Even if it is mentioned in the internal e-circular that BGs are to be refunded/released only after return of the original guarantee document, that can not prevent a person to act as per the terms and conditions mentioned in the bank guarantee document itself – Mr. Atul Kumar Kansal, RP, Universal Buildwell Pvt. Ltd. Vs. State Bank of India – NCLT New Delhi Bench Court-II
October 16, 2021
NCLT held that even if it is mentioned in the internal e-circular that BGs are to be refunded/released only after return of the original guarantee document, that can not prevent a person to act as per the terms and conditions mentioned in the bank guarantee document itself. And as per the terms and conditions mentioned in the additional bank guarantee document, the return of the original bank guarantee is not a condition precedent to release the FDs in favour of a person. Rather, it is specifically mentioned that "all your rights under the said guarantee shall stand forfeited and/or extinguished irrespective of whether the guarantee in original is received back by the bank or not".