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
- TDS on Purchase of Immovable Property by NRI from NRI
- Capital gain from sale of house property
- INTEREST APPLICABLE ON ITC REVERSAL PORTION
- Current Account Opening for Sole Proprietorship with Udyam Certificate - Zero Turnover
- FORM 26A APPLICABILITY
- Value of property in capital gain
- Regarding TDS Applicability For Director Remuneration
- When TDS on GST applied
- Before GSTAT- APL-02 Vs APL-04
- Annual return in Gst
- Transporter Declaration form
- E-Invoice applicability for new Startup
- Filing of MSME 1 form by companies
- Opting our of sec 44AD
- GST Treatment of Insurance Commission for Existing GST Holder
- Cash gift by grand mother to her grand daughter
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
