M/S ADANI AGRI FRESH LTD Vs. MAHABOOB SHARIF & ORS
Supreme Court of India (Division Bench (DB)- Two Judge)
Appeal (Civil), 14015 of 2015, Judgment Date: Dec 07, 2015
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL No.14015 OF 2015
(Arising out of SLP(C)No.9506 of 2014)
M/S ADANI AGRI FRESH LTD .......APPELLANT
VERSUS
MAHABOOB SHARIF & ORS ......RESPONDENTS
J U D G M E N T
JAGDISH SINGH KHEHAR, J.
1. Leave granted.
2 The appellant – M/s Adani Agri Fresh Ltd. (hereinafter referred
to as `M/s AAFL') is a supplier of fruit and vegetables. It entered into a
contractual agreement with M/s RMS Fruits and Company (hereinafter referred
to as `M/s RMSFC'), a wholesale dealer in fruits, whose proprietor is one
Mahaboob Sharif (respondent No.1 herein). For securing payment in lieu of
the products supplied by the appellant to respondent No.1 - M/s RMSFC, the
appellant required respondent No.1 to furnish bank guarantees, whereby the
appellant would be entitled to recover the proceeds of the products,
transported by it to M/s RMSFC. Three such registered bank guarantees
constitute the basis of the controversy in hand. The said bank guarantees
were executed by the State Bank of Mysore on 24.12.2010, 09.02.2011 and
10.02.2011. The terms of the bank guarantees being identical, reference to
one will be sufficient for all intents and purposes. Relevant clauses of
the first bank guarantee are being extracted hereunder:
“NOW THE GUARANTOR HEREBY IRREVOCABLY AND UNCONDIOTIONALLY GUARANTEES
as follows, irrespective of the validity and legal effects of the
agreement, if any entered between the parties and waiving all rights of
objection and defense arising there from, that the Guarantor shall pay any
amount up to the maximum amount of guarantee mentioned herein below, upon
the AAFL first demand to the AAFL in the event that the whole seller fails
to perform its understanding under any agreement or terms and conditions
contained in the consignment order and/or sale invoice, or by any reason of
whole seller failure to make the reimbursement thereof to the AAFL, in
time.
1. The Guarantee shall come into effect upon offer of delivery by the
transport agent of AAFL to whole seller at the invoiced address, to the
whole seller account any consignment and/or sale order after the date of
execution of this guarantee deed.
2. The Guarantor shall immediately pay at Gurgaon, Haryana(India)
favouring M/s.Adani Agri Fresh Limited at the request of AAFL, without any
demur and without any recourse merely on demand standing that the amount
demanded is due and payable by the whole seller to AAFL.
3. Notwithstanding any dispute or difference at any time subsisting
between whole seller and yourself concerning the supply of product
mentioned above or otherwise, however and notwithstanding any suit or other
proceedings that may have been instituted by either party, a sum of
Rs.15,00,000/- or such lower sums or sums as may demand in writing if the
said whole seller fails to pay to you the amounts due as per your record.
We irrevocably agree that a certificate issued by AAFL that the said sum or
any part thereof if payable to you shall be accepted by us as a conclusive
evidence and binding on us by such amount having become payable to you and
that immediately, such a certificate is furnished by you duly signed by any
of your official of Senior Manager or above grade payment of such demand
shall be made to you by us.
4. The guarantee shall not be impaired or discharged by any changes that
may hereafter take place in your constitution or in the constitution of
whole seller. This guarantees shall be in addition to and without prejudice
to any other securities or remedies, which AAFL may now have or hereafter
possess and you shall be under no obligation to marshal in our favour any
such security or any funds or assets that you may be entitled.
5. We, the guarantor hereby waive the necessity of the AAFL demanding
the said debt from the whole seller before presenting us with the demand.
6. AAFL shall have the fullest liberty under the guarantee deed to
extend, from time to time of the performance by the whole seller and that
the guarantor also waives any right of notice etc., in this regard.
7. Notwithstanding anything contained herein:
a) Our liability under this bank guarantee shall not exceed
Rs.15,00,000/- (Rupees Fifteen Lakhs only);
b) This bank guarantee shall be in full force until 23.12.2011.
c) We are liable to pay the guaranteed amount or any part thereof under
this bank guarantee only and only if the AAFL seves upon us a written
claim, either by way registered letter, courier, fax copy of delivered by
hand by an authorized agent of the AAFL and make demand there under on or
before 23.12.2011.
d) We further undertake and agree that this guarantee shall not be
revoked during its currency except with your previous consent in writing.
