National Consumer Disputes Redressal
Dhl Worldwide Express, Express ... vs G.R. Pharma Exporters And Importers, ... on 26 February, 2007
ORDER
M.B. Shah, J. (President)
1. It is the case of the Complainant, namely, M/s. G.R. Pharma Exporters & Importers (Respondent No.1 herein) that it received orders for export of 16 cartoons of pharmaceutical products from M/s.Anjonag Global Corporation, Kotonou, Peoples Republic of Benin, West Africa, along with a pay order dated 14.10.1996 for US $ 25,000 equivalent to Indian Rs.8,92,000/-, drawn on Metcalf State Bank, Overland Park, K.S. It deposited the pay order in their current account No.41272 with the ICICI Bank Ltd., (Respondent No.2 herein, Opposite Party No.1 before the State Commission) which, at the relevant time, was Bank of Madura Ltd., (hereinafter referred to as the Bank), i.e. on 8.11.1996. Undisputedly, the goods were shipped to the buyer through M/s. DHL Worldwide Express (Appellant) - Carrier (hereinafter referred to as the DHL) with specific instruction to deliver the consignment to the party on hearing confirmation from the Complainant.
2. On 16.11.1996 the Bank (Bank of Madura Ltd., at the relevant time) gave credit to the Complainant's account a sum of Rs.8,92,000/- and issued a Certificate of Foreign Inward Remittance. The Bank also deducted Rs.2,830/- under three heads, namely, charges Rs.2,230/-; DHL Rs.100/-; and, Telex Rs.500/-. The balance in the Complainant's account with the Bank was shown at Rs.8,89,170/-.
3. On the same date, i.e. on 16.11.1996 the Complainant sent a communication to the DHL to the following effect:
We have received confirmation of payment from our bankers. Thus, we confirm to hand over the goods to the party concerned immediately.
4. On receipt of the said instruction, the DHL dispatched the consignment to the destination Port, Cotonou, Peoples Republic of Benin, the place of delivery agreed under the contract. The consignment reached the port of destination on 18.11.1996. The DHL got clearance from the customs and kept the consignment ready for delivery to the consignee. Before the delivery of the goods to the consignee, the DHL was informed by the Complainant by a fax message dated 22.11.1996 to detain the goods and not to deliver the same without collecting the payment from the party. It is the say of the Complainant that despite the aforesaid communication, for the reasons best known to the DHL, they delivered the goods to the consignee on 2.12.1996.
5. The complainant was required to send the aforesaid fax message for not delivering the goods to the consignee because the Bank sent a communication to the Complainant on 22.11.1996 that the American Express Bank, New York, informed that the cheque (Pay order) drawn in favour of the Complainant had been returned unpaid by the drawee for the reasons that it was a "forged, counterfeit instrument". On the basis of the said communication, the Bank informed the Complainant and called upon the Complainant to repay the balance amount utilised by the Complainant. The Complainant sent a detailed reply to the said communication.
6. As the goods were delivered to the consignee, despite the instruction not to deliver the same, without recovering the payment and also the Bank has committed a mistake in giving credit to the Complainant without realization of the cheque, Original Petition No. 45 of 1997 was filed before the State Consumer Disputes Redressal Commission, Tamil Nadu at Chennai, for recovering the sum of Rs.8,92,000/- which is equivalent to US $ 25,000, being the cost of the goods, Rs.1 lakh as compensation; and, Rs.2 lakhs towards damages with interest at the rate of 24% pa. The State Commission arrived at the conclusion that the Bank, no doubt, acted in haste in giving credit to the foreign cheque without ensuring that the amount was available and was realizable. However, the DHL (Appellant) delivered the goods on 2.12.1992 without following the instructions issued by the Complainant on 22.11.1996. Hence, it directed the Appellant to pay a sum of Rs.8,92,000/- with interest at the rate of 7.5% from 16.11.1996 with costs of Rs.5,000/-.
7. Against that judgment and order, the DHL has preferred this appeal.
8. Learned Counsel appearing on behalf of the Appellant vehemently submitted that the Appellant has received the communication dated 16.11.1996 to deliver the goods to the consignee and on that basis the Appellant has delivered the goods. Hence, the Appellant cannot be held liable for the loss suffered by the Complainant. He submitted that fault lies with the Bank, and, therefore, the Bank should be held liable. He also submitted the Complainant was also negligent in not giving any option to the Appellant for disposal of the consignment as called upon by it by its alleged communication dated 23.11.1996. He further submitted that the complaint was not maintainable.
