JUDGMENT : DEVASHIS BARUAH, J. 1. Heard Mr. G. Goswami, the learned counsel for the appellants and Mr. U.K. Nair, the learned senior counsel assisted by Mr. R. Singha, the learned counsel appearing on behalf of the respondent. 2. This is an application under Section 37 (1) (b) of the Arbitration and Conciliation Act, 1996 (for short, the Act of 1996) challenging the order dated 15.11.2019, passed in Misc. (Arb) Case No. 57/2019 whereby the Court of the Additional District Judge, No. 1, (Kamrup (M) at Guwahati vide the said order had restrained the appellants herein from invoking or encashing the performance bank guarantee amounting to Rs.8,01,88,780/- furnished by the respondent herein and also from forfeiting the security deposit and earnest money deposited by it for the work allotted to it. 3. At this stage, it may be relevant herein to mention certain relevant facts before entering into the adjudication of the appeal. The order impugned is an ex-parte order. The appellants had filed the written objection in the said Misc (Arb.) Case No. 57/2019 and the Court of the Additional District Judge, No. 1, (Kamrup (M) at Guwahati is presently in seisin of the Section 9 proceedings. Further to that, it is also relevant to mention that on 21.09.2020, this Court while taking up the instant appeal had also made an observation that there shall be no bar on the part of the learned Court of the Additional District Judge to give final consideration to the Misc. (Arb) Case No. 57/2019, even during the pendency of this appeal and before the next date fixed for consideration of the appeal. Mr. G. Goswami, the learned counsel for the appellants submits that in spite of the said observation made by this Court, till date, the said Misc. (Arb) Case No. 57/2019 is still pending before the court below and the order impugned and the delay in disposal of the said Section 9 proceedings has seriously affected the rights of the appellants. 4. As the said Misc. (Arb) Case No. 57/2019 is still pending adjudication before the Court of the Additional District Judge, No. 1, (Kamrup (M) at Guwahati, this Court would confine its adjudication to the legality and validity of the impugned order keeping the said aspect of the matter in mind. 5. 4. As the said Misc. (Arb) Case No. 57/2019 is still pending adjudication before the Court of the Additional District Judge, No. 1, (Kamrup (M) at Guwahati, this Court would confine its adjudication to the legality and validity of the impugned order keeping the said aspect of the matter in mind. 5. The brief fact of the instant case is that pursuant to a tender process the respondent which is a Joint Venture was entrusted with the work, namely, 'supplying, fabrication, assembling and erection of composite girders for 20 Nos. Major bridges having total 128 spans (18.3m X 4 Nos., 24.4m X 29 Nos. & 30.50m X 95 Nos.) in between stations Bairabi and Sairang, including metalizing of construction of new BG Railway line from Bairabi to Sairang (Mizoram)'. The letter of acceptance was issued to the respondent on 10.07.2018 and the contract value was Rs.160,37,75,608.74. The performance guarantee in terms of a bank guarantee issued by the Allahabad Bank was submitted on 28.08.2018 for a value of Rs.8,01,88.780/- and the contract agreement was signed on 06.07.2019. The completion period was 18 months from the letter of acceptance. 6. It is the case of the appellants that the respondent failed to perform its part of the contract as per the terms of the contract and as such a termination notice was issued vide Letter No. W/60/CON/B-S/MB/2017/12/2560 dated 06.11.2019 as per Clause 62 of the General Conditions of the Contract. 7. The respondent herein, after receiving the termination notice dated 06.11.2019, filed an application under Section 9 of the Act of 1996 before the Court of the Additional District Judge, No. 1, (Kamrup (M) at Guwahati which was registered and numbered as Misc. (Arb) Case No. 57/2019 praying for grant of interim measure by way of injunction restraining the appellants herein from invoking the relevant clauses of the contract invoking the bank guarantee dated 28.08.2018 for an amount of Rs.8,01,88,780/- issued by the Allahabad Bank, Zonal Office, Ulubari, Guwahati-781007 and also from forfeiting the security deposit and earnest money deposited by the respondent till disposal of the petition. 8. 8. The Court of the Additional District Judge, No. 1, (Kamrup (M) at Guwahati vide the impugned order dated 15.11.2019 issued notice to the appellants asking to appear before the Court and file objection against the application under Section 9 of the Act of 1996 and till disposal of the petition, the appellants herein, their servants, workmen, employees, agents etc. were restrained from invoking or encashing the performance bank guarantee amounting to Rs.8,01,88,780/- furnished by the respondent and also from forfeiting the security deposit and earnest money deposited by it for the work allotted to it. 9. It is against this order that the appellants are before this Court under Section 37 (1) (b) of the Act of 1996. 