NON-REPORTABLE    

IN THE SUPREME COURT OF INDIA  CIVIL APPELLATE JURISDICTION  

 CIVIL APPEAL NO.5181 OF 2001  

 Board of Trustees                                …Appellant    VERSUS    Macgregor Navire Port Equipment A.B. & Anr.              …Respondents         

 O R D E R  

1. The Board of Trustees of the Port of Bombay is the appellant  

before us.   

2. The aforesaid appeal arises out of a suit filed by respondent No.1  

(Macgregor Navire Port Equipment A.B.) against the appellant and also  

against respondent No.2, inter alia, for an injunction restraining the  

appellant from encashing a bank guarantee issued by the bank at the  

instance of the respondent No.1. After some arguments were advanced by  

the learned counsel for the parties, our attention was drawn to an order of  

this Court dated 3rd of August, 2001 from which it appears that the  

appellant had invoked the bank guarantee on 29th of March, 1988.  

However, the bank chose not to make the payment and in fact on 28th of  

April, 1988, the High Court granted stay of encashment of the bank

guarantee. This Court in that order also noted that the bank guarantee in  

question had expired on 24th of February, 1989. This Court while passing  

the aforesaid order made the following direction :  

“…………pending hearing of the appeal, it shall pay to  the appellant the amount of the bank guarantee which was  invoked on 29th of March, 1988 along with interest at the rate  of 18% with quarterly rests with effect from  the date of the  invocation of the bank guarantee. In the event of the appeal  being dismissed, the appellant would be under an obligation to  return the money along with the same rate of interest.”  

  We are informed that the appellant has already been paid by the  

bank a sum of Rs. 34,38,171/-.   

3. After hearing the learned counsel for the parties and after going  

through the impugned order and the order passed by this Court at the  

interim stage, as quoted herein above, we find that the appellant was  

entitled to get Rs.3,16,716.50 being the principal sum together with  

interest at the rate of 8% from 29th of March, 1988 to 28th of    October,  

2001. Accordingly, the parties shall calculate the aforesaid sum with the  

aforesaid rate of interest up to the aforesaid period and if any excess  

amount has been paid, the same may be refunded by the appellant to the  

bank within two months from the date of communication of this order.   

4. With this direction, the appeal is disposed of. There will be no  

order as to costs.  

                …………………………..J.

                       [ TARUN CHATTERJEE ]        New Delhi:                                                       ………………………….J.  February 21, 2008.         [ HARJIT SINGH BEDI ]