Letter of credit international shipments where buyer & consignee are different
This query is : Resolved
04 October 2022
Dear Sirs/Madam,
Company A awards a work order to buyer, Company B.
Company B, the buyer requests Company A to issue letter of credit to his foreign manufacturer (to the extent buyer needs to pay manufacturer).
Idea here is to save banking charges and documentation work instead of Company A issues LC to Company B and then company B issues LC to manufacturer.
Now foreign manufacturer asks whether he can issue invoice and shipping documents in the name of company B and mentions Company A as consignee.
Foreign manufacturer's concern is that whether banks will process his bill under letter of credit or his bill for payment will be rejected? Because letter of credit is issued by Company A (who is the consignee in the invoice and shipping documents) but billing address is in the name of company B (who is the buyer).
Company A awards a work order to buyer, Company B.
Company B, the buyer requests Company A to issue letter of credit to his foreign manufacturer (to the extent buyer needs to pay manufacturer).
Idea here is to save banking charges and documentation work instead of Company A issues LC to Company B and then company B issues LC to manufacturer.
Now foreign manufacturer asks whether he can issue invoice and shipping documents in the name of company B and mentions Company A as consignee.
Foreign manufacturer's concern is that whether banks will process his bill under letter of credit or his bill for payment will be rejected? Because letter of credit is issued by Company A (who is the consignee in the invoice and shipping documents) but billing address is in the name of company B (who is the buyer).
04 October 2022
Invoice and shipping bill should be in the name of the person who issued LC.
Endorse in the work order to make direct payment to foreign supplier and directly receive supplies.
Endorse in the work order to make direct payment to foreign supplier and directly receive supplies.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Difference between Date of Payment and Date of Deduction?
- Tax Audit Applicability – Newly Formed Partnership Firm with Profit Below 6%/8%
- Unregistered suppliers utility
- ITDS U/S.194T of Firm
- Bank details not Visible on Traces Portal
- URGENT-Eligible leaves being shown as 24 days for 3 years Articleship instead of 156 days in 108
- Cash balance limit and property purchases limit
- TDS ON EMAIL DOMAIN SERVICE BILL
- Non-Compliance documents have not been submitted by the contractors debited
- EXPORT COMMERCIAL INVOICE HSN CODE
- NRI starting business in India
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
- CALCULATION OF DEFFERED TAX - OP BL IS DTL & CURRET IT DTA
- LLP audit under companies act
- Experienced CA recommendation from Kolkata for FNO return filing
- Interest Reporting in Form 168
- Sales of goods of amount Rs77 lakhs to a party
- Tax Demand of ₹4,650 for AY 2026-27
- Concept of Vendor and customner reconciliation
- Mistake in e-invoice identified after 24 hours
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