9. As against this, the learned Counsel for the Respondent/Complainant submitted that the order passed by the State Commission does not call for any interference, as DHL intentionally delivered the consignment without recovering the payment. It is an apparent deficiency in service. The learned Counsel appearing on behalf of the Bank submitted that as per the usual practice the Bank has given credit for the draft amount. However, as the draft was found to be a forged one, it could not realize the amount and hence it was debited to the account of the Complainant. For this purpose, the Bank would not be liable.
FINDINGS:
A. Liability of the DHL, Appellant.
10. In our view, with regard to the liability of the Appellant, we have to state that by letter dated 8.11.1996 the Complainant informed the Appellant that 240 plastic jars containing pharmaceutical products in 16 cartoons were to be transported to Cotonou (Door delivery) Benin. After mentioning the details of the documents enclosed therewith including the invoice, etc., it has specifically stated as under:
Please arrange to lift the consignment immediately to Cotonou.
As requested you are confirmed to deliver the consignment to the party on hearing from us. Hence, you are hereby further requested to advise the arrival date conformation immediately on arrival at Cotonou.
11. Thereafter, on 16.11.1996, the Complainant wrote a letter to the DHL, Coimbatore. The relevant part is as under:
SUB : Shipment of Airway Bill No. 1358917512 dt. 8.11.1996 16 cases of 210 plastic tins of Antibiotic capsules for Cotonou (Benin).
We refer to our letter of 8.11.1996 advising you not to deliver the goods unless our confirmation given.
Today we have received confirmation of payment from our Bankers thus we confirm to handover the goods to the party concerned immediately.
12. It is also undisputed that on 22.11.1996 the Senior Manager, Bank of Madura Ltd. wrote a letter to the Complainant that:
During the normal course of collection, the proceeds of the above cheque, being Rs.8,92,000/- were credited to your Current A/c No. 41272 on 16.11.1996.
However, American Express Bank, New York, now informs us that the cheque has been returned unpaid by the drawee for the reason "Forged/ Counterfeit Instrumerit.
We, therefore, request you to repay the amount of Rs. 8,92,000/- immediately.
13. On the same day, the Bank informed the Complainant that the Bank has marked lien on the amount of Rs.7,01,728.67 lying in the account of the Complainant towards repayment of the amount of Rs.8,92,000/- being the proceeds of collection instrument credited to the Complainant's Account on 16.11.1996, with a further direction to remit the balance amount immediately.
14. Immediately the Complainant wrote a letter dated 22.11.1996 to the DHL as under:
We refer to our letter dated 8.11.1996 enclosing document and requesting you not to deliver the goods unless confirmation got from us and for this we are requesting you to inform us the landing details which you are still not provided.
Now we once again request you to keep the goods at DHL, Cotonou (Benin) until you hear from us to delivery the goods. You are hereby requested to advise us the arrival particulars of our goods in Cotonou.
For your information this caution is for collecting payment from the party.
Your immediate action in this matter is highly appreciated. Kindly confirm.
15. It is to be highlighted that on the same date, the Business Manager of the DHL surprisingly wrote a letter to the Complainant, even though the goods were not delivered to the consignee at Cotonou, stating that once confirmation of payment was received, there was no point in asking him not to deliver the goods. The relevant part is as under:
But in your communication dated 16.11.1996, you informed us that you have received confirmation of payment from your banker's and therefore asked us to deliver the goods to the party concerned immediately. So there is no point in you asking us not to deliver the goods to the party, as we have already acted upon your instruction given to us on 16.11.1996, which being deliver the goods to the party
16. The next important communication is the fax letter dated 3.12.1996 written by the Complainant to the Appellant stating that the consignee has received the consignment from the DHL, Cotonou, and asked the Complainant to come down to Dubai for settlement, and also asking the Appellant on what basis the counter part of the Appellant has delivered the goods without recovering the payment. The communication is as under:
Today we have received a message from our Party acknowledging receipt of the consignment from DHL Cotonou and asking us to come down to DUBAI for settlement.
We are very much surprised to learn this from the party in COTONOU, Benin that contrary to our repeated requests vide our letter date 18.10.1996 and 22.11.1996 and several requests your Counterpart at COTONOU have released the goods to the Party without our knowledge.In this connection please let us know under what circumstances your Counterpart in COTONOU has been released the goods without our consent or whether any understanding obtained from the Party for effecting payment to us?
How your Counterpart in COTONOU can accept such an undertaking and release the goods without effecting payment.
Moreover we understood from their message that without your confirmation they have not released the consignment.
Now you are held responsible for all aspects in this regard. Your detailed answer in this respect is highly appreciated.
17. Despite the aforesaid communication, the learned Counsel for the Appellant relied upon the letter-dated 23.12.1996 wherein they have stated as under:
We are in receipt of your letter-dated 18.12.1996 on the above subject.
