HC rejects ONGC's plea seeking continuation of Swiber's $15-mln bk guarantee
This story was originally published at 15:41 IST on 15 June 2026
Register to read our real-time news.Informist, Monday, Jun. 15, 2026
NEW DELHI – The Bombay High Court Monday rejected a plea by Oil and Natural Gas Corp. Ltd., seeking continuation of Swiber Offshore Construction Pte. Ltd.'s $14.82-million bank guarantee, pending adjudication of an appeal filed by the former against a 2025 arbitral award. ONGC has failed to establish exceptional and compelling circumstances to justify the grant of post-award interim protection under Section 9 of the Arbitration and Conciliation Act, 1996, said the high court.
It said ONGC has sought continuation of the bank guarantee even though the arbitral tribunal has rejected its claim for liquidated damages and directed return of that guarantee. ONGC seeks continuation of an arrangement despite findings recorded against it in the arbitral ward and despite the subsequent arrangement reflected in the consent terms, said the high court.
"I am unable to conclude that the challenge raised by ONGC is so strong that the award can almost be ignored while considering interim protection," said Justice Amit Borkar. ONGC's challenge undoubtedly raises issues, but some of the contentions advanced by ONGC may require examination in the appeal to the arbitral award, the court said. The merits shown by ONGC do not appear to reach the level necessary for grant of the extraordinary protection sought in the present proceedings, said the court.
In 2010, ONGC and Swiber had entered into a contract for execution of a project with a value of $14.82 million. Under the contract, if there was delay in completing the work, or if Swiber failed to perform its obligations, ONGC would get the right to recover liquidated damages. Further, the contract required Swiber to furnish a bank guarantee equal to the maximum amount of liquidated damages recoverable under the contract. ONGC had granted various extensions to Swiber for completing the work.
Subsequently, disputes arose between the parties in relation to the contract and claims arising from it and Swiber invoked arbitration. The arbitral tribunal partly allowed certain claims made by Swiber and certain counterclaims raised by ONGC. However, it rejected ONGC's claims for liquidated damages and directed return of the bank guarantee. ONGC filed an appeal against the arbitral award in the high court. Since the bank guarantee was approaching its expiry date on Monday, ONGC filed the present proceedings seeking continuation of the guarantee.
ONGC said that if the bank guarantee was allowed to expire while the challenge proceedings were still pending, it would lose the contractual security furnished by Swiber and may suffer serious prejudice. ONGC contended that such prejudice would become more serious because Swiber was already under liquidation.
On Monday, shares of ONGC Ltd. ended 1.0% lower at INR 243.65 on the National Stock Exchange. End
US$1 = INR 94.71
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Reported by Surya Tripathi
Edited by Avishek Dutta
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.
Informist Media Tel +91 (11) 4220-1000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2026. All rights reserved.
To read more please subscribe
Share this Story:
