SAZCO (PVT.) LTD. vs ASKARI COMMERCIAL BANK LIMITED arts — 2021 SCMR 558 SUPREME-COURT

Case information

Citation: 2021 SCMR 558 SUPREME-COURT
Court: Supreme Court of Pakistan
Year: 2021
Reporter: SCMR
Parties: SAZCO (PVT.) LTD. vs ASKARI COMMERCIAL BANK LIMITED arts
Subject matter: Criminal
Provisions referred to: S. 182---I

Fields are extracted from the reported citation and judgment text. Where a detail is not stated in the record, it is not shown.

Judgment text as reported

SAZCO (PVT.) LTD. VS ASKARI COMMERCIAL BANK LIMITED arts. 2, 3, 4, 13 & 14(b)---Contract act (IX of 1872), S. 182---International sale transaction---"Letter of credit"---Principal-agent relationship between Bank issuing credit (issuing Bank) and nominated Bank---Claim against issuing Bank on grounds of fraud---Jurisdictional maintainability---Contractual relationship existed between the applicant of a credit with the Bank issuing the credit (issuing Bank), and also with the nominated Bank, which was to make the payment under the credit on presentation of the documents---Nominated Bank, which was to make the payment under the credit, acted as an agent of the issuing Bank---Issuing Bank would be bound and responsible for the actions or inactions of its agent carried out under the said agency---Thus, an applicant of credit registered in Pakistan would have a valid cause of action against an issuing Bank in Pakistan on two counts; first as a principal, for the actions or inactions of its agent/nominated-Bank in a foreign country; and secondly, as an issuing Bank, on receipt of (fraudulent) documents transmitted by the nominated Bank---Rationale behind the recognition of these legal relationships, which were established with the opening of documentary credit, was to bring certainty in the performance of obligations and payment of consideration of international sales transactions across the globe.

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