JUDGMENT :- (Per A. Gopal Reddy J.) 1. When vacate stay petition is listed for hearing, both the counsel requested the court to dispose of the main writ petition itself. 2. M/s. K. Ramakrishna Contractors (P) Ltd., a company registered under the provisions of the Indian Companies Act,1956, having its registered office at Hyderabad, represented by its Managing Director, K.Ramakrishna (for short “the petitioner-company”) is engaged in the activity of carrying out public contract works entered into a contract with the civic authorities in Kerala for laying of water supply pipes in the areas of Kozhikode, Meenad and Puttuvam in Kerala State vide contact bearing No.19/2004-2005/CE-JBIC. In furtherance of the said contact, the petitioner-company entered into three contracts on 27-9-2006 with M/s. Electrosteel Castings Limited, Kolkata (for short “M/s.Electrosteel”) for supply of Ductile Iron (DI) pipes for JBIC assisted KWS Projects to be operated in the areas of Kozhikode, Meenad and Puttuvam. As per the agreements entered in between the petitioner-company and M/s.Electrosteel, M/s. Electrosteel undertook to supply Ductile Iron pipes on petitioner-Company furnishing guarantee from any nationalized bank, and accordingly the petitioner-Company furnished bank guarantee worth Rs.3 crores, 1.5 crores and 1.5crores respectively for the above three projects. M/s. Electrosteel by invoking the bank guarantee furnished by the petitioner-company encashed the bank guarantees to the extent of Rs.5,08,110,00/-as against Rs.3 crores, 1.5 crores and Rs.1.5 crores. According to the petitioner-company, it informed the respondent-Bank through its letters dt. 15-1-2009 and 16-1-2009 not to honour the bank guarantee on invocation as the amount claimed by M/s. Electrosteel is excess than their liability. In spite of the same, the respondent-Bank ignored the letters and honoured the invocation of bank guarantee to a tune of Rs.5,08,110,00/-. Apprehending invocation of bank guarantees by M/s.Electrosteel and its honour by the respondent-Bank, the petitioner-company filed OS No.195/2009 before III Additional Chief Judge, City Civil Court, Hyderabad, seeking the following reliefs: 1. Declare the action of the defendant-Bank in making excess payments against the admitted liability of Rs.2,09,12,981/- as arbitrary, illegal and contrary to the terms and conditions of the bank guarantees executed on 9-12-2006 bearing Bank Guarantee Nos.12/2006, 13/2006 and 14/2006; 2. Upon such a declaration, consequential injunction be granted permanently restraining the defendant-bank from making the demand for repayment of a sum of Rs.2,98,98,019/- paid by it by playing fraud, mistake or wantonly to ECL and consequentially from declaring the plaintiff as NPA; 3. Upon such a declaration, consequential injunction be granted permanently restraining the defendant-bank from making the demand for repayment of a sum of Rs.2,98,98,019/- paid by it by playing fraud, mistake or wantonly to ECL and consequentially from declaring the plaintiff as NPA; 3. Grant such other relief or reliefs to which the plaintiff is legally entitled to. Along with the suit, the petitioner-company filed IA No.952/2009 seeking ad-interim injunction restraining the defendant-bank from declaring the petitioner-company’s account as “Non Performing Asset” pending disposal of the main suit. The III Additional Chief Judge by order dt. 23-3-2009 granted status-quo while issuing notice to the respondent-Bank. The order of status-quo has not been extended from 1-6-2009. Apprehending that due to non-extension of the order of status-quo, the bank my proceed against the petitioner-company, the petitioner-company filed IA No.2075/2009 for extension of the status-quo order. On dismissal of IA No.2075/2009 on 23-6-2009 by the learned Judge, the petitioner-Company successfully canvassed the matter before this court in CRP No.2934/2009. This court by order dt. 21-8-2009 allowed the revision setting aside the order of dismissal dt. 23-6-2009 passed in IA No.2075/2009 in OS No.195/2009 and remanded the matter to the Court of III Additional Chief Judge, City Civil Court, Hyderabad for fresh consideration. On remand, III Additional Chief Judge by order dt. 17-9-2009 rejected IA No.2075/2009 filed for extension of status quo order dt.23-3-2009. The petitioner-company filed Tr.CMP No.515/2009 for transfer of the case from III Additional Chief Judge, City Civil Court, Hyderabad to any other court. In TR.CMP No.632/2009 in Tr.CMP No.515/2009, the petitioner-company obtained stay of all further proceedings in OS No.195/2009 including interlocutory applications on 24-9-2009. As the status-quo order was not extended from 1-6-2009, the respondent-Bank declared the account of the petitioner-company as “Non-Performing Asset” with effect from 16-6-2009 and issued notice dt. 24-7-2009 under Sec. 13(2) of the Securitisation & Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (for short ”SARFAESI Act, 2002”). On receipt of the said notice, the petitioner-company filed a reply on 19-8-2009. In compliance of Section 13 (3) (A) of SARFAESI Act, 2002, the respondent-Bank by letter dt. 27-8-2009 justified its action in declaring the account of the petitioner-company as “Non-Performing Asset” under SARFAESI Act, 2002 and informed that the objection raised in response to the notice issued under Section 13(2) is replied. In compliance of Section 13 (3) (A) of SARFAESI Act, 2002, the respondent-Bank by letter dt. 27-8-2009 justified its action in declaring the account of the petitioner-company as “Non-Performing Asset” under SARFAESI Act, 2002 and informed that the objection raised in response to the notice issued under Section 13(2) is replied. But nowhere it is stated that they have rejected the representation made by the petitioner-company, and contending so they filed the present writ petition to issue a writ of Certiorari for calling for the records pertaining to the notice dt. 24-7-2009 and consequential proceedings dt.27-8-2009 and 29-8-2009 and quash the same and direct the respondent-Bank not to take any steps by treating the account of the petitioner-company as “Non Performing Asset”. 