Signature and seal of the guarantor”
(Emphasis is ours)
A perusal of the terms of the bank guarantee reveals, that the same was an
unconditional guarantee, and that, the guarantor expressly waived off
rights of any objection and defence, irrespective of the disputed positions
adopted by the contracting parties, or even, the validity and legal effects
of the contractual agreement. Under the bank guarantees, the appellant –
M/s AAFL would first make a demand/claim for the payment in lieu of fruits
transported to respondent No.1, and in case respondent No.1 failed to
reimburse the consideration, the appellant had the right to make a demand
from the guarantor, for the above payment. Actually the above stated claim
of consideration from M/s RMSFC in the first instance, was also
unnecessary, in view of paragraph 5 of the bank guarantee extracted above,
which clearly provides that it would not be necessary for M/s AAFL for
demanding the consideration from the wholesaler – M/s RMSFC, before
presenting the demand to the guarantor – State Bank of Mysore. The
aforesaid demand in terms of the bank guarantee was to be made on the basis
of a demand/claim at the hands of M/s AAFL indicating the despatch of
goods, and the amount payable in lieu thereof. Thereupon, the guarantor was
to make the payment of the amount claimed, immediately without any demur,
and without any recourse. On the receipt of such a certificate of the
outstanding amount(s), the bank guarantee(s) would stand invoked forthwith,
notwithstanding any suit or proceedings, that may have been instituted by
one or the other party, with reference to the contractual obligations.
3. It is the case of the appellant, that the appellant issued an
“Outstanding Certificate” seeking payment, on account of despatch of fruit
to M/s RMSFC. The outstanding debt indicated therein was, for a sum of
Rs.62,32,328/- (Rupees sixty two lakhs thirty two thousand three hundred
and twenty eight only). Consequent upon the aforesaid demand being not
honoured by respondent No.1, the bank guarantee was sought to be invoked,
through the aforesaid “Outstanding Certificate” dated 31.05.2011, which is
being extracted hereunder:
“Outstanding Certificate
This is to certify that M/s. R.M.S. Fruit & Co., Mysore has the
outstanding debit balance of Rs.62,32,328/- (Sixty Two Lakhs Thirty Two
Thousand Three Hundred Twenty Eight Only) in our books towards supply of
Fruit to them during last year.
Thanking you,
Yours truly,
For Adani Agrifresh Limited
Sd/-
Authorized Signatory”
4. In order to wriggle out the aforesaid bank guarantee(s),
respondent No.1 – M/s RMSFC, filed O.S.No.991 of 2011 before the Civil
Judge (Junior Division), Mysore with inter alia the following prayer:
“Wherefore the plaintiff humbly prays this Hon’ble Court be pleased
to pass a judgment and decree in favour of the plaintiff and against the
defendants for permanent injunction, restraining 1st and 2nd defendant’s
bank for paying any schedule guarantee amount to the 3rd defendant, until
and unless the claim of plaintiff and 3rd defendant is settled amicably or
through court of law. Or in the alternative restraining the 3rd defendant
from receiving the said amount from the 1st and 2nd defendant bank until
and unless the matter has been settled amicably or through court between
plaintiff and 3rd defendant with court cost and such other appropriate
reliefs as the Hon’ble Court deems fit to grant in the circumstances of the
case in the interest of justice and equity.
SCHEDULE
Guarantee amount available in State Bank of Mysore, Shivarampet
Branch, Vinoba Road, Mysore guarantee no.3/10-11 date of issue 24.12.2010
and date of expiry 23.12.2011 and extension guarantee No.04/2010-2011
(Original guarantee No.04/2009-10) and renewed period from 10.02.2011 to
09.02.2012 and another guarantee No.05/2010-11 and date of issue 09.02.2011
and date of expiry 08.12.2011.”
5. The trial court passed the following interim order after entertaining
the above-said suit, on 10.08.2011:
“ORDER
IA No.2 filed by the applicant/plaintiff under Order XXXIX Rule 1 and
2 r/w Section 151 of the CPC, is hereby allowed, conditionally.
