Phonex Traders Private Limited & Anr. Vs Union of India & Ors. (Calcutta High Court)
The Calcutta High Court allowed the writ petition challenging the communication dated 17th February, 2026 whereby respondent no.2 requested HDFC Bank, Chowringhee Branch, to encash the petitioners’ Performance Bank Guarantee of ₹85,06,020.
The petitioner no.1 and respondent no.2 had entered into several contracts relating to containerized cargo between 2006 and 2019. The last contract, awarded pursuant to the tender dated 16th May, 2019, was granted on 13th February, 2020 and was subsequently extended with effect from 1st March, 2024. Under this contract, the petitioner furnished a security deposit of ₹42,53,010 and a Performance Bank Guarantee of ₹85,06,020, valid up to 2nd April, 2025 with a claim period extending to 2nd April, 2026. Cargo operations at ICP Petrapole were taken over by the Land Ports Authority of India, following which the petitioner’s services were discontinued with effect from 17th May, 2024. The petitioner thereafter sought release of the security deposit and Performance Bank Guarantee, but no action was taken by the respondents.
The dispute had its origin in a demand raised in April 2012 for ₹3,49,56,927, relating to alleged excess Service Tax payments made during the period from 1st November, 2008 to 31st May, 2011 under the first contract. The petitioners challenged the respondent’s determination before the High Court. By judgment dated 1st December, 2017 in WP No. 14252 (W) of 2012, the Court set aside the respondent’s order dated 21st June, 2012, holding that the respondent could not adjudicate its own claim and enforce recovery by itself. The respondent preferred an appeal along with an application for stay, but the Appellate Court refused interim stay on 10th December, 2019.
