Bangalore District Court
) Tata Hitachi Construction Machinery vs M/S.Mahendra Logistics Limitd on 30 September, 2020
Govt.of Karnataka TITLE SHEET FOR JUDGMENT IN SUITS
From No.9(Civil)
Title Sheet for
Judgment in suits
(R.P.91)
IN THE COURT OF THE VI ADDL. CITY CIVIL & SESSIONS JUDGE
AT BENGALURU CITY : (CCCH.11)
Dated this the 30th day of September, 2020
PRESENT: Sri. Rama Naik, B.Com., LL.B.,
(Name of the Presiding Judge)
O.S.No :3902/2018
PLAINTIFFS 1) Tata Hitachi Construction Machinery
Company Private Limited,
Registered Office at Jubilee Building,
45, Museum Road, Bengaluru -560 025.
Reptd.by its Subrogee/Power Agent
M/s.Oriental Insurance Co. Limited,
Divisional Office IV,
No.49, 2nd Floor, Jyothi Mahal,
St.Marks Road, Bengaluru -560 001.
Reptd.by its Principal Officer.
2) M/s.Oriental Insurance Co. Limited,
Divisional Office IV,
No.49, 2nd Floor, Jyothi Mahal,
St.Marks Road, Bengaluru -560 001.
Reptd.by its Principal Officer.
[By Pleader Sri.Ranganathan.P.S]
/Vs/
OS.3902/2018
2
DEFENDANT M/s.Mahendra Logistics Limitd,
Regd. Office, Mahendra Towers,
Dr.G.M.Bhosale Marg. Worli,
Mumbai - 400 018.
Reptd.by its Authorized Signatory.
[Exparte]
Date of Institution of the suit : 02.06.2018
Nature of the Suit : Damages/
Compensation
Date of commencement of recording
of evidence : 05.09.2019
Date on which the Judgment was
pronounced : 30.09.2020
Year/s Month/s Day/s
Total Duration : 02 03 28
---
(RAMA NAIK)
VI ADDL.CITY CIVIL & SESSIONS JUDGE
BENGALURU CITY.
OS.3902/2018
3
JUDGMENT
This suit is filed by Plaintiffs for recovery of a sum of Rs.1,16,812/- with interest at the rate of 12% per annum from the date of suit till realization and for costs of the suit.
2) In brief, Plaintiffs' case is that, 1st Plaintiff is a Company duly represented by 2nd Plaintiff. 2nd Plaintiff is a Public Limited Company incorporated under the Companies Act, 1956, having its office at Bengaluru and is duly represented by its Principal Officer.
3) It is stated that, Defendant is a Private Limited Company incorporated in India, carrying on business at their registered office at Worli, Mumbai.
4) It is stated that, 1st Plaintiff, during the course of its business, dispatched consignment of Earth Moving Construction Machinery Parts from JNPT to its office at Nagpur as per its Invoice No. PS OS.3902/2018 4 00398886, dated 27.04.2016 valued at USD 104018.63. Said consignment was securely packed and the same was entrusted to Defendant common carrier for safe carriage and delivery at their office at Hubli. In acknowledgment of such entrustment, Defendant issued its Consignment Note No.245693 dated 16.05.2016 and undertook to care for, carry and deliver the said consignment in the same apparent good order and condition as was entrusted to it. 1st Plaintiff, being the owner of the consignment, insured the same with 2 nd Plaintiff under policy of insurance bearing No.421400/21/2016/23.
5) It is further stated that, Defendant delivered the consignment in a highly damaged condition. 1 st Plaintiff, being the owner of the consignment, issued a statutory notice of loss to Defendant on 28.05.2016 requesting Defendant to issue certificate of facts/damage certificate and also demanding the claim. Defendant issued its OS.3902/2018 5 Certificate of facts dated 06.06.2016 admitting the damage. On account of damaged delivery/short delivery of consignment due to leakage of the oil due to transit, they have suffered loss of Rs.1,16,812/-. Defendant is liable to pay the value of damaged delivery of consignment and short delivery of consignment sustained by Plaintiffs.
6) It is further stated that, 1st Plaintiff lodged its claim before 2nd Plaintiff under Policy of Insurance and 2nd Plaintiff indemnified 1st Plaintiff and paid a sum of Rs.2,06,640/-. Upon such indemnification, 1 st Plaintiff executed a Letter of Subrogation and Special Power of Attorney in favour of 2 nd Plaintiff at Bengaluru on 13.02.2017 by subrogating its right in favour of 2nd Plaintiff. By virtue of letter of subrogation as provided under Section 79 of Marine Insurance Act, 2nd Plaintiff is entitled to file and maintain a suit in its own name. But to avoid any technical objection that may be raised by OS.3902/2018 6 Defendant, the suit is being filed by Plaintiffs jointly. Hence, pray for decree in favour of 2nd Plaintiff.
