Hindustan Steel Workers Construction (HS)[1] Ltd. v. G.S. Atwal & Co. (Engineers) Pvt. Ltd. (GS)[2] 1995 SCC (6) 76 (Unconditional Bank Guarantee, Performance Guarantee) FACTS HS and GS entered into contracts whereby GS was to construct 11 schools. The United Commercial Bank, Calcutta (Bank) gave two Bank Guarantees (BG1 &2) to HS on behalf…
ONGC v. SBI Overseas Branch, Bombay AIR 2000 SC 2548 FACTS ONGC[1] had awarded a large gas pipeline contract to an Italian consortium S[2] at a certain contract price (CP). The work was to be executed within a given date else S was liable to pay certain percentage of C.P. S was also obliged to…
State of Madhya Pradesh v. Kaluram 1967 SCR (1) 266 (Suretyship, Section 139 and 141 of Indian Contract Act, Subrogation) FACTS At an auction for sale of felled trees, Jagatram (J) was awarded the sale, on payment of a security and subsequent payment of installments. He executed a contract in favour of the Governor of…
Ramchandra B. Loyalka v. Shapurji N. Bhownagree (1940) 42 BOMLR 550 (Section 124, 126 and 145 of Indian Contract Act, Difference between Indemnity and Guarantee) FACTS: The plaintiff (P) was a sub-broker employed by the defendant broker (D) on 50% commission. P introduced 6 constituents and became answerable to the broker for them. The constituents…
National Highways Authority of India v. Ganga Enterprises and Anr. AIR 2003 SC 3823 (on demand performance guarantee) FACTS: Appellant (N) issued a tender notice for collection of toll on a part of a highway. For this purpose two types of securities were to be furnished, bank guarantee and performance security by way of a…
Amrit Lal Goverdhan Lalan v. State Bank of Travancore and Ors. 1968 SCR (3) 724 (ss.133, 135, 139 and 141 of Indian Contract Act, Suretyship, Subrogation) FACTS: Respondents 3 to 6, as partners of Respondent 2 firm (R2), entered into an agreement with a Bank (R1) to open a cash credit account to the extent…
Punjab National Bank Ltd. v. Bikram Cotton Mills & Anr. 1970 AIR 1973 (Difference between indemnity and guarantee) FACTS The first respondent company (R1) opened a cash-credit account with the appellant bank (A) and to secure repayment of the balance due at the foot of the account R1 executed three documents through its managing agents…
Radha Kanta Pal v. United Bank of India AIR 1955 Cal 217 (Section 139 of Indian Contract Act, Discharge, Rights of a surety) FACTS: The case concerns a contract in the nature of a fidelity bond or a guarantee. A (deceased) executed a security bond in favour of a Bank, B, in consideration of the…
Lakeman v. Mountstephen (1874) LR 7 HL 17 (primary and secondary liability) FACTS: Plaintiff (P) was employed by the local board of health to construct the main sewer of a town. After the completion, the board directed the owners and occupiers of the adjacent property to connect their drains with the main system within 21days….
Craythorne v. Swineburne 14 Ves. 160 (subrogation) FACTS: Newcastle Bank (NB) gave money to Henry Swineburne (HS), for paying to other bank, on the request of Sir John Swineburne (JS). Money was given on the security of two bonds. One being the joint and several bond of HS as principle and Craythorne (C) as surety;…
Jay Bharat Credit v. Commissioner of Sales-Tax and Anr. (2000) 7 SCC 165 FACTS: The appellants (A) had a business of hire-purchase. They engaged in purchasing of vehicles and then giving them on hire with the hirer paying an initial amount and then paying the rest, which includes the price of the vehicle and hire charges,…
Bank of Rajasthan v. Hajarimal Milap C. Surana FACTS: The respondents (R) (Hajarimal Milap C. Surana) were indebted to the appellants (A) (Bank of Rajasthan) and had deposited precious stones as security. For the recovery of the debt, a suit had been filed in the court by A. Pending the suit, the parties came to…