Andhra Pradesh High Court - Amravati
Laxmi Transports, Transport ... vs National Insurance Company Limited, on 26 February, 2024
IN THE HIGH COURT OF ANDHRA
PRADESH :: AMARAVATI
(Special Original Jurisdiction) [
3
3
MONDAY ,THE TWENTY SIXTH DAY 6
7
OF FEBRUARY
]
APHC010121892006 TWO THOUSAND AND TWENTY
FOUR
PRESENT
THE HONOURABLE SRI JUSTICE V SRINIVAS
FIRST APPEAL NO: 417 OF 2006
Between:
Laxmi Transports, Transport Contractors, ...APPELLANT(S)
AND
NATIONAL INSURANCE COMPANY LIMITED ...RESPONDE
AND OTHERS
NT(S)
Counsel for the Appellant(s):SRI. VEDULA SRINIVAS
Counsel for the Respondents: KOTA SUBBA RAO
The Court made the following:
JUDGMENT:
This appeal under Section 96 of the Code of Civil Procedure is directed against the decree and judgment dated 24.03.2006 in O.S.No.22 of 2003 on the file of the Court of learned VIII Additional District and Sessions Judge (Fast Track Court), Visakhapatnam.
2. For the sake of convenience, the parties hereinafter are referred to as they are arrayed before the trial Court.
3. The appellant herein is the defendant and the respondents herein are the plaintiffs before the trial Court. 2
4. The plaintiffs instituted the suit against the defendant for recovery of an amount of Rs.11,88,628/- with subsequent interest and costs.
5. Before adverting to the material and evidence on record and nature of findings in the judgment of the trial Court, it is necessary to scan through the case pleaded by the parties in their respective pleadings.
6. The case of the plaintiffs, in brief, is as follows:
(i) The 1st plaintiff is an insurance company incorporated under the Companies Act, 1956 and having its Head Office at Kolkata and having Divisional Offices at several places and one of them is at Dwarakanagar, Visakhapatnam. The defendant is a Transport contractor engaged in the business of carriage of goods by road and it is a common carrier within the meaning of Carriers Act, 1865(for short „the Act‟).
(ii) The 2nd plaintiff is doing export business in cloth by procuring the cloth from different mills and has taken a Marine Cargo-Inland Transit Policy from the 1stplaintiff at Ahmadabad covering risk of cloth during the transit from anywhere in India to anywhere in India from 27.03.1997 to 26.03.1998.
(iii) The 2ndplaintiff purchased cotton gray fabric from M/s.Sri Saritha Synthetics Limited, Rajam of Srikakulam 3 District, Andhra Pradesh for the purpose of exporting the same to Hungary. The 2ndplaintiff has engaged the services of the defendant to transport the cotton gray fabric from M/s.Sri Saritha Synthetics Limited, Rajam to Mumbai Harbour by road.
Twenty number of bales consisting of twenty thousand metres of gray cotton fabric were dispatched from M/s. Sri Saritha Synthetics Limited vide invoice No.72 dated 27.07.1997 and LR.No.0026 dated 27.07.1997.
(iv) The defendant has transported consignments from Rajam to Mumbai by their truck and on the way, the consignment was damaged due to rain and it was delivered by the defendant at Mumbai Harbour in a wet condition. Therefore, the shipping company has refused to stuff the Cargo as is not suitable for export.
(v) On 03.08.1997, the 2nd plaintiff informed the defendant about the damage caused to the consignment and requested to settle the loss of Rs.9,90,000/- towards value of the consignment and other incidental charges on 05.08.1997. The 2nd plaintiff has informed the 1st respondent at Ahmedabad about the damage of the consignment during the transit. The 1st plaintiff, through its Divisional Office at Mumbai, has deputed a Surveyor and the Surveyor has conducted a detailed 4 survey and submitted the Survey report on 27.08.1997. On 23.09.1997, the defendant addressed a letter to the 2nd plaintiff advising to claim the loss from the insurance company.
