USHA Vs. PUNJAB & SIND BANK & ORS.

JUDGEMENT

(1.) THE appellant is aggrieved by a judgment and order of the learned Single Judge dated 13.12.2010 whereby her suit for recovery of Rs. 65,84,252/ - was dismissed on the ground of limitation. The appellant -hereafter referred to as plaintiff -was a commission agent carrying on business under the name and style of M/s. Universal Exports and in the course of that activity, he used to introduce exporters to buyers and received commission from the sellers. The plaintiff alleged that the second defendant, a manufacturer of cotton yarn, was introduced by her to one M/s. Export India. The latter caused the revolving letter of credit no. 44/95 of Rs. 2 Crores to be opened in favour of the second defendant, the supplier. The terms of the LC indicated that it could revolve three times. The plaintiff further alleges that on account of this transaction or introduction, her concern was to receive 5% of the FOB value of the LC. The plaintiff relied upon Memorandum of Understanding (MOU) said to have been entered into between her and the second defendant - the supplier, on 22.07.1995, assuring payment of 5% commission of the FOB value after realisation of the sale proceeds. Certain other terms were also alleged. In the suit ultimately filed by the plaintiff, it was alleged that despite demands made upon the second defendant for payment of commission, an amount of Rs. 27,31,494/ - which was due to her was not paid and only the sum of Rs. 13,65,757/ - was paid upon her invoking the bank guarantee on 28.11.1995. The plaintiff consequently claimed a sum of Rs. 34,34,252/ - as principal towards balance commission payable along with interest @ 18% from 1.1.1996 to 30.11.1998.

(2.) THE Bank -Punjab & Sindh Bank, the first defendant in the suit, contended that its liability ceased on 30.11.1995, i.e., the last date of the bank guarantee. By then, the realized invoices and export proceeds shown to it were to the tune of Rs. 5,46,29,903/ -. It paid 2.5% of that value in terms of the bank guarantee, i.e., Rs. 13,65,748/ -. The bank also averred that the second defendant had informed it that the plaintiff had complied and performed only part of the contract and was entitled to the commission of only 2.5% of the FOB value.

(3.) THIS Court, before which the suit was originally filed, had framed eight issues. The impugned judgment dwelt on all the issues. The learned Single Judge was of the opinion that the plaintiff could establish entitlement to the extent of 5% of the total bank guarantee value, i.e., Rs. 6 Crores and thus was entitled to legitimately claim Rs. 30 Lakhs. However, the learned Single Judge was also of the opinion that the suit was time barred as it was filed on 30.11.2008. According to the learned Single Judge, the earliest point of time when the cause of action arose was on 28.11.1995 at the stage when plaintiff invoked the bank guarantee.