10. I have perused the said order impugned in the instant proceeding. By the said order, the appellants were restrained from invoking or encashing the performance bank guarantee issued by the Allahabad Bank and from forfeiting the security deposit and earnest money. The said order does not disclose any reason as to why the said order was passed. 11. The law as regards grant of interim measure under Section 9 of the Act of 1996 is well settled and the principles for granting of interim relief are: (i) good prima-facie case; (ii) balance of convenience in favour of grant of interim relief and (iii) irreparable injury or loss to the applicant for interim relief. 12. However, the Court below in passing the impugned order has not at all taken into consideration the said aspects of the matter and only after recording the stand of the respondent, who was the applicant in the said proceeding, has passed the order. The learned Court ought to have known that grant of interim measures could neither have been claimed as a matter of right nor that grant of interim measures was a charity. As already stated herein above, the Court while exercising the jurisdiction under Section 9 of the Act of 1996 is required to follow the principles well settled before the grant of interim measures. The satisfaction in respect to the aforesaid principles is a condition precedent for grant of interim measures, be it, pending disposal of the Section 9 proceedings. 13. At this stage, it is relevant to take note of the law as regards grant of injunction in respect to invocation of bank guarantee. The satisfaction in respect to the aforesaid principles is a condition precedent for grant of interim measures, be it, pending disposal of the Section 9 proceedings. 13. At this stage, it is relevant to take note of the law as regards grant of injunction in respect to invocation of bank guarantee. The Supreme Court in the case of Andhra Pradesh Pollution Control Board vs. CCL Products (India) Limited, (2019) 20 SCC 669 had the occasion to deal with the aspect as regard to the invocation of bank guarantee. The Supreme Court after relying upon the various judicial precedents had held that except in the case of fraud, irretrievable injustice and special equities, the court should not interfere with the invocation or encashment of a bank guarantee so long as the invocation was in terms with the bank guarantee. Paragraph Nos. 16 to 20 of the said judgment, being relevant, are quoted herein below: “16. The principle which we have adopted accords with a consistent line of precedent of this Court. In Ansal Engg. Projects Ltd. vs. Tehri Hydro Development Corporation Ltd. a three-Judge Bench of this Court held thus: (SCC p. 454, Paras 4-5) “4. It is settled law that bank guarantee is an independent and distinct contract between the bank and the beneficiary and is not qualified by the underlying transaction and the validity of the primary contract between the person at whose instance the bank guarantee was given and the beneficiary. Unless fraud or special equity exists, is pleaded and prima facie established by strong evidence as a triable issue, the beneficiary cannot be restrained from encashing the bank guarantee even if dispute between the beneficiary and the person at whose instance the bank guarantee was given by the bank, had arisen in performance of the contract or execution of the works undertaken in furtherance thereof. The bank unconditionally and irrevocably promised to pay, on demand, the amount of liability undertaken in the guarantee without any demur or dispute in terms of the bank guarantee... 5......The court exercising its power cannot interfere with enforcement of bank guarantee/letters of credit except only in cases where fraud or special equity is prima facie made out in the case as triable issue by strong evidence so as to prevent irretrievable injustice to the parties.” 17. 5......The court exercising its power cannot interfere with enforcement of bank guarantee/letters of credit except only in cases where fraud or special equity is prima facie made out in the case as triable issue by strong evidence so as to prevent irretrievable injustice to the parties.” 17. The same principle was followed in SBI vs. Mula Sahakari Sakhar Karkhana Ltd. where a two-Judge Bench of this Court held thus: “33. It is beyond any cavil that a bank guarantee must be construed on its own terms. It is considered to be a separate transaction. 