SYNDICATE BANK Vs. ALLAHABAD BANK

JUDGEMENT

(1.) THE appeal is directed as against the interim Order dated 18.2.2003 passed by the Tribunal to pay the admitted amount of guarantee as admitted by the appellant Syndicate Bank. THE interim Order was passed on the ground that the appellant Syndicate Bank admitted the amount of guarantee as the Syndicate Bank executed guarantee for the amount and the Syndicate Bank is required to fulfil the obligation in terms of guarantee.

(2.) It is the case of the respondent Allahabad Bank that the Syndicate Bank has issued two Bank guarantees BG No. 34/1989 & BG No. 35/1989 in favour of the 2nd defendant M/s. Dhanalakshmi Consolidates Industries Ltd., Chennai, guaranteeing payment of Rs. 1,25,00,000/- (BG No. 34/1989) and also guaranteeing payment of a further sum of Rs. 3,75,00,000/- (BG No. 35/89) to the 2nd defendant and both these guarantees were executed by the Syndicate Bank on 29.4.1989 but the Bank Guarantee BG No. 34/89 stands discharged as the lease rentals due under it were paid of by the Syndicate Bank, So, there remains only the Bank guarantee bearing BG No. 35/89 and the interim decree is passed by the DRT on the ground that the Syndicate Bank admitted the fact that the 2nd defendant M/s. Dhanalakshmi Consolidates Industries Ltd., Chennai, assigning its rights under Bank guarantee bearing No. 35/89 in favour of the plaintiff M/s. Allahabad Bank issued notice of assignment to the plaintiff Bank in the present TA. It is also stated that the Syndicate Bank conveyed its acceptance to the said assignment by its letter dated 3.5.1989.

(3.) COUNSEL for the Syndicate Bank submitted that there is no admitted liability and the Syndicate Bank never admitted to pay the amount under the guarantee and there is no admitted liability at all and the interim decree passed is not proper and the PO, DRT-1 can pass a well considered Order in the OA after considering all the aspects and the interim decree passed is not sustainable.