That in relation to “Irretrievable injury”, the Hon’ble Supreme Court of India & Hon’ble High Courts of Different States of India in catena of Decisions has held & Observed as follows:

• In the case of Svenska Handelsbanken, Appellant v. M/s. Indian Charge Chrome and others, Respondents AIR 1994 SUPREME COURT 626, the Hon’ble Supreme Court observed:

  At Para 61, “Under the terms agreed to between the parties, there is no scope of injunction. The High Court proceeded on the basis that this was not an injunction sought against the bank but against the appellant. But the net effect of the injunction is to restrain the bank from performing the bank guarantee. That cannot be done. One cannot do indirectly what one is not free to do directly. The respondent was not to suffer any injustice which was irretrievable. The respondent can sue the appellant for damages. There cannot be any basis in the case for apprehension that irretrievable damage would be caused, if any.”
  
  At Para 96, “Again there is no case of any irretrievable injury either of the type as held in the case of Itek Corporation (566 Federal Suppl. 1210) (supra) as there is no difficulty in the judgment of this country being executable in the courts in Sweden.”
  
  At Para 98, “Irretrievable injury is of the nature as noticed in the case of Itek Corporation (566 Federal Supplement 1210) (supra).”
  
  At Para 83, in relation to the case of Itek Corporation v. The First National Bank of Boston etc. by the United States District Court, Massachusetts reported in 566 Federal Supplement 1210, the Hon’ble Supreme Court observed “It will be noticed that this judgment is on peculiar facts of its own and the situation created after the Iranian Revolution and the American Government cancelled the export licence in relation to Iran as it related to high technology……. The court was of the view that even if claim for damages is decreed by the American courts situation in Iran was such that the decree will not be executable in Iran. It was on these facts that the court felt that it was a case where the plaintiff had demonstrated that it has no adequate remedy at law and the allegations of irreparable harm are not speculative but genuine and immediate and the plaintiff would suffer irreparable harm if the requested relief is not granted.”

• In the case of Bridge Building Construction Co. Pvt. Ltd. …V/s… Cimindia Co. Ltd. & Others, II (1994) BC 530, the Hon’ble Calcutta High Court Observed:

  At Para 12, “Though the Petitioner has stated that irretrievable injustice will be caused to the Petitioner, yet it cannot be said that if the Petitioner ultimately succeeds in the arbitration proceedings, the Petitioner will not be able to recover the amount if any as may be awarded, in favour of Petitioner by the Arbitrator.

• In the case of Laxmikant Marketing Corporation …V/s… Karnataka State Electronics Development, II (1995) BC 519, the Hon’ble Karnataka High Court Observed:

  At Para 8, the Hon’ble Court observed “It is also not demonstrated what the irreparable harm that the plaintiff will suffer. It is also not shown that the plaintiff has no other remedy except the one now pursued. The apprehension expressed by the appellant is speculative and not real”.

• In the case of M/s Tarapore and Co., Madras …V/s… M/s V/O Tractoroexport Moscow and another, A.I.R. 1970 SC 891, the Hon’ble Supreme Court of India observed:

  At Para 7, “The main grievance of the Indian Firm is that if the Russian Firm is allowed to take away the money secured to it by the letter of Credit, it cannot effectively enforce its claim arising from the breach of the contract it complains of. It was urged on its behalf that the Russian firm has no assets in this country and therefore any decree that it may be able to obtain cannot be executed. …. The allegation that the Russian Firm has no assets in this country was not made in the pleadings. That apart in the circumstances of this case that allegation has no relevance. An irrevocable letter of credit has a definite implication. It is a mechanism of great importance in international trade. Any interference with that mechanism is bound to have serious repercussion on the international trade of this country. Except under very exceptional circumstances, the courts should not interfere with that mechanism.

• In the case of United Commercial Bank …V/s… Bank of India and others A.I.R. 1981 SC 1426, the Hon’ble Supreme Court of India:

  At Para 41 Quoted with approvable, that “It is only in exceptional cases that the courts will interfere with the machinery of irrevocable obligations assumed by banks. They are the life-blood of international commerce. Such obligations are regarded as collateral to the underlying rights and obligations between the merchants at either end of the banking chain. Except possibly in clear cases of fraud of which the banks have notice, the courts will leave the merchants to settle their disputes under the contracts by litigation or arbitration as available to them or stipulated in the contracts. The courts are not concerned with their difficulties to enforce such claims; these are risks which the merchants take … the machinery and commitments of banks are on a different level. They must be allowed to be honoured, free from interference by the courts. Otherwise trust in international commerce could be irreparably damaged”.

Balance of convenience in his favour.

Other Important Case Laws relating to Letter of Credit/ Bank Guarantee

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