XPO XPERT PRIVATE LIMITED Vs. PUNJAB NATIONAL BANK

JUDGEMENT

(1.) The petitioner-company was wound up vide order dated 22.9.1983 (C.P. No. 32 of 1983). Later the Company's Directors submitted various documents and the statement of affairs to the Liquidator, the latter found that an amount of Rs. 1,60,000/- i.e. equivalent to 13,439.54 U.S. Dollars was due to the company from the respondent-Punjab National Bank on account of certain goods supplied by the Company to M/s Abdul Aziz Ahmed Abdul Salam of Khartoum (Sudan). As per the stand of the Liquidator, the bank had to collect this amount from its counterpart i.e. Sudan Commercial Bank, Khartoum, through whom the invoice and the bill of exchange was passed on to M/s Abdul Aziz Ahmed Abdul Salam. Since the bank had failed to pay this amount on repeated requests, the present petition was filed by the Liquidator under Section 446(2) of the Companies Act. The case of the bank is that it had passed on the documents i.e. invoice and the bill of exchange and bill of lading etc. to Sudan Commercial Bank, Khartoum on the directions of the seller company and latter the Sudan Commercial Bank though had collected the amount from M/s Abdul Aziz Ahmed Abdul Salam for the goods supplied, yet could not pay to the bank on account of certain foreign exchange problems between the two countries i.e. Sudan and India. The bank denies its liability on the ground that it never collected the amount from M/s Abdul Aziz Ahmed Abdul Salam or the Sudan Commercial Bank, Khartoum. Mr. Jain urges with some amount of vehemence that the bank cannot possibly escape its liability in view of Section 211 of the Indian Contract Act as it was acting as an agent of the company and could not hand over the documents i.e. invoice, bill of exchange, bill of lading etc. to M/s Abdul Aziz Ahmed Abdul Salam except on receiving the price of goods in cash i.e. in U.S. Dollars. Having given thoughtful consideration to the submission of the learned counsel, I am of the opinion that it is right that when the respondent-bank passed on the above referred to documents to the Sudan Commercial Bank, it acted as an agent of the company, yet the bank did not incur any liability to pay any amount to the company on that account alone. It is clear cut stand of the bank that the above noted documents were handed over the Sudan Commercial Bank, Khartoum for purposes of collecting the price of goods from M/s Abdul Aziz Ahmed Abdul Salam, Khartoum, as per the instructions of the company itself. This is also very clear from bill of exchange (Exhibit P.2) which reads :

(2.) So, the act of the Bank passing on the above noted documents to Sudan Commercial Bank, Khartoum was not an independent act of the respondent and was rather in consonance with the directions of the company itself. Otherwise also, the learned counsel for the Liquidator is not in a position to refer to any condition, practice or principle which the respondent-bank has violated. Merely because it had passed on the documents referred to above to Sudan Commercial Bank, Khartoum, it did not create any liability for itself to reimburse or to pay the price of the goods supplied to M/s Abdul Aziz Ahmed Abdul Salam, Khartoum by the company though it was entitled to collect the price of the amount payable by the said purchaser i.e. M/s Abdul Aziz Ahmed Abdul Salam through the Sudan Commercial Bank, Khartoum since the bank did not collect this price for one reason or another, it to my mind came under no obligation to pay the price of the goods from its own account. Therefore, this petition fails and is dismissed.