The defendants 1 and 2 banks are hereby restrained from making
payment of schedule amount to the 3rd defendant till the disposal of the
suit either amicably or judiciously between the plaintiff and the 3rd
defendant subject to following conditions:
The Plaintiff shall extend the Bank guarantee executed through the
defendants 1 and 2 in favour of the 3rd defendant for every six months,
till disposal of the suit; after expiry of the period under the Guarantee
No.5/10-11 from the period 10.2.2011 to 9.2.2012.
In case, the plaintiff fails in this suit, the plaintiff shall compensate
the defendant No.3 by paying interest at the rate of 18% p.a. on the total
value of goods to the 3rd defendant from the date of suit till the disposal
of the suit.
No order as to costs.”
6. The aforesaid order was affirmed, by the Additional Senior
Civil Judge, Mysore, on a challenge raised thereto, on 13.09.2011. Even the
High Court of Karnataka, where the appellant preferred W.P.No.4654 of 2012,
did not interfere with the interim order. The order passed by the High
Court on 16.12.2013, dismissing the above-mentioned writ petition, is
subject matter of challenge at the hands of the appellant before this
Court.
7. As a proposition of law, learned counsel for the appellant has
placed vehement reliance on a number of judgments of this Court, we would
refer to only two of them, which would suffice the purpose. In this behalf,
reference may first be made to U.P.Cooperative Federation Ltd. vs. Singh
Consultants and Engineers (P) Ltd., (1988) 1 SCC 174, where-from our
attention was invited to the following observations :
“27. 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 a 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.
28. I am, however, of the opinion that these observations must be
strictly considered in the light of the principle enunciated. It is not
the decision that there should be a prima facie case. In order to restrain
the operation either of irrevocable letter of credit or of confirmed
letter of credit or of bank guarantee, there should be serious
dispute and there should be good prima facie case of fraud and special
equities in the form of preventing irretrievable injustice between
the parties. Otherwise the very purpose of bank guarantees would be
negatived and the fabric of trading operation will get jeopardised.
xxx xxx xxx
43. The argument for the respondent is attractive but it seems to
overlook the basic nature of the case. The basic nature of the case
relates to the obligations assumed by the bank under the guarantees given
to UPCOF Ltd. If under law, the bank cannot be prevented by SCE(P) Ltd
from honouring the credit guarantees, the UPCOF Ltd. also cannot be
restrained from invoking the guarantees. What applies to the bank must
equally apply to UPCOF Ltd. Therefore, the
frame of the suit by not impleading the bank cannot make any difference in
the position of law. Equally, it would he futile to contend that
the court was justified in granting the injunction since it has found
a prima facie case in favour of the SCE(P) Ltd. The question of
examining the prima facie case or balance of convenience does not arise
if the court cannot interfere with the unconditional commitment made by the
bank in the guarantees in question.
xxx xxx xxx
54. The Court, however, should not lightly interfere with the operation
of irrevocable documentary credit. I agree with my learned brother
that in order to restrain the operation of the irrevocable letter
of credit, performance bond or guarantee, there should be serious dispute
to be tried and there should be a good prima facie acts of fraud. As Sir
John Donaldson M.R. said in Bolivinter oil SA v. Chase Manhattan Bank &
ors. [1984] 1 All E.R.351 at 352:
"The wholly exceptional case where an injunction may be granted
is where it is proved that the bank knows that any demand for payment
already made or which may thereafter be made will clearly be fraudulent.
But the evidence must be clear, both as to the fact of fraud and as to
the bank's knowledge. It would certainly not normally be sufficient
that this rests on the uncorroborated statement of the
customer, for irreparable damage can be done to a bank's credit in the
relatively brief time which must elapse between the granting of such an
injunction and an application by the bank to have it discharged."
55. From the above discussion, what appears to me is this: The sound
banking system may, however require more caution in the issuance of
irrevocable documentary credits. It would
be for the banks to safeguard themselves by other means and generally
not for the court to come to their rescue with injunctions unless
there is established fraud. In the result, this appeal must be
allowed. The judgment and order of the Allahabad High Court dated February
20, 1987 must be set aside and the order of learned Civil Judge,
Lucknow dated August 8, 1986 restored.”
