Judgment :- These second appeals arise out of a common judgment in A.S. Nos. 346 and 381 of 1983, on the file of the First Additional Judge, City Civil Court, Madras, dt. 16-11-1983 which in turn arose out of a judgment and decree in O.S. No. 6589 of 1982, on the file of XI Assistant Judge, City Civil Court, Madras. 2. The 1st defendant in the said suit is the appellant in Second Appeal No. 1089 of 1984 and the plaintiff in the said suit is the appellant in Second Appeal No. 1510 of 1984. The second respondent in both the second appeals was the second defendant in the suit. (The parties will be referred to hereafter as plaintiff and defendants 1 and 2 for the sake of convenience). 3. The plaintiff succeeded in the trial Court by getting a decree as prayed for. Against the judgment and decree of the trial Court, the 1st defendant as well as the second defendant preferred two appeals, and the lower appellate Court, while allowing the appeal filed by the 1st defendant in part, dismissed the appeal filed by the 2nd. defendant. The 2nd defendant has not, however, preferred any further appeal. The 1st defendant has filed S.A. No. 1089 of 1984 against the portion of the judgment which went against it, while the plaintiff has filed S.A. No. 1510 of 1984 against that portion of the judgment allowing in part the appeal filed by the 1st defendant. 4. The relevant facts leading to the filing of the suit may now be noted. The plaintiff placed an order on the 1st defendant for the supply of one number of Model T. 650W truck mounted water well drilling rig (hereinafter called 'the rig') with complete standard accessories. The 1st defendant supplied the rig after receiving an advance of 10% of the value and delivered the same to the plaintiff on 26-12-1981. For the balance of sale consideration, the 1st defendant raked as many as ten Bilk of Exchange dt. 26-11-1981 on the plaintiff as well as Canara Bank, Guindy, Madras-32 for different amounts and forwarded the same for acceptance. The Bills were duly accepted both by the plaintiff as well as by the 2nd defendant-Canara Bank, agreeing to pay the sums noted in the Bills of Exchange on the due dates mentioned therein. 26-11-1981 on the plaintiff as well as Canara Bank, Guindy, Madras-32 for different amounts and forwarded the same for acceptance. The Bills were duly accepted both by the plaintiff as well as by the 2nd defendant-Canara Bank, agreeing to pay the sums noted in the Bills of Exchange on the due dates mentioned therein. The plaintiff, after taking delivery of the rig, has given a Certificate of Commissioning of the rig to the 1st defendant.The plaintiff has been using the rig for quite some time. While so, it is the grievance of the plaintiff that the 1st defendant failed to get the registration of the vehicle under the Motor Vehicles Act as undertaken and as a result of which, the plaintiff incurred heavy loss. According to the plaintiff, until registration is made, the sale is not complete and, therefore, the 1st defendant is not entitled to receive any payment under the Bills of Exchange. The plaintiff has also stated that the rig supplied by the 1st defendant was manufactured in the year 1979 as a prototype and was lying idle for want of buyers and by making false representations, induced the plaintiff to purchase the same. On the basis of these allegations, the plaintiff came forward with a suit for injunction restraining the 1st defendant from receiving any payment from the 2nd defendant-Bank on the basis of ten Bills of Exchange dt. 26-12-1981 referred to above, and also for an injunction against defendant 2 from making payment on the basis of the same Bills of Exchange. 5. The defendant 1 contested the suit contending that the City Civil Court has no jurisdiction to try the suit, that the 1st defendant never agreed to get the vehicle registered in accordance with the Motor Vehicles Act, or promised to complete the registration within 15 days from the date of delivery of the rig. It further denied the statement of the plaintiff that the sale of the rig was not complete. According to the 1st defendant, the sale of the rig was complete when the plaintiff paid the price through I.D.R.I. Scheme by accepting 10 Bills of Exchange and also by taking delivery of the rig. It is the case of the 1st defendant that it was not its responsibility to get the rig registered. According to the 1st defendant, the sale of the rig was complete when the plaintiff paid the price through I.D.R.I. Scheme by accepting 10 Bills of Exchange and also by taking delivery of the rig. It is the case of the 1st defendant that it was not its responsibility to get the rig registered. The assistance, if any, given by the defendant 1 for getting the vehicle registered was only to help the plaintiff as one of its customers, and was not as an obligation or part of the contract. The plaintiff after satisfaction only took delivery of the rig in perfect condition. The defects, if any, would have occurred only after the Certificate of Commissioning was duly signed and handed over by the plaintiff to the 1st defendant. The further stand taken by the 1st defendant was that under the Negotiable Instruments Act, the liability of the acceptor and co-acceptor of Bills of Exchange is absolute and unconditional and, therefore, under no circumstances any payment due under such Bills of Exchange could be stopped. Assuming for the sake of arguments, according to the 1st defendant, if there was any breach of contract, the remedy open to the plaintiff was to proceed against the 1st defendant for damages and not to approach the Civil Court for injunction. 