Delhi District Court
M/S Expo Freight P. Ltd vs Committed Cargo Care P. Ltd on 28 November, 2023
IN THE COURT OF MS. SHILPI M JAIN : ADDL. DISTRICT
JUDGE-05, SOUTH WEST DISTRICT, DWARKA
COURTS, NEW DELHI
Counter Claim No. 36/2023
CNR No. DLSW01-009827-2023
M/s. Expo Freight Pvt. Ltd.
A-113, Road No. 2, 1st Floor,
Mahipalpur Extn.,
New Delhi-110037
And also resident of
Plot No. 9A, Road No.4,
Mahipalpur Extn.,
National Highway-8,
New Delhi-110037.
Through its Director
namely Prem Shahny ... Counter claimant/Defendant
Versus
M/s. Committed Cargo Care Pvt. Ltd.
Operation Office Situated at
Plot No. 409, Block-A,
Road No. 4, Street No. 8,
Mahipalpur Extn.,
New Delhi-110037
Through its Authorized Representative
Namely Badri Prasad ....Non counter claimant/Plaintiff
Date of Institution : 17.10.2012
Date of Conclusion of Arguments : 25.11.2023
Date of Judgment : 28.11.2023
INDEX
FACTUAL BACKGROUND ....................2
ISSUES .....................4
EVIDENCE GIVEN BY PARTIES .....................4
SUBMISSIONS OF THE PARTIES .....................6
ISSUEWISE ANALYSIS .....................8
CONCLUSION & FINDINGS .....................21
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 1 of 23
JUDGMENT
1. Present counter claim for filed for recovery of Rs. 19,45,216/- (Nineteen Lakh Forty Five Lakh Two hundred Sixteen only) by the Counter claimant/Defendant i.e. Rs. 15,50,000/- (Rupees Fifteen Lakhs Fifty Thousand only) towards the cost of goods missing/stolen due to negligence of the Non Counter claimant/Plaintiff and Rs. 3,95,216/- (Rupees Three Lakhs Ninety Five Thousand Two Hundred and Sixteen only) towards the loss on account of with-holding of payment by the client of the Counter claimant/Defendant due to the default of the Non Counter claimant/Plaintiff.
FACTUAL BACKGROUND:
2. Briefly stated, Counter claimant/Defendant is an international freight forwarder and handles international cargo on behalf of various exporters/importers and logistic providers to its various agents/customers in the international trade market. It is averred that, one M/s. Survi Projects Private Limited contacted Counter claimant/Defendant to import consignment of containers containing casting bed, concrete machinery and equipments etc., from Finland to India at project site of M/s. Survi Projects Private Limited at Manesar/Gurugram, India. It is further averred that, Counter claimant/Defendant assigned shipping contract to its overseas agent M/s. Beweship Finland, which engaged shipping line Hapaglloyd for bringing the shipment to ICD, Tughlakabad.
3. It is further averred that, since Non Counter claimant/Plaintiff is export/import custom clearance agency and are in business terms with the Counter claimant/Defendant, it assigned custom clearance work to it for said assignment, whereby Non Counter claimant/Plaintiff was responsible to take clearance/possession of consignment from ICD Tuglakabad and to Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 2 of 23 deliver/transport the same to project site of M/s. Survi Projects Private Limited, Manesar in good and safe condition.
4. It is further averred that, first lot of the shipment (HBL No. 7185226) was timely cleared and delivered to the client of Counter claimant/Defendant by the Non Counter claimant/Plaintiff. However, Non Counter claimant/Plaintiff unreasonably delayed in custom clearance of second lot of shipment for HBL No. 7187610 comprising three containers which reached to ICD, Tughlakabad on 18.08.2011 and got cleared only on 02.09.2011 and delivered the same to project site to Manesar on 03.09.2011 and 04.09.2011 in bad condition. It is further averred that, in second lot, entire contents of boxes number 47, 48 and 49 and part of the contents of box number 52 were found missing/stolen on arrival due to which Counter claimant/Defendant's client withhold the payment of Rs. 3,95,216/- and value of stolen goods were assessed @ Rs. 15,15,000/-. Thus, present case is filed for the recovery of Rs. 19,45,216/-.
5. In its written statement, non counter claimant/plaintiff denied the averments made by the Counter Claimant and stated that, it is custom clearance agency and do freight forwarder work as per the customer requirement only. It is further averred that, non counter claimant/Plaintiff was responsible for custom clearance only and handed over the same to transport company i.e. M/s. Divya Roadlines at the request of counter claimant for delivery of consignment from ICD Tughlakabad to project site at Manesar. It is also submitted that, non counter claimant/plaintiff is neither aware nor responsible for the alleged loss to caused to the shipment. Lastly, it is submitted that, the present counter claim is merely a counter blast to the civil suit for recovery filed by the non counter claimant/plaintiff. It is also submitted that, it has no concern or knowledge with respect to alleged withholding of payment of Rs. 3,95,216/- by M/s. Survi Projects Pvt. Ltd.
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 3 of 23
6. Replication to the Written Statement of non counter claimant was filed on behalf of Counter Claimant thereby reiterating and reaffirming the contents of the plaint.