3. The respondent-Bankfiled a counter-affidavit along with vacate stay petition contending that the petitioner-company availed bank guarantee limit of Rs.1450.00 lakhs on 23-3-2006 and Clean Overdraft limit of Rs.25.00 lakhs after execution of necessary loan documents. On invoking the bank guarantee, the respondent-Bank was constrained to release the payment since the bank cannot stop the payment or stop release of the payment on the ground that any dispute between the beneficiary and the party on whose behalf the guarantee is issued is subsisting, regarding the payments. Once the petitioner-company specifically authorized the bank to release the payment in case of invocation of the bank guarantees, under the loan documents including counter guarantee executed for the purpose of availing the bank guarantee limit to Rs.1450.00 lakhs and agreed to indemnify the respondent-Bank, the petitioner-company is bound by the terms and conditions settled under the loan documents and counter guarantees. On beneficiary invoking all the three bank guarantees vide their letter dt. 12-1-2009 for a total sum of Rs.5,08,11,000/-, the respondent-Bank received the said letter of invocation on 15-1-2009 and honoured the bank guarantees furnished on 16-1-2009. The respondent-bank vide its letter dt. 16-1-2009 informed the petitioner-company about the payment made by the Bank to the beneficiary pursuant to the invocation of the bank guarantees and called upon the petitioner-company to reimburse the amount paid by the bank to the beneficiary along with interest. The subsequent letter dt.1-7-2009 was only a notice of demand for payment in the normal course of banking procedure. Since the petitioner-company failed to remit the amount paid by the bank, a notice under Sec. 13(2) of SARFAESI Act, 2002 dt. The subsequent letter dt.1-7-2009 was only a notice of demand for payment in the normal course of banking procedure. Since the petitioner-company failed to remit the amount paid by the bank, a notice under Sec. 13(2) of SARFAESI Act, 2002 dt. 24-7-2009 was issued directing the petitioner-company and the guarantors to liquidate the entire liability within a period of 60 days from the date of receipt of the said notice. The petitioner-company was also directed to pay a sum of Rs.6,04,08,121/- with further interest at the rate of 17.50 % per annum compounded monthly from 1-7-2009 till the date of realization. In the said notice, it has been specifically stated by the Bank that the account of the petitioner-company was declared as “Non-Performing Asst” with effect from 16-6-2009. On petitioner-company giving reply through its reply dt. 19-8-2009, in compliance of Sec.13(3)(A) of the SARFAESI ACT,2002, the respondent-Bank disposed of the same on 27-8-2009 and informed the petitioner-company accordingly. The entire procedure initiated by the respondent-Bank is strictly in accordance with the SARFAESI Act, 2002. Filing of suit OS No.195/2009 before the civil court and granting status quo and not extending the status quo order from 1-6-2009 are all matters on record. On remand from this court, III Additional Chief Judge again heard the matter on 17-9-2009 and dismissed the application, IA No.2075/2009, by way of speaking order. On disposing of the representation, the petitioner-company will have a right of appeal under Section 17 of the SARFAESI Act, 2002 to the Debt Recovery Tribunal and further appeal to the Debt Recovery Appellate Tribunal at Chennai under Sec. 18 of the SARFAESI Act, 2002 against any final order passed in that regard. Therefore, the petitioner-company is not entitled to invoke the jurisdiction of this court under Art. 226 of the Constitution of India and prayed for dismissal of the writ petition. 4. Sri Milind G. Gokhale, learned counsel appearing for the petitioner-company contended that when the suit is filed disputing the liability of the petitioner-company to M/s. Electrosteel and also obtained an order of status-quo, issuing Sec.13(2) notice during the interregnum period ie., from the date of expiration of the order of status quo ie., 1-6-2009 to 21-08-2009, on which date the revision is allowed by the High Court, is arbitrary and illegal. When the petitioner-company filed the suit on 23-3-2009, in which bank filed its written statement on 1-6-2009 and declared the account of the petitioner-company as Non-Performing Asset with effect from 16-6-2009 by notice under Sec. 13 (2) dt. 24-7-2009, the question whether the account of the petitioner-company can be declared as non-performing asset or not is sub judice in OS No.195/2009 before the III Additional Chief Judge, City Civil Court, Hyderabad, which granted order of status quo. He further contended that the writ petition cannot be rejected on the ground of availability of alternative remedy of appeal under Section 17 of the SARFAESI Act, 2002. In support of the said contention, he placed reliance on the judgment of this court in NEEL MADHAV MINING PVT. LTD., V AUTHORISED OFFICER, UNION BANK OF INDIA 2005(4) ALT 136 (DB) and Orissa High Court in NOBLE AQUA PVT. LTD., V. STATE BANK OF INDIA AIR 2008 ORISSA 103. 