M/S Bses Ltd. (Now Reliance Energy Ltd.) vs M/S Fenner India Ltd. & Anr

The Supreme Court addressed the issue of injunction against the enforcement of bank guarantees, emphasizing that exceptions based on 'lack of good faith' or 'oblique purpose' do not apply in this context. The Court held that the unconditional nature of bank guarantees, as per the Arbitration and Conciliation Act, 1996, does not permit intervention unless there is a strong prima facie case of fraud or irretrievable injustice. The appeal was allowed, and the injunction against the Appellant was lifted, affirming the enforceability of the bank guarantees.