Federal Bank Ltd vs V.M Jog Engineering Ltd. And Ors

The Supreme Court held that the Negotiating Bank, Federal Bank, was wrongfully denied reimbursement from the Issuing Bank due to a temporary injunction granted against the latter, despite the absence of allegations of fraud or forgery against the Negotiating Bank. The Court emphasized that the Negotiating Bank had acted in accordance with the Uniform Customs and Practice of Documentary Credits (1983) and had no locus standi in the injunction proceedings. The Court overturned the lower courts' decisions, allowing the Negotiating Bank to seek reimbursement from the Issuing Bank.