7) Defendant has failed to enter its appearance in spite of service of summons, hence, Defendant has been placed ex-parte in this suit.
8) Heard. Perused the records. 9) Point that arises for consideration is :
" Whether Plaintiffs are entitled to the relief as prayed for?"
10) In support of the claim of Plaintiffs, Administrative Officer of 2nd Plaintiff has been examined as P.W.1 and got marked Exs.P.1 to P.9 in this suit.
11) My answer to the above point is in the affirmative for the following :
OS.3902/2018 7 REASONS
12) By this suit, Plaintiffs claim a sum of Rs.1,16,812/- from Defendant, contending that, 1 st Plaintiff during the course of its business dispatched consignment of Earth Moving Construction Machinery Parts from JNPT to its office at Nagpur as per its Invoice No.PS 00398886 dated 27.04.2016 valued at USD 104018.63. Said consignment was securely packed and it was entrusted to Defendant Carrier for safe carriage and delivery at the place of the consignee at Hubli. Acknowledging such entrustment, Defendant issued its Consignment Note No.245693 dated 16.05.2016 and undertook to care for, carry and deliver the said consignment in the same apparent good order and condition. It is contended that, 1st Plaintiff, being the owner of the consignment, insured with 2nd Plaintiff under policy of insurance No.421400/21/2016/23.
OS.3902/2018 8 Defendant delivered the consignment entrusted to it in a highly damaged condition.
13) It is contended that, 1St Plaintiff issued a statutory notice for the loss caused to it on 28.05.2016 by informing Defendant about the loss caused and claiming the loss amount. Defendant issued its Certificate of facts dated 06.06.2016 admitting the damage.
14) It is contended that 1st Plaintiff suffered loss of Rs.1,16,812/- due to short delivery and consequent loss sustained by 1st Plaintiff is due to negligence and lack of care on the part of the Defendant. 1st Plaintiff lodged its claim before 2nd Plaintiff under Policy of Insurance and 2nd Plaintiff indemnified the loss caused to 1st Plaintiff and paid a sum of Rs.2,06,640/-. Upon such indemnification, 1st Plaintiff executed a Letter of Subrogation and General Power of Attorney in favour of 2nd Plaintiff, at Bengaluru on 13.02.2017. By virtue of execution OS.3902/2018 9 of letter of subrogation and Special Power of Attorney provided under Section 79 of Marine Insurance Act, 2nd Plaintiff is entitled to file and maintain a suit in its own name, but to avoid technical objections, this suit is being filed jointly by both Plaintiffs and it is contended that, 1 st Plaintiff has 'no objection' for the decree being passed in favour of 2nd Plaintiff.
15) 2nd Plaintiff has examined its Administrative Officer-Ms.Anushree Sarkar, as P.W.1, who has reiterated the plaint averments on oath in her examination-in-chief and has produced nine documents in support of its case, which are marked as Exs.P.1 to P.9.
16) Ex.P.1 is the Authorization letter dated 05.09.2019, wherein, 2nd Plaintiff authorizes its Administrative Officer, Ms.Anushree Sarkar to appear before the court in this suit, hence, it can be said that 2nd Plaintiff has been duly represented in OS.3902/2018 10 this suit. Ex.P.2 is Invoice bearing No.PS00398886 dated 27.04.2016 issued by 1st Plaintiff, wherein, 1st Plaintiff described the consignment which was to be delivered to its office at Nagpur and also mentioned its value. Ex.P.3 is Consignment Note No.2458693 dated 16.05.2016. Ex.P.4 is Notice of claim for compensation dated 28.05.2016 for value of loss of consignment issued by 1st Plaintiff to Defendant. Ex.P.5 is Claim bill dated 28.05.2016 claiming total value of Rs.1,40,152=73 towards loss of consignment. Ex.P.6 is Certificate of Fact dated 06.06.2016 issued by Defendant admitting fact of damage. Ex.P.7 is Survey report. Ex.P.8 is Discharge Voucher dated 30.01.2017 issued by 2nd Plaintiff in full and final settlement of claims arising in respect of loss. Ex.P.9 is letter of subrogation and special power of attorney dated 13.02.2017, executed by the 1st Plaintiff to 2nd Plaintiff by subrogating the right, title and interest of 1 st Plaintiff in favour of the 2nd Plaintiff.