(vi) On 17.10.1997, the 2ndplaintiff addressed a letter to the defendant requesting to issue a Damage Certificate. But it has not issued any certificate regarding the damage of consignment during transit. So, the 2ndplaintiff made the claim with the 1st plaintiff. The 2nd plaintiff claimed Rs.7,47,565/- from the 1st plaintiff and the 2nd plaintiff also addressed a letter dated 03.11.1999 requesting the 1st plaintiff at Ahmadabad to settle the claim immediately. The claim was settled for the above said amount towards full and final settlement of the claim to the 2nd plaintiff on 29.12.1997. The 2ndplaintiff inturn executed the Special Power of Attorney and a letter of subrogation, subrogating all the rights and remedies to the Insurance Company/1stplaintiff to recover all loss or damages from the defendant. Hence, the 1st plaintiff is entitled to claim the amount paid to the 2 nd plaintiff from the defendant with interest.
(vii) The 1st plaintiff addressed several letters to the defendant to settle the claim, but there is no response. Thereafter, issued a legal notice dated 12.03.1998 to the 5 defendant, for which, it gave a reply dated 04.04.1998 refusing the liability to settle the claim.
(viii) Then, a complaint was filed on 08.07.1999 before the District Consumer Forum, Visakhapatnam. But the same was returned as the District Consumer Forum is not having jurisdiction beyond five lakhs. So, the 1st plaintiff filed C.D.No.92 of 1999 before the State Consumer Disputes Redressal Commission, Hyderabad, on 28.07.1999 and the same was dismissed holding that the complainant is not a consumer. Hence, the period from 28.07.1999 to 08.10.2022 shall be excluded while computing the period of limitation for filing the suit under Section 14 of the Limitation Act.
7. The defendant while admitting the booking of cotton gray fabric for transport from Rajam to Mumbai Harbour with the defendant on 27.07.1997, contended in the written statement as follows:
(i) One S.N.Das received the goods at Mumbai Harbour and endorsed the same on hire slip of Sri Saritha Synthetic Limited, Rajam, stating that he received twenty bales from the defendant‟s truck driver and hence, it is not liable to pay any damages to the 2nd plaintiff as well 1st plaintiff. 6
(ii) As per condition No.1 of the L.R. receipt of the defendant, all consignments accepted for transport through carriers are entirely "at owner‟s risk". Condition No.2 is that the company is not responsible for loss or damages to goods by breakage, evaporation, theft road and weather condition, strikes, lockouts, riots, Civil or Political disturbances explosion, fire or accident to the vehicle by which goods are transported or fire to godown, where goods are stored. Hence, the defendant is not responsible and not liable to pay any damages of the cotton gray bales of the 2nd plaintiff and the defendant fetched the said goods in time and also the same was endorsed by one S.N.Das, GSC Shipping Limited, Mumbai Harbour. The suit is barred by time and there is no cause of action to file the suit. Hence, prayed to dismiss the suit.
8. Basing on the above pleadings, the trial Court settled the following issues for trial:
1. Whether the 1st plaintiff is entitled to recover Rs.11,88,628/- being the value of loss of the consignment and interest thereon from the defendant as prayed for?
2. Whether the defendant delivered the consignment to Mumbai Harbour under endorsement and therefore, the defendant is not liable to pay any damages to the Plaintiffs as contended in the Written Statement? 7
3. To what relief?
9. At the trial, on behalf of the plaintiffs, P.W.1 was examined and Exs.A.1 to A.21 were marked. On behalf of the defendant, D.W.1 was examined and Exs.B.1 and B.2 were marked.
10. Basing on the material and evidence, trial Court came to conclusion that the defendant is liable to pay damages as claimed by the 2nd plaintiff and decreed the suit with costs.
11. It is against this decree and judgment, the defendant preferred this appeal.
12. Heard Ms.P.Anvitha, learned counsel representing Sri Vedula Srinivas, learned counsel for the appellant/defendant. Even after availing opportunities, none appeared for the respondents/plaintiffs to advance arguments.
