9911796707
TMI Blog2003 (8) TMI 367X X X X Extracts X X X X X X X X Extracts X X X X ..... s "Montari Industries Ltd." on credit basis. To ensure due payment of the price of the goods a Bank Guarantee dated 9/12th September, 1994 for an amount not exceeding Rs. 50 lakhs was furnished to the plaintiff by the defendant bank. This Bank guarantee was irrevocable. Defendant undertook to pay the amount due without any demur on the demand of the plaintiff as and when Montari Industries Ltd. failed to pay the amount of invoices within 30 days. The said Bank Guarantee was extended from time to time and the last extension was upto 7th September, 2000. 3. When M/s. Montari Industries failed to pay the amount of the invoices raised by the plaintiff within 30 days the plaintiff invoked the Bank Guarantee vide letter dated 29th May, 2000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ff is required to obtain clearance from the Government of India or the Committee constituted under the directions of the Government of India before the filing of the suit. 5. I have heard learned counsel for the defendant-applicant and learned counsel for the plaintiff. 6. Learned counsel for the defendant has referred to section 22 of the SICA to contend that after its amendment in the year 1994 no suit for the recovery of money or a suit for the enforcement of any security or guarantee in respect of any loan or advance granted to sick company can be instituted and proceeded further except with the consent of the Board or the Authority, as the case may be. Learned counsel for the plaintiff, however, contends that the bar created by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d no suit for the recovery of money or for the enforcement of any security against the industrial company or of any guarantee in respect of any loans or advance granted to the industrial company shall lie or be proceeded with further, except with the consent of the Board or, as the case may be, the appellate authority." 8. Learned counsel for the defendant has relied upon a judgment of the Apex Court in Patheja Bros. Forgings Stamping v. ICICI Ltd. [2000] 26 SCL 404 in which it was held that no suit for enforcement of guarantee in respect of any loan or advance granted to a sick industrial company would lie or be proceeded with/without the consent of the Board or the Appellate Authority as the case may be. The view taken by the Bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have the effect of impeding revival of the sick company or adding to its liabilities. Therefore, the clause introduced in section 22 of SICA by way of amendment Act of 1994 has to be harmoniously construed to advance its object and it has to be held that even Bank Guarantee furnished by the defendant at the instance of the sick company cannot be invoked. The Judgment of the Apex Court in the case of Patheja Bros. Forgings Stamping ( supra ) also says that the bar against suits applies in respect of suits against guarantors also. A Bank Guarantee may be an independent contract between the Beneficiary and Bank but section 22 of SICA takes into its sweep. This controversy therefore is a triable issue and provides sufficient grounds to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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