We are surprised to receive a Debit note of Rs.7,45,836/- bearing No. 2213 and we have following points to make on this subject:
1. The material reached our Benin office on 18.11.1996 after the customs clearance and was delivered to your consignee on 02.12.1996.
2. The shipment was lying at our Benin office for almost 14 days after the clearance.
3. We had intimated to you the options available to you after receiving your request for on hold, which being:
(a) return the material, which will cost roughly around 3 lakhs (for which you were not willing).
(b) destroy the shipment at destination (or) confirm delivery within 3 days.
But to our dismay you were indecisive on the matter.
4. Meanwhile consignee was enquiring with our Benin office for the shipment delivery. After a span of 14 days we delivered the shipment to your buyer, after collecting the duty payable by your buyer, since you had not responded with any decision.
As mentioned in your letter that we have delivered the goods to somebody blindly for which we are enclosing herewith a copy of the delivery details, which goes to prove that it has been received by Mr. Amos, the consignee himself.
On the above circumstances, we will not be in a position to accept any debit note or for that matter any damages claimed by you. You said debit note is herewith returned.
18. From this letter, it is clear that the delivery of the goods was made by the DHL to the consignee on 2.12.1996. This was done despite the specific communication dated 22.11.1996 with an instruction to keep the goods at DHL, Cotonou, until there is specific instruction to deliver the goods. They were requested to advise the Complainant with regard to arrival particulars of their goods in Cotonou and the information was sent for collecting the payment from the party. There is no dispute with regard to the receipt of the said communication, because on 22nd itself the DHL wrote back that they have acted upon the instruction of the Complainant which was given on 16.11.1996 to deliver the goods to the party. As a matter of fact, the goods were delivered to the consignee only on 2.12.1996. This would clearly reveal that the apparent fraud was committed at the office of the DHL. Further, the learned Counsel for the Appellant contended that the Appellant has informed the Complainant that the goods could be returned to the place of origin, and for that it would cost Rs.3 lakhs or it would be destroyed. But, no reply was received from the Complainant, and hence the consignment was delivered on 2.12.1996 to the consignee who was approaching the office of the Appellant at Benin with necessary documents. It is to be stated that the alleged letter dated 23.11.1996 is nowhere produced on record nor it is reliable. There is no evidence on record to show that the DHL has informed the Complainant about the disposal of the material. It is only on 23.12.1996, a story is made out. On the contrary, the letter dated 22.11.1996 received by the DHL which is produced on record clearly reveals the mind set of the Appellant wherein they have specifically stated that they have acted upon the instruction which was given on 16.11.1996, and the goods were being delivered to the consignee. Therefore, the said defence of the Appellant is false and concocted, subsequently, to get benefit under the provisions of Carriage by Air Act, 1972. Learned Counsel for the Appellant submitted that under the Carriage By Air Act, the liability of the Appellant is limited as provided under Rule 22 of Schedule-II at 250 Francs per kilogram. In our view, this submission is without any substance, because Rule 22 is subject to Rule 25 which specifically provides that the limit of liability specified in Rule 22 will not apply if it is proved that the damage resulted from an act done with the intention and knowledge that the damage would result to the Complainant. Rule 25 reads as under:
25. The limit of liability specified in Rule 22 shall not apply if it is proved that the damage resulted from an act or omission of the carrier, his servants or agents, done with intent to cause damage or recklessly and with knowledge the damage would probably result; provided that, in the case of such act or omission of a servant or agent, it is also proved that he was acting within the scope of his employment.
19. We further note that this contention was not raised or contended by the Appellant before the State Commission. From the facts stated above, it can be held that the delivery of goods was done with an intent to cause damage to the Complainant and with the knowledge that damage would result to the Complainant. This is so, because the DHL was specifically informed that the draft handed over by the consignee was found to be a forged one by the clearing bank. Despite the receipt of the information that forgery was committed by the consignee, the goods were delivered to the consignee without taking payment as instructed by the Complainant, that too, the deliver was given as late as on 2nd December, 1996.
Therefore, the order passed by the State Commission against the Appellant cannot be said to be in any way erroneous.
