MAHEMMAD HABEEB SHAMS ANSARI, J. ( 1 ) THE Court: Only a few relevant facts need to be stated for the disposal of the instant application filed for injunction restraining the invocation of the bank guarantee. ( 2 ) THE defendant No. 3 (Ansaldo Service Pvt. Ltd.) hereinafter referred to 'aspl' entered into contract with The Neyveli Lignite Corporation Limited, on December 10, 1998 for construction of a 2 X 210 MW Expansion of the First Thermal Power Project Station at Neyveli, Tamil Nadu. ( 3 ) PLAINTIFF (Development Consultants Pvt. Ltd.) hereinafter referred to as 'dcl' and the defendant No. 2 (U. B. Engineering Limited) hereinafter referred to as the 'ubel' formed into a consortium in respect of ther two sub-contracts bearing Nos. 229225 and 229226 entered into by and between ASPL and UBEL and DCL. Sub contracts are dated April 15, 1999 and the consortium agreement between UBEL and DCL is dated August 4, 1999. ( 4 ) UBEL is the leader under the said consortium agreement and pursuant to Clause 14 of the said consortium agreement, UBEL was required to and did furnish a bank guarantee for performance of the two several sub contracts. ( 5 ) DCL in turn was required to furnish counter guarantees in respect of pro rata share of total amount of bank guarantee given by UBEL to ASPL. ( 6 ) PLAINTIFF caused two several bank guarantees to be issued by the respondent No. 1 bank under the terms of consortium agreement. Particulars of the said bank guarantees are as under; bank Guarantee No. Amount (Rs ). 43/idbi/cal 71,83,000. 00 (Sub-contract No. 229226) 44/idbi/cal 6,32,17,000. 00 (Sub-contract No. 229225) ( 7 ) CLAUSES 5 and 6 of the two bank guarantees being relevant for the enquiry on hand need to be extracted. For that purpose the said clauses from the bank guarantee No. 43 are extracted hereunder. The said clauses in the other bank guarantee are identical except for the amount specified in the respective bank guarantees;"dcl has requested the Industrial Development Bank of India (IDBI) to furnish a Guarantee for Rs. 71,83,000/- (Rupees seventy one lac eighty three thousand only) in favour of UBEL being a Counter Guarantee to the Guarantee Furnished. UBEL on behalf of the Consortium (UBEL-DCL) to ASPL for the due performance by DCL of its scope of work under Sub Contract No. 229226. 6. 71,83,000/- (Rupees seventy one lac eighty three thousand only) in favour of UBEL being a Counter Guarantee to the Guarantee Furnished. UBEL on behalf of the Consortium (UBEL-DCL) to ASPL for the due performance by DCL of its scope of work under Sub Contract No. 229226. 6. In consideration of UBEL having furnished a Guarantee to ASPL for the due performance of the Sub Contract No. 229226 for and on behalf of the Consortium. We, industrial Development Bank of India (IDBI) a Corporation established under the Industrial Development Bank of India Act, 1964 (18 of 1964) and having its Head Office at IDBI Tower, WTC Complex, Cuffe Parade, Mumbai-400 005 and a Branch Office at 44, Shakespeare Sarani, Calcutta-700 017 (hereinafter referred to as IDBI which expression shall unless repugnant to the context or meaning thereof include its successors administrators representatives and assignees) at the request of DCL do hereby irrevocably guarantee and undertake to pay UBEL within fifteen (15) days of UBEL sums demand in writing without any demur and without referring to any other source any and all moneys payable by DCL for non-execution of its scope of Contract No. 229226 (read with Consortium Agreement dated 04. 03. 1999) as may be decided by ASPL subject to the extent of 10% of the value of the DCL's portion of the Sub-Contract price i. e. Rs. 71,83,000/- (Rupees seventy one lac eighty three thousand only)" ( 8 ) IT is the case of the plaintiff that the aforesaid Clause 6' in the two bank guarantees was amended. ( 9 ) THE said amendment of Clause 6 was by a document executed by defendant bank of the same date i. e. on November 18, 1999 as the two bank guarantees dated November 18, 1999. The copies of the said documents are Annexure 'c' at pages 63 and 65 to the application. A perusal thereof would show that the amendment was made on the proposal of the plaintiff. The copies of the said documents are Annexure 'c' at pages 63 and 65 to the application. A perusal thereof would show that the amendment was made on the proposal of the plaintiff. Clause 6 as amended thereby reads as under:"at the request of the above proposal we hereby amend the Clause No. 6 of the aforesaid bank guarantee as follows: in consideration of UBEL having furnished a Guarantee to ASPL for the due performance of the Sub Contract No. 229226 for and on behalf of the Consortium, we, Industrial Development Bank of India (IDBI), a Corporation established under the Industrial Development Bank of India Act, 1964 (18 of 1964) and having its Head office at IDBI Tower, WTO Complex, Cuffe Parade, Mumbai-400 005 and a Branch office at 44, Shakespeare Sarani, Calcutta-700 017 (hereinafter referred to as "idbi" which expression shall unless repugnant to the context or meaning thereof, include its successors, administrators, representatives and assignees) at the request of DCL do hereby irrevocably guarantee and undertake to pay UBEL, within fifteen (15) days of UBEL's first demand in writing without any demur and without referring to any other source any and all moneys payable by DCL for non-execution of DCL's Scope of Contract No. 229226 (read with Consortium Agreement dated 04. 