13. Learned counsel for the appellant/defendant submits that the suit is barred by limitation and is liable to be dismissed; that the alleged survey of the damaged goods was conducted belatedly after more than seven days from the date of delivery of the goods at Mumbai and no explanation is offered by the plaintiffs for such delay; that the plaintiffs have not informed about the inspection of the surveyor nor even notified at the time of said survey to appear thereby the said survey report did not bind the defendant; that 8 synthetic fabric was dispatched in unfit condition for being exported should not fasten the defendant with the entire value of material; that in Ex.B2, it is not mentioned nor made endorsement that the consignment delivered in a wet condition and there is no negligence on the part of the defendant in delivering the consignment; that the plaintiffs failed to establish that consignment was received in a wet condition and Ex.B2-L.R.endorsement, it was not mentioned that the foreign importer was rejected to receive the goods on the ground of same being found in a wet condition and that the appellant/ defendant is solely responsible for the alleged damage.
14. Per contra, none come forward to address the arguments on behalf of the respondents in spite giving several opportunities, however in order to decide the matter on merits this court perused the record to find mistake occurred in the judgment of the trial court.
15. Thus on perusal of the material available on record, it is found that that the consignment was accepted and delivered in damaged condition and reasons assigned is due to rain and the consignment was delivered by the defendant at Mumbai Harbour in a wet condition, thereby, the shipping company refused to stuff cargo as it is not suitable for export is not correct; that the goods received by 9 the clearing agent at Mumbai i.e. at destination point the goods were received.
16. In fact as per record, the defendant/appellant should give a damage certificate and admittedly, no such damage certificate was given in spite of addressing a letter covered under Ex.A10. No where it is mentioned by the defendant that damage was not caused during the transit. Since the 1stplaintiff paid the loss to the 2nd plaintiff, both of them are jointly entitled to receive the same from the defendant/appellant and that the claim is not barred by any limitation as initially,the plaintiffs filed the case before the District Consumer Forum and later before the State Consumer Disputes Redressal Commission, Hyderabad. In view of the law laid down by the Supreme Court in Lakshmi Engineering works v. P.S.G.Industrial Institute(1985(3) Crl.L.J. 379 (388) SC, the plaintiffs filed the suit within time.
17. In view of Section 14 of the Limitation Act as the plaintiffs have been prosecuting the case with due diligence and good faith, thereby the contention of the defendant that the claim is barred by limitation has no locus and that the time taken by the plaintiffs before State Consumer Disputes Redressal Commission, Hyderabad, is only two years four months and 27 days i.e. the claim made by the plaintiffs is within the limitation.
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18. It is against this backdrop, the point arise for determination is, "whether the decree and judgment passed by the trial court is liable to be set aside? If so, to what relief and to what extent?"
19. To decide the said point, the following has to be determined:
1. Whether the plaintiffs are able to establish that they are entitled for recovery of an amount of Rs.11,88,628/-
being the value of consignment and interest thereon from the defendant?
2. Whether the defendant delivered the consignment in good condition?
3. Whether the defendant is not liable to pay any damages to the plaintiff as contended in the written statement?
4. To what relief ?
POINT Nos.1 to 3:
20. The undisputed facts are that the 2nd plaintiff/respondent-
Madhu International, is doing export business by procuring the cloth from different mills. It had taken a Marine Cargo-Inland Transit Policy from the 1st plaintiff/respondent covering risk of cloth during the transit from anywhere in India to anywhere. The 2nd plaintiff purchased cotton gray fabric from Saritha Synthetics Limited, Rajam of Srikakulam District, Andhra Pradesh for the purpose of exporting the same to Hungary. The 2nd plaintiff engaged the services of the defendant to transport the said material from Saritha Synthetics 11 Limited, Rajam to Mumbai Harbour by road vide invoice No.72 dated 27.07.1998 with L.R.No.0026 dated 27.07.1997.
21. It is the specific case of the plaintiffs that the defendant took the cotton gray fabric bales from Rajam to Mumbai Harbour and as per their claim, the said material was loaded on 01.08.1997 and one S.N.Das received the goods and endorsed the same on hire slip of Sri Saritha Synthetic Ltd, Rajam. Admittedly, the fabric of twenty bales was damaged due to rain and consignment was delivered at Mumbai harbour in wet condition. Therefore, the shipping company has refused to stuff the cargo as it is not suitable for export. It was happened on 01.08.1997.
