SEPCOIII ELECTRIC CONSTRUCTIONS CO. LTD. vs FEDERATION OF PAKISTAN Bank guarantee

Fields are extracted from the reported citation and judgment text. Where a detail is not stated in the record, it is not shown.

SEPCOIII ELECTRIC CONSTRUCTIONS CO. LTD. VS FEDERATION OF PAKISTAN Bank guarantee---En-cashment of---Principle---Appellant company executed Bank Guarantee in favour of respondent Authority---Grievance of appellant was that en-cashing of Bank guarantee was in direct contradiction of provisions of tender---Validity---Bank Guarantee was an independent/autonomous contract between Bank and Customer---Bank authorities were to construe it independent of principle/primary contract---Bank Guarantee furnished by the Bank contained undertaking and had imposed absolute obligations on the Bank to pay the amount, irrespective of any dispute between the parties to the principle contract---Absolute obligation existed upon the Banker to comply with terms as enumerated in Bank Guarantee and to pay amount stipulated therein---Bank could not be prevented by the party at whose instance Guarantee was issued, from honoring the credit guaranteed---Respondent Authority vide a letter conveyed to the Bank about intentional failure/alleged violation of appellant/bidder, as per tender-document clauses during validity of bid with the request to en-cash Bank Guarantee---Bank issuing Guarantee was not concerned with underlying contract between the parties as obligations arising under the Bank Guarantee were independent of the obligations arising out of specific contract between parties---Division Bench of High Court declined to interfere in the matter---Intra Court Appeal was dismissed in circumstances. art. 199---Constitutional jurisdiction of High Court---Contractual rights, commitments, undertakings and obligations---Scope---Contractual rights, commitments, undertakings and obligations have to be enforced through courts of ordinary jurisdiction and should not be interfered with by High Court while exercising its constitutional jurisdiction especially in those matters arising out of contractual obligations---Violation of contract or failure to abide by terms and conditions mentioned therein or to honour obligations arising out of an agreement cannot be decided in exercise of Constitutional jurisdiction---High Court observed that Superior Courts should not involve themselves into investigations of disputed question of fact which necessitate taking of evidence---Such can more appropriately be done in ordinary civil procedure for litigation by a suit---Extraordinary jurisdiction under art. 199 of the Constitution is intended primarily, for providing expeditious remedy in a case where illegality of action of executive or other authority can be established without any elaborate enquiry into complicated or disputed facts.

SEPCOIII ELECTRIC CONSTRUCTIONS CO. LTD. vs FEDERATION OF PAKISTAN Bank guarantee — 2022 PLD 628 LAHORE-HIGH-COURT-LAHORE

Case information

Judgment text as reported

Other judgments reported in 2022 PLD