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Recovery of a sum of Rs. 26,48,406/- along with interest under a scheme notified by the Government of India for advancing duty-free gold to manufacture and export gold jewelry. Analysis: The plaintiff filed a suit seeking recovery of Rs. 26,48,406/- along with interest from the defendant. The plaintiff, acting as a designated agent of the Government of India, advanced duty-free gold to the defendant for manufacturing and exporting gold jewelry under a government scheme. The defendant failed to comply with the condition of re-exporting the gold within 120 days, leading to the imposition of Customs Duty and penalties. The plaintiff proved that the Customs Department had already recovered the amount from the plaintiff by encashing a bank guarantee. The court found that the defendant had undertaken to export the finished goods within the specified time frame and was liable for the Customs Duty amount. The court decreed the suit in favor of the plaintiff for the recovery of the said sum along with interest at the rate of 24% per annum from the date of encashment of the bank guarantee. The plaintiff established that the defendant had agreed to the conditions of the scheme, including the obligation to re-export the gold within 120 days. Non-compliance led to the imposition of Customs Duty, which the plaintiff had to pay. The court held that since the liability was of the defendant, the plaintiff was entitled to recover the amount paid, including interest. The court noted that the bank guarantee had been encashed, and therefore, interest at the rate of 24% per annum was awarded to the plaintiff from the date of encashment until realization. The judgment decreed the suit in favor of the plaintiff, granting the recovery of the sum along with interest. The court concluded that the plaintiff was entitled to costs and decreed the suit in favor of the plaintiff, along with interest at the specified rate. All pending applications were disposed of as part of the judgment. The defendant's failure to comply with the re-export condition under the government scheme resulted in the plaintiff incurring Customs Duty and penalties, which the court deemed the defendant liable for, leading to the decree in favor of the plaintiff for the recovery of the amount along with interest.
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