https://www.taxtmi.com/caselaws?id=278885 An unconditional bank guarantee operates as an independent contract, and the bank's obligation to honour it on demand is not affected by disputes under the underlying contract. Injunction against encashment is justified only where fraud is clearly pleaded and prima facie established by strong evidence, or where special equity exists to prevent irretrievable injustice. A mere dispute over the amount due under the contract is insufficient to restrain invocation of the guarantee. On the facts, no fraud was shown and no special equity was established, so restraint on enforcement was not warranted. en-us Wed, 31 Jul 1996 00:00:00 +0530 Sat, 23 Aug 2025 10:17:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=278885 An unconditional bank guarantee operates as an independent contract, and the bank's obligation to honour it on demand is not affected by disputes under the underlying contract. Injunction against encashment is justified only where fraud is clearly pleaded and prima facie established by strong evidence, or where special equity exists to prevent irretrievable injustice. A mere dispute over the amount due under the contract is insufficient to restrain invocation of the guarantee. On the facts, no fraud was shown and no special equity was established, so restraint on enforcement was not warranted. Case-Laws Indian Laws Wed, 31 Jul 1996 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=278885