ISSUES:
7. On the basis of pleadings of parties, following common issues were framed in present suit as well as in counter claim vide order dated 20.03.2014:
i. Whether the plaintiff is entitled to the decree of amount as prayed for? OPP.
ii. If the answer to the aforesaid issue is in affirmative, whether the plaintiff is entitled to interest thereupon, if so at what rate and for what period? OPP.
iii. Whether the defendant is entitled to the decree of counter claim, as prayed for? OPD.
iv. If the answer to the aforesaid issue is in affirmative, whether the defendant is entitled to interest thereupon, if so at what rate and for what period? OPD.
v. Whether there was a relationship of bailor and bailee between the
plaintiff and defendant, if so its effect? OPD
vi. Relief.
EVIDENCE GIVEN BY PARTIES:
8. In support of its case and to contest counter claim filed by defendant, plaintiff examined only two witnesses in all. PW1 is Sh. Badri Prasad has tendered his evidence by way of affidavit Ex. PW1/A and has relied upon following documents:
S. NO. PARTICULARS EXHIBIT/MARKED
1. Ledger Account of the Ex. PW1/1 (colly) (running into nineteen pages)
plaintiff and the defendant
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 4 of 23
2. Invoice/bills Ex. PW1/2 (colly) (running into one hundred
eighty pages)
3. Legal notice dated 24.04.2012 Ex. PW1/3 (colly) (running into two pages)
4. Postal receipt Ex. PW1/4
5. Board of Directors Resolution Ex. PW1/5
9. PW-2 Sh. Amit Arora has tendered his evidence by way of affidavit Ex. PW2/A and also relied upon compliance certificate Ex. PW-
2/AA and he has been cross-examined on behalf of the defendant.
10. Thereafter, plaintiff closed its evidence and the matter was listed for defendant's evidence.
11. In support of its defence and counter claim, defendant examined total two witnesses in all. DW-1 Sh. Sunil Thomas has tendered his evidence by way of affidavit Ex. DW1/A and has relied upon following documents:
S. PARTICULARS EXHIBIT/MARKED
NO.
1. Copy of resolution dated 02.01.2015 Ex. DW1/1 (OSR)
2. Copy of letter dated 10.07.2012 Mark DX1
3. Copy of consignment Note No.4591 dated Ex. PW1/3 (colly) (running into
02.09.2011 two pages)
4. Postal receipt Mark A
5. Letter dated 07.09.2011 Ex. DW1/4
6. Written complaint dated 10.09.2011 Ex. DW1/5
addressed to SHO PS Pul Prahlad Pur,
Delhi
7. Certified copy of FIR No. 271/2011 Ex. DW1/6
8. Survey report dated 16.09.2011 and Ex. DW1/7 (colly-20 pages)
photographs of boxes (objected to by ld. Counsel for
plaintiff as in compliance
certificate this document Ex.
DW1/7 is not mentioned)
9. Copy of letter dated 15.10.2011 Mark DX2
10. Debit Notes dates 22.08.2011 for Rs. Ex. DW1/9 to Ex. DW1/11
1,00,993/-, debit note dated 21.09.2011
for Rs. 1,89,697/- and debit note dated
03.10.2011 for Rs. 1,04,526/-
11. General Ledger Report w.e.f. 01.04.2011 Ex. DW1/12
to 31.03.2012
12. Bill of lading dated 08.06.2011 bearing Ex. DW1/13
carrier's reference No. 37515424 (objected to by ld. Counsel for
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 5 of 23
plaintiff as page No. 1 of 3 is not
mentioned)
13. Copy of FBL of Beweship dated Mark DX3
07.06.2011
14. Computerized copy of Sea Cargo Arrival Ex. DW1/15
notice cum Invoice dated 05.08.2011 (objected to by ld. Counsel for
plaintiff as in compliance
certificate this document Ex.
DW1/15 is not mentioned)
15. Bill of lading dated 02.07.2011 Ex. DW1/16
(objected to by ld. Counsel for
plaintiff as page no. 1 of 3 is not
mentioned)
16. FBL of Beweship dated 29.06.2011 Ex. DW1/17
17. Copy of invoice of Elematic to Survi Mark DX4
Projects dated 29.06.2011
18. Copy of invoices, packing list, Test Mark DX5 (colly-8 pages)
Certificate Inspection Certificate and
certificate of origin
19. Internet generated copy of mails Ex. DW1/20 (colly-42 pages)
exchanged between plaintiff, defendant (objected to by ld. Counsel for
and Survi Projects plaintiff as in compliance
certificate this document Ex.
DW1/20 is not mentioned)
20. Copy of resolution dated 07.08.2003 Ex. DW1/22 (OSR)
21. Resolution dated 23.05.2013 Ex. DW1/23.
12. DW-2 Sh. Adhip Nautiyal, Manager (Accounts) has tendered his affidavit in evidence which is Ex. DW2/A and relied upon certificate under Section 65B of Evidence Act as DW2/1.