08. 1999) as may be decided by UBEL only after ASPL invokes the guarantee provided by UBEL subject to the extent of 10% of the value of the DCL's portion of the Sub-Contract price i. e. Rs. 71,83,000/- (Rupees seventy one lac eighty three thousand only ). " (Emphasis added) ( 10 ) THE above said two bank guarantees were extended by Annexure 'b' at pages 58 to 60 inter alia in the following terms:" (1) We hereby extend the validity period of the above guarantee upto 10. 02. 2004 and (2) Any dispute/s arising out of this Bank Guarantee will be subject to jurisdiction of Court/s at Pune. " ( 11 ) UBEL by its letter being Annexure 'd' invoked the bank guarantee by its letter dated March 25, 2003. Plaintiff thereupon instituted a writ petition being W. P. No. 719 of 2003 and by an order dated April 11, 2003, same was dismissed on the ground of availability of alternative remedy of civil suit or arbitration as the petitioner may be advised and as may be available to the petitioner in law. Plaintiff thereupon instituted a writ petition being W. P. No. 719 of 2003 and by an order dated April 11, 2003, same was dismissed on the ground of availability of alternative remedy of civil suit or arbitration as the petitioner may be advised and as may be available to the petitioner in law. ( 12 ) PETITIONER thereupon filed the present suit and when the matter was moved before Court, an interim order of injunction was passed. ( 13 ) THE application has now been listed for final disposal after affidavits. ( 14 ) MR. Gautam Mitra, learned Advocate for the plaintiff submitted that the interim order needs to be confirmed on the well settled principles governing grant of injunction with respect to bank guarantees. A bank guarantee, it was urged, can be invoked only in terms thereof. Whereas, in the case on hand it is sought to be invoked contrary to the terms of the bank guarantee. This contention apparently is based upon the amended Clause 6. Attention of this Court was drawn to the interim order dated April 17, 2003 wherein it was observed as under;". . . I have also perused the Clauses mentioned in the bank guarantee furnished by the petitioner. It further appears that the bank guarantee was amended and which was duly accepted by the parties. It further appears from the bank guarantee that the defendant No. 2 (UBEL) shall have the right to invoke the bank guarantee only after the respondent No. 3 expresses their intention to invoke the guarantee furnished by the UBEL in favour of the defendant No. 3 (ASPL ). It further appears from the documents annexed to the petition that ASPL has specifically mentioned that they have not taken any steps in invoking the bank guarantee furnished by the defendant No. 2 and as such as has been submitted on behalf of the petitioner before me, has some substance to hold that a strong prima facie case has been made out at this stage by the petitioner to have an injunction restraining the defendant No. 2 not to invoke the said bank guarantees bearing Nos. 229225 and 229226 for a sum of Rs. 6,32,17,000/- and Rs. 71,83,000/- respectively. The defendant No. 1 is also directed not to take any steps at this stage in accordance with the invocation letter issued by the defendant No. 2. 229225 and 229226 for a sum of Rs. 6,32,17,000/- and Rs. 71,83,000/- respectively. The defendant No. 1 is also directed not to take any steps at this stage in accordance with the invocation letter issued by the defendant No. 2. The petitioner is directed to communicate the order to all the respondents who are not present before this Court. " ( 15 ) ALTHOUGH, in the affidavit-in-opposition, it has been stated that no amendment was carried out in respect of the bank guarantees and if any the same were not communicated to the defendant No. 2 by the defendant bank till date and come to learn of the same at the time of moving the application under Article 226 - W. P. No. 719 of 2003. In the affidavit-in-reply plaintiff has denied the said allegation and relied upon the letters dated December 6, 1999 and December 16, 1999 sent to defendant No. 2 by Fax and Mail collectively marked Annexure 'a' to the said affidavit-in-reply. ( 16 ) MR. Jayanta Banerjee, learned counsel for the defendant No. 2 UBEL submitted that Court's interference with bank guarantees is by now well settled and the instant case is one where no interference is warranted with the invocation of the bank guarantee. Objections have also been raised with regard to the maintainability of the suit on two grounds