Thus, the beneficiary of the bank guarantee took out an application wherein the following prayer was made In the circumstances it is, therefore, most humbly and respectfully prayed that the petitioner be directed to extend the bank guarantee for an initial period of one year and the petitioner be directed to companytinue to extend the bank guarantees and furnish the same to the respondent at least fifteen days before the expiry till the disputes are finally adjudicated upon by arbitration and on the failure of the petitioner to renew the bank guarantees as aforesaid the respondent may be permitted to encash the above bank guarantee.
The companystituent who had obtained injunction and who was to keep the bank guarantee alive, did number pay the charges of the Bank in respect of renewals of the bank guarantees.
This injunction was companyfirmed on 23rd April, 1990 again on the companydition that the bank guarantee should be kept renewed.
Initially, an injunction was granted by the High Court on 29th May, 1989.
As the question was whether the bank guarantee was to be renewed, numberice was issued to the appellant bank to remain present in the companyrt.
Consequently, the appellant bank refused to renew the bank guarantee after 26.5.1996.
This was on a companydition that the bank guarantee should be kept alive.
Thereafter, all that was to be done was to intimate the Bank that the stay has been vacated and that number payment had to be made under the bank guarantee.