SUBMISSIONS OF THE PARTIES
13. Ld. counsel for plaintiff submits that, Plaintiff worked as CHA with defendant and paid all freight charges and other charges to custom and concerned department for transporting the goods of defendant. It is further submitted that, plaintiff had worked with defendant for hundreds of shipment and no deficiency in service was ever found on the part of plaintiff. Plaintiff further relied upon Ex. PW1/2 (colly) (running into one hundred eighty pages), thereby showing multiple transactions between the plaintiff and defendant. It is further submitted that, each invoice was issued on shipment on shipment basis and defendant was charged under various heads. It is Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 6 of 23 further submitted that, defendant breached the contract and did not assign any work to the plaintiff company w.e.f. 16.03.2012 and in fact failed to clear its outstanding of Rs. 4,06,021/-. It is further submitted that, there is no delay in clearance of consignment under invoice no. SI.11/259 and same was timely delivered as per the instruction of defendant. It is further averred that, there is no bailor-bailee relationship existed between the plaintiff and defendant. It is also averred that, entire shipment was duly insured and no loss suffered by defendant. It is also averred that, Defendant/Counter Claimant lodged a FIR against undisclosed person for missing of goods under which closure report was filed by the Police and infact, protest petition was also dismissed. Lastly, it is submitted that, present Counter claim has been filed by defendant as the counter blast to the present suit.
14. Per contra, Ld. Counsel for defendant submitted that, defendant has incurred huge losses due to the default of the plaintiff in a contract of bailment entered in between the parties, which has been suppressed by the plaintiff. The plaintiff acting as bailee on account of its default lost eh goods from its possession which goods were being transported from Inland Container Deport, Tughlakabad to Manesar in Gurgaon. The estimated cost of goods lost is Rs. 15,50,000/ (Rupees Fifteen Lakhs Fifty Thousand Only). Additionally, the defendant has incurred a loss of Rs. 3,95,216/- (Rs. Three Lakhs Ninety Five Thousand Only) on account of withholding of payment of its charges by the client's of the defendant, M/s Survi Projects Private Limited which is directly in account of the default of the plaintiff.
ISSUEWISE ANALYSIS:
15. Since, in the present matter, six issues were framed out of which issue no. 6 was common, while issue no. 1 and 2 relates to the main suit no. 165/20 i.e. separately decided by this court on even date, while issue no. 3, 4 & 5 relates to the counter claim i.e. subject matter for adjudication before this Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 7 of 23 court. Thus, in present order, this court has given finding for issue no. 3, 4 & 5 alongwith respective relief under Issue No. 6.
ISSUE NO. 3: WHETHER THE COUNTER CLAIMANT/DEFENDANT IS ENTITLED TO A DECREE OF COUNTER CLAIM, AS PRAYED FOR?
OPD ISSUE NO. 5: WHETHER THERE WAS A RELATIONSHIP OF BAILOR AND BAILEE BETWEEN THE NON COUNTER CLAIMANT/PLAINTIFF AND COUNTER CLAIMANT/DEFENDANT, IF SO ITS EFFECT? OPD
16. Since issue no. 3 and 5 are inter-connected both are decided simultaneously.
17. The claim of the Counter claimant/Defendant is two fold. Firstly, recovery of Rs. 3,95,216/- towards the payment due from Survi Projects Private Limited i.e. client of defendant and not released due to the direct consequence of the defaults, acts and omission of the Non Counter claimant/Plaintiff. Secondly, recovery of Rs. 15,50,000/- stated to be assessed value of missing/stolen goods due to the negligence of the Non counter claimant/Plaintiff.
18. It is well settled law that, when a contract has been broken, the party who suffers by such breach is entitled to receive compensation for any loss or damage caused to it. However, said loss or damage must be naturally arose in the usual course of things from the breach and such compensation is not to be given for any remote or indirect loss or damage sustained by the reason of the breach. It is also well settled law that, Damages are compensatory, not penal. The governing purpose of damages is to put the Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 8 of 23 party whose rights have been violated in the same position, so far as money can do so, as if his rights have been observed.
19. For ready reference, the relevant provisions of Indian Contract Act 1872, are reproduced below.
"Sec 73. Compensation of loss or damage caused by breach of contract:
When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it.
Such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach.
Compensation for failure to discharge obligation resembling those created by contract: When an obligation resembling those created by contract has been incurred and has not been discharged, any person injured by the failure to discharge it is entitled to receive the same compensation from the party in default, as if such person had contracted to discharge it and had broken his contract.
Explanation: In estimating the loss or damage arising from a breach of contract, the means which existed of remedying the inconvenience caused by non-performance of the contract must be taken into account.
Section 74. Compensation for breach of contract where penalty stipulated for: When a contract has been broken, if a sum is named in the contract as the amount be paid in case of such breach, or if the contract contains any other stipulation by way of penalty, the party complaining of the breach is entitled, whether or not actual damage or loss is proved to have been caused thereby, to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named or, as the case may be, the penalty stipulated for.
Explanation: A stipulation for increased interest from the date of default may be a stipulation by way of penalty.
Exception: When any person enters into any bail bond, recognizance or other instrument of the same nature or, under the provisions of any law, or under the orders of the Central Government or of any State Government, gives any bond for the performance of any public duty or act in which the public are interested, he shall be liable, upon breach of the condition of any such instrument, to pay the whole sum mentioned therein.
Explanation: A person who enters into a contract with the government does not necessarily thereby undertake any public duty, or promise to do an act in which the public are interested."
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 9 of 23
20. Thus, basic ingredients for unliquidated damages firstly, includes there should be privity of contract between the parties, secondly one party must have breached said contract, thirdly other party sustained any loss or damage due to said breach, fourthly said damage or loss caused to the party naturally arose in the usual course of things from such breach. However, in exceptional cases where the plaintiff suffers no loss the court may still award him nominal damages in recognition of his right. But this is in the discretion of the court. The court may altogether refuse to award any damages or may award even substantial damages. The court is competent to award reasonable compensation in case of breach, even if no actual damage is proved or shown to have been suffered in consequences of breach of contract.
