SARAF IMPEX PVT LTD Vs. FEDERAL BANK LTD

JUDGEMENT

(1.) The grievance of the plaintiffs appears to be this.

(2.) For the purpose of honouring a Letter of Credit in favour of the fifth defendant in a particular transaction, the first defendant bank was required to procure foreign exchange for the plaintiff company in August, 2011 for US Dollar 5,209,600. At that time the exchange rate was L 45.2058. However, the dollars were purchased by the bank at a much later point of time, on 2nd January, 2012, when the exchange rate rose to L 53.29. The differential payment to be made by the plaintiff was a little over L 4 Crores.

(3.) On that basis the plaintiffs have been declared to be a willful defaulter and their names are threatened to be posted by the third defendant as such, on the recommendation of the Reserve Bank of India. The plaintiff. company is a very large export house having substantial business. If its name is posted in the list of willful defaulters, no bank or financial institution would lend and advance any sum to them.