Law: Imports and Exports (Control) Act, 1950

Section: 3

Imports and Exports (Control) Act (XXXIX of 1950)--S. 3-Import and Export Licence-Utilisation of licence means at least payment of price to suppliers if not actual payment of goods covered---Mere opening of letter of credit-Not ulitisation of licence-­Defendants getting import licence against their future export perform­ances on plaintiffs' guarantee and their (defendants') own counter ­guarantee to surrender foreign exchange, worth a certain sum to Government in case of defendants licensees` failure to comply with conditions of licence-No shipments effected by foreign suppliers and no part of foreign exchange remitted-No part of licence, in circum­stance, utilised----Defendant in ;absence of such specific condition in licence not obliged to import by there grant of import lieence ­Government demanding plaintiff's to surrender bonus vouchers of specified value for part utilisation of import license sand failure of defendants to export goods-Defendants' obligation to export. Not independent of utilisation of import licence.-No import effected, hence, no occasion arose for export and no condition of licence contravened Defendant., held, not liable to make good amount paid over try Government by plaintiffs. JUDGMENT The facts relevant to the controversy between the parties are not in dispute. The defendant by its letter dated 13th June 1966 informed the plaintiff that they had applied for an import licence from C. C. L & E. for import of balancing machinery of the value of ; 34,500.00 against their future export performances and to obtain this licence they had to export goods worth $ 69,000.00 which they were prepared to make and, therefore, requested to issue guarantee on their behalf on the standard pattern prescribed by C. C. I. & E. against their counter-guarantee. The guarantee given by the plaintiff Bank in pursuance of this request reads as follows:- "To: The President of Pakistan. In consideration of your having granted Import Licence No. 804460 dated for Rs. 1,76,131.50 Messrs Associated Fisheries Corporation, Karachi, hereinafter called the licensee for import of Cold Storage Machinery and Ice Plant we hereby agree to guarantee as follows:- `If…

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