21. Perusal of the record reveals that, DW-1 in its evidence by way of affidavit i.e. Ex.DW1/A specifically stated that, "Counter claimant/Defendant has incurred a loss Rs. 3,95,216/- on account of withholding of payment of its charges by the client of the Counter claimant/Defendant M/s. Survi Projects Pvt. Ltd. which is directly on account of default of Non Counter claimant/Plaintiff".
22. To prove its claim Counter claimant/Defendant relied upon General Ledger Report for the period of 01.04.2011 to 31.03.2012 i.e. Ex. DW1/12. For the purpose of clarification, same is reproduced herein below:
DATE VOUCHER ACCOUNT NAME DEBIT CREDIT BALANCE
NAME
2011-07-01 18866 SHORT AND EXCESS 0.50 0.00 0.50 Cr
RECOVERIES
2011-07-25 SIDELC1070186 FRIGHT INBOUND 11,11,096.50 0.00 11,11,097.00 Cr
RECEIPTS - SEA
IMPORT
2011-07-27 14403 AXIS BANK- 0.00 11,11,097.00 0.00
910020023643824
2011-08-01 20650 SHORT AND EXCESS 0.00 0.43 0.43 Cr
RECOVERIES
2011-08-05 SIDELC1070198 FREIGHT INBOUND 9,88,838.43 0.00 9,88,838.00 Cr
RECEIPTS- SEAL
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 10 of 23
IMPORT
2011-08-12 14747 AXIS BANK- 0.00 988,838.00 0.00
910020023643824
2011-08-22 DNSILODDEL111 OTHER OPERATIVE 77,168.09 0.00 77,168.09 Cr
20007 RECEIPTS- SEAL
IMPORT
2011-08-22 DNSILODDEL111 OTHER OPERATIVE 100,992.89 0.00 1,78,160.98 Cr
20008 RECEIPTS- SEAL
IMPORT
2011-08-22 RCNSILODDELL1 OTHER OPERATIVE 0.00 77,168.09 1,00,992,89 Cr
120004 RECEIPTS- SEAL
IMPORT
2011-09-10 SIDELC1070238 FREIGHT INBOUND 767,841.46 0.00 8,68,834.35 Cr
RECEIPTS- SEAL
IMPORT
2011-09-16 15360 AXIS BANK- 0.00 767,841.00 1,00,993.35 Cr
910020023643824
2011-09-21 DNSILODDEL111 CUSTOM RELATED 189,697.25 0.00 2,90,690.60 Cr
20010 RECEIPTS-SEA
IMPORT
2011-09-30 24694 SHORT AND EXCESS 0.00 0.46 2,90,690.60 CR
RECOVERIES
2011-10-03 DNSILODDEL111 OTHER OPERATIVE 104,526.20 0.00 3,95,216.34 CR
20011 RECEIPTS - SEA
IMPORT
23. DW-1 was partly cross-examined on 11.07.2019 and vide order dated 26.08.2022 DW-1 stands discharged uncross-examined as counsel for Non Counter claimant/Plaintiff stated to be non available. Thus, this court carefully gone through the entire material available on record.
24. Present counter claim is limited to the second lot of shipment qua HBL No. 7187610 (B/L No. HLCUHEL110606272) in three containers i.e. TOLU 4906037, HLXU 4613960 and TOLU 4591557 whereby Counter claimant/Defendant averred that, due to the negligence and default of non counter/plaintiff its client withhold the payment for Rs. 3,95,216.34. Perusal of the record also reveals that, vide Ex. DW1/15, Counter claimant/Defendant issued Sea Cargo Arrival notice cum invoice dt. 05.08.2011 for HBL no. 7187610 (subject matter of present dispute) for Rs. 9,88,838/- which is duly cleared by its client on 12.08.2011 as reflected in Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 11 of 23 Ex. DW1/12 and pending amount of Rs. 3,95,216.34 is w.r.t. three different debit notes (Ex. DW1/9 to Ex. DW1/11) issued by Counter claimant/Defendant to its client as follows:
DATE VOUCHER ACCOUNT HBL/CONTAINER NARRATION AMOUNT NO. NAME NUMBER (IN RS.) 22.08.2011 DNSILODDE Other 7189191/HLXU4619886 Debit Note for 1,00,992.89 L11120008 Operative & HLXU5617996 Clearance Charges (Ex. DW1/11) receipts
-Sea Import 21.09.2011 DNSILODDE Customs 7187610/ TOLU4906037, Debit Note for 1,89,697.25 L11120010 related HLXU4613960 & Clearance Charges -
(Ex. DW1/10) receipts- TOLU4591557 Sector Charges -
Sea Import Detention Charges,
Handling Charges -
has to pay to liner as
tarpaulin was found
torn
03.10.2011 DNSILODDE Other 7185226/HLXU4613445, Debit Note for 1,04,526.20
L11120011 Operative HLXU5649972 & Clearance Charges -
(Ex. DW1/9) receipts HLXU5634503 Detention Charges -
-Sea Import Waiting Charges paid
to the Transporter,
Sectro Charges -
Packing/Repacking
Charges
Total 3,95,216.34
25. Thus, bare perusal of above debit notes it is clear that, Ex. DW1/9 and Ex. DW1/11 don't pertained to HBL No. 7187610 at all and so far as Ex. DW1/10 is concerned, no explanation was given by Counter claimant w.r.t. purpose of issuance of said debit notes once payment with respect to HBL No. 7187610 already cleared by its client on 12.08.2011. In any case, no material placed on record by the counter claimant thereby showing that it's client i.e Survi Projects Pvt. Ltd withhold the payment. No notice, mail, letter or any other placed on record by the counter claimant to show that, it has made demand for payment for the due amount and same is refused by Survi Projects Pvt Ltd. Thus, in considered opinion of this court, Counter claimant is not entitled to claim due amount of Rs. 3,95,216.34 qua its client from Non-counter claimant.
