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.
