U.P. Co-Operative Federation Ltd vs Singh Consultants & Engineers (P) Ltd on 19 November, 1987
16. Now the only question is as to whether the observation made by the Supreme Court in the case of U.P. Co-operative Federation Ltd. v. Singh Consultants and Engineers (P) Ltd., , is applicable in the facts and circumstances of the present case. One distinguishing feature in the present case from the facts of the aforesaid Supreme Court case is the bank guarantee given in the present case is out of the agreement entered into between the petitioner and the respondent. Further in this case it is the case of the respondent that whatever required to be done under the contract for which the guarantee was given has been done by the respondent and, therefore, there is no question of enforcing the bank guarantee. It is true that as to whether the supply by the respondent is proper or not, whether the error in work done as per the contract or not, the decision of the petitioner Karkhana is final on that point but in spite of the foresaid clause since to show that the respondent has performed its part of the contract as per the terms of the contract, the respondent is relying on the document furnished by the petitioner and, therefore, in such facts and circumstances of the case if injunction is not given and the petitioner is allowed to enforce the Bank guarantee, the same will amount to deriving unjust enrichment to the petitioner which the aforesaid Supreme Court case also considered as one of the exceptions to the general rule that no injunction should be given against the irrevocable bank guarantee.