UCP600. At the behest of Zoom, which was desirous of arranging for Buyer’s Credit to meet its obligation under the FLC for making payment to the foreign supplier i.e. PEMS, the Appellant voluntarily, unilaterally and independently issued a LOU in favour of the foreign lender. This unilateral and independent act of the Appellant was in replacement of its obligations under the FLC. The Appellant issued three LOUs in favour of the foreign lender. Neither Zoom nor the Appellant had informed the Respondent about the said decision. The Ld. Senior Counsel argues that the concurrence of the Respondent was mandatory under the terms of the SBLC. Hence, there is a departure from the agreed terms of the SBLC and therefore, the Respondent is not liable to pay any amount to the Appellant. The claim of the Appellant arises under the LOUs issued by it independently and without the knowledge and concurrence of the Respondent, and therefore, the Respondent, stood discharged of its obligation under SBLC, submits the Ld. Senior Counsel. It is further submitted that an FLC and LOU are necessarily two different facilities/ transactions, legally as well as from a regulatory perspective and the contracting parties under the FLC/SBLC and the buyer’s credit/LOU are different and distinct. The Ld. Sr. Counsel also points out that the terms and conditions under the SBLC must be observed strictly and, in the event they are not observed, the bank issuing the said SBLC would be well within its right to refuse to honour the SBLC and no cause of action would arise against the bank. 8. Reliance is placed by the Ld. Sr. Counsel on a judgment of the Hon’ble Supreme Court in United Commercial Bank vs. B a nk of India
