M/S AUTO INDIA

(CASE STUDY)

Question 1
Which Article of UCPDC 600 state about the place of `Presentation’?

a. Two
b. Fourteen
c.Six
d.Eight

Question 2
`Banking day’ means the day on which a bank is regularly open for performance of an Act.

a. Correct
b. Wrong
c. Can’t say
d. When the treasury of the respective bank is open for foreign exchange transaction.

Question 3
Whether Global Bank Pune (Issuing bank) can put the condition to deliver the original document under LC to
its Head O􀃞ce when LC Issuing bank is Pune Office.

a. Yes, As per the internal instruction of the Issuing Bank’s Head Office
b. No
c. As per agreement of applicant and beneficiary
d. As per UCPDC 600 the documents should be received by issuing bank only

Question 4
Is it required under URR to negotiate the documents before claiming LC Value from Reimbursing Bank and
to certify the same.

a. Required
b. Not Required
c. At the option of negotiating /confirming bank
d. If the reimbursement claim is value-dated

Question 5
Is the discrepancy as pointed out by Global Bank, Pune agreeable?
a. Debatable
b. Yes
c. No
d. The discrepancy is subject to approval of LC applicant

Question 6
Can Auto India, LC applicant, ask for copies of document by fax for review and Global Bank, Pune provide
the same?

a. Yes, because Auto India is stakeholder as importer

b. No. Because documentary credit is transaction between Issuing bank and beneficiary and LC applicant is
outside party
c. Global Bank, Pune has taken right step for facilitation of trade
d. The Issuing Bank needs to take approval from Beneficiary

Question 7
Global Bank Pune examined the documents as received from its Head Office and determined that the same
were discrepant, so they pointed out the discrepancies to negotiating bank

a. Global Bank Pune was entitled to refer the discrepancies when they received the document. Hence their
action is correct.
b. The period of 5 banking days for standard examination of documents shall start from the receipt of
documents by the Head Office of the Global Bank as the same
condition was put up in the LC document
c. Global Bank Pune should write to their Head Office for delay in despatch of original documents.
d. The LC term required the documents to be delivered at Head Office of the Global Bank. Hence the period
of 5 banking days shall start from the date of receipt of document to their Head Office

Question 8
Was it a `Complying Presentation’ as per UCPDC 600 by American Bank, New York ?

a. No
b. Yes
c. Partly correct
d. None of the above
.
Question 9
Do you think that Global Bank, Pune is precluded from claiming relief under Article 14 of UCPDC 600

a. Global Bank Pune has failed to observe the stipulated time period as required under Article 14 of UCPDC
600, hence precluded
b. Global Bank, Pune can act only after receipt of document from their Head Office. Hence they are
compliant
c. Shall depend on the relationship between Issuing and Negotiating Bank
d. It was the duty of the Global Bank Head Office to examine the documents in stipulated time period

Question 10
If the documents under LC are discrepant and the same are presented to importer who in turn will accept the
same for payment, should Issuing Bank also accept the discrepancies and commit payment

a. The discrepancy needs to be examined by Issuing Bank and put back to negotiating Bank refusing the
payment/acceptance under LC.

b. The Issuing Bank can wait till the approval is received from Lc applicant and the credit limit allows the
payment of the LC.

c. It is the discretion of the Issuing bank

d. Contract of LC is between LC applicant beneficiary and Issuing Bank. Hence, Issuing Bank will have to
accept the LC once discrepancy accepted by LC applicant.