6. The 2nd defendant has agreed to abide by the orders of the Court and further contended that it was not a necessary party. 7. The trial Court framed three issues for its decision, and on appreciation of pleadings, evidence both oral and documentary and the arguments advanced on both sides, has held that though the general rule is that the vendor of a motor vehicle is not responsible for the registration of the vehicle, the 1st defendant having sold the vehicle to the plaintiff by making misrepresentations, the general rule will not apply to the facts of this case. The learned trial Judge further held that the plea of the 1st defend ant that the plaintiff is entitled to sue the 1st defendant for damages will lead to multiplicity of proceedings, and to avoid that, the plaintiff, according to the trial Court, is entitled to a decree of injunction as prayed for. Accordingly, the trial Court decreed the suit as prayed for. 8. Accordingly, the trial Court decreed the suit as prayed for. 8. Against the judgment and decree of the trial Court in O.S. 6589 of 1982, both the defendants preferred appeals in A.S. Nos. 346 and 381 of 1983 respectively. The lower appellate Court, while dealing with the appeal filed by defendant 1 held that the stand taken by the plaintiff that the sale of the rig is not complete cannot be accepted. However, the lower appellate Court, taking note of the purpose for which the rig was purchased, , took the view that the plaintiff and the 1st defendant must be deemed to have been aware that the vehicle must not merely be roadworthy, but, in law, it should be possible for the purchaser to move the vehicle from place to place without any objection from statutory authorities. Therefore, the lst defendant, as seller, cannot escape the compliance of such obligation, namely, getting the vehicle registered. The lower appellate Court characterised the stand taken by the 1st defendant to the effect that it was not its duty to have the vehicle registered nor was it a part of the contract, as an afterthought. Ultimately, the learned Appellate Judge found that the parties have understood and accepted as a term of sale of the rig that the registration of the vehicle must be made by the 1st defendant in first defendant's name first and then must have the registration of the vehicle transferred in the name of the plaintiff. On the basis of this conclusion, the learned Judge found that 'even though the sale of the rig as contemplated by the Sale of Goods Act had become complete, one of the terms of the contract of sale had not been performed by the vendor and the obligation that was cast upon the vendor has not been discharged by the vendor. The failure of the vendor to complete the registration of the vehicle and transfer the registration of the vehicle in favour of the transferee, the plaintiff, will have its impact on the right of defendant 1 to collect the amount covered by the Bills of Exchange accepted by the plaintiff and co-accepted by the 2nd defendant'. The failure of the vendor to complete the registration of the vehicle and transfer the registration of the vehicle in favour of the transferee, the plaintiff, will have its impact on the right of defendant 1 to collect the amount covered by the Bills of Exchange accepted by the plaintiff and co-accepted by the 2nd defendant'. On the basis of the above conclusion, the learned Appellate Judge further held, 'I am of the view that both in equity and on the principles of natural justice and under the terms of the contract of sale between the parties the plaintiff will be entitled to have protection and should be relieved of the obligations to pay the entire amount under the Bills of Exchange accepted by the plaintiffs and co-accepted by the second defendant'. 9. However, the lower appellate Court, taking note of the fact that the plaintiff has used the rig and earned certain amounts, held that the 1st defendant must be allowed or permitted to draw that amount covered by those Bills of Exchange which have already matured, and for the balance only, the injunction is prayed for will be granted in favour of the plaintiff. Accordingly, the lower appellate Court partly allowed the appeal of defendant 1. 