Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | International trade - Letter of credit (LC) |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Dismissed |
Headnote | Intemational trade — Letter of credit (LC) — Responsibility of the opening bank — Held: In trans-border or international transactions, trade depends almost entirely on the faith reposed in banking institutions to secure the price of the exported goods, commodities etc — Exporter can legally and reliably expect that the Bankers will watch its interests by ensuring that the exported consignment shall be released to the buyer only on the transmission of the price of the shipment as secured through LC — Thus, heavy and fiduciary responsibility rests on the Opening Bank which furnishes LC to ensure that payment is secured unless the documentation is defective and/or the invocation of LC is discrepant - Opening Bank cannot disregard, delay or dilute its responsibility to make payment strictly and promptly as obligated by the terms of LC — Law assures the Exporter and its Bank to repose in the expectation, nay, certainty, that the consignment, which is the subject-matter of LC is not usurped by the importer/Consignee or its agents, without remitting payment to the consignors Bank — On facts, Indian exporter exporting rice to Bangladesh firm-importer — Appellant had opened LC for sum of USD 352,250 on Bank of India, Calcutta in favour of Exporter — Appellant Bank evaded mentioning that without the permission of or information to either the Exporter or the Bank of India, it had provided its certification to photocopies of the documentation which, in the event, and as any prudent banker would anticipate were misused by the Importer to have the rice consignment released to him — Appellant admitted its liability in the Dhaka |
Judge | Hon'ble Mr. Justice Vikramajit Sen |
Neutral Citation | 2015 INSC 34 |
Petitioner | National Bank Limited |
Respondent | Ghanshyam Das Agarwal & Ors. |
SCR | [2015] 1 S.C.R. 937 |
Judgement Date | 2015-01-14 |
Case Number | 7513 |
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