Delhi High Court – Orders
Central Transmission Utility Of India … vs Idbi Bank Limited Through Its Chairman & … on 19 March, 2026
Author: Jasmeet Singh
Bench: Jasmeet Singh
$~6
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 9305/2024
CENTRAL TRANSMISSION UTILITY OF INDIA LTD
.....Petitioner
Through: Mr. Alok Shankar, Mr. Tushar Jain,
Advs.
versus
IDBI BANK LIMITED THROUGH ITS CHAIRMAN & ANR.
.....Respondent
Through: Adv. Sidhartha Barua Adv. Praful
Jindal Adv. Kumar Arnav Singh Deo Adv. Naman
Chaliha
Mr. Raghav Mittal, Ms. Adyasha Patra, Advs. for
R2
CORAM:
HON'BLE MR. JUSTICE JASMEET SINGH
ORDER
% 19.03.2026
1. This is a writ petition filed under Article 226 of the Constitution of
India seeking the following prayers:-
“(a) issue a writ of Mandamus or any other appropriate Writ,
Order or Direction directing Respondent No.1 Bank to
forthwith release an amount of Rs.8.7 Cr. to the Petitioner in
under the Bank Guarantee dated 26.5.2016 [bearing
NO.1601331BGP00255] in terms of the letter dated
17.12.2020 of the Petitioner rightfully invoking the said Bank
Guarantee;…”
2. The brief facts of the case are that the respondent No.2 furnished 22
bank guarantees to the petitioner amounting to an aggregate sum of
Rs. 66 crores. The petitioner invoked 11 bank guarantees of about Rs.
32 crores, including a bank guarantee Bearing No.1601331BGP00255
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of Rs. 8.7 crores, vide letter dated 17.12.2020
3. Mr. Shankar, learned counsel for the petitioner, states that the said
invocation has been held to be valid as per the order of the National
Company Law Tribunal and National Company Law Appellate
Tribunal. Despite the petitioner invoking the bank guarantees in
accordance with law, the respondent bank did not remit the amounts
covered by the bank guarantee.
4. Mr. Barua, learned counsel for the respondent, states that the petition
raises disputed questions and draws my attention to the refusal of the
bank dated 05.02.2024 which reads as under:-
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5. The said refusal letter was followed by the letter dated 12.02.2024
issued by the petitioner, wherein the petitioner again reiterated its
demand for encashment of the bank guarantees and cited the RBI
Regulations. The same was again refused on 16.02.2024 by the
respondent bank.
6. My attention has been drawn to a judgment of the Coordinate Bench
in IDBI Bank Ltd. v. Power Finance Corporation passed in W.P.(C)
11946/2018,
“28. In Joshi Technologies International INC v. Union of India
and Ors (supra),… Paragraph nos. 68 and 69 are reproduced
as under:
“68….At the same time, discretion lies with the High
Court which under certain circumstances, can refuseThis is a digitally signed order.
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to exercise. It also follows that under the following
circumstances, ‘normally’, the Court would not
exercise such a discretion:
(a) the Court may not examine the issue unless the
action has some public law character attached to it.
(b) Whenever a particular mode of settlement of
dispute is provided in the contract, the High Court
would refuse to exercise its discretion Under Article
226 of the Constitution and relegate the party to the
said made of settlement, particularly when settlement
of disputes is to be resorted to through the means of
arbitration.
(c) If there are very serious disputed questions of fact
which are of complex nature and require oral
evidence for their determination.
XXXXXXXX
(iii) Even in cases where question is of choice or
consideration of competing claims before entering into
the field of contract, facts have to be investigated and
found before the question of a violation of Article 14
could arise. If those facts are disputed and require
assessment of evidence the correctness of which can
only be tested satisfactorily by taking detailed
evidence, involving examination and cross-
examination of witnesses, the case could not be
conveniently or satisfactorily decided in proceedings
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Under Article 226 of the Constitution. In such cases
court can direct the aggrieved party to resort to
alternate remedy of civil suit etc.
(iv) Writ jurisdiction of High Court Under Article 226
was not intended to facilitate avoidance of obligation
voluntarily incurred.
(v) Writ petition was not maintainable to avoid
contractual obligation. Occurrence of commercial
difficulty, inconvenience or hardship in performance
of the conditions agreed to in the contract can provide
no justification in not complying with the terms of
contract which the parties had accepted with open
eyes. It cannot ever be that a licensee can work out
the license if he finds it profitable to do so: and he
can challenge the conditions under which he agreed
to take the license, if he finds it commercially
inexpedient to conduct his business….