10. So far as the appeal filed by the 2nd defendant is concerned, the lower appellate Court, taking note of the stand take by it in the written statement, observed that it was a futile effort on the part of defendant 2, Bank to agitate the cause of the 1st defendant, and consequently dismissed the appeal filed by defendant 2. 11. It is under these circumstances, these two second appeals came to be filed one by the 1st defendant and the other by the plaintiff. 12. Second Appeal 1 No. 1089 of 1984 was admitted on the following substantial questions of law :- "1. Do the Bills of Exchange accepted/ coaccepted by the respondent form a separate and independent contract from that of the contract of sale and can the payment under such bills be injuncted on ground of dispute with regard to the performance of the main or wider contract? Do the Bills of Exchange accepted/ coaccepted by the respondent form a separate and independent contract from that of the contract of sale and can the payment under such bills be injuncted on ground of dispute with regard to the performance of the main or wider contract? Will the rights of the holder in due course, who has purchased the bills in good faith for a valuable consideration, for collection of the bill on due dates, be affected by reason of such disputes between the buyer and seller with regard to the performance of the main or wider contracts? 2. Can the plaintiff, after taking delivery of the rig and after having used the same for nine months repudiate the contract and injunct the payment under the Bills of Exchange accepted by him as consideration for the purchase of the rig? 3. Whether the registration of the vehicle which is a component of the rig can be treated as a breach of the contract of the sale of the rig? 4. Who is responsible for the registration of the vehicle, which is the component of the rig, under the Motor Vehicles Act?" * 13. Second Appeal No. 1510 of 1984 was admitted on the following substantial questions of law : "1. Whether Bills of Exchange payable on different dates but relating to one void contract of sale creating no obligation for payment in respect of that sale be split up on the ground of either equity or convenience and directed to be honoured when the main contract itself is either incomplete or void? 2. Whether the Bills of Exchange in respect of a contract of sale accepted by the buyer is a conditional payment or does it operate as absolute payment irrespective of whether the main and wider contract of sale fails and is unenforceable." * 14. Dr. Chitaley, learned Counsel for the 1st defendant and Mr. G.S. Subramaniam, learned Counsel for the plaintiff addressed arguments, of course, extensively, covering all the substantial questions of law set out above. 15. Dr. Chitaley, learned Counsel for the 1st defendant and Mr. G.S. Subramaniam, learned Counsel for the plaintiff addressed arguments, of course, extensively, covering all the substantial questions of law set out above. 15. After carefully considering the rival submissions and after a careful perusal of the pleadings, evidence and the judgments of the Courts below, I am of the view that only in the event of the plaintiff getting a favourable answer to the first substantial question of law in Second Appeal No. 1089 of 1984, the necessity for considering all the other substantial questions of law will arise. Therefore, let me at the outset consider the first substantial question of law as framed in Second Appeal No. 1089 of 1984. Incidentally, it may be mentioned that it will also cover the second substantial question of law as framed in Second Appeal No. 1510 of 1984. 16. Before doing so, at the risk of repetition, I consider it necessary to set out the findings of the lower appellate Court. The lower appellate Court negatived the contention raised on behalf of the plaintiff that in the absence of the registration of the vehicle in question as required under the provisions of the Motor Vehicles Act, the sale was not complete. On the other hand, the clear finding given by the lower appellate Court was to the effect that the sale of the rig in favour of the plaintiff by the 1st defendant was complete. After rendering such a finding, the lower appellate Court purports to proceed further to consider the terms of contract of sale between the plaintiff and the 1st defendant. The lower appellate Court has noticed that the plaintiff as P.W. 1 has admitted that there was no stipulation in the terms of the contract to the effect that the registration of the rig must be completed by the 1st defendant. The further admission by P.W.1 was to the effect that as per Ex.A.6 letter, the plaintiff intimated the 1st defendant that the loss arising out of non-registration of the vehicle would be intimated to the 1st defendant and the same will be mutually sorted out. The further admission of the plaintiff as P.W. 1 as noticed by the lower appellate Court was that the