TMI Blog1980 (5) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... not only extended the period of shipment stipulated in the Letter of Credit dated 16th March, 1978, but also altered the price per unit of the material to be shipped, the Counsel urged that the escalation of the price was demanded by the suppliers due to the general price rise of drugs which had been a world-wide phenomenon. Further even through the escalation of the price was accepted by the petitioner s firm, the quantity of the goods had to be reduced proportionately so that the value of the L/C remained unaltered. The counsel argued that the Letter of Credit is a mere mode of payment and forms part of the contract and since the Letter of Credit was opened on 15th March, 1978 i.e. prior to 3-4-1978 the concession envisaged in paragraph 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n is thus whether there existed a firm commitment for import of these goods between the suppliers and the buyer prior to 3-4-1978 and also whether a Letter of Credit was opened prior to this date. So far as opening of the L/C is concerned, the Government observe that the petitioner s Company did open L/C on 15th March, 1978 for import of Sulfaguanidine of a CIF value of ₹ 32,016/-. Through the relevant copy of the Letter of Credit is not On record, it is in undisputed fact that this L/C was amended on 16th June, 1978 to extend the period of shipment. The price quoted per unit of the material in the L/C itself was also altered through this amendment dated 16th June, 1978. The question therefore, arises as to whether on the face of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nience, it does not materially affect the basic character of the transaction to a great extent. In this case, however, the Government observe that both the ingredients of the transaction namely; the period of shipment as well as the price stipulated in terms of the original L/C which was opened prior to 3-4-1978 were substantially altered. The counsel on behalf of the petitioners however, urged that the escalation of the price became necessary because there was a general price rise. The world market and therefore, the petitioners had not other alternative but to accede to the suppliers request in the said escalation of price. There may not be any reason to disagree or dispute the counsel s contention or reason to disbelieve what he has plea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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