XXXXX
(xi) The scope of judicial review in respect of disputes
falling within the domain of contractual obligations
may be more limited and in doubtful cases the parties
may be relegated to adjudication of their rights by
resort to remedies provided for adjudication of purely
contractual disputes.”
[Emphasis supplied]
29. In State of Bihar & Ors. v. Jain Plastics and Chemicals
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Ltd. (supra), the Hon’ble Supreme Court was to adjudicate
upon the issue–whether the High Court ought not to have
exercised its jurisdiction under Article 226 of the Constitution
of India for granting relief in case of alleged breach of
contract. The Apex Court held that a writ petition under Article
226 of the Constitution of India is not the proper proceeding
for adjudicating such disputes. Under the law, it was open to
the respondent therein, to approach the court of competent
jurisdiction for appropriate relief for breach of contract. It is
settled law that when an alternative and equally efficacious
remedy is available to a litigant, he should be required to
pursue that remedy and not invoke the writ jurisdiction of the
High Court. Equally, the existence of an alternative remedy
does not affect the jurisdiction of the court to issue a writ, but
ordinarily, that would be a good ground in refusing to exercise
the discretion under Article 226 of the Constitution of India.
xxxx
32. This court in National Building Construction Corp. v.
Punjab National Bank, was to decide upon a writ petition that
prayed, inter alia, for a direction as against the respondent
no.1 therein, to remit certain amount under the bank
guarantee. After relying upon Kerala State Electricity Board
(supra), this court held in paragraph nos. 17 and 18 to the
following effect:
“17. The law enunciated in the above two judgments
is fully applicable on the facts of the present caseThis is a digitally signed order.
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also. The bank guarantee furnished by the
respondent no. 1 in favour of the petitioner at the
instance of the respondent no. 2 is a private contract
and not a statutory contract. It is governed by the
provision of the Contract Act. The dispute relating to
the interpretation of the terms and conditions of such
contract and the validity of the invocation of the bank
guarantee and whether the amount was payable by
the respondent no. 1 on such invocation of the bank
guarantee are the questions which were agitated in a
writ petition. It is a matter either of arbitration as
provided by the contract or for the civil court or any
other appropriate forum to decide these questions.
18. It cannot be denied that the normal remedy for
enforcing a right for payment under the private
contract like the bank guarantees in question from
the State or from the instrumentality of the State was
by filing a civil suit in the civil court…”
Emphasis supplied]”
7. I have heard the learned counsels for the parties.
8. The perusal of judgment makes it clear that the law regarding the
bank guarantees being a separate private contract is settled. Any
dispute related to interpretation of the terms of bank guarantee and
terms of invocation is a subject matter of civil suit. On a perusal of the
facts, it becomes apparent that the present dispute arises out of
invocation of the bank guarantee dated 26.05.2016. The petitioner hasThis is a digitally signed order.
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placed reliance on the orders of NCLT and NCLAT to substantiate his
claims of invocation of bank guarantee. The respondent bank has
raised objections stating that the bank guarantee has expired and
therefore, the said amount secured by the bank guarantee could not be
released. The relief sought by the petitioner would entail
interpretation of terms of the bank guarantee, being an independent
contract governing the parties.
9. Such questions are not merely question of law but are intertwined
with the disputed questions of facts and would thus involve detailed
examination of evidence and contractual terms. The interpretation of
terms of the Bank Guarantee between two parties cannot be given the
color of public law.
10. The writ jurisdiction of this Court is undoubtly expansive but it is not
a forum for contesting disputes which involve careful scrutiny of facts
and evidences. A writ court is short of jurisdiction to adjudicate such
disputes and entertaining the present petition would effectively
require to undertake the adjudication akin to that of a civil suit. When
an alternative and equally efficacious remedy is available with the
party aggrieved, the writ jurisdiction should not be invoked. The same
is neither the purpose nor the scope of proceedings under Article 226
of the Constitution of India, rather it shall be abuse of the expansive
jurisdiction conferred upon this Court under the Article 226 of the
Constitution of India.
11. In such circumstances, the Court is of the considered view that the
present petition is not amenable to adjudication in the writ
jurisdiction. However, the petitioner is at liberty to file a suit inThis is a digitally signed order.
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accordance with law.
12. Hence, granting the petitioner the said liberty, the present petition is
disposed of.
JASMEET SINGH, J
MARCH 19, 2026 / (MS)This is a digitally signed order.
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