AMITARA INDUSTRIES LTD Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) Complainant/Appellant herein has filed this Appeal against the judgment and order dated 31.08.06 passed by the State Consumer Disputes Redressal Commission, Gujarat (in short, 'the State Commission') in complaint No. 56/99 wherein the State Commission dismissed the complaint filed by it.

(2.) Complainant/Appellant was engaged in the business of exporting textile goods to the foreign currencies. During the course of business, Appellant sold the textile goods to M/s. BPS Nico Ltd., Moscow, Russia under irrevocable Letter of Credit (ILC) No.96129 opened on 28.11.96 by Bangkok Bank, PCL, London. The entire purpose of operating under the ILC was to ensure that the said letter of credit in no way be revoked or cancelled and the ILC opening Bank would mandatorily honour the said letter of credit by making the payments irrespective of the outcome of the dealing between the parties concerned on the due date of payment according to the prevailing international documentary credit practice and rules. The bill of sale along with letter of credit and the relevant documents was submitted by the Appellant with the Respondent Bank with a clear instructions to deliver the same to the buyer's Bank on the acceptance from the buyer and collect the payment on due date from the foreign correspondent bank/letter of credit operating bank. Appellant negotiated the said bill with the Respondent and the Respondent discounted the bill on the strength of the ILC and agreed to render service to the Appellant after charging consideration for the same.

(3.) Respondent discounted the said export bill for $ 88,443/- on 6.1.97. The bill was due for payment on 31.3.97. The Letter of Credit Opening Bank (Bank of Bangkok) accepted the export bill for payment on due date, i.e. 31.3.97. However, before the due date of payment, i.e., 31.3.97, the importer BPS Trading approached the London Court and obtained an ex-parte order restraining the ILC opening bank, i.e. Bank of Bangkok from making the payment towards the export bill on due date on the ground of serious quality problem in the goods imported. Respondent Bank contested the proceedings in the London Court and the London Court set aside the restrain order in January, 1998 in its favour. The principle amount of $ 88,443/- was received from Bank of Bangkok on 19.1.98 and the interest amounting to $ 4,355.94 awarded by the London Court was also paid to the Appellant. The costs of 7704 British Pounds awarded by the London Court could not be recovered by the Respondent Bank as the importer company went into liquidation. Respondent Bank incurred legal expenditure amounting to GBP 11257.45 (approx.Rs.7,43,000) which were debited in Appellant's account. Respondent Bank also recovered a sum of Rs.4,84,158/- towards interest from the Appellant as it received the amount in respect of the discounted export bill of $ 88,443/- only on 14.1.98 though the payment was due on 31.3.97. Appellant, being aggrieved, filed the complaint before the State Commission.