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1982 (10) TMI 134 - SC - Companies LawWhether the whole of ₹ 50,000 should be demanded or any lesser sum should be demanded from the bank was entirely within the choice of the Electricity Board? Held that:- Appeal allowed. The bank has, therefore, to pay the amount due under the letter of guarantee given by it to the Electricity Board. On such payment it is open to the bank to have recourse to the securities given by the company in liquidation for the purpose of the issue of the letter of guarantee. The Electricity Board is not concerned with what the bank does in order to reimburse itself after making payment of the amount guaranteed by it. It is the responsibility of the bank to deal with the securities held by it in accordance with law. It was not, however, open to the company judge to make any order under the Companies Act prohibiting the Electricity Board from realising the amount guaranteed by the bank as this had nothing to do with the assets of the company in liquidation, The order of the company judge and the judgment of the Division Bench in appeal are, therefore, liable to be set aside and they are accordingly set aside.
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