registration of the vehicle by defendant 1 was not stipulated as a condition precedent to the plaintiff purchasing the vehicle. The further admission of the plaintiff as P.W. 1 as noticed by the lower appellate Court was that the registration of the vehicle by defendant 1 was not stipulated as a condition precedent to the plaintiff purchasing the vehicle. Notwithstanding these factors, the lower appellate Court felt that having regard to the purpose of the purchase of the rig, it must be deemed that the registration of the vehicle was a term of contract of sale and the non-compliance of the same will have its impact on the right of the 1st defendant to collect the amount covered by the Bills of Exchange accepted by the plaintiff and co-accepted by the 2nd defendant. The lower appellate Court having come to such a conclusion, further proceeded to hold that the failure on the part of defendant 1, to have the vehicle registered under the provisions of the Motor Vehicles Act will amount to a sort of fraud played by the 1st defendant upon the plaintiff and, therefore, both in equity and on the principles of natural justice, and under the terms of contract of sale, the plaintiff will be entitled to have protection and should be relieved of obligations to pay the entire amount under the Bills of Exchange accepted by the plaintiff and co-accepted by defendant 2. 17. With this background, we shall now take up the first substantial question of law as set out earlier in Second Appeal No. 1089 of 1984. 18. The main argument of Dr. Chitaley was that on the basis of the finding given by the lower appellate Court that the sale of the rig was complete, the consequences that should follow should have been the dismissal of the suit for injunction reserving the right of the plaintiff, if at all to sue for damages if there was scope for the same. On the other hand, the lower appellate Court went wrong in introducing a clause which factually, admittedly, did not exist in the terms of contract entered into between the parties. The learned Counsel further submitted that the lower appellate Court went wrong in giving a finding that defendant 1 played a fraud upon the plaintiff in pushing through the sale in question when there is no pleading at all nor any evidence much less any suggestion in the correspondence between the parties. Dr. The learned Counsel further submitted that the lower appellate Court went wrong in giving a finding that defendant 1 played a fraud upon the plaintiff in pushing through the sale in question when there is no pleading at all nor any evidence much less any suggestion in the correspondence between the parties. Dr. Chitaley further contended that the lower appellate Court failed to bear in mind a very important aspect, namely, that the sale of the rig is separate and independent of the Bills of Exchange and both cannot be clubbed together. In other words, according to the learned Counsel, the remedy available for the plaintiff, if at all, on the bash of the pleadings, is only to sue for damages for violation of the terms of contract, if any. In support of this, the learned Counsel relied on a number of decided authorities, and the latest one cited is U.P. Co-operative Federation Ltd. v. Singh Consultants and Engineers (P.) Ltd., reported in (SC). As pointed out earlier, learned Counsel also addressed arguments on other questions. If necessary, I shall advert to them later on. 19. Mr. G.S. Subramaniam, learned Counsel appearing for the plaintiff, contending contra, submitted that even though a plea of fraud was not specifically taken in the plaint, it is open to the Court to infer fraud in the facts and circumstances of the case and the technicalities of pleadings should not stand in the way of dispensing justice when the facts and circumstances of the case warrant such inference. In support of that, he relied on two judgments, one of this Court and the other of the Supreme Court. They are V. Rengaswamy Gounder v. Nallathangal, reported in 1982 TLNJ 280 and Nagubai Ammal v. B. Shama Rao, reported in 1956 AIR(SC) 593, 1956 SCJ 655, 1956 SCR 451 , 1957 BLJR 264, 1956 AnLT 1029, 1956 ILR(Mys) 152. Mr. G.S. Subramaniam, learned Counsel further submitted that the finding of the lower appellate Court regarding registration of the vehicle is part of the contract and as a result of non-performance of the same, the plaintiff is discharged from the responsibility of honouring the Bills of Exchange, is sustainable in law. Mr. G.S. Subramaniam, learned Counsel further submitted that the finding of the lower appellate Court regarding registration of the vehicle is part of the contract and as a result of non-performance of the same, the plaintiff is discharged from the responsibility of honouring the Bills of Exchange, is sustainable in law. He also fairly Submitted that the plaintiff either succeeds or fails in whole and there is no question of the plaintiff succeeding