HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH ?AFR Court No. - 4 Case :- MISC. BENCH No. - 11063 of 2015 Petitioner :- Chief Engineer (Planning) U.P.Power Corp.Ltd.Lko.And Anr. Respondent :- Reserve Bank Of India Dbod Thru Its Governor And Ors.' Counsel for Petitioner :- Rajiv Srivastava Counsel for Respondent :- Amit Jaiswal Hon'ble Amreshwar Pratap Sahi,J.
Hon'ble Attau Rahman Masoodi,J.
The U.P. Power Corporation is before this Court praying for a mandamus to the Reserve Bank of India and its authorities to take action against the respondent No. 4 ? Axis Bank Ltd. on the complaint filed by the petitioner. The additional prayers are to release and pay the bank guarantee amount of Rs. 9 Crores with interest as the petitioners had invoked the bank guarantee as per the terms and conditions thereof dated 24.9.2012.
Sri Rajiv Srivastava, learned counsel for the petitioners has vehemently argued that the respondent - Axis Bank contrary to the guidelines of the Reserve Bank of India shifted the claim expiry date and made it expire on the same date till the date of extension of the bank guarantee which was contrary to the intention as indicated in the original bank guarantee where a period of one month was provided for between the expiry date and the claim expiry date. He submits that by making the dates common in the subsequent extension bank guarantee documents the respondent Bank has tried to manipulate the withholding of the payment of the bank guarantee to the petitioners inspite of it having been invoked in accordance with law.
This according to Sri Srivastava has been done with a view to facilitate M/s NSL Bank Nagapatnam Power and Infratech Pvt. Ltd. with whom the petitioner corporation had negotiated and agreed to purchase electricity and whose bank guarantee is in question.
Sri Rajiv Srivastava has invited the attention of the Court to the Master Circular of the Reserve Bank of India dated 1st July, 2013 relating to guarantees and coacceptances to contend that the guidelines clearly provide for ensuring and securing the interest of government departments in particular for honouring bank guarantees without delay as and when they are invoked.
In the instant case the specific documents which are on record indicate that the original bank guarantee did provide for one month period between expiry date and the claim expiry date, but when the same was extended as is evident from the documents filed as Annexure 4 and 5 to the petition, the date of extension and the claim expiry date was mentioned as the same date.
Sri Srivastava submits that the said dates amounted to a material alteration by the respondent bank which was contrary to the tenor of the original bank guarantee which provided one month period in between for invoking the bank guarantee.
Sri Srivastava therefore submits that the petitioner being a public corporation, this matter deserves to be enquired into and the bank should be compelled to honour and invoke the bank guarantee as desired by the petitioner which was within the period of one month of the date of extension under the extended guarantee.
The dispute to our mind is therefore clearly confined to the mentioning of the claim expiry date in the extended bank guarantee being the same as the date of extension i.e. 22.8.2013. The petitioner invoked the bank guarantee admittedly thereafter on 27.8.2013. The bank refused to do so in their reply which they have given to the petitioner, on their representation through their legal representative, clearly stating that the fact of the dates being same was well known to the petitioner in advance, inasmuch as, the extension of bank guarantee was intimated to the petitioner on 14.2.2013 and 17.5.2013 expressly, which is not disputed by the petitioner.
The petitioner is now questioning the correctness of the said dates giving an explanation that the petitioner in good faith had not noticed the said material alteration made in the dates which was contrary to the tenor of the original bank guarantee.
Learned counsel for the respondent no. 4 ? Axis Bank, Sri Amit Jaiswal has vehemently opposed the petition contending that the petitioner cannot be permitted now to raise this plea as the petitioner had knowledge well in advance when the bank guarantee was extended and was having full knowledge of the said dates. The petitioner has subsequently tried to wriggle out of the same on a projected ground that the petitioner had not noticed the said alleged alteration in good faith.
It is therefore urged that in view of this admitted position that the said dates were dully communicated under the extension documents the aforesaid plea cannot be a matter of complaint to the Reserve Bank of India under the guidelines on which reliance has been placed.
It is further submitted that the said guidelines in the shape of a master circular dated 1st of July, 2013 itself provides that the bank guarantee has to be honoured in accordance with the terms of the guarantee deed unless there is a court order restraining the bank from doing so.
Learned counsel for the bank therefore submits that admittedly the invocation was attempted after expiry of the said period and consequently the reply given by the respondent bank as per Annexure 12 justifies not to act as per the wishes of the petitioner.
As noticed above the extension of the bank guarantee was known to the petitioners. In our considered opinion, if the petitioners are questioning the interpretation of the terms and conditions of the extension date and the claim expiry date being contrary to the original bank guarantee then the same is clearly a disputed question of fact as this will require leading of evidence and establishing as to whether the intention of the parties was otherwise. Secondly, the plea of the petitioner that the petitioner in good faith did not notice the said material alteration, which is different from the original bank guarantee is also a question of fact which the respondent bank is entitled to contest. This will also require leading of evidence and therefore whether the master circular in its general terms as indicated above comes to the aid of the petitioners or to the aid of the respondent bank would be dependent on the establishment of such facts. The alleged good faith plea of not having noticed this alleged material alteration can also be possibly an act of undue diligence on the part of the officials of the petitioner corporation who were entrusted to look into and deal with the same. The power corporation should therefore also have made an enquiry as to who were the officials who may be responsible for any such negligence or otherwise of having not noticed the said material alteration so as to take timely action. A mere allegation without any bonafide action on the part of the power corporation cannot by itself be a presumption of such bonafides on the part of the officials which fact is also subject to evidence.
Consequently in view of the terms and conditions relating to any dispute arising out of the bank guarantee being subject to the court's order at Lucknow having exclusive jurisdiction, we find this case to be clearly a matter which can be subjected to a civil suit for an effective and proper decision. The writ jurisdiction under Article 226 of the Constitution of India is not the appropriate remedy on the facts of the present case. The relief therefore prayed for cannot be entertained for the aforesaid reasons.
The writ petition is dismissed without prejudice to the rights of the petitioner corporation to proceed appropriately and avail of any such remedy that might be available to them and take appropriate action in accordance with law. Any observations on facts made hereinabove are only for the purpose of not entertaining this petition at this stage for the reasons above and does not amount to any adjudication on the merits of the case.
Order Date :- 1.12.2015 sahu