A foreign company engaged in the business of leasing cable-laying
machinery leased its machinery to an Indian contractor who
had a contract from a telecom company. The client went on
the recommendations of one of their acquaintances and did
not carry out a proper due diligence on the contractor,
who turned out to be a very unreliable and inexperienced
person. We periodically monitored the progress, which was
very slow. As the contractor was inexperienced and did not
have sound financial position, he was not able to pay any
rentals as also salary to his operations staff. After a
few weeks, we concluded that the machinery might not be
safe if the contractor’s staff start playing dirty
and damage the same. As there was no possibility of any
other business opportunity, we suggested to the client to
take back the machinery and re-export it. At the time of
imports / re-export, we arranged for customs clearance and
total logistics support / insurance cover to ensure that
the machinery was absolutely safe in transit, in fact our
manager accompanied the consignment, both from / to the
port. We also negotiated with the shipping company and supervised
the loading operations. We arranged for the refund of Customs
duty paid on imports to the extent of 85% of the duty paid
earlier.
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