Application Cum Agreement for Openingletter of Credit

[HOGC 11030 Annexure]FED 2-64

(To be stamped as an agreement)

APPLICATION –CUM – AGREEMENT FOR OPENINGLETTER OF CREDIT

To

The Branch Manager

VIJAYA BANK

______

______

Please open by SWIFT through your Correspondents in ______anirrevocable Letter of Credit (LC) infavourof______(herein after referred to as “Beneficiary) for the sum of ______(in words ______)drawn on us at sight/on ______days (usance) from ______covering import of______of ______origin at a price of ______FOB/CFR/CIF/FCA/CPT/CIP _____ available against submission of the following documents (please delete whichever is not applicable): -

a)Signed Commercial Invoice in ____ copies.

b)Full set of ‘Clean on Board’ ocean Bill of Lading made out to the order of Vijaya Bank, showing ‘Freight prepaid/payable at destination’ and marked notify to ourselves.

OR

Air Waybill/Air Consignment Note (Shippers Copy No. 3), showing flight number and date, evidencing goods consigned to Vijaya Bank, showing ‘Freight prepaid/payable at destination’ and marked notify to ourselves.

OR

Post Parcel Receipt evidencing dispatch of goods in the name of Vijaya Bank A/c: ourselves showing postage paid.

c)Marine Insurance PolicyorCertificate in duplicate, in negotiable form, in the currency of the LC, for not less than 10% over the invoice valuecoveringInstitute Cargo Clause (All Risks) Theft Pilferage and Non-delivery clauses, Institute War Clauses (Air Cargo/Cargo) and Institute SRCC Clauses (Air Cargo/Cargo) with claims payable in India in the currency of the Invoice.

OR

Marine Insurance is covered by us locally as per Insurance Policy/Certificate No. ______dated ______for ______Issued by ______. The Policy/ Certificate is enclosed herewith.

d)Certificate of ______Origin issued by ______in ___ copies.

e)Packing List in ___ copies.

f)Weight List in ___ copies.

g)Other documents (please specify): -

evidencing shipment from ______to ______last date of shipment ______(both days inclusive)with partial shipments being/not being allowed with/without trans-shipment.

This LCshall beavailablefor presentation of the documents by beneficiary at the counters of negotiating bank within ____ days from the date of shipment. The LC shall finally expire on ______.

Additional Instructions: -

(1)All bank charges outside Indiaare for our/beneficiary's account.

(2)This import is covered underLicence No: ______dated ______validupto ______(EC copy of the licence is enclosed)

OR

This import is falling under ITC (H.S) Code No. ______and is freely importable into Indiaas per the current Foreign Trade Policy.

(3)Our Importer Exporter Code No. is ______.

ADDITIONAL CONDTIONS REQUIRED (use annexure if space is insufficient): -

(1)All documents must show your LC number and date.

(2)Invoice must show our IEC number and the ITC (HS) code number/import licence number mentioned above.

(3)

(4)

Inconsideration of your opening the LC as aforesaid, I/we agree/undertake/confirm as follows: -

