In an interim order on a notice of motion, the High Court stayed the encashment of bank guarantees for eight weeks while acknowledging the prima facie validity of the arbitral award against the appellant.
Directed that the bank guarantees shall not be encashed for a period of eight weeks.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
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NMAlodg2882-12
Mlns
IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION
NOTICE OF MOTION LODGING NO.2882 OF 2012 in APPEAL LODGING NO.685 OF 2012 in
ARBITRATION PETITION NO. 303 OF 2008
M/s Jagson International Ltd. … Applicant Vs.
Oil and Natural Gas Corporation Ltd. … Respondent
D.D.Madon, Senior advocate with Mayur Khandeparkar and H.S.Khokhawala i/b. M/s.Nankani & Associates, for applicant. Rajiv Kumar, Senior advocate with Virendra Pereira i/b. M/s Divya Shah Associates, for respondent.
CORAM : MOHIT S. SHAH, C.J. & N.M. JAMDAR J. Thursday, September 27, 2012.
P.C.:
Having heard the learned counsel for the parties on the question of interim stay, we are of the view that since the Arbitral Tribunal as well as the learned Single Judge have held against the appellants and found that the ONGC was justified in invoking the bank guarantee on account of admitted failure on the part of the appellants to offer the rig for inspection by 4 June 2003, prima facie, no fault can be found with the impugned arbitral award. Accordingly, the ONGC will be free to proceed with the encashment of the bank guarantees which were given when the contract was awarded by the ONGC to the appellants. However, the receipt of the amount by ONGC upon
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encashment of the bank guarantee will be subject to the result of the appeal and in case the appellants succeed in this appeal the ONGC shall be bound to refund the amount with interest at such rate as may be determined at the final hearing of this appeal.
2. Notice of Motion accordingly stands disposed of.
CHIEF JUSTICE
N.M.JAMDAR, J.
1 issue framed by the court
Whether the bank guarantees should be encashed immediately or suspended pending the final outcome of the appeal.
M/s Jagson International Ltd.
Oil and Natural Gas Corporation Ltd.
MOHIT S. SHAH
N.M. JAMDAR
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