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 12 of 23
26. Another claim of counter-claimant is with respect to recovery of Rs. 15,50,000/- stated to be assessed value of missing/stolen goods due to the negligence of the Non counter claimant/Plaintiff. It is averred that, Non counter claimant did not take care of the goods bailed to him as a man of ordinary prudence would under similar circumstances, take of his own goods of eth same bulk, quality and the value of goods bailed. It is further averred that, relationship between Counter Claimant and Non Counter Claimant was of Bailor and Bailee whereby Counter claimant in capacity of bailor of goods assigned the work to Non Counter claimant.
27. Thus, before discussing the facts of the present case, it would be appropriate to discuss the law on bailment as provided under Indian Contract Act, 1872.
"148. "Bailment""bailor" and "bailee" defined -- A "bailment" is the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them. The person delivering the goods is called the "bailor". The person to whom they are delivered is called, the "bailee". Explanation.--If a person already in possession of the goods of another contracts to hold them as a bailee, he thereby becomes the bailee, and the owner becomes the bailor of such goods, although they may not have been delivered by way of bailment.
149. Delivery to bailee how made -- The delivery to the bailee may be made by doing anything which has the effect of putting the goods in the possession of the intended bailee or of any person authorised to hold them on his behalf. --The delivery to the bailee may be made by doing anything which has the effect of putting the goods in the possession of the intended bailee or of any person authorised to hold them on his behalf.
150. Bailor's duty to disclose faults in goods bailed --The bailor is bound to disclose to the bailee faults in the goods bailed, of which the bailor is aware, and which materially interfere with the use of them, or expose the bailee to extraordinary risks; and if he does not make such disclosure, he is responsible for damage arising to the bailee directly from such faults. If such goods are bailed for hire, the bailor is Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 13 of 23 responsible for such damage, whether he was or was not aware of the existence of such faults in the goods bailed.
151. Care to be taken by bailee -- In all cases of bailment the bailee is bound to take as much care of the goods bailed to him as a man of ordinary prudence would, under similar circumstances, take of his own goods of the same bulk, quantity and value as the goods bailed."
28. In M/s Rasiklal Kantilal & Co vs Board Of Trustee Of Port Of Bombay1, Hon'ble Supreme Court of India held as follows:
"49. The essence of bailment is possession and the consent of the owner of the goods is not necessary. [Port of Bombay v. Premier Automobiles Ltd., (1981) 1 SCC 228, pp. 234-35, para 11:
"11. It is well settled that the essence of bailment is possession. It is equally well settled that a bailment may arise, as in this case, even when the owner of the goods has not consented to their possession by the bailee at all : Palmer on Bailment, 1979 Edn., p. 2. There may thus be bailment when a wharfinger takes possession of goods unloaded at the quay side. A bailment is not therefore technically and essentially subject to the limitations of an agreement, and the notion of privity need not be introduced in an area where it is unnecessary, for bailment, as we have said, arises out of possession, and essentially connotes the relationship between a person and the thing in his charge. It is sufficient if that possession is within the knowledge of the person concerned. It follows that a bailment may very well exist without the creation of a contract between the parties and it essentially gives rise to remedies which, in truth and substance, cannot be said to be contractual. That is why Palmer has made the assertion that "bailment is predominantly a tortuous relation" (p. 36), and the two are fundamentally similar."] The distinction between possession and custody of goods is also noted by jurists. [ "Bailment" is a technical term of the common law, though etymologically it might mean any kind of handing over. It involves change of possession. One who has custody without possession, like a servant, or a guest using his host's goods, is not a bailee. [See Pollock & Mulla, The Indian Contract and Specific Relief Acts, 13th Edn., p. 1931]] In this context, the language of Section 49(2) is significant -- "A Board may ... take charge of the goods....". But we do not propose to examine the significance as the same is neither argued nor necessary. In our opinion, for the purpose of the present, we must also mention here that Section 63 of the Act authorises the Board to sell the goods "placed in their custody". This Court also recognised that bailment can come into existence even otherwise than by a contract, in State of Gujarat v. Memon Mahomed Haji Hasam [State of Gujarat v. Memon Mahomed Haji Hasam, AIR 1967 SC 1885] : (AIR p. 1888, paras 5 and 6) "5. ... Bailment is dealt with by the Contract Act only in cases where it arises from a contract but it is not correct to say that there 1 2017 SCC Online SC 176 Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 14 of 23 cannot be a bailment without an enforceable contract. As stated in Possession in the Common Law by Pollock and Wright, p. 163:
'Upon the whole, it is conceived that in general any person is to be considered as a bailee who otherwise than as a servant either receives possession of a thing from another or consents to receive or hold possession of a thing for another upon an undertaking with the other person either to keep and return or deliver to him the specific thing or to (convey and) apply the specific thing according to the directions antecedent or future of the other person.' 'Bailment is a relationship sui generis and unless it is sought to increase or diminish the burdens imposed upon the bailee by the very fact of the bailment, it is not necessary to incorporate it into the law of contract and to prove a consideration'.
