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U.P. Co-Operative Federation Ltd vs Singh Consultants & Engineers (P) Ltd on 19 November, 1987 cites

Texmaco Ltd. vs State Bank Of India And Ors. on 12 May, 1978

I may notice that in India, the trend of law is on the same line In the case of Texmaco Ltd. v. State Bank of India and others, A.I.R. 1979 Calcutta 44, one of us (Sabyasachi Mukharji) held that in the absence of special equities arising from a particular situation which might entitle the party on whose behalf guarantee is given to an injunction restraining the bank in performance of bank guarantee and in the absence of any clear fraud, the Bank must pay to the party in whose favour guarantee is given on demand, if so stipulated, and whether the terms are such have to be found out from the performance guarantee as such. There the Court held that where though the guarantee was given for the performance by the party on whose behalf guarantee was given, in an orderly manner its contractual obligation, the obligation was undertaken by the bank to repay the amount on "first demand" and 'without contestation, demur or protest and without reference to such party and without questioning the legal relationship subsisting between the party in whose favour guarantee was given and the party on whose behalf guarantee was given," and the guarantee also stipulated that the bank should forthwith pay the amount due notwithstanding any dispute between the parties," it must be deemed that the moment a demand was made without protest and contestation, the bank had obliged itself to pay irrespective of any dispute as to whether there had been performance in an orderly manner of the contractual obligation by the party.
Calcutta High Court Cites 7 - Cited by 46 - S Mukharji - Full Document

Arul Murugan Traders vs Rashtriya Chemicals And Fertilisers ... on 29 March, 1984

Our attention was also drawn to the judgment of the learned single Judge of the Madras High Court in Arul Murugan Traders v. Rashtriya Chemicals and Fertilizers Ltd. Bombay and another, A.I.R. 1986 Madras 161 where the learned Single Judge expressed the opinion that there was no absolute rule prohibiting grant of interim injunction relating to Bank guarantees and in exceptional case courts would interfere with the machinery of irrevocable obligations assumed by banks, and that the plaintiff must establish prima facie case, meaning thereby that there is a bona fide contention between the parties or serious question to be tried and further the balance of convenience was also a relevant factor. If the element of fraud exists, then courts step in to prevent one of the parties to the contract from deriving unjust enrichment by invoking bank guarantee. In that case the learned Single Judge came to the conclusion that the suit involved serious questions to be tried and particularly relating to the plea of fraud, which was a significant factor to be taken into account and claim for interdicting the enforcement of bank guarantee should have been allowed.
Madras High Court Cites 8 - Cited by 11 - Full Document

The State Trading Corporation Of India ... vs The Commercial Tax Officer, ... on 26 July, 1963

Consequently, in such a case, the party on whose behalf guarantee was given was not entitled to an injunction restraining the bank in performance of its guarantee It appears that special equities mentioned therein may be a situation where the injunction was sought for to prevent injustice which was irretrievable in the words of Lord Justice Danckwerts in Elian and 1140 Rabbath (Trading as Elian & Rabbath) v. Matsas and Matsas & Ors. (supra).
Supreme Court of India Cites 81 - Cited by 170 - B P Sinha - Full Document
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