Encashment of Bank Guarantee and Legal Principles
In case of IVRCL Ltd v. Rail Vikash Nigam Ltd [2017] GCtR 6384 (Delhi), what factors would constitute fraud of egregious nature or irretrievable injury or irretrievable injustice so as to warrant an injunction against the encashment of bank guarantee were explained.
It was held that "fraud, if any, must be of an egregious nature as to vitiate the underlying transaction. Bank guarantee is a separate contract and is not qualified by the contract under which it is given." (p.9, 10)
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