6. There can, therefore, be bailment and the relationship of a bailor and a bailee in respect of specific property without there being an enforceable contract. Nor is consent indispensable for such a relationship to arise. A finder of goods of another has been held to be a bailee in certain circumstances."
50. As rightly opined in Forbes case [Forbes Forbes Campbell & Co. Ltd. v. Port of Bombay, (2015) 1 SCC 228 : (2015) 1 SCC (Civ) 488] , there is no bailor and bailee relationship between the Board (the first respondent) and the consignee (the appellant); either voluntarily or statutorily compelled but such a relationship exists between the first respondent and the owner of the ship (through the steamer agent). It is possible in a given case where the consignee or any other person (such as the appellant herein) claiming through the consignor, eventually may not come forward to take delivery of the goods for a variety of reasons -- considerations of economy or supervening disability imposed by law, etc. Therefore, in such cases, to say that merely because the bill of lading is endorsed or the delivery order is issued, the consignor or his agent is absolved of the responsibility for payment (of rates or rent for services rendered with respect to goods) would result in a situation that the Board would incur expenses without any legal right to recover such amount from the consignor and be driven to litigation for recovering the same from the consignee who did not take delivery of the goods with whom the Board had no contract of bailment and consequently, no contractual obligation to pay the "rates or rent".
51. Enquiry into the relationship between either the Board, the consignor of goods, the owner of the vessel and the steamer agent on the one hand or the consignee and the Board on the other, in our opinion, is wholly irrelevant in examining the right of the Board to recover the amounts due towards the rates or rent for services rendered with respect to the goods. The right of the Board is unquestionable. The only question is: from whom can the Board recover -- we emphasise the question is not who is liable. Depending on the nature of the relationship between the consignor and consignee, the liability may befall either of them.
52. On the other hand, in the light of the legal position declared by the Constitution Bench in Rowther-1 [Port of Madras v. K.P.V. Sheik Mohamed Rowther & Co., 1963 Supp (2) SCR 915] , the first respondent is a sub- bailee of the goods bailed by the consignor (bailor) to the shipowner Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 15 of 23 (bailee). The goods are bailed through the agent (steamer agent) of the bailee. The appellant is only a person claiming through the bailor, without any direct contractual relationship with the first respondent.
53. Title to the goods is irrelevant even in the cases of a bailment arising under a contract. Any person who is capable of giving physical possession of goods can enter into a contract of bailment and create bailment. Under Section 148 of the Contract Act, "bailment", "bailor" and "bailee" are defined as under:
"148. "Bailment", "bailor" and "bailee" defined.--A "bailment" is the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them. The person delivering the goods is called the "bailor". The person to whom they are delivered is called the "bailee".
Explanation.--If a person is already in possession of the goods of another contracts to hold them as a bailee, he thereby becomes the bailee, and the owner becomes the bailor of such goods, although they may not have been delivered by way of bailment."
It can be seen from the above that bailment is a contractual relationship and bailment can be created by any person who is in possession/custody of goods but not necessarily the owner of the goods. When the purpose of bailment is accomplished, the goods are to be returned or otherwise disposed of according to the directions of the person (bailor) delivering them."
29. In Cochin Port Trust v. Arebee Star Maritime Agencies (P) Ltd.2, Hon'ble Supreme Court of India held as follows:
"75. Sriyanesh Knitters [Port of Bombay v. Sriyanesh Knitters, (1999) 7 SCC 359] is the next judgment that has to be dealt with in chronological sequence. This was a judgment of two learned Judges of this Court, in which the question that arose before the Court was stated thus : (SCC p. 364, para 1) "1. The common question involved in these appeals is whether the appellant Board of Trustees of the Port Trust constituted under the Major Port Trusts Act, 1963 (for short "the MPT Act") have a general lien for their dues over the present or future consignments imported by the importers at the Bombay Port when the said dues are in respect of the past imports made by the said importers."
The Court first found that a reading of Sections 59 and 61(1) of the MPT Act made it clear that the lien spoken of is a lien qua the particular goods that are imported, and cannot extend to previous imports of similar goods made by the same party. The Court then went on to hold that the MPT Act is not a comprehensive code, and has to be read together with other Acts wherever the MPT Act is silent. It was then held that Section 171 of the Contract Act, 1872 speaks of a general lien which may be exercised by the Port Trust as it is a "wharfinger" within the meaning of the said section. This being so, the Port Trust may continue to retain the goods bailed as security for past dues, but would have to have recourse to proceedings in accordance with law for securing an order, which would then enable the Port Trust to sell the goods to 2 (2021) 11 SCC 641 : 2020 SCC OnLine SC 622 at page 696 Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 16 of 23 realise the amounts due to it. This could be done by filing a suit for recovery of the amount due to it under Section 131 of the MPT Act.
