T S SAWHNEY Vs. STATE

JUDGEMENT

(1.) This petition under S.397/401, Criminal P.C. is directed against an order of a Metropolitan Magistrate dt. Sept. 24, 1985.

(2.) T.S. Sawhney, the petitioner, is a partner of M/s. Sawhney Brothers. This firm is engaged in the business of export. Ramesh Suri, Mahender Suri and their father, K.L. Suri are partners of M/s. Orient Enterprises. This firm is carrying on import business. M/s. Orient Enterprises, it is stated, entered into an agreement with M/s. Bentrex and Company, a Singapore firm, for the import of cloves (Zanzibar quality) of the valve of Rs. 40 lacs. They lacked finances and consequently entered into an agreement, dt. July 26, 1979, with Sawhney Brothers. Under the agreement Sawhney Brothers agreed to open a letter of credit with its bankers at New Delhi for Rs. 40 lacs. They were to be paid 2% commission on the CIF value of the consignment of the value of Rs. 40 lacs. The agreement contained various other terms.

(3.) Pursuant to this agreement, two insurance covers one for Rs. 44 lacs insuring the risk regarding the consignment in question and the other for Rs. 16 lacs insuring the profit on the said goods were obtained on July 31, 1979 from the Oriental Fire and General Insurance Co. Ltd. (for short 'Insurance Company'). A sum of Rs. 19,378.40 was paid towards premium for the first policy and Rs. 7046.70 for the second. Insured in both the covers was "M/s. Sawhney Brothers, New Delhi". Under the terms of these policies consignment was required to be shipped "per any first class and/or approved steamer (particulars of which to be declared hereafter)". Sawhney Brothers opened an irrevocable letter of credit with the Central Bank of India for Rs. 40 lacs on Aug. 10, 1979. This amount was to be paid to M/s. Bentrex and Company at Singapore on shipment of the consignment to India and on presentation of the usual documents.