in part, and to that extent, the learned Counsel did not support the judgment of the lower appellate Court in granting reliefs partly to the 1st defendant and partly to the plaintiff. Mr. G.S. Subramaniam also addressed arguments on the other substantial questions of law as well. 20. I shall now proceed to consider the rival submissions by first setting out the relevant provisions in the Negotiable Instruments Act, 1981. Section 5 defines "Bill of Exchange" which reads as follows : - "A Bill of Exchange is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument. A promise or order to pay is not "conditional" within the meaning of this section and S.4, by reason of the time for payment of the amount or any instalment thereof being expressed to be on the lapse of a certain period after the occurrence of a specified event which, according to the ordinary expectation of mankind, is certain to happen, although the time of its happening may be uncertain. The sum payable may be "certain" within the meaning of this section and S.4, although it includes future interest or is payable at an indicated rate of exchange, or is according to the course of exchange, and although the instrument provides that, on default of payment of an instalment, the balance unpaid shall become due. The person to whom it is clear that the direction is given or that payment is to be made may be a "certain person" within the meaning of this section and S.4, although he is mis-named or designated by description only." Section 13 defines" Negotiable Instrument"which reads as follows : - (1) A" negotiable instrument" * means a Promissory Note, Bill of Exchange or Cheque payable either to order or to bearer. Explanation (i) - A Promissory Note, Bill of Exchange or Cheque is payable to order which is expressed to be so payable or which is expressed to be payable to a particular person, and does not contain words, prohibiting transfer or indicating an intention that it shall not be transferable. Explanation (ii) - A Promissory Note, Bill of Exchange or Cheque is payable to bearer which is expressed to be so payable or on which the only or last endorsement is an endorsement in blank. Explanation (iii) - Where a Promissory Note, Bill of Exchange or Cheque either originally or by endorsement, is expressed to be payable to the order of a specified person, and not to him or to his order, it is nevertheless payable to him or his order at his option. (2) A negotiable instrument may be made payable to two or more payees jointly or it may be made payable in the alternative to one of two, or one or some of several payees. "Section 32 sets out the liability of maker of note and acceptor of bill which reads as follows:-" * In the absence of a contract to the contrary, the maker of a promissory note and the acceptor before maturity of a bill of exchange are bound to pay the amount thereof at maturity according to the apparent tenor of the note or acceptance respectively, and the acceptor, of a bill of exchange at or after maturity is bound to pay the amount thereof to the holder on demand. In default of such payment as aforesaid, such maker or acceptor is bound to compensate any party to the note or bill for any loss or damage sustained by him and caused by such default. "Section 43 relied on by the learned counsel for the plaintiff reads as follows :-" * Negotiable instrument made, etc. without consideration. - A negotiable instrument made, drawn, accepted, indorsed or transferred without consideration, or for a consideration, which fails, creates no obligation of payment between the parties to the transaction. But, if any such party has transferred the instrument with or without endorsement to a holder for consideration, such holder, and every subsequent holder driving title from him, may recover the amount due on such instrument from the transferor for consideration or any prior party thereto. But, if any such party has transferred the instrument with or without endorsement to a holder for consideration, such holder, and every subsequent holder driving title from him, may recover the amount due on such instrument from the transferor for consideration or any prior party thereto. Exception I.- No party fur whose accommodation a negotiable instrument has been made, drawn, accepted or indorsed can, if he has paid the amount thereof, recover thereon such amount from any person who became a party to such instrument for his accommodation. Exception II. - No party to the instrument who has induced any other party to make, draw, accept, indorse or transfer the same to him, for a consideration which he has failed to pay or perform in full, shall recover thereon an amount exceeding the value of the consideration (if any) which he has actually paid or performed. "The argument of the learned counsel Mr. G. Subramaniam for the plaintiff that by invoking S.43 of the Negotiable Instruments Act, the plaintiff is entitled to succeed, cannot be accepted as such a case has not been made out nor pleaded before the Courts below. Therefore, I am unable to agree with the contention of Mr. G. Subramaniam that the plaintiff is entitled to an injunction on the ground of lack of consideration for all the Bills of Exchange in question. 