Commercial Court – Jurisdiction – Counter Bank Guarantee governed by Egypt Laws
In 2023, the plaintiff submitted tender and approached SBI for bid bond / performance security of USD 1,50,000. SBI approached the Qatar National Bank for Bid Bond with the condition of a counter bank guarantee for the said amount in favour of the appellant. CBG was accordingly issued on 10.2.2023 valid till 30.6.2023 subject to the Egypt laws.
On 19.4.2023, Fayum Gas issued purchase order to the plaintiff. However, following the disputes and differences, Faiyum Gas terminated the purchase orders and invoked the bank guarantee issued by the appellant Qatar National Bank. The appellant in turn invoked CBG. However, receipt of CBG proceeds, the plaintiff filed the Commercial Suit on 9.11.2023.
The respondent no.1 filed commercial suit againt Fayum Gas Company, State Bank of India, appellant – Quatar National Bank Alahli and the Central Bank Egypt for declaration that the termination of purchase order and invocation of Bid Bond is null and void. Prayer for injunction from invoking bid bond was also made. The learned Single Judge granted ex parte interim injunction against Qatar Bank from invoking CBG.
HELD that the High Court has no jurisdiction to entertain the Commercial Suit when the parties agreed that CBG shall be governed by the Egypt Laws and when the said CBG is an independent contract between SBI and Qatar Bank.
Judgment dated 23.1.2025 of the Division Bench of High Court of Bombay (OS) in Commercial Appeal No.18 of 2024 of Qatar National Bank Alahli Vs. Man Industries (India) Limited and others with connected matters
