TMI Blog1994 (7) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... lant being found liable for damages to the foreign buyers and the appellant claiming reimbursement from the Indian suppliers for the loss sustained by it on account of such claim for damages on the basis of the indemnity clause contained in the contract between the Indian suppliers and the appellant. - 623-30 of 1980 - - - Dated:- 15-7-1994 - S.C. Agrawal and R.M. Sahai, JJ. [Judgment per : S.C. Agarwal, J.]. - These appeals are directed against the common judgment of the High Court of Delhi dated October 29, 1979 in the writ petitions assailing the amendments introduced in the Export (Control) Order, 1977 on February 20, 1979 whereby a ban on export of silver was imposed by the Government of India. 2. Import and export of goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion with the supplier and was entitled to a consideration of 1% of the value of invoice. 4. Under the Export (Control) Order, 1977 promulgated by the Central Government under Section 3 of the Imports and Exports (Control) Act silver bullion, silver sheets and plates which have not undergone any process of manufacture subsequent to rolling were listed at S. No. 77(i) in Part B of Schedule I to the said Order and the export of these items was allowed through the appellant only within a limited ceiling permissible subject to certain conditions specified in Column (3) of the Schedule. By Exports (Control) Fifteenth Amendment Order, 1979 issued on February 20, 1979 the said item was deleted from Part B of Schedule I and was inserted at S. No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... silver for export and the contract of sale by the appellant with the foreign buyer are part of one whole and cannot be separately dealt with even though the appellant alone is the common party in these two types of contracts and the suppliers had no privity of contract with the foreign buyer from the appellant. In this context the High Court has observed : "The effect of the total ban on the export of silver imposed by the Government of India on February 20, 1979 was that both these contracts became impossible of performance. The Corporation could not export silver to the foreign buyers. Similarly the suppliers could not compel the appellant to buy silver from the suppliers nor could the appellant compel the suppliers to sell the silver ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rchase tax, actions, losses, damages, expenses etc. arising out of or relating to or in respect of this contract and/or the export contract, and the STC shall be free to invoke the Bank Guarantee and/or forfeit the cash security deposit for the same". 8. The appellant submits that in view of the said indemnity clause the appellant is entitled to claim indemnity for any loss sustained by it on account of any claim for damages made by the foreign buyers against the appellant and that the observations of the High Court should not be so construed as to preclude the appellant from claiming the protection of the indemnity clause referred to above. 9. Reference, at this stage, may be made to the decision of this Court in Union of India Ors. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... give a direction that if the foreign buyer claims damages for breach of contract from the appellant, whether the appellant should at all be permitted to enforce indemnity given by the intending exporters and having regard to the facts of those cases this Court held that the indemnity clause in the contract shall not be enforced by the appellant even if the unlikely event of the appellant being made liable by the foreign buyer takes place. The Court expressly left open as a general proposition of law the question of automatic absolution from the indemnity clause so far as indigenous suppliers are concerned. 10. The learned Additional Solicitor General, in support of the appeals, has raised the said question and has urged that in spite of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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