21. Likewise, the argument that the plaintiff is entitled to succeed in the suit for injunction on the ground of fraud played upon by defendant 1 against the plaintiff is also not acceptable. In this connection, I am inclined to agree with the argument of the learned counsel for the 1st defendant, Dr. Chitaley that there was no plea of fraud taken in the plaint, nor even a suggestion put to the witnesses when they were in the witness box and, therefore, the plea of fraud cannot be invoked. Likewise, the inference of fraud drawn by the lower appellate Court cannot also be sustained. The argument of Mr. G. Subramaniam that the rule of technicalities of absence of pleadings should not be pressed into service irrespective of the facts and circumstances of the case cannot also be accepted as there is no extraordinary circumstance to relax that rule. Likewise, the inference of fraud drawn by the lower appellate Court cannot also be sustained. The argument of Mr. G. Subramaniam that the rule of technicalities of absence of pleadings should not be pressed into service irrespective of the facts and circumstances of the case cannot also be accepted as there is no extraordinary circumstance to relax that rule. The two decisions, namely, 1956 AIR(SC) 593, 1956 SCJ 655, 1956 SCR 451 , 1957 BLJR 264, 1956 AnLT 1029, 1956 ILR(Mys) 152 and 1982 TLNJ 280 (cited supra) will not help the plaintiff as in this case at no stage the plea of fraud was thought of even remotely by the plaintiff. 22. The principles laid down by the Supreme Court in the recent judgment in U.P. Co-Operative Federation Ltd., v. Singh, Consultants and Engineers (P) Ltd., reported in , in my view, apply in all fours and even with more force to the facts of this case. In that case, the Supreme Court, while considering the scope and effect of Bank Guarantee, after noticing various English decisions and also various decisions of the High Courts in India and of the Supreme Court, has clearly laid down certain principles which, as I said earlier, will apply to the facts of this case. His Lordship Sabyasachi Mukharji, J., in his leading judgment, has held as follows : -" * ...... Where, therefore, a bank had given a performance guarantee it was required to honour the guarantee according to its terms and was not concerned whether either party to the contract which underlay the guarantee was in default. The only exception to that rule was where fraud by one of the parties to the underlying contract had been established and the bank had notice of the fraud. "The learned Judge accepted with approval the principles laid down in the case in R.D. Harbottle (Mercantile) Ltd. v. National Westminster Bank Ltd., reported in 1977 (2) AllER 862, 1977 (3) WLR 75241the said principles read as follows :-" * (i) only in exceptional cases would the courts interfere with the machinery of irrevocable obligations assumed by banks. "The learned Judge accepted with approval the principles laid down in the case in R.D. Harbottle (Mercantile) Ltd. v. National Westminster Bank Ltd., reported in 1977 (2) AllER 862, 1977 (3) WLR 75241the said principles read as follows :-" * (i) only in exceptional cases would the courts interfere with the machinery of irrevocable obligations assumed by banks. In the case of a confirmed performance guarantee, just as in the case of a confirmed letter of credit the bank was only concerned to ensure that the terms of its mandate and confirmation had been complied with and was in no way concerned with any contractual disputes which might have arisen between the buyers and selliers. Accordingly, since demands for payment had been made by the buyers under the guarantees and the plaintiffs had not established that the demands were fraudulent or other special circumstances, there were no grounds for continuing the injunctions. (ii) It was right to discharge the injunctions against the bank, the fact that the Egyptian defendants had taken no part in the proceedings could not be a good ground for maintaining those injunctions. Further, equally strong considerations applied in favour of the discharge of the injunctions against the Egyptian defendants, and their failure to participate in the proceedings did not preclude the court from discharging the injunctions against them. "On the facts of the case, the learned judge came to the conclusion which reads as follows:-" * In the instant case, the learned Judge has proceeded on the basis that this was not an injunction sought a against the respondent. But the net effect of the injunction is to restrain the bank from performing the bank guarantee. That cannot be