Authority: High Court of Andhra Pradesh
Order Date: 25.02.2026
Case Overview
- Parties: Unnamed petitioner, 3rd respondent (Executive Engineer), and 5th respondent (Bank).
- Background: Under a contract dated 2012, the petitioner furnished a bank guarantee of Rs.2,14,69,400 as a condition precedent. Disputes arose, leading the 3rd respondent to invoke the guarantee. The Bank prepared demand drafts for the 3rd respondent.
- On 10.10.2025 the Court issued an order restraining the disbursement of those demand drafts. The matter was later dismissed for non‑prosecution, prompting an interlocutory application to restore the writ petition.
- The petitioner asserted that the securities pledged with the guarantee remain in force and that demand drafts lapse after three months.
Observations & Directions
- To balance the claims of the petitioner and the 3rd respondent, the Court directed the 5th respondent‑Bank to cancel the demand drafts and retain the full guarantee amount of Rs.2,14,69,400 in the petitioner’s account.
- The Bank was further instructed not to permit the petitioner to withdraw the Rs.2,14,69,400 from his account pending final disposal of the writ petition.
- The Court condoned a procedural delay of 422 days in the proceedings.
- The petitioner was ordered to pay costs of Rs.10,000 to the High Court A.P Legal Services Committee within two weeks of the order.
Final Outcome
- The writ petition (W.P.No.1314 of 2012) was restored on the Court’s file.
- The Bank must keep the guarantee amount locked in the petitioner’s account and refrain from any withdrawal until the writ is finally disposed.
- The delay was condoned and a cost of Rs.10,000 was imposed on the petitioner.
Topics: Bank Guarantee, Court Order