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Please refer to your representation No. MI/ECGC/1/95 dated 28.11.95 on the above subject.

The matter has been reviewed by our higher authorities.  We regret that we are unable to admit any liability for the above shipments since there was no valid credit limit on the dates of shipments.

Thanking you,   Yours faithfully, Sd/-

(MS VARDHINI R) ASST. MANAGER"

28.   This letter does not address itself to any other ground except to not having valid Credit Limit on the date of shipment.  Even otherwise, the first ground of repudiation that shipments have not been made under firm order cannot be sustained as is evidenced by the bills of exchange and acceptance by the buyer for a total value of US$ 56,122.95.  The second ground addressed by the Appellant Corporation in their letter dated 13.1.1994(first letter of repudiation) that shipments have been made on credit terms without valid C.L. on the buyer, is unsustainable as is evidenced under the chronological orders of dates that application for credit limit of Rs. 25 lakhs was made by the Exporter on 5.5.92 itself and that admittedly the Credit Limit of Rs. 5 lakhs was sanctioned only on 12.10.1992.  After asking for credit limit, Exporter had sent two consignments viz. MI/LG/134 dated 13th May 1992 for US $19370.25 and MI/LG/135 dated 13th May 92 for US $ 6596.50.  Out of these, US $ 6596.50 had been received against consignment MI/LG/135 dated 13th May 1992.   It was also informed to the Appellant about despatch of 4 earlier consignments and requested for covering these consignments also.  The Appellant did not cover the earlier consignments, but they accepted the premiums.  The Complainant had also reported the delay about receipt of payments to their office.  It is also pertinent to note that the Respondent Exporter had withdrawn the claim for the first four shipments and has only confined their claim to the 5th consignment.  Repeated correspondence between the Appellant and the Respondent evidences that despite reminders and payment of Rs. 750/- towards Credibility Report, there was  delay of 5 months on behalf of the Appellant Corporation in sanctioning the Credit Limit.  The third ground for repudiation is unjustified in the light of the fact that it was only vide letter dated 20.12.1993 that the Exporter realised that the buyer had been using delaying tactics.  Therefore, non-settlement of the claim on the ground that the bills were not "Noted and Protested" in the light of the facts and circumstances and the sequence of events in the instant case, cannot be sustained.