76. However, the judgment in Sriyanesh Knitters [Port of Bombay v. Sriyanesh Knitters, (1999) 7 SCC 359] goes on to make certain observations, in particular in para 23, stating that a relationship of bailor and bailee comes into existence, when the Board is required to store goods that have been imported, between the Board and the consignee of those goods. Apart from the fact that this is directly contrary to Rowther-1 [Port of Madras v. K.P.V. Sheik Mohamed Rowther & Co., 1963 Supp (2) SCR 915] (see SCR p. 940), the consignee cannot be considered to be a bailor if the definition of bailor under the Contract Act, 1872 is read. Under Section 148 of the Contract Act, a bailor is defined as a person who delivers the goods to the bailee. In this case, the person who delivers the goods to the bailee is the vessel and not the consignee, as has been correctly stated in Rowther-1 [Port of Madras v. K.P.V. Sheik Mohamed Rowther & Co., 1963 Supp (2) SCR 915] . Therefore, the observations that the consignee is the bailor of the goods, with the Port Trust being the bailee thereof, made in paras 23 and 25 of Sriyanesh Knitters [Port of Bombay v. Sriyanesh Knitters, (1999) 7 SCC 359] cannot be said to state the law correctly, and are accordingly overruled. However, since we are not going into the point of sub-bailment as argued by Shri Pratap, we leave open the question as to whether the Port Trust, as sub-bailee, is entitled to recover its dues from the original bailor -- the consignor, and persons claiming through it, given the statutory scheme of the MPT Act."
30. In present matter, Counter claimant/Defendant itself claimed to be an international freight forwarder who handles international cargo on behalf of various exporters/importers and logistic providers to its various agents/customers in the international trade market. Admittedly, M/s. Survi Projects Private Limited was the actual consigner/owner of entire shipment who engaged Counter claimant/Defendant to import consignment from Finland to India at its project site at Manesar/Gurugram, India. While, Counter claimant/Defendant firstly assigned shipping contract to its overseas agent M/s. Beweship Finland, which engaged shipping line Hapaglloyd for bringing the shipment to ICD, Tuglakabad and than engaged Non-counter claimant/plaintiff for the purpose of custom clearance at ICD, Tuglakabad. Thus, admittedly, shipment (HBL 7187610) underwent into following transit:
S. NO. NATURE OF FROM TO DATE OF
TRANSIT ARRIVAL
1. Sea Transit Helsinki Mundra Port Not available
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 17 of 23
2. Inland Transit by Rail Mundra Port ICD, 18.08.2011
Tughlakabad
3. Road Transit ICD Tughlakabad Manesar 02.09.2011
31. It is also admitted fact that, during inspection at ICD,
Tughlakabad entire shipment was found intact. Ld. Counsel for Counter claimant/defendant give specific suggestion to PW1 during his cross examination and PW1 deposed as follows:
"It is correct that the shipments of Survi Projects were got physically examined by custom department by the officials Committed Cargo present at Inland Container Depot, Tuglakabad, New Delhi (ICD-TKD)"
32. It is also admitted fact that, shipment was further transit by Ms/ Divya Roadlines from ICD-TKD to Manesar, Haryana vide consignment note No. 4591 dt. 02.09.2011. Pursual of Mark A i.e. admitted document by Plaintiff reveals that name of consigner mentioned as 'International Cargo Helpers, ICD-TKD, New Delhi' while Consignee name is mentioned as 'Survi Projects Pvt. Ltd, Manesar'. It is worthwhile to mentioned here that, neither M/s Divya Roadlines nor M/s International Cargo Helpers nor Survi Projects Pvt. Ltd. summoned by either party during its evidence.
33. Thus, in view of law settled by Hon'ble Supreme Court of India as discussed above and considering the above facts and circumstances as well as material available on record, this court is of the considered opinion that, there is no bailee-bailor relationship between the parties as Counterclaimant is itself engaged by Survi Projects Pvt Ltd for the purpose of transshipment of entire consignment from Finland to India, who firstly assigned shipping contract to its overseas agent M/s. Beweship Finland, which engaged shipping line 'Hapaglloyd' for bringing the shipment to Mundra Port, Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 18 of 23 whereafter material was transit to ICD, Tughlakabad via Container Corporation of India Ltd. (CONCOR) and Non-counter claimant/plaintiff was engaged for the purpose of custom clearance at ICD, Tughlakabad and from ICD-TKD goods were actually transported via M/s Divya Roadlines to Manesar under the invoice issued by Survi Projects Pvt. Ltd, Delhi to Survi Projects Pvt. Ltd., Manesar. In any case, no material placed on record thereby showing that, there is a negligence on the part of non counter-claimant which cause any loss or damage. Thus, issue no. 5 decided against the Counter claimant/defendant.
