M/S. Bgr Energy Systems Limited vs Hinudustan Petroluem ...
2023 Latest Caselaw 1777 AP

     THE HON'BLE SRI JUSTICE RAVI NATH TILHARI

            WRIT PETITION No. 8096 of 2023

JUDGMENT:

1) The present Writ Petition is moved by way of "Lunch

Motion".

2) Heard Sri. A. Satya Prasad, learned Senior Counsel

assisted by Sri. Prakash Buddarapu, learned Counsel for

the Petitioner and Sri. Sreekanth Reddy Ambati, learned

Standing Counsel for the Respondent Nos. 1 and 2.

3) The petition was filed challenging the letter, dated

29.03.2023, of the 2nd Respondent - the Hindustan

Petroleum Corporation, Visakh Refinery, Malkapuram,

Visakahpatnam, to the 3rd Respondent - State Bank of

India, invoking the bank guarantee.

4) Challenging the aforesaid letter, Sri. A. Satya Prasad,

learned Senior Counsel, submits that the Respondent

Nos.1 and 2 could not invoke the bank guarantee in view of

Clause 12.3 of the "General Terms and Conditions of

Works Contract", which provided that, "the Owner on

termination of such contract shall have the right to

appropriate the security deposit, retention money and invoke

the bank guarantee furnished by the Contractor and to

appropriate the same towards the amounts due and payable

by the Contractor as per the conditions of the contract and

return to the Contractor the excess money, if any, left over".

5) Submission of the learned Senior Counsel is that,

'Termination of Contract' is the condition precedent for

invoking the bank guarantee but there was no termination

of contract, though notices were given intimating

'termination of the contract', as one of the proposed

actions, for which the negotiations were going on.

6) Sri. Sreekanth Reddy Ambati, learned Standing

Counsel, submits that, the contract has been terminated

on 29.03.2023, and, thereafter, the bank guarantee was

invoked. He has placed a copy of 'Termination of Contract,

dated 29.03.2023', a copy of which has also been given to

the learned Counsel for the Petitioner. The same is taken

on record.

7) In view of the aforesaid, the submission as advanced

by the learned Senior Counsel, based on Clause 12.3 of the

General Terms and Conditions of Work Contract, has no

substance.

8) Accordingly, the Writ Petition is dismissed.

9) However, it is open to the Petitioner to seek

appropriate remedy in appropriate forum as may be

advised.

No order as to costs.

Pending miscellaneous petitions, if any, shall stand

closed in consequence.

________________________ RAVI NATH TILHARI, J

Date: 31.03.2023 SM/BSM

THE HON'BLE SRI JUSTICE RAVI NATH TILHARI

WRIT PETITION NO. 8096 OF 2023

Date: 31.03.2023

SM/BSM