(Emphasis is ours)
8. Reliance was also placed on Vinitec Electronics Private Ltd.
vs. HCL Infosystems Ltd., (2008) 1 SCC 544. The following observations have
been recorded in the above judgment:
“11. The law relating to invocation of bank guarantees is by now
well settled by a catena of decisions of this Court. The bank guarantees
which provided that they are payable by the guarantor on demand is
considered to be an un-conditional bank guarantee. When in the course of
commercial dealings, unconditional guarantees have been given or accepted
the beneficiary is entitled to realize
such a bank guarantee in terms thereof irrespective of any pending
disputes. In U.P. State Sugar Corporation vs. Sumac International Ltd.,
this Court observed that :
12. The law relating to invocation of such bank guarantees is by now well
settled. When in the course of commercial dealings an unconditional bank
guarantee is given or accepted, the beneficiary is entitled to realize such
a bank guarantee in terms thereof irrespective of any pending disputes.
The bank giving such a
guarantee is bound to honour it as per its terms irrespective of any
dispute raised by its customer. The very purpose of giving such a bank
guarantee would otherwise be defeated. The courts should, therefore, be
slow in granting an injunction to restrain the realization of such a bank
guarantee. The courts have carved out only two exceptions. A fraud in
connection with such
a bank guarantee would vitiate the very
foundation of such a bank guarantee. Hence if there is such a fraud of
which the beneficiary seeks to take advantage, he can be restrained from
doing so. The second exception relates to cases where allowing the
encashment of an unconditional bank guarantee would result in irretrievable
harm or injustice to one of the parties concerned. Since in most cases
payment
of money under such a bank guarantee would
adversely affect the bank and its customer at whose instance the guarantee
is given, the harm or injustice contemplated under this head must be of
such an exceptional and irretrievable nature as would override the terms of
the guarantee and the adverse effect of such an injunction on commercial
dealings in the country. The two grounds are not necessarily connected,
though both may coexist in some cases.
12. It is equally well settled in law that bank guarantee is an
independent contract between bank and the beneficiary thereof. The bank is
always obliged to honour its guarantee as long as it is an unconditional
and irrevocable one. The dispute between the beneficiary and the party at
whose instance the bank has given the guarantee is immaterial and of no
consequence. In BSES Limited vs. Fenner India Ltd. this Court held :
10. There are, however, two exceptions to this rule. The first is when
there is a clear fraud of which the Bank has notice and a fraud of the
beneficiary from which it seeks to benefit. The fraud must be of an
egregious nature as to vitiate the entire underlying transaction. The
second exception to the general rule of non-intervention is when there are
`special equities' in favour of injunction, such as when `irretrievable
injury' or `irretrievable injustice' would occur if such an injunction were
not granted. The general rule and its exceptions has been reiterated in so
many judgments of this Court, that in U.P. State Sugar Corpn. V. Sumac
International Ltd.(1997) 1 SCC 568 (hereinafter `U.P. State Sugar Corpn')
this Court, correctly declare that the law was `settled'.
13. In Himadri Chemicals Industries Ltd. V. Coal Tar Refining Company,
this court summarized the principles for grant of refusal to grant of
injunction to restrain the enforcement of a bank guarantee or a letter of
credit in the following manner :
“14...(i) While dealing with an application for injunction in the course
of commercial dealings, and when an unconditional bank guarantee or
letter of credit is given or accepted, the Beneficiary is entitled to
realize such a bank guarantee or a letter of credit in terms thereof
irrespective of any pending disputes relating to the terms of the contract.
(ii) The bank giving such guarantee is bound to honour it as per its terms
irrespective of any dispute raised by its customer.
(iii) The courts should be slow in granting an order of injunction to
restrain the realization of a bank guarantee or a letter of credit.
(iv) Since a bank guarantee or a letter of credit is an independent and a
separate contract and is absolute in nature, the existence of any dispute
between the parties to the contract is not a ground for issuing an order of
injunction to restrain enforcement of bank guarantees or letters of credit.
(v) Fraud of an egregious nature which would vitiate the very foundation
of such a bank guarantee or letter of credit and the beneficiary seeks to
take advantage of the situation.
(vi) Allowing encashment of an unconditional bank Guarantee or a Letter of
Credit would result in irretrievable harm or injustice to one of the
parties concerned.