to which I shall refer to a little later. ( 17 ) WHILE considering the relief of injunction in respect of commercial transaction, power of Court has to be exercised with circumspection. In the matter of grant of injunction restraining the invocation of bank guarantee, the position in law has been crystallised by numerous decisions of the Apex Court. It is by now well settled that the autonomy of a bank guarantee is entitled to protection. Therefore, as a rule, Courts refrain from interfering with that autonomy. Contract of guarantee is independent and unqualified by the main contract between the parties. The banks must honour the guarantee free from Court's interference. It is only in exceptional cases that a Court would interfere. Illustrative of such exceptional cases being where fraud or irretrievable injury is established. In other words, Courts do not grant injunction restraining invocation of a bank guarantee except in cases where fraud or irretrievable injury is established. The banks must honour the guarantee free from Court's interference. It is only in exceptional cases that a Court would interfere. Illustrative of such exceptional cases being where fraud or irretrievable injury is established. In other words, Courts do not grant injunction restraining invocation of a bank guarantee except in cases where fraud or irretrievable injury is established. However, the said principles are applicable to cases where the liability of the bank is absolute and guarantee is unconditional. Reference for the above propositions may be made to the judgments relied upon by Mr. Jayanta Banerjee in Dwarikesh Sugar Industries Ltd. v. Pem Heavy Engineering Works (P) Ltd. and Anr. , AIR 1997 SC 2477 wherein several judgments of the Supreme Court have been considered and to the judgment in Federal Bank v. V. M. Jog Engineering Ltd. and Ors. , 2001 (Suppl.) Arb. LR 572 (SC ). ( 18 ) THOUGH as noticed supra, the bank guarantees are unconditional by amendment to Clause 6, certain conditions have been imposed which weighed with His Lordship P. C. Ghosh, J. , while issuing the interim injunction. Whether the amendments are valid or to the knowledge of the defendant No. 2 is not a matter which should detain us for that is a question which will have to be gone into at trial. Whether the bank guarantees could have been unilaterally amended as has been purported to be done without the consent or knowledge of the beneficiary (Defendant No. 2) or that such amendments had been sent by Fax and Mail to defendant No. 2 are matters which are of some significance and will have to be gone into at the trial and hearing of the suit. This aspect will also have a bearing on the nature of interim order to be passed on this motion. ( 19 ) THE objection strenuously urged on behalf of the defendant No. 2 is, however, with regard to the maintainability of the suit. ( 20 ) A two fold plea was advanced by Mr. Jayanta Banerjee, learned counsel for the defendant No. 2 with regard to the maintainability of the suit. Firstly, it was contended that an arbitration clause exist in the contract and, therefore, all disputes can be decided by only resort to arbitration proceeding. Secondly, it was contended that this Court has no jurisdiction to entertain, try and determine the suit and this application. Firstly, it was contended that an arbitration clause exist in the contract and, therefore, all disputes can be decided by only resort to arbitration proceeding. Secondly, it was contended that this Court has no jurisdiction to entertain, try and determine the suit and this application. ( 21 ) AS to the first ground, I find that this Court does not suffer from inherent lack of jurisdiction in entertaining the suit. Arbitration clause in an agreement per se does not constitute an ouster of jurisdiction of the Court. Reliance of Mr. Jayanta Banerjee upon the order dated April 11, 2003 in W. P. No. 719 of 2003 filed by the petitioner and which was dismissed at the threshold is misconceived. That writ petition was dismissed, as noticed supra, on the ground that there was an alternative remedy. Such order of dismissal does not determine the rights of the parties. No such rights were determined. They were left to be determined by appropriate proceedings. ( 22 ) AS regards the second ground, it was submitted that the defendant Nos. 2 and 3 are situate outside the Original civil jurisdiction of this Court and are also carrying on business beyond the jurisdiction of this Court. It was further submitted that the bank guarantee itself stipulates (supra) that any dispute arising out of the bank guarantee will be subject to jurisdiction of the Courts at Pune. ( 23 ) ON the other hand, Mr. Gautam Mitra contended that as part of the cause of action has arisen within the jurisdiction of this Court, the Court has the jurisdiction to entertain the suit in question. Mr. Mitra relied upon the consortium agreement being Annexure 'a' executed between UBEL and DCL and particularly to page 36 of the application