22. On 03.08.1997, the 2nd plaintiff informed the defendant about the damage and requested to settle the loss of Rs.9,90,000/- towards value of consignment and other incidental charges or at least issue damage certificate. As well on 05.08.1997, the 2nd plaintiff informed the 1st plaintiff at Ahmadabad about the damage of the consignment during transit, on which the 1st plaintiff-insurer has deputed a surveyor. The surveyor conducted a detailed survey and submitted a report on 27.08.1997 under Ex.A7.
23. On 23.09.1997, the defendant addressed a letter-Ex.A9 to the 2nd plaintiff to claim the loss from the 1st plaintiff. On 17.10.1997, the 2nd plaintiff addressed a letter-Ex.A10 requesting to issue a 12 damage certificate. But the defendant has not issued any certificate regarding damage of the consignment during the transit. Then the 2nd plaintiff has made a claim that the 1st plaintiff has also covered risk during transit.
24. On 03.11.1997, the 2nd plaintiff addressed a letter to the 1st plaintiff requesting to settle the claim immediately on which the 1st plaintiff settled the claim and paid an amount of Rs.7,47,565/- towards full and final settlement as per Ex.A16. In turn, the 2 nd plaintiff has executed a Special Power of Attorney and letter of subrogation under Ex.A15. Subrogation of rights and damages to the 1st plaintiff-insurer for recovery of loss and damages from the defendant thereby the 1st plaintiff through the 2nd plaintiff entitled for loss from the defendant with interest and costs.
25. It is also found from the record that initially they filed a claim on 08.07.1999 before the District Consumer Forum, Visakhapatnam and the same was returned on the ground of pecuniary jurisdiction. Then, the plaintiffs filed C.D. before the State Consumer Disputes Redressal Commission, Hyderabad but the same was dismissed as there was no consumer relationship between the plaintiffs and the defendant by virtue of orders dated 08.10.2002. Hence, they filed a suit in O.S.No.22 of 2003.
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26. In order to prove the claim, the plaintiffs examined Divisional Manager of the 1st plaintiff as PW.1 and through him 21 documents were marked. PW.1 consistently stated that the cargo was loaded at Rajam to be delivered at Mumbai and the damaged goods were unloaded at Mumbai harbour.
27. This court also perused Ex.A7-Surveyor‟s report dated 27.08.1997. It shows that on instructions, survey was conducted on 05.08.1997. It was categorically stated that consignment was packed in gunny bags. The loss was caused due to water damage and due to heavy rain enroute. Ex.A7 further discloses that cotton bales were dispatched from Visakhapatnam to Mumbai under LR.No.0026 dated 22.07.1997 by M/s.Laxmi Transporters (defendant) insured with National Insurance Co. Ltd (1st plaintiff). The material which supplied through M/s.Laxmi Transporters (defendant) is 20 bales (20,000 metres), 100% cotton gray fabric, gross weight 5300 kgs. and Net weight 5100 kgs. The report further discloses that pursuant to the instructions received from National Insurance Co. Ltd (1st plaintiff) that all 20 bales of gray fabric were carted wet condition at MOD Shed No.2, the agents of the vessel conveyed their inability to stuff the cargo due to its wet condition and further contend that all 20 bales were inspected by them and found to be severely drenched. 14
28. The said report further specifies that on 07.08.1998, 08.08.1997 and 13.08.1997, the surveyors did external inspection only due to non-availability of labour and also for want of permission from B.P.T. and finally secured permission on 21.08.1997 against payment of requisite fee. The findings are that the entire consignment was rendered unfit for the intended purpose of export as the same was severely water affected. The agents of shipping lines declined to stuff the wet cargo. The Managing Director of Shipper‟s firm visited Mumbai port at MOD Shed 2 where goods were lying and was satisfied that the entire consignment was damaged and hence not suitable for export. The detailed physical inspection revealed that the fabric was found to bear heavy yellow water stains and the same was torn out on stent ring. The damaged cargo emitted out bad smell and was also affected by small insects/ants/elgi. The shippers expressed their inability to retain the damaged material at any allowance as they do not trade in this commodity. In Ex.A7, it was specifically stated that the damage certificate has to be given by the carriers. But the same was not given and that the claimants/plaintiffs claimed already their right for full value of consignment. Thus, from Ex.A7, it is noted that entire material said to be carried through the transport of the defendant got damaged and the damage was due to water. 15
29. The defendant complained that the transit hazard due to circumstances beyond its control and that as the goods were booked at „owners risk‟ they would not admit any claim or liability and also intimated that the 2nd plaintiff can make a claim with the 1stplaintiff.
