My Student Arpit have started the Exim business at age 17. As age 18 is needed for PAN, so he registered a firm with his bro PAN.
He received an order from Srilanka to export Garlic. The order value was 25,00,000 INR, the buyer agreed to pay 25% Advance & 75% via DP. He received 6,25,000 INR in his bank account & remaining 18,75,000 INR via DP, that is he needs to buy goods, pack it and load it into vessel afterwords BL document would be made at end, buyer asked for 5 docs, Invoice, Packing List, Certificate of Origin, Phyto Cenetary Certificate & Bill of Lading (BL). Documents was never an issue for him it could be done easily but the biggest issue for him was funds, he needs to pay a full payment of approx 22,20,000 INR to the supplier of garlic & he will receive funds after BL + Other docs reach importers bank. He did not have sufficient money in his bank account, his father was in a very poor situation, he belongs to a very poor family. He took advance from buyer but his intention was to export, he asked many good suppliers but due to his age no one considers him a serious kid. Supplier asked for an advance.
How Arpit bhai will receive the payment in above case?
Arpit bhai already received the 25% advance & rest 75% is against documents against payment (DP via Bank) i.e he need to puracase full goods made it load into vessel, then only BL (bill of lading) would be generated and could be transmitted via bank, against which 75% would be given. Buyer requires Original BL to clear the goods from his port.
My Discussion with Kid Arpit
Kishan Barai : How you are going to do this deal without money ?,
Arpit Bhai : Sir, I have got Cheque Book & Cheque Book = Money
Kishan Barai : How much you have got in a bank account?
Arpit Bhai : Virtually Nothing
Kishan Barai : How Cheque = Money ??
Arpit Bhai : Supplier don't know about it.... , so its money for him
I told NO 1000 times but he did not listen... I suggest him to forward this deal to my other clients and get good commission but he disagrees.
With Supplier, he made terms that he is going to pay amount via Cheque as Cash payment is bulk is illegal & Cheque would be provided once goods are packed and load it into truck
Supplier did hard work to pack garlic in mesh bags in kept in the box and loaded into truck.
After work is done Arpit gave him a cheque of 22,20,000 INR, now it is very obvious that supplier cant hold the truck until cheque gets clear but it gets time.
Truck went away towards port.
Arpit Bhai instantly visited his bank and told to bank official that my cheque with this number is lost, so kindly do stop payment in that, he did stop payment before supplier clear this cheque, so when supplier provided this cheque to bank it got stop payment. Stop payment cant be considered as Crime but if cheque could have bounce due to insufficient funds then it could be a crime. Arpit bhai played a very smart game and took away the goods, done stop payment so no strong complaint against him could be made.
Supplier Cried, local business is most dangerous, people provide a Cheque & many times Post Dated Cheque which could be clear after some days they take goods and do stop payment by saying to the bank that this cheque is lost, so supplier did not get funds credited. Many time buyer sue supplier in spite of doing a cheat & tell the court that supplier took the advantage of his lost cheque and before supplier tries to prove his innocence buyer is far away. Fake Online NEFT done photoshop images / Fake Banking Message are also provided to the supplier, buyer says NEFT will take 48 hours to get it credited.
Here the intention of Arpit bhai was not to cheat but he wanted to provide money to the supplier as soon as he receives the funds from buyer but in this case, Srilankan buyer was a fraud he did not pay 75% and asked him to surrender the BL as bank was closed for 4 days due to public holiday in Srilanka, he did not ask me about this issue as he felt that Sir is not with me as I have done such a purchase from supplier but he should have asked me before surrender of BL. He lost his 75 %, I would say his supplier lost it but I took painstaking efforts and thanks to international business safety ECGC Paid us & he provided his supplier.
What is surrender of BL ?
Surrender of BL is cancellation of BL & providing authority to clear the goods without BL. I don't know why he took foolish step of surrendering the BL without asking me.
If he had not surrendered his BL, his buyer could not be able to clear the goods without BL (Bill of Lading) & to receive BL in DP terms he need to pay his money in bank, but document against payment system was broken due to surrender.
Arpit bhai was kicked out from a partnership firm, then I explained to him the value of ethics, I told them if you don't have money; work for this people they will help you or do small deals at first, but he told me Dhiru bhai ambani always did big deals.
He changed many firms,
At age 18 he holds a credit card, where he has got a limit of 5,00,000 INR to source good on credit.
How he got Credit Card?
He made asked one of his friend firm Multico Exim to provide 50,000 INR a month in his bank account, once received he will withdraw and provide it back to him. Multico Exim provided 50,000 INR a month to Arpit bhai, on the same day arpit bhai withdrew and provide it back to Multico Exim. For every month he made a fake salary slip and provided to a bank, & Kotak Bank Provided him Credit Card with a limit of 5,00,000 INR
I literally scolded to stop him & told him stop all this nonsense to fool world. He just told me that he wants to earn for the benefit of poor & needy so he is doing such things
He did several deals for others but due to his such approach, he was kicked out very soon by his partner.
According to Arpit bhai it was a fault of partener but i dont know about there fight.
At some stage, I feel he was correct also, partner might have took wrong call & blamed arpit bhai for it
I imparted him good lessons, even he did not gain much money in commission but he gains the Practical Knowledge of product by working for others at a young age.
Why I like him because he changed much now and he stopped taking money from his parents from age 17 & infant he proved money to his poor family via the field of Exim. He is a hard worker also works in night shift in a factory. He sleeps only for 4 hours. At a young age he did not enjoy his life as most Kids do... He now also shares his valuable knowledge with others. Now according to me, he changed a lot. He started helping others for free in Exim Business.
Phone : +91 9601102255 & +91 9537443030
Now He is helping others well in Export-Import Business share his experience in International trade but Beware HA HA HA HA...
See his Video :
Arpit Bhai (At age 17) : https://www.youtube.com/watch?v=tGGX-rigc0g&t=1s & https://www.youtube.com/watch?v=ROOzD0mOAbY&t=5s (Gujarati Language) {in part 2 video he is showing his first imported product}
Changed One : Arpit Bhai (Now at age 19) : https://www.youtube.com/watch?v=SG9TNSjGcW0 (Hindi Language)