Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Letter of Credit

(Querist) 22 October 2010 This query is : Resolved 
Is letter of credit used in service industry?
If yes, how?
Parthasarathi Loganathan (Expert) 24 October 2010
I am explaining purely as a Banker and not a lawyer. A Letter of Credit is a binding document that a buyer can request from his bank in order to guarantee that the payment for goods will be tranferred to the seller. Basically, a letter of credit gives the seller reassurance that he will receive the payment for the goods. In order for the payment to occur, the seller has to present the bank with the necessary shipping documents confirming the shipment of goods within a given time frame. It is often used in international trade to eliminate risks such as unfamiliarity with the foreign country, customs, or political instability.

HENCE IN LC TRANSACTION THERE MUST BE PHYSICAL TRANSFER OF GOODS ONLY AND THEREFORE IT GOES WITHOUT SAYING THAT IT IS NOT APPLICABLE TO SERVICE INDUSTRY.

I stand corrected on legal perspective.
Devajyoti Barman (Expert) 24 October 2010
Yes
s.subramanian (Expert) 24 October 2010
I agree with Mr.Loganathan.
SURENDRA KUMAR RAKHECHA (Expert) 24 October 2010
In service sector there is no sale of goods hence LC is not used.



You need to be the querist or approved LAWyersclub expert to take part in this query .


Click here to login now



Similar Resolved Queries :





Post a Suggestion for LCI Team
Post a Legal Query