OS.3902/2018 11
17) On perusal of the documentary evidence makes it clear that, 1st Plaintiff delivered its consignment to its Office at Nagpur vide Ex.P.2 through Defendant Carrier. This has been established at Ex.P.3-Consignment Note. Exs.P.4 to P.6 establish the fact of loss of consignment to the extent of Rs.1,40,152.70. Ex.P.7 substantiates the fact that 2nd Plaintiff being the insurer of 1st Plaintiff, indemnified the value of loss of consignment to 1 st Plaintiff. Ex.P.9 establishes that the right of 1 st Plaintiff to claim the value of loss of consignment has been subrogated to 2nd Plaintiff and 1st Plaintiff has also authorized 2nd Plaintiff by signing Special Power of Attorney. Based on Ex.P.9, 2 nd Plaintiff has filed this suit against Defendant for the value of loss of consignment which amount has already been paid to 1st Plaintiff by 2nd Plaintiff.
18) Here, the question that arises is, whether 1 st Plaintiff can subrogate his right of claim to 2 nd OS.3902/2018 12 Plaintiff and on the basis of subrogation, 2nd Plaintiff can initiate legal action against Defendant?
19) At this stage, it is relevant to mention Section 79 of the Marine Insurance Act 1973. Section 79 deals with right of subrogation. It reads as follows :
"(1) Where the insurer pays for a total loss, either of the whole, or in the case of goods of any apportionable part of the subject-matter insured., he thereupon becomes entitled to take over the interest of the assured in whatever may remain of the subject-matter so paid for and he is thereby subrogated to all rights and remedies of the assured in and in respect of that subject-matter as from the time of the casually causing the loss.
(2) Subject to the foregoing provisions, where the insurer pays for a partial loss, he acquires no title to the subject-matter insured, or such part of it as may remain, but he is thereupon subrogated to all rights and remedies of the assured in and in respect of the subject-matter insured as from the time of the casualty causing the loss, in so far as the assured has been indemnified, according to this Act, by such payment for the loss."
20) Section 79 of the Act specifically states that, where the insurer pays for a total loss either of a whole or in the case of goods of any apportionable part of the subject matter insured, the insurer is OS.3902/2018 13 thereupon subrogated all rights and remedies of the assured.
21) Plaintiffs have placed reliance on the judgment in the case of Economic Transport Organization Vs. M/s.Charan Spinning Mills (P) Ltd.& Anr., [2010 (1) Supreme 658], wherein, the Hon'ble Supreme Court was pleased to hold as follows :
" Doctrine of Subrogation - Scope and ambit of - Subrogation, as an equitable assignment, is inherent, incidental and collateral to a contract of indemnity, which occurs automatically, when the insurer settles the claim under the policy, by reimbursing the entire loss suffered by the assured - It need not be evidenced by any writing- But where the insurer does not settle the claim of assured fully, by reimbursing the entire loss, there will be no equitable assignment of the claim enabling insurer to stand in the shoes of the assured, but only a right to recover from the assured, any amount remaining out of the compensation recovered by the assured from the wrongdoer, after the assured fully recovers his loss - To avoid any dispute with the assured as to the right of subrogation and extent of its rights, the insurers usually reduce the terms of subrogation into writing in the form of a Letter of Subrogation which enables and authorizes insurer to recover the amount settled and paid by insurer, from the third party wrong-doer as a OS.3902/2018 14 Subrogee-cum-Attorney-When the Insurer obtains an instrument from the assured on settlement of the claim, whether it will be a deed of subrogation, or subrogation-cum- assignment, would depend upon the intention of parties as evidenced by wording of the document-The title or caption of the document, by itself, may not be conclusive-It is possible that the document may be styled as 'subrogation' but may contain in addition an assignment in regard to the balance of the Claim, in which event it will be a deed of subrogation-cum-assignment-It may be a pure and simple subrogation but may inadvertently or by way of excessive caution use words more appropriate to an assignment - If the terms clearly show that the intention was to have only a subrogation, use of the words "assign, transfer and abandon in favour of" would in the context be construed as referring to subrogation and nothing more."
22) Principles of law of subrogation enunciated in the above judgment are aptly applicable to the case of Plaintiffs. Hence, in view of Section 79 of the Act and the principles as laid down by the Hon'ble Supreme Court, this Court comes to the conclusion that 2nd Plaintiff is having right to institute this suit for the value of loss or short of delivery of consignment against Defendant.
OS.3902/2018 15
23) Next question is, as to what extent the Defendant can be liable for the short of delivery of consignment? Admittedly, Defendant is a Carrier. It undertakes to deliver the goods to the destination which it agrees. Ex.P.3, Consignment Note substantiates this fact. Sections 9 and 10 of the Carriers Act read as follows :
"9. Plaintiffs, in suits for loss, damage, or non-delivery, not required to prove negligence or criminal act - In any suit brought against a common carrier for the loss, damage or non-delivery of [goods including container, pallets or similar article of transport used to consolidate goods)entrusted] to him for carriage, it shall not be necessary for the plaintiff to prove that such loss, damage or non-delivery was owing to the negligence or criminal act of the carrier, his servants or agents.