34. No material placed on record thereby showing that, how the missing/stolen goods assessed at Rs. 15,50,000/-. Moreover, Survi Projects Private Limited was having lien on the shipment as per shipping documents. Counter-claimant/defendant has no locus to claim the damages towards the alleged missing/stolen goods as he is not owner or bailor of the consignment. Moreover, perusal of record reveals that, insurance claim made by the client of counter-claimant w.r.t. the loss/stolen goods. However, no material placed on record to show the status of said insurance claim. During cross examination DW1 specifically deposed that:
" We have stated in the FIR that the goods i.e. constriction material consisting of screws, wadges, beds etc worth Rs. 15,50,000/- have been missing. We have placed on record the bill of the missing goods, which is March DX4. I cannot produce the original of Mark DX4. The said FIR has been closed by the police on the ground that the goods could not be traced out. We have filed the protest petition against the closure report of the police in the said FIR. The court dismissed our protest petition. It is correct that EX. DW1/PX1 (Colly) are the certified copies of the FIR, closure report, protest petition and order of the court. The missing goods were insured. We did not make the claim from the insurance company because we did no insure the goods and the consignee company has insured the goods and they have made a claim' Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 19 of 23
35. Further, Mark DX4 is merely a photocopy of invoice dated 29.06.2011 issued by Survi Projects Pvt. Ltd., New Delhi to Survi Projects Pvt. Ltd., Manesar, Gurugram for entire shipment from Finland to India hence, same is not bill of missing goods as stated by DW1 during his cross- examination. In fact, as per survey report i.e. Ex.DW1/7 (colly) w.r.t. HBL No. 7187610, only four numbers of wooden case were shown to the surveyor team and same were found kept in temporary room, constructed at site. For the purpose of clarification, relevant portion is reproduced herein below:
36. Thus, it is not clear that, when alleged theft or damage occurred to the shipment as survey was requested after 10 days of arrival of shipment at the behest of Survi Projects Pvt. Ltd. and same was done on 14.09.2011 when the goods were already offloaded from the transport. Infact, Ex.DW1/6 i.e. FIR no. 217 dt. 18.09.2011 (PS Pul Prahladpur) doesn't bear any assessment value of alleged stolen goods. Thus, issue no. 3 also decided against the Counter claimant/defendant. Consequently, issue no. 4 need not to be consider as same is w.r.t. interest on decretal amount.
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 20 of 23 ISSUE NO. 6: RELIEF
37. Thus, in view of above facts and circumstances, this court does not find any merit in the counter-claim filed by the counter-claimant. Accordingly, same is dismissed.
CONCLUSION & FINDING
38. Considering the facts and circumstances of present case, pleadings/submissions made by the parties and material available on record as well as evidence led by the parties, this court does not find any merit in the counter-claim filed by the counter-claimant in terms of following conclusions:
1. In view of law settled by Hon'ble Supreme Court of India as discussed above and considering the above facts and circumstances as well as material available on record, this court is of the considered opinion that, there is no bailee-bailor relationship between the parties as Counterclaimant is itself engaged by Survi Projects Pvt Ltd for the purpose of transshipment of entire consignment from Finland to India, who firstly assigned shipping contract to its overseas agent M/s.
Beweship Finland, which engaged shipping line 'Hapaglloyd' for bringing the shipment to Mundra Port, whereafter material was transit to ICD, Tughlakabad via Container Corporation of India Ltd. (CONCOR) and Non-counter claimant/plaintiff was engaged for the purpose of custom clearance at ICD, Tughlakabad and from ICD-TKD goods were actually transported via M/s Divya Roadlines to Manesar under the invoice issued by Survi Projects Pvt. Ltd, Delhi to Survi Projects Pvt. Ltd., Manesar. In any case, no material placed on record thereby showing that, there is a negligence on the part of non counter-claimant which cause any loss or damage;
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 21 of 23
2. Debit notes i.e. Ex. DW1/9 and Ex. DW1/11 don't pertained to HBL No. 7187610 at all and so far as Ex. DW1/10 is concerned, no explanation was given by Counter claimant w.r.t. purpose of issuance of said debit notes once payment with respect to HBL No. 7187610 already cleared by its client on 12.08.2011. In any case, no material placed on record by the counter claimant thereby showing that it's client i.e Survi Projects Pvt. Ltd withhold the payment. No notice, mail, letter or any other placed on record by the counter claimant to show that, it has made demand for payment for the due amount and same is refused by Survi Projects Pvt Ltd. Thus, in considered opinion of this court, Counter claimant is not entitled to claim due amount of Rs. 3,95,216.34 qua its client from Non- counter claimant;
3. No material placed on record thereby showing that, how the missing/stolen goods assessed at Rs. 15,50,000/-. Moreover, Survi Projects Private Limited was having lien on the shipment as per shipping documents. Counter-claimant/defendant has no locus to claim the damages towards the alleged missing/stolen goods as he is not owner or bailor of the consignment. Moreover, perusal of record reveals that, insurance claim made by the client of counter-claimant w.r.t. the loss/stolen goods. However, no material placed on record to show the status of said insurance claim. In fact, no inference can be drawn from survey report i.e. Ex.DW1/7 (colly) w.r.t. HBL No. 7187610;
4. Thus, in view of above facts and circumstances, this court does not find any merit in the counter-claim filed by the counter-claimant. Accordingly, same is dismissed.
39. No order as to cost.
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 22 of 23 40 Decree sheet be prepared accordingly. File be consigned to record room.
Announced in open court SHILPI Digitally signed
by SHILPI M
JAIN
on 28.11.2023. M Date:
2023.11.28
JAIN 16:49:24 +0530
(SHILPI M JAIN)
ADDL. DISTRICT JUDGE-05
DWARKA COURTS, NEW DELHI
Counter Claim No. 4203/2023 Expo Freight P. Ltd. Vs. Committed Cargo Care P. Ltd. Pg No 23 of 23