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2020 (10) TMI 390 - Tri - Insolvency and BankruptcyInvocation of Bank Guarantee - Whether a third party who happened to be employer/ contracting party of the Corporate Debtor can be restrained from invocation of its Performance Bank Guarantee as per the terms of the Guarantee/ Contract executed for completion of work contract/ project? HELD THAT:- Such issue has already been examined by the Hon’ble NCLAT in the matter of GAIL (INDIA) LIMITED VERSUS RAJEEV MANAADIAR & ORS. [2018 (7) TMI 2144 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] and it is held by their Lordships that the security interest shall not include the Performance Bank Guarantee and the Performance Bank Guarantee given by the Corporate Debtor in favour of the party (Gail India Limited) is not covered by Section 14 and such party (Gail India Limited) is entitled to invoke its ‘Performance Bank Guarantee’ in full or in part - Since the debatable issue involved in the present M.A. has now been legally settled by the Hon’ble NCLAT, in the above referred judgement of ‘GAIL (India) Ltd.’, this Bench is not expected to go into the controversy of the other issues, hence the objection raised by the Applicant or Corporate debtor is not sustainable in the eye of law and invocation of the ‘Performance Bank Guarantee” does not fall within the purview of Section 14 of the I&B Code and the relief being sought for cannot be granted. The status quo order granted against the Respondent no.1 stands ceased to have its effect automatically soon after the approval of Resolution Plan. Further, there cannot be status quo against Respondent no.2 Axis Bank for discharging contractual obligation and performing its part of contract. Therefore, the Respondent no.1 being a contracting party is eligible and entitled to invoke its Performance Bank Guarantee. It cannot be restrained by this Adjudicating Authority at the instance of Corporate Debtor and it is upto a competent civil court/ forum and not necessarily by this Adjudicating Authority under the provisions of the I&B Code to deal with and decide the same. Hence, no injunction order can be passed, being out of the purview of the Section 14 of the I&BC Moratorium. Application rejected.
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