| Citation(s) |
|---|
| 1998 SLG 1274 1998 SLD 1274 1998 CLC 582 |
Lahore High Court
First Appeal from Order No.318 of 1996, decision dated: 10-03-1997
KARAMAT NAZIR BHANDARI, J
Jawad S. Khawaja for Appellants. Syed Najamul Hassan Kazmi and Sh. Zahoor Kausar for
Respondent
First Appeal from Order No.318 of 1996, decision dated: 10-03-1997
KARAMAT NAZIR BHANDARI, J
Jawad S. Khawaja for Appellants. Syed Najamul Hassan Kazmi and Sh. Zahoor Kausar for
Respondent
BANQUE INDOSUEZ BELGIUM and others
VS
HARAL TEXTILE LTD.
Law:
Section:
(a) Contract Act (IX of 1872)-------Ss.2(h) & 73---Sale of Goods Act (III of 1930), S.4---Purchaser seeking to frustrate working of contract represented by Letter of Credit---Terms of Letter of Credit indicated that on fulfilment of conditions therein issuing Bank had undertaken unqualified obligation to pay the amount mentioned therein as per agreement---Purchaser alleging breach of contract of sale---Effect---Purchaser on basis of alleged breach of contract of sale could not frustrate working of contract represented by Letter of Credit---Working of Contract of Letter of Credit could only be interrupted if it was shown that one or other condition of Letter of Credit itself had been breached---Negotiating Bank or holder of negotiable instrument in due course would have absolutely no concern . J with the working/improper working of original contract of sale---Perusal of terms of Letter of Credit showed that on fulfilment of conditions therein, issuing Bank had undertaken to pay the amount mentioned therein as per agreement--Contract of Letter of Credit is altogether independent of the original contract---Plaintiff (purchaser), on showing prima facie case of breach of contract of sale, would not become entitled .to frustrate payment under Letter of Credit. Tarapore v. Tractoexport AIR 1970 SC 891; Svenska Handelsbanken v. M/s. Indian Charge Chrome 1995 PSC 1276; B.S. Aujla Company (Pvt.) Ltd. v. Kaluram Mahadeo Prosad and others AIR 1983 Cal. 106; Pan Ocean Enterprises (Pvt.) Ltd. v. Thariayon Company Limited and 5 others PLD 1990 Kar. 395 and Articles of the Uniform Customs and Practice for Documentary Credits, 1983 Revision, Publication No.400 of the International Chamber of Commerce ref. (b) Sale of Goods Act (III of 1930)--- ----S.4---Civil Procedure Code (V of 1908), O.XXXIX, Rr.l, 2 & O.XLIII, R.1--Plaintiff (purchaser) seeking to frustrate payment to importer under Letter of Credit---Trial Court through interim injunction restrained Bank which had issued Letter of Credit from making payment---Trial Court misconstrued legal position that on showing prima facie case of breach of contract of sale, plaintiff would become entitled to frustrate payment…
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