10. Notice of loss or injury to be given within six months.- No suit shall be instituted against a common carrier for the loss of, or injury to [goods including container, pallets or similar article of transport used to consolidate goods) entrusted] to him for carriage, unless notice in writing of the loss or injury has been given to him before the institution of the suit and within six months of the time when the loss or injury first came to be knowledge of the plaintiff."
24) In this case, Defendant undertook to deliver the consignment to the destination. Under such OS.3902/2018 16 circumstance, it was his bounden duty to deliver the consignment in good order and condition during the period of undertaking. If Defendant fails to do so, the liability would be fastened on Defendant to reimburse the value of loss of consignment. Section 9 of the Carriers Act deals with rebuttable presumption of law which states that it shall not be necessary for Plaintiffs to prove that, loss, damage or non-delivery was owing to the negligence or criminal act of the carrier, his servants or agents. As per Section 9 of the Carriers Act, the burden lies upon Defendant to prove that, the loss, damage or non delivery of the goods is not on the part of the Defendant. Under such circumstances, it shall be presumed that, the loss of consignment is owing to the negligence of Defendant and therefore, he is liable for the same.
OS.3902/2018 17
25) Even the Hon'ble Supreme Court was pleased to hold in the case of Economic Transport Organization stated supra that :
" Consumer Protection Act, 1986 - Section 2(1)(g) - Deficiency" - "Deficiency" means any fault, imperfection, short-coming, or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service."
26) Hence, negligence of Defendant in delivering the consignment squarely comes under the ratio laid down in the judgment supra.
27) Section 10 of the Carriers Act specifically states that, no suit shall be instituted against the Carrier unless notice in writing has been given to him before institution of the suit within six months of time, when the loss or injury came to the knowledge of Plaintiff. Here, the consignment was sent through Defendant on 16.05.2016, which was received on 18.05.2016 at Plaintiff's destination at OS.3902/2018 18 Nagapur. Loss of consignment was brought to the notice of Defendant by Plaintiff on 28.05.2016. Same was brought to the notice of Defendant within ten days from the date of short of consignment. Hence, it can be said that the suit is filed after due compliance of Section 10 of the Carriers Act.
28) For the foregoing discussion, I am of the opinion that, the damage/short of consignment has been duly proved by Plaintiffs and Plaintiffs have also proved the value of loss of consignment, which was paid to 1st Plaintiff by 2nd Plaintiff and thereby, 1st Plaintiff's right has been subrogated to the 2 nd Plaintiff in accordance with law. Negligence on the part of the Carrier has also been proved and in this circumstance, presumption of negligence shall be drawn in view of Section 9 of the Carriers Act against the Carrier. Moreover, Plaintiffs have brought this suit after complying with the provisions of Section 10 of the Carriers Act. In view of statutory right of subrogation, Plaintiff No.2 is OS.3902/2018 19 entitled to claim the amount from Defendant with 12% interest per annum. Accordingly, I answer the above point in the affirmative and proceed to pass the following :
ORDER (1) Suit of Plaintiffs is hereby decreed with costs for Rs.1,16,812/-
(Rupees One Lakh Sixteen Thousand Eight Hundred and Tweleve Only).
(2) Defendant is hereby directed to pay a sum of Rs.1,16,812/- (Rupees One Lakh Sixteen Thousand Eight Hundred and Tweleve Only) to the 2 nd Plaintiff with interest at 12% per annum from the date of suit till realization.
(3) Draw decree accordingly.
(Dictated to the Judgment Writer directly on computer, typed matter corrected and then pronounced by me in open court, on this the 30th day of September, 2020.) (RAMA NAIK) VI Addl.City Civil & Sessions Judge, Bengaluru City.
OS.3902/2018 20 ANNEXURE I. List of witnesses examined on behalf of :
(a) Plaintiffs side :
P.W.1 - Ms.Anushree Sarkar, dtd.05.09.2019
(b) Defendant's side : N I L II. List of documents exhibited on behalf of :
(a) Plaintiffs side :
Ex.P.1 Authorization Letter dtd.05.09.2019 Ex.p.2 Invoice, dtd.27.04.2016 Ex.P.3 Consignment Note, dtd.16.05.2016 Ex.P.4 Notice dtd.28.05.2016 regarding loss of consignment Ex.P.5 Claim Bill, dtd.28.05.2016 Ex.P.6 Certificate of Fact, dtd.06.06.2016 Ex.P.7 Survey Report Ex.P.8 Discharge Voucher, dtd.30.01.2017 Ex.P.9 Letter of Subrogation and Special Power of Attorney, dtd.13.02.2017
(b) Defendant's side : N I L
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VI Addl.City Civil & Sessions Judge Bengaluru City.
OS.3902/2018 21