5. It is not disputed by the learned counsel for the petitioner-company that learned III Additional Chief Judge granted status quo on 23-3-2009; same was extended from time to time till 1-6-2009 and thereafter it has not been extended. In view of non-extension of the order of status-quo, the petitioner-company filed IA No.2075/2009 seeking extension of the status quo order granted in IA No.952/2009, but the same was dismissed on 23-6-2009. This court set-aside the order passed in IANo.2075/2009 by allowing CRPNo.2934/2009 and remitting the matter to the trial court with a direction to pass appropriate orders on merit. But it is no where asserted that this court continued the order of status quo pending revision or on disposal of revision till IA No.2075/2009 is disposed of. It is specifically asserted by the respondent-bank that on remand said IA No.2075/2009 was dismissed on merits. In view of the same there is no bar for the respondent-bank in proceeding under the provisions of SARFAESI Act, 2002 since the petitioner-company failed to remit the amount paid by the bank to the beneficiary on invocation of the bank guarantees. It is pertinent to notice the bank by its letter under Sec. 13(2) demanded the petitioner-company to pay Rs.6,04,80,121/- with further interest at the rate of 17.50% per annum compounded monthly together with all costs, charges, expenses and incidental charges from 1-7-2009 till the date of payment. It is pertinent to notice the bank by its letter under Sec. 13(2) demanded the petitioner-company to pay Rs.6,04,80,121/- with further interest at the rate of 17.50% per annum compounded monthly together with all costs, charges, expenses and incidental charges from 1-7-2009 till the date of payment. Whereas the petitioner-company seeks declaration that the action of the Bank in making excess payment to M/s. Electrosteel amounting to Rs. 2,98,98,019/- against the admitted liability of Rs.2,09,12,981/- as arbitrary and illegal. But it is no where stated by the petitioner-company that admitted liability of Rs.2,09,12,981/- payable on invocation of the bank guarantees to the bank has been paid on demand, therefore, it can be declared as non-performing asset. 6. It is now fairly well settled that in the matter of invocation of a bank guarantee or a letter of credit, it is not open to the bank to rely upon the terms of the underlying contract between the parties. The bank giving such guarantee is bound to honour it as per its terms irrespective of any dispute raised by its customer on whose behalf bank guarantee is given to the beneficiary under the bank guarantee. Bank cannot have any valid resistance, for payment of amount covered by bank guarantee, except of course, in a case of fraud. Further, bank guarantee should be read along with terms of contract between the parties, when bank guarantee absolute and unconditional terms of contract have no relevance. Since a bank guarantee or a letter of credit is an independent and a separate contract and is absolute in nature, the existence of any dispute between the parties to the contract is not a ground for issuing an order of injunction to dishonour the bank guarantee given by the bank, otherwise banks would expose to unnecessary litigation and banks’ credit will be at stake. Further Section 34 of the SARFAESI Act,2009 prohibits the jurisdiction of the Civil Court to entertain any suit or proceeding in respect of any matter which the Debts Recovery Tribunal or an Appellate Tribunal is empowered by or under the Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred under this Act or under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. Section 35 of the SARFAESI Act,2002 gives overriding effect to the provisions of the said Act notwithstanding anything inconsistent therewith contained in any other law for the time being in force. In view of the same, the contention advanced by the learned counsel for the petitioner-company that bank cannot take possession of the property and it is hit by Section 52 of the Transfer of Property Act do not merit consideration, and the same is accordingly rejected. 7. Once the petitioner-company committed a default in remitting the amount paid by the bank on invocation of the bank guarantees, the dispute between the petitioner-company and the beneficiary of the bank guarantee with regard to any liability is not a ground for not honouring the bank guarantee on invocation, and the petitioner-company has to reimburse the said amount and can recover the same from the beneficiary in the event it succeeds against the beneficiary either in an independent suit or under the terms of the contract including the bank in honouring the bank guarantee against the terms of the bank guarantee. Once the petitioner-company failed to establish that the bank paid the amount covered by the bank guarantee contrary to the terms of the contract, the petitioner-company cannot disown its liability, which it undertook under the loan agreement, and also counter indemnity guarantee. 8. In view of the same, we do not see any merit in the writ petition. 9. The writ petition fails and is accordingly dismissed. No costs.