done. One cannot do indirectly what one is not free to do directly. But a maltreated man in such circumstances is not remedyless. The respondent was not to suffer any injustice which was irretrievable. The respondent can sue the appellant for damages. In this case, there cannot be any basis for apprehension that irretrievable damages would be caused if any. I am of the opinion that this is not a case in which injunction should be granted. An irrevocable commitment either in the form of confirmed bank guarantee or irrevocable letter of credit cannot be interfered with except in case of fraud or in case of question of apprehension of irretrievable injustice has been made out. I am of the opinion that this is not a case in which injunction should be granted. An irrevocable commitment either in the form of confirmed bank guarantee or irrevocable letter of credit cannot be interfered with except in case of fraud or in case of question of apprehension of irretrievable injustice has been made out. This is the well settled principle of the law in England. This is also a well settled principle of law in India, as I shall presently notice from some of the decisions of the High Court and decisions of this Court." Ultimately, the learned Judge held as follows: - " On the basis of these principles I reiterate that commitments of banks must be honoured free from interference by the courts. Otherwise, trust in commerce internal and international would be irreparably damaged. It is only in exceptional cases that is to say, in case of fraud or in case of irretrievable injustice be done, the Court should interfere. " In para. 35, the learned Judge has observed as follows :- " Mr. Tarkunde submitted before us that in this case the grievance of the appellant was that there was delay in performance and defective machinery had been supplied. He submitted that if at this stage appellant was allowed to enforce the bank guarantee, damage would be done. He submitted before us that appellant could not be permitted to take advantage of illegality by invoking the bank guarantee. But in my opinion these contentions cannot deter us in view of the principle well settled that there should not be interference in trade. This is not a case where irretrievable injustice would be done by enforcement of bank guarantee. This is also not a case where there was a strong prima facie case of fraud in entering into a transaction was made out. If that is the position, then the High Court should not have interfered with the bank guarantee. "23. His Lordship Jagannatha Shetty, J., while agreeing with the leading judgment of Sabyasachi Mukharji, J., has expressed his views in the following manner : -" * The argument for the respondent is attractive but it seems to overlook the basic nature of the case. "23. His Lordship Jagannatha Shetty, J., while agreeing with the leading judgment of Sabyasachi Mukharji, J., has expressed his views in the following manner : -" * The argument for the respondent is attractive but it seems to overlook the basic nature of the case. The basic nature of the case relates to the obligations assumed by the bank under the guarantees given to UPCOF Ltd. If under law, the bank cannot be prevented by SCE (P) Ltd. from honouring the credit guarantees, the UPCOF Ltd. also cannot be restrained from invoking the guarantees. What applies to the bank must equally apply to UPC OF Ltd. Therefore, the frame of the suit by not impleading the bank cannot make any difference in the position of law. Equally it would be futile to contend that the court was justified in granting the injunction since it has found a prima facie case in favour of the SCE (P) Ltd. The question of examining the prima facie case or balance of convenience does not arise if the Court cannot interfere with the unconditional commitment made by the bank in the guarantees in question. "24. Again, in para 9, the learned Judge has observed as follows : -" * The letter of credit has been developed over hundreds of years of international trade. It was most commonly used in conjunction with sale of goods between geographically distant parties. It was intended to facilitate the transfer of goods between distant and unfamiliar buyer and seller. It was found difficult for the seller to rely upon the credit of an unknown customer. It was also found difficult for a buyer to pay for goods prior to their delivery. The bank's letter of credit came into existence to bridge this gap. In such transactions, the seller (beneficiary) receives payment from issuing bank when he presents a demand as per terms of the documents, the bank must pay if the documents are in order and the terms of credit are satisfied. The bank, however, was not allowed to determine whether the seller had actually shipped the goods or whether the goods conformed to the requirements of the contract. Any dispute between the buyer and the seller must be settled between