INDIAN BANK Vs. EURO INTERNATIONAL PRIVATE LIMITED

JUDGEMENT

(1.) This appeal has been filed by the appellant against order dated 11-06-98 inter alia restraining the appellant Bank from enforcing two Bills of Exchange. The order is noted in detail subsequently.

(2.) The appellant is a nationalised Bank. It had sanctioned credit facilities to the respondent No. 2, Ganapati Export Ltd. (hereinafter referred to as Ganapati) from its office at Nariman Point, Bombay subject to a limit of Rs. 40 Crores. The facility granted was a packing credit facility to enable Ganapati to export rice to the respondent No. 1 (referred to as Euro) in Singapore. Several documents were executed by Ganapathi on 8th July, 1994 in connection with this advance including deeds of hypothecation of moveable property and stocks, and a promissory note. An agreement for bills purchased was also executed by Ganapati.

(3.) The terms of the bills purchased agreement which are relevant for the purposes of this appeal provided as follows :