[ By Bobby Anthony ]The Bank of Baroda (BoB) has announced that it has moved the Supreme Court challenging a Calcutta High Court order in a case regarding a bank guarantee issued by BoB on behalf of Simplex Projects Ltd.Earlier, the Calcutta High Court had asked the Reserve Bank of India (RBI) to consider “appropriate steps” against Bank of Baroda (BoB), including cancelling its...
The Bank of Baroda (BoB) has announced that it has moved the Supreme Court challenging a Calcutta High Court order in a case regarding a bank guarantee issued by BoB on behalf of Simplex Projects Ltd.
Earlier, the Calcutta High Court had asked the Reserve Bank of India (RBI) to consider “appropriate steps” against Bank of Baroda (BoB), including cancelling its banking license, after it was found to have delayed honoring a bank guarantee.
The Calcutta High Court order stated that the Indian Oil Corporation Ltd (IOCL) had entered into an agreement with Simplex Projects in 2017 so that it could undertake work at IOCL’s Bongaigaon facility.
To undertake this work, Simplex was required to provide a bank guarantee as a security deposit. An unconditional bank guarantee was furnished by BoB on behalf of Simplex for about Rs 6.97 crore, which was later revoked by IOCL.
“Considering the conduct of the appellants, the RBI should consider what appropriate steps may be taken against the Bank of Baroda, including revoking its license or the authority to carry on banking business, if necessary,” the order dated February 10, issued by Justice Sanjib Banerjee and Justice Kausik Chanda had stated.