SATYAM FIBRES INDIA P LTD Vs. INDIAN BANK

JUDGEMENT

(1.) THE complainant shipped certain quantity of cotton grey sheeting ("the goods") under a contract on 17th May, 1989 to a French firm M/s. STE Kolori. Originally the goods exported were of the value of French Francs 4,35,000 and subsequently by an agreement among the buyers and the seller this was reduced to French Francs 4,10,000 only. The said goods were to be delivered to the buyer in France against acceptance of bills of exchange drawn by the complainant on M/s. STE Kolori and co-accused to by a foreign Bank.

(2.) THE complainant supplier drew bills of exchange which on their face, stated that draft was to be accepted by the drawer and co-accepted by the drawee Bank for payment on 31.12.1991. The Bills of Exchange were submitted to the opposite party Indian Bank with a covering letter on 26th August, 1991 which specifically instructed the opposite party Bank that the said Bills of Exchange have to be accepted by the buyer and co-accepted by the Bank named thereon for payment on 31.12.1991.

(3.) ON the 10th December, 1991 the complainant was informed by the liquidator that the said buying firm M/s. STE Kolori had gone into liquidation. In January, 1992, on enquiries made from the opponent, the complainant came to know that the said Bills of Exchange had not been honoured on the due dates due to liquidation of the buyer firm and that under the French Law the French Banks do no co-accept Bills of Exchange. As such, no such co-acceptance was obtained from the Foreign Bank by the buyer M/s. STE Kolori. The opposite party Bank also denied their liability to make payment of French Francs 4,10,000 to the complainant.