30. It is to be seen whether there is any negligence on the part of the defendant/appellant or not while transmitting the goods from Razam to Mumbai. There is no material placed on record by the defendant/appellant in that regard. It is also an admitted fact that the cloth was said to be entrusted to the defendant/appellant for the purpose of exporting and said cloth was not suitable for export as per Ex.A7-report. It is stated by DW.1 in his evidence that one S.N.Das was received the goods and endorsed on hire slip covered under Ex.B2 that he received twenty bales from the appellant/defendant‟s Truck Driver. But the defendant contend that it is not liable to pay any damages to the 2nd plaintiff or to the 1st plaintiff. The defendant consistently stated in his evidence as well in pleadings that in their L.R. copy, the terms and conditions of consignments were clearly mentioned as the consignment has accepted through carriage are „at owners risk‟ and defendant is not responsible for loss of damage to goods. As per that condition, the defendant is not responsible for any damages of cotton bales. It is an admitted fact that goods were entrusted to the defendant/appellant for carriage. It was made clear 16 that they have been carried at owners risk and they cannot claim that there is no negligence on their part because it depends on whether there is any negligence on the part of the carrier i.e. appellant herein when there is negligence on the part of the carrier it cannot be absolve its liability but merely stating that goods were being carried out at the owners risk.
31. It is not in dispute that the appellant is a common carrier as defined under Section 2 of the Carriers Act, 1865. It is settled law that the duties and responsibilities of common carrier was enforced in this country at the time when the Carriers Act, 1865 was passed and that from the preamble of that Act, it was clear that the legislature had assumed that the defendant is answerable for the loss of goods entrusted to him as such, though the loss be in no way caused by any default on his part. He has to insure the safe delivery of, that is to say, as having contracted to carry and deliver safely and securely the goods of which he, as common carrier, is bailee. His duty was imposed upon him irrespective of any contract.
32. Common carriers are largely entrusted with the property of the public. They are entrusted with it under circumstances which make a breach of the trust a very easy matter, and the detection of the breach by the owner of the goods often extremely difficult. It is a 17 duty cast upon common carriers by reason of their exercising a public employment for reward.
33. It is settled law that „A breach of this duty‟, "is a breach of the law, and for this breach an action lies founded on the common law which action wants not the aid of a contract to support it. In this context, it is relevant to mention the judgment of the Supreme Court in M.G. Brothers Lorry Service v. Prasad Textiles1. The Supreme Court held that the Carriers Act was enacted because it was thought expedient not only to enable common carriers to limit their liability for loss of or damage to property delivered to them to be carried but also to declare their liability for loss of or damage to such property occasioned by the negligence or criminal acts of themselves, their servants or agents. This judgment is discussed because it is liability of the defendant/appellant to speak that there is no negligence on their part or they have taken all care and caution while transporting the goods in question. In this connection, Section 8 of the Act clearly indicates that very common carrier shall be liable to the owners for loss of or damage to any property delivery. Carrier where such loss or damage arisen from the negligence of the carrier or any of his agents or servants. In this particular case, it is evident from record that the driver of the lorry has unloaded the wet conditioned twenty bales of 1 AIR 1984 SC 15 18 cotton and no undertaking was even made to the 2 nd plaintiff and that there is no evidence or otherwise let in by the defendant that there is no negligence on the part of the driver in carrying the goods entrusted for transportation. In view of Section 8 of the Act, the defendant cannot evade the liability as a common carrier for the damages to the goods entrusted to it. It is also settled position that under Sections 8 and 9 of the Act, in any suit brought against a common carrier for the loss, damage or non-delivery of 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 of the carrier, his servants or agents.