themselves. The Courts, however, carved out an exception to this rule of absolute independence. The bank, however, was not allowed to determine whether the seller had actually shipped the goods or whether the goods conformed to the requirements of the contract. Any dispute between the buyer and the seller must be settled between themselves. The Courts, however, carved out an exception to this rule of absolute independence. The Courts held that if there has been "fraud in the transaction" the bank could dishonour beneficiary's demand for payment. The Courts have generally permitted dishonour only on the fraud of the beneficiary, not the fraud of somebody else. "25. In the light of the above pronouncement of the Supreme Court, I find no difficulty in holding that the Bills of Exchange in question accepted by the plaintiff and co-accepted by defendant 2 Bank formed a separate and independent contract and, therefore, there cannot be any injunction against defendant 2 on the ground of dispute with regard to the performance of the main contract. I also hold that the Bills of Exchange accepted by the buyer operate as absolute payment irrespective of the main and wider contract subject of course to one and only exception as pointed out by the Supreme Court. The only exception pointed out by the Supreme Court reads as follows :" * .......The only exception to that rule was where fraud by one of the parties to the underlying contract had been established and the bank had notice of the fraud. "His Lordship Jagannatha Shetty, J. also pointed out the exception in the following terms : -" * The Court, however, should not lightly interfere with the operation of irrevocable documentary credit. I agree with my learned brother that in order to restrain the operation of irrevocable letter of credit, performance bond or guarantee, there should be serious dispute to be tried and there should be a good prima facie acts of fraud. As Sir John Donaldson M.R. said in Bolivinter Oil SA v. Chase Manhattan Bank, 1984 (1) AllER 351, 1984 (1) WLR 392 at 352. "The wholly exceptional case where an injunction may be granted is where it is proved that the bank knows that any demand for payment already made or which may thereafter be made will clearly be fraudulent But the evidence must be clear both as to the fact of fraud and as to the bank's knowledge. "The wholly exceptional case where an injunction may be granted is where it is proved that the bank knows that any demand for payment already made or which may thereafter be made will clearly be fraudulent But the evidence must be clear both as to the fact of fraud and as to the bank's knowledge. It would certainly not normally be sufficient that this rests on the uncorroborated statement of the customer, for irreparable damage can be done to a bank's credit in the relatively brief time which must elapse between the granting of such an injunction and an application by the bank to have it discharged." * 26. I have made it clear that the plaintiff has miserably failed to bring his case within this rule of exception. 27. Both the Courts below have not correctly appreciated the position in law. The trial Court was not right in lightly overruling the objection that the remedy if at all available to the plaintiff was to sue for damages by stating that it will give room for multiplicity of proceedings.Likewise. the lower appellate court having rightly held that the sale was complete, fell into an error of law in inferring an act of fraud which was not at all pleaded. The view taken by the lower appellate court that the plaintiff is entitled to a decree on the basis of principles of natural justice and equity cannot be sustained in view of the observations of His Lordship Sabyasachi Mukharji, J. set out above while repelling a similar contention advanced by Mr. Tarkunde, learned counsel appearing for the respondent in that case. 28. In the view I have taken that the Bills of Exchange in question formed a separate and independent contract and, therefore, the suit for injunction on the basis of nonperformance of the main contract will not lie in the facts and circumstances of the case, I do not think it is necessary to consider the other substantial questions of law even though arguments were advanced by the learned counsel on both sides. 29. In the result, the judgments and decrees of the Courts below are set aside. The suit filed by the plaintiff, namely, O.S. No. 6589 of 1982, on the file of the XI Assistant Judge, City Civil Court, Madras, is dismissed. 29. In the result, the judgments and decrees of the Courts below are set aside. The suit filed by the plaintiff, namely, O.S. No. 6589 of 1982, on the file of the XI Assistant Judge, City Civil Court, Madras, is dismissed. Consequently Second Appeal No.1089 of 1984 is allowed and Second Appeal No. 1510 of 1984 is dismissed. However, I make no order as to costs in both the second appeals. Order accordingly.