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1. This order of mine disposes of an application of the plaintiff under O. 39, rr. 1, 2 & 3 read with s. 151, Code of civil Procedure (hereinafter referred to as "the Code") for the grant of a temporary injunction.

2. The facts germane to the decision of this application succinctly are that in July, 1979, defendant No. 1, M/s. Bentrex & Company, which is a sole proprietary concern of Man Mohan Singh, defendant No. 2, entered into a contract for sale of first grade first quality cloves (Zanzibar quality) of the value of the Rs. 25,00,000 at the rate of US $ 7,950 per M.T., C & F Bombay, to be shipped from Singapore on or before 30th September, 1979. Pursuant to the said contract of sale the buyer/plaintiff established an irrevocable commercial credit from the New Bank of India Limited (a banking Corporation), defendant No. 3 for a sum not exceeding a total of US $ 60,050 on the basis of which the latter issued a letter of credit bearing No. JNP/FLC/677 dated 17th August, 1979, and the same was advised to defendant No. 1 through Chase Manhatten Bank (advising bank), Singapore. Accordingly, defendant No. 1 shipped a consignment of cloves (Zanzibar quality) contained in 153 bags, gross weight 7.803 M.T. (net weight 7.650 M.T.) on board the vessel 'OH DAI' on 3rd September, 1979, and the documents of shipping, inter alia, comprising bill of lading, invoice and a draft for the price of the goods, viz., US $ 60,800 odd, were duly sent to the issuing bank, viz., defendant No. 3. On 13th September, 1979, the plaintiff received non-negotiable copies if some of these documents and on inspecting the same they found that the said documents suffered from serious discrepancies and were contrary to the express conditions embodied in the letter of credit opened by them in favor of defendant No. 1. So they requested defendant No. 3 through a letter of even date to intimate by means of a telex/cable to the negotiating bank at Singapore to withhold payment against the documents relating to the letter of credit covering the goods in question. Accordingly, defendant No. 3 pointed out the alleged discrepancies to the negotiating bank, namely, European Asian Bank, Singapore, through whom the said documents had been received and appraised them that the documents were not acceptable to the drawee (i.e., the plaintiff). The latter explained the correct position, vide their letter dated 20th September, 1979, and asked the issuing bank (defendant No. 3) to honour their commitment promptly. Accordingly, defendant No. 3, vide letter dated 22nd September, 1979, called upon the plaintiff to make payment of the bill immediately, inter alia, stating that the discrepancies observed by them in the documents received under the above letter of credit were not justifiable. The plaintiff, however, took exception to the same and eventually instituted this suit for a declaration that the bill of lading dated 3rd September, 1979, as also the quality certificate of even date were defective and was not in conformity with the agreement of sale between the parties. They have also prayed for a permanent injunction restraining defendant No. 3 and its servants/agents, etc., from in any manner making payment against the documents received under the letter of credit in question favoring defendant No. 3 and its servants/agents, etc., from in any manner having recourse to the margin money covered by the said letter of credit or to have recourse to any other moneys/deposits lying with defendant No. 3 in relation to the aforesaid letter of credit. The plaintiff has also sought an ad interim injunction on these very lines for safeguarding their interest.

3. The application is contested tooth and nail by defendants Nos. 1 & 2, who vehemently assert, that they have scrupulously complied with the terms and conditions incorporated in the letter of credit and as such they are entitled to payment of the price of the goods forthwith. Similar stance has been taken by defendant No. 3, according to whom the shipping documents and the draft received by them from defendants Nos. 1 & 2 are perfectly in order, being in conformity with the terms and conditions contained in the letter of credit. I shall elaborate the stand taken by them respectively in relation to each and every contention raised by the plaintiff while dealing with the same.

27. The learned counsel for the defendants has also questioned the tenability of this argument on the ground that this plea as such was never raised by the plaintiff either in the correspondence or in the pleadings and it is only during the course of arguments that he has come forward with this objection for the first time. Secondly, she has canvassed rather fervently that 15th of October, 1979, was the deadline for the negotiation of bills and the defect in the bill of exchange could well be rectified by defendants Nos. 1 & 2, has the same been pointed out well in time, the negotiable set of documents having reached defendant No. 3 by 18th of September, 1979. It is urged that the plaintiff is estopped from seeking an equitable relief like that of an interim injunction, on account of laches on his part and he cannot be allowed to raise this plea to the detriment of the defendant at this belated stage. No doubt the argument put forth seems to be attractive but the plaintiff cannot be punished for mere delay on his part in pinpointing this serious flaw in the bill of exchange which is a document of vital importance especially when the discrepancy is patent on it face. It is noteworthy that in the letter dated 4th October, 1979, to defendant No. 3, the plaintiff specifically raised the objection that the shipping documents including the draft had been signed by the secretary of defendant No. 1 even though it was a proprietary concern and the contract of sale had been signed by the proprietor. So, the omission to incorporate this objection in the plaint cannot be fatal. After all, replication has yet to be filed and no fresh facts need be investigated at this stage. In other words, the objection embodies a pure question of law and it goes to the root of the matter. So, exception can hardly be taken to it when the case is itself at a preliminary stage of hearing. Surely, the interests of justice demand that the mischief be avoided before it is too late. Hence, I uphold the objection taken by the plaintiff's counsel to the negotiability of the bill of exchange on the score of its having been signed by one Kalawati as secretary of defendant No. 1 and not by defendant No. 2, who is its sole proprietor.

31. Article 8(f) further lays down that, "if the issuing bank fails to hold the documents at the disposal of the remitting bank, or fails to return the documents to such bank, the issuing bank shall be precluded from claiming that the relative payment, acceptance or negotiation was not effected in accordance with the terms and conditions of the credit". Not only that, even if the remitting bank draws the attention of the issuing bank to any irregularities in the documents or advises such bank that is has paid, accepted or negotiated under reserve or against a guarantee in respect of such an irregularity, the issuing bank shall not thereby be relieved from any of its obligations and such guarantee or reserve concerns only the relations between the remitting bank and the beneficiary. [See Art. 8(g)], Thus, having regard to the aforesaid provisions of the UCP there can be no room for doubt that it is for the issuing banker to scan the documents tendered by the seller beneficiary under the credit on his own and he is not to be guided by anyone else in the matter. He must take full responsibility for accepting or rejecting the documents and that too within a reasonable time. If the banker wrongfully refuses to accept a draft accompanied by the required documents he has to face any action which may be brought against him by the seller beneficiary for the amount of the commercial credit and interest, etc. Further, it is equally well-settled that in order to constitute a valid tender, the documents must, in the first place, he merchantable and, secondly, must be of the type current in the trade in question. If the tender of a document does not strictly comply with the requirement of the commercial credit, the banker is entitled to reject it, it being immaterial whether the discrepancy is significant or minute. On authority too, it has been long established that when a letter of credit is issued and confirmed by a bank, the bank must pay it if the documents are in order and the terms of the credit are satisfied. Any dispute between the buyer and the seller must be settled between themselves but the bank must honour the credit. [See Malas (Trading as Homzeh Malas and Sons) v. British Imex Industries Ltd. [1958] 1 All ER 262; [1958] 2 QB 127; R. D. Harbottle (Mercantile) Ltd. v. National Westminster Bank Ltd. [1977] 2 All ER 862 (QB) and Edward Owen Engineering Ltd. v. Barclays Bank International Ltd. [1978] 1 All ER 976].