to show that the contract between the parties was executed at Calcutta. It was further contended that the bank guarantee has been furnished by the defendant No. 1 bank at Calcutta. The invocation of the bank guarantee has been by the letter received at Calcutta. ( 24 ) RELIANCE was placed by Mr. Mitra upon a Division Bench judgment in Tata Finance Ltd. v. Pragati Paribahan and Ors. , AIR 2000 Cal 241 . The invocation of the bank guarantee has been by the letter received at Calcutta. ( 24 ) RELIANCE was placed by Mr. Mitra upon a Division Bench judgment in Tata Finance Ltd. v. Pragati Paribahan and Ors. , AIR 2000 Cal 241 . ( 25 ) NORMALLY, in the case of bank guarantee, it is not the place where the bank guarantee is executed nor even the place where the bank guarantee is invoked/enforced that a suit can be laid. This is for the reason that the said facts do not constitute part of the cause of action for a suit filed for injunction against bank not to pay any amount on the basis of the bank guarantee. As bank guarantee is furnished pursuant to a contract and being a guarantee for the performance the contract, it is either the situs of the contract or the place where the contract is to be performed that a suit can be filed at either of the said places. ( 26 ) AS held in A. B. C. Laminart Pvt. Ltd. and Anr. v. A. P. Agencies, Salem, AIR 1989 SC 1239 for a suit on breach of contract it is the place where the contract was made or the place where it is to be performed it can be said that a part of cause of action can be said to have arisen. That judgment is also an authority for the proposition that where there may be two or more competent Courts which can entertain a suit consequent upon a part of the cause of action having arisen therein if the parties to the contract agree to vest jurisdiction in one such Court the agreement would be valid. ( 27 ) THE above judgment of the Supreme Court was relied upon by the Division Bench of this High Court, to which I was a member, in Tata Finance Ltd. v. Pragati Paribahan and Ors. , AIR 2000 Cal 241 . In that case, the Court considered the clause in the agreement which conferred exclusive jurisdiction upon the Courts at Bombay and repelled the challenge to the jurisdiction of this Court when upon scrutiny of the facts in that case it was found as under:"11. In the instant case it has wrongly been stated in the agreement that the same was being executed at Bombay. In the instant case it has wrongly been stated in the agreement that the same was being executed at Bombay. In fact, the same had been executed at Calcutta. Admittedly, all the installments had been paid at Calcutta. The seizure of the vehicle which gave rise to the disputes and differences between the parties also took place at Calcutta. 12. It cannot, therefore, be said that any part of cause of action arose at Bombay and, thus, the Bombay Courts could have exclusive jurisdiction in the matter. " ( 28 ) AS contended by Mr. Mitra, learned counsel for the plaintiffs, the consortium agreement has been executed at Calcutta and it is in furtherance of the said agreement (Clause 14 thereof) that the bank guarantees in question have been executed at Calcutta by defendant No. 1 bank. The place of performance of the contract between the parties is a Tamilnadu (First Thermal Power Project Station at Neyveli ). It is, therefore, not established by the defendant as to how any part of the cause of action can be said to have arisen at Pune to confer exclusive jurisdiction upon the Courts at Pune or to oust the jurisdiction of this Court where a part of cause of action can be said to have arisen. ( 29 ) IN the light of the discussions as above and prima facie conclusions arrived at, the interim order, in my view, needs to be confirmed, however, with certain modifications. As the bank guarantee has been invoked by defendant No. 2, the validity whereof is subject matter of consideration in the present suit, instead of an injunction restraining the defendant No. 2 from invoking the bank guarantee, the better course, in my judgment, would be to issue an order of injunction restraining the bank from making any payment pending disposal of the instant suit. ( 30 ) ACCORDINGLY, an order of injunction shall issue restraining the defendant bank from making any payment to defendant No. 2 pursuant to the impugned letter of invocation and to hold the amount covered thereby in a separate account free from any lien awaiting the final orders that may be passed in the instant suit. It is so ordered and the interim order is accordingly modified in the above terms. The application stands disposed of. It is so ordered and the interim order is accordingly modified in the above terms. The application stands disposed of. In the facts and circumstances of the case, there shall be no order as to costs. Signed copy of the operative portion of the judgment and order be made available to the parties, if applied for, on the usual undertaking. Application disposed of of.