14. In Mahatama Gandhi Sahakra Sakkare Karkhane vs. National Heavy Engg.
Coop. Ltd and anr., this Court observed :
“If the bank guarantee furnished is an
unconditional and irrevocable one, it is not open to the bank to raise any
objection whatsoever to pay the amounts under the guarantee. The person in
whose favour the guarantee is furnished by the
bank cannot be prevented by way of an injunction from enforcing the
guarantee on the pretext that the condition for enforcing the bank
guarantee in terms of the agreement entered into between the parties has
not been fulfilled. Such a course is impermissible. The seller cannot
raise the dispute of whatsoever nature and prevent the purchaser from
enforcing the bank guarantee by way of injunction except on the ground of
fraud and irretrievable injury.
What is relevant are the terms incorporated in the guarantee executed
by the bank. On careful analysis of the terms and conditions of the
guarantee in the present case, it is found that the guarantee is an
unconditional one. The respondent, therefore, cannot be allowed to raise
any dispute and prevent the appellant from encashing the bank guarantee.
The mere fact that the bank guarantee refers to the principle agreement
without referring to any specific clause in the preamble of the deed of
guarantee does not make the guarantee furnished by the bank to be a
conditional one.
xxx xxx xxx
24. The next question that falls for our consideration is as to whether
the present case falls under any of or both the exceptions, namely, whether
there is a clear fraud of which the bank has notice and a fraud of the
beneficiary from which it seeks to benefit and another exception whether
there are any “special equities” in favour of granting injunction.
25. This Court in more than one decision took the view that fraud, if
any, must be of an egregious nature as to vitiate the underlying
transaction. We have meticulously examined the pleadings in the present
case in which no factual foundation is laid in support of the allegation of
fraud. There is not even a proper allegation of any fraud as such and in
fact the whole case of the appellant centers around the allegation with
regard to the alleged
breach of contract by the respondent. The plea of fraud in the appellants
own words is to the following effect:
“That despite the respondent, HCL being in default of not making payment as
stipulated in the bank guarantee, in perpetration of abject dishonesty and
fraud, the respondent, HCL fraudulently invoked the bank guarantee
furnished by the applicant and sought remittance of the sums under the
conditional bank guarantee from the Oriental Bank of Commerce vide letter
of invocation dated 16.12.2003.”
26. In our considered opinion such vague and indefinite allegations made
do not satisfy the requirement in law constituting any fraud much less the
fraud of an egregious nature as to vitiate the entire transaction. The
case,therefore does not fall within the first exception.
27. Whether encashment of the bank guarantee would cause any
“irretrievable injury” or “irretrievable injustice”. There is no plea of
any special equities by the appellant in its favour. So far as the plea of
“irretrievable injustice” is concerned the appellant in its petition merely
stated:
“That should the respondent be successful in implementing its evil design,
the same would not only amount to fraud, cause irretrievable injustice to
the applicant, and render the arbitration nugatory and infructuous but
would permit the respondent to take an unfair advantage of their own wrong
at the cost and extreme prejudice of the applicant.”
(Emphasis is ours)
9. Based on the judgments rendered by this Court more
particularly, the judgments referred to hereinabove, it was the vehement
contention of the learned counsel for the appellant, that the terms and
conditions of a “Deed of Guarantee” could not be injuncted from being given
effect to, on the basis of the principle adopted in determining “prima
facie case”, “balance of convenience” and “irreparable loss”, which are the
usual parameters on the basis whereof injunctions are granted. Insofar as
the injunction of an unconditional bank guarantee is concerned, it was
submitted, that the same could be granted only if the court was satisfied
about the commission of a flagrant fraud, at the hands of one or the other
contracting parties, or alternatively if the Court was satisfied that an
irreparable injury or some irretrievable injustice would be caused to the
concerned party.
10. Insofar as the present controversy is concerned, the defence of
respondent No.1 is entirely based on a communication dated 14.01.2011,
stated to have been addressed by the appellant to respondent No.1. The
aforesaid communication, which constitutes the basis of the defence of
respondent No.1, is extracted hereunder:
“ADANI
AGRIFRESH LIMITED
14th January, 2011
To
Mr.Mahaboob Shariff,
M/s R.M.S.Fruits & Co.,
# 1875, Anesarui Street,
Behind Deveraja Market,
Mysore 50 001
Sub : Settlement of amount
Sir,
We inform you that, our settlement talk held at Mysore,
regarding destroyed and damage of 8(eight) Loads of Apples supplied to you,
four firm agreed to receive 1/4th value of total value. Hence, you are
directed to send the amount in installments as agreed after we supplying
Apple load as earlier.
