YOG SYSTEMS INDIA LTD Vs. SU-KAM POWER SYSTEMS LTD
HIGH COURT OF DELHI
Yog Systems India Ltd
Su-Kam Power Systems Ltd
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SANJIV KHANNA,J -
(1.) THE present appeal is directed against the Order dated 29th August, 2006 passed by the learned Single Judge restraining the appellant-M/s. Yog Systems India Limited from encashing the bank guarantee and
confirming ex-parte ad-interim injunction dated 6th July, 2006 till
disposal of the suit. The said suit has been filed by the
respondent-M/s.Su-Kam Power Systems Limited. Learned Single Judge
accepted the case of the respondent that the appellant had played fraud
inasmuch as he had attempted to invoke the bank guarantee on a false
pretext without supplying the goods.
(2.) ON 26th May, 2006, the appellant had sent quotation to the respondent for supply of 5000 transformers. The quotation records that the supply
would be made on Free on Board basis at Baddi, Himachal Pradesh within
one week from the date of the purchase order. The place of delivery
mentioned in the purchase order was Baddi, Himachal Pradesh, where the
factory of the respondent is located. It is further stated in the
quotation that local transport at Baddi, Himachal Pradesh would be on
buyer's account. The quotation required that payment for the material
shall be made within 7 days and secured against a bank guarantee.
Thereafter, a purchase order dated 26th May, 2006 was placed on the appellant by the respondent for supply of 5000 transformers on various
dates stipulated therein. The supply order specifically mentions that the
delivery was to be made at Baddi, Himachal Pradesh and mode and time of
payment was stipulated as against delivery. The total value of the supply
order was Rs. 57,20,000/-. There is also another Purchase Order dated
26th May, 2006 for the same number of transformers i.e. 5000 pieces, for the same value. The said Purchase Order, however, in supplier's reference
refers to Rev-01 dated 12th June, 2006. As per the said Purchase Order
delivery was to be made at Baddi, Himachal Pradesh and the mode and terms
of payment as stipulated required payment within ten days from the date
of lorry receipt.
(3.) A bank guarantee dated 26th May, 2006 for Rs. 60,00,000/- was issued by Standard Chartered Bank at the request of the respondent in favour of
the appellant. The said bank agreed to pay to the appellant in case of
default, refusal, denial, disputes raised due to failure of the buyer to
make the payment as per agreed terms. The relevant recital in the bank
guarantee reads as under:-
"WHEREAS M/s Yog Systems India Ltd. having its Registered office at DELHI at 4A, Ramchandra Lane, Civil Lines, Delhi - 110054 hereinafter for the sake of brevity referred to as "the SELLER" (which expressions shall include its successors in interest and assigns) AND M/s Su-Kam Power Systems Ltd., a public Limited Company and having its Registered Office at WZ-1401/2, Nangal Raya, New Delhi-110046 and Corporate Office of Business at Plot No.196-C, Udyog Vihar Ph- VI, Sector-37, Gurgaon hereinafter for the sake of brevity referred to as ?the Buyer? (which expressions shall include all its existing Partners/Directors and there respective successors in interest and heirs and executors as the case may be) have agreed to trade transformer worth Rs. 60,00,000/- (Rs.Sixty Lakhs over a period of time in staggered delivery schedule for which necessary Purchase Orders will be placed on the Seller from time to time, the Seller is agreeable to accept Bank Guarantee for Rs. 60,00,000/- (Rupees Sixty Lakhs Only) as security for the Buyer's obligation to make the payments as per the agreed terms and at the request of the Buyer we Standard Chartered Bank, H-2, Connaught Place, New Delhi-110001 (hereinafter referred to as ?THE BANK?) have agreed to issue a guarantee in favour of the Seller." ;
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