B. Liability of the Bank:
Further, it is to be stated that without obtaining the clearance of the cheque/draft issued by the consignee, the Bank gave credit for the said draft amount; informed the Complainant in writing; the Complainant withdrew part of the said draft amount; he had informed the carrier that the amount was realized; and that the goods may be delivered. Relevant portion of the 'Certificate of Foreign Inward Remittance' dated 16.11.1996 of Bank of Madura Ltd., Coimbatore Branch reads as under:
Certificate of Foreign Inward Remittance:
We certify that we have received the following remittance and proceeds thereof were paid (a) to the beneficiary M/s. GR. Pharmaa, No.693, Raja Street, Coimbatore on 16.11.1996 by credit to Current Accoung with us and place of residence of remitter Anjanog Global Corporation, Coutonou, Republic of Benin and address of remitting Bank Metcalf State Bank, Overland Park, KS No. 6000215 dated 14.10.96 in currency amount USD 25000 Rupee equivalent Rs.8,92,000/- (Rupees Eight Lacs Ninety Two Thousand only) ____ GR Pharma ___pplied 35.68 __ of remittance as stated by remitter/beneficiary advance payment received for exports.
We also certify that the payment thereof has / has not been received in non-convertible Rupees or any special trade or payments agreement.
We confirm that we have obtained the reimbursement in an approved manner.
20. This Certificate is signed by (i) Officer; and, (ii) Manager. Further, the Statement of Account dated 20.11.1996 issued by the Bank for the period 31.10.1996 to 16.11.1996 shows the credit balance of Rs.8,21,670/-.
21. Thereafter, the Bank vide letter dated 22.11.1996, which is referred to above, asked the Complainant to repay the amount of Rs.8,92,000/- as cheque/draft given by the Appellant was returned 'unpaid' On the same day, the Bank had also informed the Complainant that they had marked lien on the amount of Rs.7,01,726/- lying in the account of the Complainant.
22. It may be stated here that for the collection of the draft amount, the Bank has charged Rs.2,830/-
23. Thereafter, on 23.11.1996 the Complainant wrote to the Bank Manager, Main Branch, Coimbatore that it was very embarrassing to see the letter dated 22.11.1996 requesting them to repay the amount which has been credited to their account. The Complainant has also informed the Bank that if the Bank was insisting to repay the amount, then the Bank would have to get back the goods to them. It was stated that the Bank ought not to have given credit without confirmation.
24. On 25.11.1996 also the Bank was informed that the Complainants have submitted the inward remittance certificate to the Customs Authorities to release the drawback amount, and, if they inform the authorities that the certificate was a forgery/counterfeit document, then the Customs Authorities would issue show-cause notice or memo them.
25. Thereafter, a legal notice was given to the Bank on 25th December, 1996 stating all the facts and intimating that the Bank should not recover any amount from the Complainant and that the stand taken by the Bank directing the Complainant to repay the amount of Rs.8,92,000/- was untenable. The aforesaid correspondence amply shows deficiency in service on the part of the Bank because without verifying the clearance of the cheque/draft, the same was credited to the account of the Complainant and information was also given to the Complainant that the draft amount was credited in his account, and, thereafter, the Complainant withdrew the amount from his account and informed the Carrier to deliver the goods.
26. From the facts stated above, it is clear that the Bank acted negligently in permitting the Complainant to withdraw the amount. This resulted in loss to the Complainant. Otherwise, the Complainant would not have written the letter to the DHL on 16.11.1996 that the goods may be delivered to the consignee as the draft was cleared. This amounts to deficiency in service on the part of the Bank.For this deficiency the Bank is required pay compensation. The State Commission has not passed any order against the Bank for the deficiency in service. With regard to deficiency in service by the Bank we have heard the learned Counsel for the Bank exhaustively.
27. Considering the overall picture, in our opinion, this would be a fit case for directing the Bank to pay a sum of Rs.1 lakh as compensation for the above deficiency in service. This Commission being the appellate authority would have jurisdiction to pass appropriate orders to render complete justice between the parties without ignoring the substantive rights of any of the parties. [Re. Delhi Electric Supply Undertaking V. Basanti Devi and Anr. ]. As the appeal is not filed by the Complainant for enhancement of rate of interest or for getting compensation from the Bank, to render complete justice between the parties it is directed that the aforesaid amount of Rs.1 lakh shall be deposited by the Respondent No.2 with the Registrar of this Commission who will credit the said amount in the Legal Aid Account maintained by the National Consumer Disputes Redressal Commission. In the result, the order passed by the State Commission directing the Appellant - DHL Worldwide Express to pay the sum of Rs.8,92,000/- with interest at the rate of 7.5% p.a. from 16.11.1996 till the date of payment, and also costs of Rs.5,000/-, is confirmed. The Appellant shall also pay Rs.25,000/- as costs to the Complainant. The Appellant shall pay the balance amount within a period of four weeks from today. It is also ordered that Respondent No.2 Bank shall deposit Rs.1 lakh with the Registrar of this Commission, within a period of four weeks from today.