MALAYAN BANKING BERHAD Vs. INDUSIND BANK LIMITED

JUDGEMENT

(1.) The Plaintiff has filed the suit claiming a sum of Rs. 3,47,87,865.42 along with interest at 12% per annum from the date of filing of the suit or such other rate as this Hon'ble Court may deem fit and proper.

(2.) The Plaintiff is a bank situated in Malaysia. Sometime in December, 2011 MMTC Ltd. ("Buyer"), a Government of India organization placed an order for purchase of copper wire rod from one M/s. Synergic Industrial Marketing Services SDN. BHD., a company in Malaysia ("Seller"). At the instance of MMTC Ltd., the Defendant issued an irrevocable Letter of Credit dated 2nd December, 2011 for USD 544,500/( + / 3%). The letter of credit was available for negotiation with the Plaintiff and was governed by UCP600. The beneficiary viz., the seller submitted the documents to the Plaintiff and since the documents were in accordance with the requirements of the letter of credit, the Plaintiff negotiated the documents and paid the amount to the beneficiary. This negotiation took placed on 12th December, 2011 and the amount paid was USD 367,697.22 and USD 184,491.1 The letter of credit which the Defendant issued to the Plaintiff required certain documents to be submitted for receiving payment. The payment to be made was 90 days usance from the date of Bill of Lading. The Plaintiff forwarded the documents to the Defendant and the Defendant relayed its message dated 6th January, 2012, confirming its acceptance of the documents and undertook to reimburse the Plaintiff with the amount of letter of credit on the maturity date, i.e., 5th March, 201 The message copy whereof is at Page 43 to the plaint reads as under :

(3.) Thereafter, on 1st February, 2012, almost a month later, the Defendant sent a message to the Plaintiff that they have been informed by their applicant, i.e., MMTC Ltd., that some of the documents submitted were forged and the matter was being investigated. This was followed by a message dated 7th February, 2012, in which the Defendant made it clear that they will not be making payment on the due date, i.e., 5th March, 2012, as the documents mentioned stood refused. It is necessary to note that, on 6th January, 2012 the Defendant had accepted the documents as required under the LC terms and after almost one month, i.e., on 7th February, 2012, the Defendant states the documents are refused.