34. If a construction, as was suggested by Mr. Naphade, is to be accepted, it would also be open to a banker to put forward a case that absolute and unequivocal bank guarantee should be read as a conditional one having regard to circumstances attending thereto. It is, to our mind, impermissible in law.' 18. A bank guarantee constitutes an independent contract. In Hindustan Construction Co. Ltd. v. State of Bihar4, a two-Judge Bench of this Court formulated the condition upon which the invocation of the bank guarantee depends in the following terms: “9. What is important, therefore, is that the bank guarantee should be in unequivocal terms, unconditional and recite that the amount would be paid without demur or objection and irrespective of any dispute that might have cropped up or might have been pending between the beneficiary under the bank guarantee or the person on whose behalf the guarantee was furnished. The terms of the bank guarantee are, therefore, extremely material. Since the bank guarantee represents an independent contract between the bank and the beneficiary, both the parties would be bound by the terms thereof. The invocation, therefore, will have to be in accordance with the terms of the bank guarantee, or else, the invocation itself would be bad.” (Emphasis supplied) 19. The settled legal position which has emerged from the precedents of this Court is that absent a case of fraud, irretrievable injustice and special equities, the Court should not interfere with the invocation or encashment of a bank guarantee so long as the invocation was in terms of the bank guarantee. 20. In the present case, the bank undertook to the appellant that it would pay the guaranteed amount on demand, subject to the overall amount stipulated in each of the three bank guarantees. 20. In the present case, the bank undertook to the appellant that it would pay the guaranteed amount on demand, subject to the overall amount stipulated in each of the three bank guarantees. It was not for the bank to determine as to whether the invocation of the bank guarantees was justified so long as the invocation was in terms of the bank guarantee. A demand once made would oblige the bank to pay under the terms of the bank guarantee. State Bank of India correctly understood its legal obligations and paid over the amount to the appellant. In this view of the matter and having regard to the terms of the bank guarantees, we are of the view that the principle of law which has been formulated by the Tribunal cannot be accepted as reflecting the correct legal position.” 14. From a reading of the above quoted paragraphs and applying the same to the facts of the instant case it would be seen that the bank guarantee is an independent and a distinct contract between the bank and the beneficiary and in the instant case between the Allahabad Bank and the appellants herein. A perusal of the said bank guarantee would show that it is not qualified by any underlying transaction and the validity of the primary contract between the person at whose instance the bank guarantee was given (the respondent herein) and the beneficiary. Unless fraud or special equity exists which is pleaded and prima-facie established by strong evidence as a triable issue, the beneficiary cannot be restrained from encashing the bank guarantee even if dispute between the beneficiary and the person at whose instance the bank guarantee was given by the bank, had arisen in performance of the contract or execution of the works undertaken in furtherance thereof. In the instant case, the bank unconditionally and irrevocably promised to pay, on demand, the amount of liability undertaken in the guarantee without any demur or dispute in terms of the bank guarantee provided the invocation is done in terms with the bank guarantee. 15. In the instant case, the bank guarantee in question dated 28.08.2018, contained the following stipulations in paragraph Nos. 3 & 4, which is quoted herein under: “3. 15. In the instant case, the bank guarantee in question dated 28.08.2018, contained the following stipulations in paragraph Nos. 3 & 4, which is quoted herein under: “3. We Allahabad Bank, Panbazar Branch, Guwahati further agree that the guarantee herein contained shall remain in full force and effect during the period that would be taken for the performance of the said agreement and that it shall continue to be enforceable till all the dues of the Government under or by virtue of the said Agreement have been fully paid and its claims satisfied or discharged or till Chief Engineer/Con, N.F. Railway, Maligaon, Guwahati, Assam-7810011 certified that the terms and conditions of the said Agreement have been fully and properly carried out by the said contractors and accordingly discharge this Performance Guarantee. Unless a demand or claim under this guarantee is made on us in writing on or before the 28.05.2020 we shall be discharged from all liability under this guarantee thereafter. 