34. In view of this provision, the burden is on the carrier to establish that any loss of or damage to any property delivered to him has not arisen from his negligence. In this case, the goods were damaged due to rain and that they were delivered in a wet condition cannot be disputed because of the admission to that effect as well Ex.A7 is also goes to show the same. In view of the specific law laid down by catena of judgments as well under Sections 8 and 9 of the Act that the goods were carried at owners risk does not mean carriers need not pay any damage for the loss caused and Sections 8 and 9 of the Act clearly speaks that the burden is on the carrier that there is no negligence on their part.
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35. In the present case, no reliable and convincing evidence has been placed by the appellant/defendant to discharge its burden on it and establish that it‟s servants or agents had taken all reasonable care in respect of the goods entrusted to it and that there was no negligence on its part. Even legally also, the claim is made within limitation as per Section 10 of the Act and the defendant cannot escape it‟s liability for its negligence. In this connection, the trial Court relied upon the judgment of the Division Bench of this Court in Hindustan Corporation (Hyderabad) Pvt. Ltd, by its Director v. United India Fire and General Insurance Co. Ltd (1996(2) ALD 1128 (D.B)), wherein the Division Bench categorically held that Sections 6 and 8 of the Act, the burden lies on the common carrier to prove that there is no negligence on their part. Here, the defendant/appellant did not place any material except Exs.B1 and B2 and the oral evidence of DW.1, which is not suffice to deny the claim of the plaintiffs. So far as the limitation is concerned, the trial Court, in paras-23 and 24 of its judgment held as follows:
23. By virtue of Section 14 of the Limitation act, the time during which the plaintiff has been prosecuting with due diligence in another civil proceedings, where in court of first instance or of appeal or revision, against he defendant shall be excluded. Provided the said proceedings relate to the same in issue and is prosecuted in good faith. In a court which, from defect of jurisdiction or other cause of a like nature is unable to entertain it. The explanation (1) to the section 14 of the Limitation act shows that in including the time during which a former civil proceeding was pending, the day of which, that proceedings was instituted and the day of it was ended 20 shall both be counted. Further under section 14 of the Limitation act, the period spent in prosecuting proceedings under the Consumer Protection Act can be excluded as laid down by the Apex Court in Lakshmi Engineering Words v. P.S.G.Industrial Institute (1985(3) Crl.L.J. 379(388) S.C.
24. Therefore, as rightly contended by the learned counsel appearing for the plaintiff the said period is to be excluded, if that is to be excluded the period of limitation starts from 28-07-1997 the date of ex.A2 customer of invoice and also ex.A4 the lorry receipt dated 27.07.1997, The suit is filed after 5 years 6 months and 27 days from 27.07.1997 the period spent in prosecuting proceedings under the Consumer Protection Act is from 08.07.1997 to 08.10.2002 i.e 3 years 3 months is to be excluded. Therefore by excluding the time taken by the plaintiff for filign the suit is 2 years 4 months 27 days, it is less than three years. Therefore, the suit is well within time."
36. The trial Court in well articulated manner discussed in detail about the limitation period of the suit and held that the suit is within time. There is no other or rather contra material placed before this Court to accept the contention of the appellant that the suit is within time as claimed by them. The trial court in clear terms and in unambiguously discussed the suit claim is within time, which is referred to above. Thereby, the defence of the appellant/defendant that the suit is barred by limitation, has no merits.
37. For the above reasons, this Court is of the view that there are no merits in the appeal. This court also closely perused the judgment of the trial court, which is well articulated and described the liability and burden on the defendant, which is not discharged by it, thereby this Court cannot interfere with the decree and judgment rendered by the trial Court.
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38. In the result, the Appeal Suit is dismissed by confirming the judgment dated 24.03.2006 in O.S.No.22 of 2003 on the file of the Court of learned VIII Additional District and Sessions Judge (Fast Track Court), Visakhapatnam. There shall be no order as to costs.
39. Interim orders granted earlier if any, stand vacated.
40. Miscellaneous petitions pending if any, stand closed.
_________________ JUSTICE V.SRINIVAS Date: 26.02.2024 Pab 22 THE HON'BLE SRI JUSTICE V.SRINIVAS APPEAL SUIT No.417 of 2006 DATE: 26.02.2024 Pab