Sincerely Yours,
Sd/-
Authorised Signatory
Seal”
In addition to the relying on the above communication (dated 14.01.2011),
it was the vehement contention of the learned counsel representing
respondent No.1 that respondent No.1 – M/s RMSFC had tendered and enclosed
photographs depicting rotten and damaged apples, which were allegedly
despatched by the appellant to respondent No.1. It was the submission of
the learned counsel for respondent No.1, that the veracity of the aforesaid
photographs, was not disputed by the appellant, before the trial court.
11. It is not possible for us to determine the veracity or
truthfulness of the defence raised by respondent No.1. The aforesaid shall
emerge only on the culmination of the proceedings initiated by respondent
No.1 before the Civil Court. At the present juncture, we are only
concerned with the injunction of the three bank guarantees, referred to
hereinabove, the invocation whereof was injuncted, not only by the trial
court, but also by the appellate court, and the same was thereafter
maintained even by the High Court.
12. During the course of hearing, learned counsel for the appellant
candidly submitted, that the communication dated 14.01.2011 relied upon by
respondent No.1 in its defence, is a fabricated and doctored document,
which was never executed by the appellant. The position adopted by the
rival parties lead us to record the following conclusions. Firstly, that
the concerned bank guarantees, are clearly unconditional. This is apparent
from the extracts thereof, reproduced above. Secondly, the veracity and
truthfulness of defence of respondent No.1 – M/S RMSFC, based on the
communication dated 14.01.2011, cannot be opined on at the present
juncture, and will have to await the final outcome of the civil suit filed
by M/s RMSFC at Mysore. Thirdly, M/s RMSFC has not levelled any
allegations of the commission of a flagrant fraud by M/s AAFL, for
engineering the invocation of the bank guarantees executed by the State
Bank of Mysore. Fourthly, no submissions have been advanced on behalf of
M/s RMSFC to establish, that the invocation of the bank guarantees would
lead to an irreparable injury or some irretrievable injustice. The instant
eventuality is therefore ruled out.
13. In deciding the present controversy, we will therefore have to
adopt the principles laid down by this Court in U.P.Cooperative Federation
Ltd. vs. Singh Consultants and Engineers (P) Ltd. (supra), and in Vinitec
Electronics Private Ltd. vs. HCL Infosystems Ltd.(supra). Having given our
thoughtful consideration to the law laid down by this Court, in respect of
grant/refusal of an injunction of an unconditional bank guarantee, and
keeping in mind the terms and conditions, more particularly of the
contractual conditions extracted and narrated above, we are satisfied that
the courts below were not justified in injuncting the invocation of the
three bank guarantees, executed by the State Bank of Mysore, at the
instance of M/s RMSFC. We accordingly hereby direct respondent Nos.2 and 3
– the State Bank of Mysore to honour the same forthwith.
14. While accepting the claim raised by the appellant as has been
recorded by us in our conclusions hereinabove, it is also imperative for us
to record, that we had required the learned counsel representing the
appellant, to obtain instructions from the appellant, whether or not the
appellant was truthful in describing the communication dated 14.01.2011 as
fabricated and doctored. In case, the appellant had accepted it to be
genuine, we would have permitted the bank guarantees to be invoked, for the
reimbursement of 1/4th of the total value of the goods, in consonance with
the communication dated 14.01.2011. Having obtained instructions, learned
counsel for the appellant states, that the express and specific stance of
the appellant, that the communication dated 14.01.2011 (extracted above) is
actually fabricated and doctored, and was never sent or executed by the
appellant – M/s AAFL to respondent No.1 – M/s RMSFC. In view of the
position adopted by the appellant on express instructions, we consider it
just and appropriate to further record, that in case the statement made to
this Court on behalf of the appellant is not found to be correct, on the
culmination of the proceedings initiated by respondent No.1, it shall be
open to respondent No.1 – M/s RMSFC to initiate civil and criminal
proceedings against the appellant, as may be permissible in accordance with
law.
15. We are satisfied in granting liberty to respondent No.1 - M/s
RMSFC, to suitably amend the plaint, so as to mould the relief in order to
claim whatsoever is due to respondent No.1, under the contractual
obligations with the appellant, in consonance with law.
16. The appeal is disposed of in the above terms.
.........................J.
(JAGDISH SINGH KHEHAR)
.........................J.
(R. BANUMATHI)
NEW DELHI;
DECEMBER 2, 2015.
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