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14) The contention of Shri J.P.Pendse, the learned Counsel for the respondent no.1, is that the preamble of the Bank Guarantees clearly indicate that the contract of the Bank Guarantees in question, is a conditional and contingent contract depending upon the fulfillment of the conditions specified therein.

According to him, there should be a demand in writing stating that there is a specified amount which is due and payable by the respondent no.1 for the reason of the failure/negligence in performing the terms and conditions contained in the contract by the respondent no.1. Referring to the letter dated 17.2.2011, impugned in the Special Civil Suit No.236 of 2011, he has urged that there is nothing on record to show that any amount is due and payable by the respondent no.1 to the appellant for the reason of .....17/-

20) Section 31 of the Indian Contract Act, 1872, defines the contingent contract and the same is reproduced below--

Chapter III : OF CONTINGENT CONTRACTS "Section 31. "Contingent contract"

defined.- A "contingent contract" is a contract to do or not to do something, if some event, collateral to such contract, does or does not happen."

Section 32 of the said Act, deals with the enforcement of the contracts contingent on an event happening, and the same is also relevant hence, .....28/-

0609ao85.11.odt reproduced below--

"Section 32. Enforcement of contracts contingent on an event happening.--

Contingent contracts to do or not to do anything if an uncertain future event happens, cannot be enforced by law unless and until that event has happened.

Till happening of an event, it merely remains a contract which is unenforceable. In case of such contingent contract, the beneficiary has no unfettered right to invoke the Bank Guarantees and to demand immediate payment. The terms of such contract .....29/-

0609ao85.11.odt will have to be strictly construed and if it prescribes the manner in which performance is to be claimed, it will have to be seen as to whether the performance is claimed, in the manner so prescribed.