1. I/We hereby confirm that I/we are eligible for importing the above said goods in terms of the current Foreign Trade Policy of Government of India. I/We are importing the said goods at our entire risk and responsibility. The subject goods have not been included in the ‘Banned’ ‘Restricted’ or ‘Canalised’ list in the current Foreign Trade Policy. I/We agree to comply with all the rules and regulations of FEMA, RBI, Customs and Foreign Trade Policy as applicable to this import.
2. I/We shall, if required by the Bank, hedge foreign exchange risk under the LC to the satisfaction of the Bank.
3. I/We hereby undertake to pay on demand all sight bills or to accept on presentation and pay at maturity all usance bills, which may have been negotiated under this LC at the current rate of exchange ruling on the date of payment by me/us together with interest thereof at the rate of ___ percent per annum from the date of your payment to the negotiating bank upto the date of our payment plus Bank Commission, Postage and all other charges which may become due thereon. And further I/we agree that on no account shall any claim be made against the Bank after the bill is retired by me/us.
4. In the event of our failure to pay on demand all sight bills within ten days of receipt of the same by you, or usance bills on the respective due date, you are hereby authorised at your absolute discretion to crystallize the foreign currency liability into Indian Rupees by applying the rate of exchange ruling on the day of conversion or at the contracted rate, as the case may be, regardless of the fact that whether I/we have received Bill Intimation Memo from you or not. In case such crystallization results in early delivery under the forward contract, the bank is at liberty to levy early delivery charges, if any, as per FEDAI Rules which I/we agree to pay. I/We also agree that such crystallization when made by the Bank shall be fully binding on me/us.
5. I/We further undertake to pay the sum thus converted together with all your charges and interest at the rate of ____ percent per annum promptly within 10 days thereafter or on or before the arrival of the vessel carrying the relative goods, whichever is earlier. Provided further that the interest payable by me/us shall be subject to the changes in the interest rate that may be made by the Bank from time to time.
6. I/We further agree that the Bank will open this LC entirely at my/our own risk and I/We undertake to honour all the bills presented under the LC even though the relative goods have been lost/damaged in transit or not arrived at the port of destination or refused landing in the port of destination through any act of war or restrictions imposed by the Government Ordinance.
7. Should this LC be extended or amended in any way, such amendment(s) will be treated as part of this agreement and I/We agree to pay all charges in connection therewith.
8. I/We agree that insurance shall be effected on the shipments to the full value thereof; such insurance to be made available for your benefit by the deposit of the policies, or Certificate of Insurance and in case of default your Bank is at liberty to effect insurance thereof and the premia and expenses therewith I/we agree to repay.
9. And furtherI/We agree that all goods covered by thebillsdrawn under the LC shall remain in your possession until each billis paid by me/us. I/We hereby hypothecate and pledge the said goods to you as security for the payment at maturity of the bills and hereby give you authority, if there shall be any breach by me/us of any termsthereof, to sell the said goods either by public auction or private contract and apply the net proceeds thereof towards payment of any sum which then or shall thereafter become owing by me/us to you.
10. I/We hereby authorize you to make such arrangements as may be necessary for providing reimbursement to the negotiating bank in respect of the documents negotiated under this LC and where the LC is required by us to be opened in a foreign currency in which you are not dealing, then you may authorize your London/New York correspondent bank to reimburse the negotiating bank for their payment and charges, if any, and to claim from us in equivalent GBP/USD converted at the ruling exchange rate prevailing on the date of such payment by your London/New York correspondent bank. I/We further undertake and agree to pay the GBP/USD equivalent of the bill amount at the exchange rate ruling on the date of payment by us or on the date of crystallization by you in terms of Clause No. 3 above.
11. I/We hereby confirm that I/we relieve you entirely from all responsibility whatsoever for regularity,genuinenessand/or validity of any document which you may be called upon to receive on my/our behalf and for genuineness of the endorsement and/or signatures thereon and for the weight, quality or nature of the goods to which such documents refer and in event of their loss in transit, I/we will at once reimburse the amount of the payment and charges upon your furnishing evidence of such payment have been effected by you.
12. I/We agree that neither you nor your correspondents shall be responsible for any loss or damage to goods however and wherever caused or for failure for any reason by you/your correspondents or any other person to store and insure the goods. I/We further agree that all acts and omissions of the beneficiary and/or correspondent bank or any other person to store and insure the goods and I/we further agree that all acts and omissions of the beneficiary and/or correspondent banks and/or any other person shall be at my/our risk.
13. I/We hereby authorize you to debit our account No. ______or any other account in my/our name towards the bill amount, your charges, commission, margin, deposit etc., in connection with this LC without any prior notice which will be binding on me/us.
14. I/We hereby undertake to submit all the documents, as may be required by you from time to time, in connection with or relating to the LC or bills drawn thereunder.
15. All SWIFT messages in connection with this Credit shall be sent by you at my/our risk and cost and you shall not be responsible for any loss caused by mistake or omission, coding or decoding or interpretation when received or by delay on the part of the service provider companies concerned.
16. The receipt by you at any time of other collateral of whatsoever nature shall not be deemed a waiver of any of your rights or powers relating to any collateral which you may hold at the time of receipt.
17. This agreementshall continue to be in force not withstanding any change in the constitution of the undersigned whether arising from the death or retirement of one or more partners/directors or accession of one or more new partners/directors.
18. This LC can be revoked or altered only with the consent of all parties interested.
19. The documents accepted in connection with this LC may be those which are generally acceptable in accordance with the laws, customs and usages at the place of negotiation or which may be considered satisfactory by you or your branch or correspondents.
20. I/We hereby undertake to submit to you the exchange control copy of the Bill of Entry/Postal Wrapper soon after the goods are cleared from the customs or within 3 months from the date of payment/crystallization whichever is earlier.
21. I/We hereby agree and give consent for the disclosure by the Bank of all or any such: -

a)Information or data relating to me/us;

b)Information or data relating to any credit facility availed of/to be availed by me/us; and

c)Default, if any, committed by me/us, in discharge of my/our obligation

as the Bank may deem appropriate and necessary to disclose and furnish to Credit Information Bureau (India) Ltd., and any other agency authorised in this behalf by RBI. I/We declare that the information and data furnished by me/us to the Bank are true and correct. I/We undertake that: -

a)The Credit Information Bureau (India) Ltd., and any other agency so authorised may use, process the said information and data disclosed by the Bank in the manner as deemed fit by them; and

b)The Credit Information Bureau (India) Ltd., and any other agency so authorised may furnish for consideration the processed information and data or products thereof prepared by them to banks/financial institutions.

"This LC is to be issued subject to Uniform Customs and Practice for Documentary Credits (2007 Revision)International Chamber of Commerce Brochure No. 600"

DECLARATION cum UNDERTAKING

(Under Section 10 (5) Chapter III of the Foreign Exchange Management Act, 1999)

I/We hereby declare that the transaction the details of which are specifically mentioned in the Schedule hereunder does not involve, and is not designed for the purpose of any contravention or evasion of the provisions of the aforesaid Act or of any rule, regulation, notification, direction or order made thereunder.

I/We also hereby agree and undertake to give such information/documents as will reasonably satisfy you about this transaction in terms of the above declaration.

I/We also understand that if I/we refuse to comply with any such requirements or make only unsatisfactory compliance therewith, the Bank shall refuse in writing to undertake the transaction and shall if it is has reason to believe that any contravention/evasion is contemplated by me/us report the matter to Reserve Bank of India.

I/We further declare that the undersigned has/have the authority to give this declaration and undertaking on behalf of the firm/company.

Place:

Date:(Signature of the Applicant)

SCHEDULE

Nature/purpose of foreign exchange transaction: Opening of LC as per the application above.

Amount of foreign exchange: As mentioned in the application.

Beneficiary: As mentioned in the application.

FOR USE OF THE BRANCHDate: -

1. FLC

1. FAB

1. CAIBC

1. LAD

1. Others (specify)

Present Request

LC amount in foreign currency:Exchange Rate:

Rupee Equivalent:Total FLC liability if approved:

Excess over the limit if any:Due date of the limit:

Discrepancies/remarks/recommendations of the department: -

OfficerABM/SBM/CMBRANCH HEAD