Hi
I have a client in Singapore who supplied material to a customer (A Chemical Company) in India (Pune). The Customer has not made any payment towards the supply made. This material was supplied by my client on oral guarantee of one of his business friend from Canada. The customer was a cousin of this business friend.
There was some dispute between this business friend and his cousin (the customer) because of which they are no longer on good terms. To punish his cousin, the customer did not pay for the material supplied. My client has demanded the payment through his bank, to the bank of customer, however never got the payment. There has been no formal demand notice send to the customer.
My client doesn't want to come to India and file recovery suit against the customer, instead he is insisting his business friend to make payment, because it was on his word the material was supplied. The customer was not made party to this oral guarantee.
My query is
1) Can the business friend, based in Canada, file a recovery suit against the customer in India, after he makes the payment of the dues?
2) Can the customer take a stand that the guarantee was never given by my permission so I don't honour the contract between you and your friend?
3) What will be the procedure to recover the dues, if the business friend of my client wants to recover it after payment made to my client? (e.g. demand notice, authority letter etc.)
4) What are the Foreign Exchange rules voilation in this transaction if my client's friend wants to recover the dues? As he was not the supplier.
4) Any other solution you may suggest for recovery of the money, without involvement of my client
