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2022 (1) TMI 1239 - Tri - Insolvency and BankruptcySeeking to refund the money equivalent to the Bank Guarantee - mobilisation advances invoked and encashed during the CIRP without any termination of contract - HELD THAT:- The Bench notes that the encashment of these Bank Guarantees were done by the Respondent, Engineering Projects (India) Limited without termination of contract and without any valid reason of dispute between Corporate Debtor and the Respondent. The Bench also notes that these Bank Guarantees were renewed annually and on timely basis. It is also clear from the records of the Corporate Debtor that the Respondent took illegal benefit of initiation of CIRP of the Corporate Debtor on 27.03.2019 and recovered unlawfully Bank Guarantees in violation of Section 14 of the Code. The Bench notes that this act of the Respondent is a clear violation of the provisions of Section 14 of the Code i.e. moratorium and the Respondent should not have proceeded with encashing the Bank Guarantee during the CIRP period. The Bench also notes that these Bank Guarantees are covered within the definition of the Terms Security Interest and is hit by Section 14(1)(c) of the Code. The Bench directs the Respondent, Engineering Projects (India) Limited to refund an amount of Rs. 34,28,000/- which has been wrongfully encashed by the Respondent by invoking Bank Guarantee during the CIRP. The Bench directs that this refund be made to the account of the Corporate Debtor within one week of the pronouncement of this order - Application allowed.
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