4. We Allahabad Bank, Panbazar Branch, Guwahati further agree with the Government that the Government shall have the fullest liberty without our consent and without affecting in any manner or obligations hereunder to vary any of the terms and conditions of the said Agreement or to extent time of performance by the said contractors from time to time or to postpone for any time or from time to time any of the powers exercisable by the Government against the said contractors and to forbear or enforce any of the terms and conditions relating to the said Agreement and we shall not be relieved from our liability by reason of any such variation, of extension being granted to the said contractors or for any forbearance, act or omission on the part of the Government or any indulgence by the Government to the said contractors or by any such matter or thing whatsoever which under the law relating to sureties would, but for this provision, have affected of so relieving us.” 16. In the backdrop of the above law, if this Court looks into the impugned order it would be seen that the learned Additional District Judge, No. 1, Kamrup (M) at Guwahati did not deal with the said aspect of the matter at all and it mechanically without any application of mind had passed the impugned order. In the backdrop of the above law, if this Court looks into the impugned order it would be seen that the learned Additional District Judge, No. 1, Kamrup (M) at Guwahati did not deal with the said aspect of the matter at all and it mechanically without any application of mind had passed the impugned order. It further astonishes and shocks this Court to see that while granting the interim measures, no condition such as extension of the validity of the bank guarantee or keeping the bank guarantee alive till disposal of the Section 9 proceedings were imposed although at paragraph No. 27 of the application under Section 9 of the Act of 1996, the respondent herein had given an undertaking to keep the bank guarantee in question valid for such further time as may be directed by the court. 17. Mr. U.K. Nair, the learned senior counsel for the respondent submits that during the pendency of the instant appeal, the State Bank of India had filed a proceeding under Section 7 of the Insolvency and Bankruptcy Code, 2016 (for short ‘the Code’) for initiation of Corporate Insolvency Resolution Process against one of the partners of the Joint Venture, i.e. Nayak Infrastructure Pvt. Ltd. Taking into consideration that the respondent herein is a Joint Venture which is a separate legal entity as held by the various judicial precedents (See Gammon India Limited vs. Commissioner of Customs, Mumbai, (2011) 12 SCC 499 ), the said submission of Mr. U.K. Nair, the learned senior counsel is misplaced in the present facts and circumstances of the case. 18. Considering the above, this Court, therefore, sets aside the impugned order dated 15.11.2019 passed in Misc. (Arb.) Case No. 57/2019 and further directs the learned Court of the Additional District Judge, No. 1, Kamrup (M) at Guwahati to proceed with the adjudication of Misc. (Arb) Case No. 57/2019 as expeditiously as possible and preferably within a period of 30 (thirty) days from the date of appearance of the parties before it. 19. The parties shall appear before the said court below on 14.07.2022. 20. The above adjudication is only as regards the order impugned in the instant proceeding and the court below shall not be influenced by the observations made herein above while finally deciding the proceeding under Section 9 of the Act of 1996. 19. The parties shall appear before the said court below on 14.07.2022. 20. The above adjudication is only as regards the order impugned in the instant proceeding and the court below shall not be influenced by the observations made herein above while finally deciding the proceeding under Section 9 of the Act of 1996. It is further clarified that vide this order, this Court has only gone into the legality and validity of the impugned order which relates to curtailment of the right to invoke the Bank Guarantee by the Appellants by way of an injunction and no observations have been made as regards the rights of the appellants to invoke the bank guarantee vis-a-vis the Allahabad Bank in question. The question as regards the undertaking given by the respondent in paragraph No. 27 of the application is left open for the court below to decide in the final outcome of the Section 9 proceedings. 21. In view of the above observations and orders, the instant appeal stands disposed of.