Devyani Food Industries Limited & Anr. v. Indian Power Corporation Limited & Ors.

In this background, the petitioner had also initiated a proceeding before the Grievance Redressal Officer (GRO), challenging the above demand which was ultimately dismissed by an order dated 18 September 2025. Being aggrieved by the order dated 18th September, 2025 the petitioner had also filed a statutory appeal before the Ombudsman. It is an admitted position that proceeding before the Ombudsman is pending and there has not been any final decision. In view of the above, there is no legal debt which has yet become due and payable by the 5 petitioner to the respondent no. 1. The disputed bill is still pending final determination. This issue is being adjudicated and rights and obligations of the parties have not yet crystalized. In this background, after having waited for a period of more than three years, the respondent no. 1 has arbitrarily and whimsically invoked the bank guarantee furnished by the petitioner and credited the proceeds thereof. Any action uninformed by reason or in violation of the Rule of Law is arbitrary and is liable to be struck down. There is no lawful justification which respondent no. 1 has been able to demonstrate in invoking the above bank guarantee. In order to survive any interference, any action must not be susceptible to the vice of arbitrariness which is the crux of Article 14 of the Constitution. In view of the above, the entire action of the respondent no. 1 in the invoking bank guarantee is arbitrary, unreasonable and without any lawful authority. The respondent no. 1 cannot be unjustly enriched and enjoy the fruits of their illegality. In such circumstances, the writ petition stands allowed. The respondent is restrained from claiming any further sum on account of security deposit or demand any additional bank 6 guarantee as security from the petitioners. The amount so invoked and credited in favour of the respondent no. 1 shall be treated as security deposit for the electricity connection granted to the petitioner. To this extent, WPA 5144 of 2026 stands allowed. (Ravi Krishan Kapur, J.)