TaxTMI 
TaxTMI 
TaxTMI 
2000 (1) TMI 988
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....n [hereinafter referred to as the foreign bank]. The respondent claimed that he did not ask the appellants to negotiate the export documents through any particular bank in Sudan but the appellants on their own appointed the foreign bank for realising the export proceeds from the consignee; that the appellants had not at any time consulted or even obtained the respondents opinion in the matter of appointing the foreign bank; that the appellants had to release the export documents to the consignee only on payment of the export value in U.S.Dollars and the instructions to release the shipping documents to the consignee to enable him to take delivery of the consignment as denoted by the expression cash against documents. It is further claimed that the appellants should not have realised the export documents without receiving the export value from the consignee in U.S.Dollars. It is contended that the invoices were realised in U.S.Dollars and the appellants could not have realised the export documents before ensuring that the export proceeds could be repatriated to India in U.S.Dollars. In accordance with the directions of the Reserve Bank of India in the matter of exports, the procee....
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.... matter of repatriation of export proceeds are attributable to the appellants but the Reserve Bank of India had been pressurising the respondent for repatriation of the export proceeds. Therefore, it was claimed that an amount of ₹ 2,25,377.04p U.S.Dollars was due to the respondent towards the export proceeds from Sudan which were covered by the documents negotiated through the appellants. It was claimed that the respondent is a consumer under the Consumer Protection Act, 1986 and had hired the services of the appellants for consideration and there has been a total deficiency or absolute breach of agreement in the performance of the duty or otherwise in relation to the service rendered by the appellants. The appellants contended that the claim had become stale as it related to the years 1979 to 1982; that the matter did not fall under the provisions of the Consumer Protection Act and accordingly, the Commission had no jurisdiction; that there was no transaction with the respondent and the banks customer was a firm carrying on business in partnership by name M/s Javerilal & Sons and thus the respondent had no locus standi at all; that there was no deficiency of service on th....
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....g Corporation, New York with instructions to make payment to the Banks Central Foreign Exchange Department, Bombay. The Commission further adverted to the Export Control Manual, 1978 issued by the Reserve Bank of India and held that the appellants being an authorised dealer was enjoined to receive the remittances from foreign countries or to obtain the reimbursement from their correspondent in those countries against payments due for exports from India either in rupees from the account of a bank situate in Group A countries or receive payment in any permitted currency. According to the Commission, those instructions were clear to fix the responsibility of the bank who was also an authorised dealer under the Export Control Manual and thus the Commission concluded that there was a lapse on the part of the appellant bank in realising the consignments against local currency and without ensuring realisation and repatriation of the export value in U.S.Dollars. The respondent modified the claim in the light of the appellants response and limited the claim for damages as follows : a. Rupee equivalent of U.S.$ 22,538 [10% of the total amount receivable]; b. ₹ 52,816.76p deducted ....
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....is dealing with documentary credits, banks deal only with the documents and not with the underlying transaction. Accordingly, the bank has not failed to provide the service that it was expected to. 5. The Commission seriously erred in granting the relief and that too in excess of the prayer. The respondent was not entitled to any relief whatsoever. On behalf of the respondent the contentions raised before the Forum to which we adverted to in detail are reiterated. The agreement between M/s Javerilal & Sons and Sudan Tea Company dated March 19, 1979 provided for sale of tea. Clause (5) thereof provided the mode of payment. It states that the payment of the seller shall be made on the basis of cash against documents on the arrival of the carrier at Port Sudan through EL NILEIN BANK, KHARTOUM and subject to the presentation of following documents: 1. Complete set of clean on board bill of lading marked foreign pre-paid in three negotiable copies. 2. Suppliers invoice in ten copies showing C&F Port Sudan in Dollars. Details to include number of chests gross and nett weights and marks. Invoice to be certified true and correct and signed. 3. Certificate of Origin. 4. Preshipment i....
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....ent in respect of shipments in question. The said form was signed both by the consignor and the appellant bank. It has been declared therein that the amount shall be deposited by the buyer in the local currency with a correspondent bank in the buyers country on the date indicated against that column and proceeds are awaiting transfer to India. The claim was to the extent of 90% of the value of exports. While it is the contention of the appellants that the exporter had entrusted the bank to negotiate certain documents through a certain bank mentioned therein when in fact that bank had failed to collect the money in foreign exchange but collected only in local currency in the foreign country and not in the currency indicated in the documents and thus there was no liability at all on the part of the appellants, the respondent would submit that the appellants having purchased the documents in question were in fact collecting the monies for their own benefit and not for the benefit of the respondent when the documents had clearly indicated the manner in which the consignee get the goods except after payment of cash no delivery could have been made, the appellant bank had acted with negl....
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....ptember 25, 1992 that is clearly a decade after a claim had been made before the Corporation. A claim could not have been filed by the respondent at this instance of time. Indeed at the relevant time there was no period of limitation under the Consumer Protection Act to prefer a claim before the Commission but that does not mean that the claim could be made even after unreasonably long delay. The Commission has rejected this contention by a wholly wrong approach in taking into consideration that foreign exchange payable to Reserve Bank of India was still due and, therefore, the claim is alive. The claim of the respondent is from the bank. At any rate, as stated earlier, when the claim was made for indemnifying the losses suffered from the Corporation, it was clear to the parties about the futility of awaiting any longer for collecting such amounts from the foreign bank. In those circumstances, the claim, if at all was to be made, ought to have been made within a reasonable time thereafter. What is reasonable time to lay a claim depends upon facts of each case. In the legislative wisdom, three years period has been prescribed as the reasonable time under the Limitation Act to lay a....