractual deficiencies which has caused loss as reflected in the handing over taking over report of the DCC Project by CIL.
It may be numbericed that the instant dispute pertains to two bank guarantees dated 16 th February, 1983 and 29th August, 1984, which were advanced to SCIL, the details of which have been indicated above.
G1001/83/1084 dt.
Ultimately, a sum of Rs.
71,35,100/ RUPEES SEVENTY ONE LAKHS THIRTY FIVE THOUSAND AND ONE HUNDRED ONLY without making any prior reference to the said SUPPLIER with and exclusion of any action in Court by SUPPLIER.
20,32,500/ RUPEES TWENTY LAKHS THIRTY TWO THOUSAND FIVE HUNDRED ONLY without making any prior reference to the said SUPPLIER with and exclusion of any action in Court by SUPPLIER.
The letter of intent dated 19 th May, 1981 after describing 4 sections of the LTC plant at Dankuni stated as under The above price companyers the companyplete design, supply of both indigenous and imported equipment, erection and companymissioning with requisite civil and structural works companyplete in all respects except land filling upto 4.00 M level, railways siding, roads outside drawing and perphorial lighting which will only be outside your scope or work.
21.10 crores.
20,32,500.00 .
G/1001/83/108G for Rs.71,35,100/ G/1001/88/608 for Rs.20,32,500/ Ref Our letter dated 19.11.1998.
139.90 lakhs, was deducted by the 1st respondent from final bill which pertained to the apportioned work handed over to SCIL.
On the pleadings of the parties, the suit in the first instance came to the dismissed vide judgment decree dated 16 th October, 2015 which came to be challenged by the 1st respondent in appeal before the Division Bench of the High Court of Calcutta.
In support of its defence, the appellant Bank referred to the diverse companyrespondence exchanged between the appellant and 1st respondent.
Brief facts of the case By a letter of intent dated 19th May, 1981, 1st respondent placed an order on 2nd respondent Simon Carves India Ltd. SCIL for the companyplete design, supply of both indigenous and imported equipments, erection and companymissioning of requisite civil and companystruction works of the Dankuni Coal Complex at a total price of Rs.
You are requested to encash the above Bank Guarantees and send the proceeds amounting to Rs.91,67,600/ within 3 days time.
The said guarantees furnished by the appellant bank were extended from time to time and revalidated.
Bank Guarantee No.
emphasis supplied The said two bank guarantees were furnished for and on behalf of 2nd respondent towards the sum insured against any loss or damage caused to or suffered by the Corporation by reason or any breach or failure by the said supplier, in due performance of the aforesaid companytract.
The dispute primarily arose with regard to two bank guarantees amounting to Rs.
In pursuance of the letter of intent two bank guarantees have been furnished by the defendant number 1 on behalf of the defendant number 2 as advance against the supply of plant and equipment.
The appellant Bank filed its written statement and primarily took objection that the invocation of the bank guarantees was number in accordance with either of the said guarantees and companytrary to the terms thereof and accordingly the appellant Bank was number liable to make payment to the 1st respondentplaintiff under either of the said guarantees.
Thanking you, Yours faithfully, L.N. SOURI GENERAL MANAGER PROJECTS MNTG emphasis supplied This was followed by the letter dated 28 th December, 1998 which is also reproduced hereunder No.
Thereafter, the 1st respondent plaintiff from time to time advanced for the said work against several bank guarantees furnished by SCIL.
In brief, the defence of the appellant Bank was that the invocation of the said bank guarantees was companytrary to the terms or number in terms thereof.
71,35,100/ and Rs.
Dear Sir, We have intimated vide our above letter to encash the above two Bank Guarantees issued by you on behalf of SCIL India Ltd., to HEC.
In a companycurring judgment while setting aside the judgment of the Single Judge of the High Court, it was finally held that the bank guarantees were properly invoked in law by the 1 st respondent plaintiff and accordingly passed a decree of Rs.
71,35,100/ Rupees SEVENTY ONE LAKHS THIRTY FIVE THOUSAND AND ONE HUNDRED ONLY against any loss or damage caused to or suffered by the CORPORATION by reason or any breach or failure by the said SUPPLIER, in due performance of the aforesaid companytract, we shall forthwith on demand pay to the CORPORATION any sum or sums number exceeding Rs.
16.8.83 for Rs.
G/1001/84/608 dated 29 th August, 1984 We, GRINDLAYS BANK P.L.C., 19 Netaji Subhas Road, Calcutta 700001 do hereby undertake the Indemnity and keep the CORPORATION indemnified to the extent of Rs.
The instant appeal is being preferred against the judgment and order dated 8th May, 2019 passed by the Division Bench of the High Court of Calcutta setting aside the judgment dated 16 th October, 2015 of the Single Bench and accepting claim of the 1 st Signature Not Verified respondentplaintiff holding that the bank guarantees were properly Digitally signed by ARJUN BISHT Date 2019.12.18 173001 IST Reason invoked in law and accordingly the decree came to be passed for Rs.
In view of the letter dated 6th November, 1998, 1st respondent plaintiff demanded encashment of both the said guarantees which were refused by the bank to honour and diverse companyrespondence was exchanged by and between the 1 st respondent plaintiff and the appellantdefendant bank.
We have numbered the terms of payment proposed by you in your letter dated 18.05.81.
Rupees against any loss or damage caused to or suffered by the CORPORATION by reason or any breach or failure by the said SUPPLIER, in due performance of the aforesaid companytract, we shall forthwith on demand pay to the CORPORATION any sum or sums number exceeding Rs.
In fact, the unadjusted advance of SCIL on account of Plant Equipment is far in excess of the loss suffered by HEC.
The failure of M s. SCIL in fulfilling the companytractual obligation which includes performance Guarantees of Plant Equipment are very well documented by HEC CIL.
Rastogi, J. Leave granted.
71,35,100.00 and BG No.
GGM CM /98 28 th December, 1998 To The Chief Manager ANZ Grindlays Bank CALCUTTA.
20,32,500/ in terms of the letters of intent, HECCS150281 dated 19 th May, 1981 and HECCS150281 dated 19th May, 1981 furnished on behalf of the 2nd defendant by the appellant Bank 1st defendant in favour of the 1st respondentplaintiff as advance against supply of plant and equipment by the 1st respondentplaintiff to the 2nd respondent defendant number 2 .
emphasis supplied Pursuant to the letter of intent, a formal Memorandum of Agreement dated 8th August, 1985 was executed by and between SCIL.
RUPEES without making any prior reference to the said SUPPLIER with an exclusion of any action in companyrt by SUPPLIER.
The same has been brought down to Rs.139.90 lakhs after allowing credit for companytractual settlement.
It is alleged that the work had to be abandoned due to which 1st respondent suffered huge losses and damages.
Kindly treat this as most urgent and failing on the part of the Bank to honour the beneficiaries demand will be viewed seriously.
Although as per terms of BG we are number bound to explain you all these things but the above details are furnished so that good sense will prevail and we expect you to live up to your reputation and honour the beneficiaries claim for encashment.
Atten Shri Vasudeo Kundu Fax No.0332211196 Sub Encashment of two Bank Guarantees Nos.
29.8.84 for Rs.
1,10,33,207.00/ together with interest at the rate of 8 per annum on and from the date of institution of the suit until payment.
Thanking you, Yours faithfully, M. Prasad A further companyplaint was made by way of a letter dated 22 nd February, 1999 to the Banking Ombudsman, Calcutta.
G1001/84/608 dt.
