Madras High Court
Shipping Corporation Of India vs Modern Re-Rollers on 17 September, 2013
Author: R.S.Ramanathan
Bench: R.S.Ramanathan
IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated : 17.09.2013 Coram The Hon'ble Mr.Justice R.S.Ramanathan A.S.No.1183 of 1994 Shipping Corporation of India, having its Registered Head Office at Madam Cama Road, Bombay rep. by its Agent M/s.K.P.V.Shaik Mohamed Rowther & Co.(P) Ltd., No.202, Linghi Chetty Street, Madras 600 001. ...Appellant Vs. 1.Modern Re-Rollers, rep. by its Partners, Murarilal Santhalia, G.P.Agarwal, P.K.Santhalia and C.L.Lohia. 2.Oriental Fire and General Insurance Co. Ltd., Divisional Office, No.115, Broadway, Madras 600 001. ...Respondents Appeal filed under Section 96 of C.P.C, against the judgment and decree dated 24.03.1987, passed in O.S.No.6272 of 1984, on the file of the III Assistant Judge, City Civil Court, Chennai. For Appellant : Mr.K.Bijaisundar For Respondent 1 : set ex parte For Respondent 2 : Mr.S.K.Krishnamurthy JUDGEMENT
The first defendant in O.S.No.6272 of 1984, on the file of III Assistant Judge, City Civil Court, Chennai, is the appellant herein.
2. The first respondent/plaintiff filed the abovesuit for recovery of Rs.56,224/- from the appellant/first defendant and the second respondent/second defendant, for the loss caused due to the short delivery of the goods.
3. The Trial Court, by its judgment, dated 24.03.1987 decreed the suit. Aggrieved by the same, the present was filed.
4. The case of the plaintiff/first respondent, is as follows:-
i) On 29.03.1983, 4,16,810 metric ton of Iron were shipped through the Vessel, named "Vishva Pankaj", owned by the appellant/first defendant from Antwerp Port to the Madras Port Trust. The appellant/first defendant also issued a Bill of lading, bearing No.501, dated 29.03.1983, acknowledging the entrustment of goods in good condition, undertaking to deliver the same at Madras Port Trust. The said consignment was insured with the second respondent/second defendant/Insurance Company, under a Policy, bearing No.10307, dated 03.03.1983. The said Vessel arrived at the Port of Madras, on or about 2.5.1983, and commenced unloading operations. The clearing and forwarding agents of the plaintiff's filed their import application No.91/95, dated 18.05.1983, and took delivery of 3,99,240 kgs of the consignment originally entrusted with the carrier at the Port of loading as against the total weight of 4,16,810 kgs. The Madras Port Trust issued a certificate of weighment, dated 01.06.1983, confirming the weight of the goods delivered to the first respondent/plaintiff.
ii) Thus, the appellant/first defendant short delivered 17.570 metric ton of the suit consignment, and therefore, the first defendant has committed breach of contract of affreightment, as evidenced by the Bill of lading. As a result of short landing of goods, the plaintiff suffered pecuniary loss of Rs.56,224/-. On 25.8.1983, the plaintiff filed a claim for a sum of Rs.56,224/- on the defendants. The first defendant, by their letter, dated 24.09.1983, repudiated the claim. The second defendant also by their letter, dated 7.9.1983, repudiated the claim of the plaintiff as untenable and false. As the insurance policy covers the loss of goods, out of theft, pilferage and non-delivery as such, the second defendant, as Insurer is liable to indemnify the loss caused to the plaintiff. Hence, the suit was filed for recovery of Rs.56,224/- with interest at the rate of 12/ % p.a. from the defendants.
5. The appellant/first defendant has filed a written statement, wherein, it has been stated as follows:-
i) The suit is barred by limitation. Neither the first defendant, nor, its agents were aware of the weight of the cargo entrusted with them and only on the basis of the declaration given by the Consignor, the Bill of lading was issued to the plaintiff, and therefore, the first defendant is not liable for the short delivery. If at all, there was any theft, or, pilferage, that must have occurred only after the Vessel reached the Madras Port Trust, and liability, if any, has become extinguished by reason of the provisions of the Article 3, Rule 6 of the Carriage of Sea Goods Act. Further, no personal decree can be passed against the first defendant in view of the provisions of Section 230 of the Indian Contract Act.
ii) It is further stated in the written stated that the Vessel arrived at the Port of Madras, on 02.05.1983 and discharged the cargo in the same condition and order, as was entrusted at the Port of Shipment into the custody of the Madras Port Trust, and no notice, as contemplated under Article 3, Rule 6 of the Carriage of Sea Goods Act was served on this first defendant and the first defendant was not liable for the alleged short landing of the cargo and the cargo was lying in the custody of Madras Port Trust, after its discharge. Therefore, the loss, if any, must have occurred only during its stay at Madras Port Trust, and hence, the Madras Port Trust is necessary party to be impleaded in the suit.
iii) It is also stated in the written statement that the weighment of the goods was done long after discharging the goods from the Vessel and that did not disclose the actual quantity discharged from the Ship. Therefore, weighment done in the Port weigh bridge is not binding on the first defendant/appellant and the certificate issued by the Madras Port Trust on 01.06.1983, is not binding on the first defendant and hence, there was no negligence on the part of the first defendant/appellant in dealing with the cargo and considering the nature of the cargo, there was no possibility of any handlement of the cargo during the course of transit. Hence, the first defendant/appellant is not liable for the loss caused to the plaintiff and the interest claimed is also not maintainable.
6. The second respondent/second defendant filed a written statement, admitting the issuance of policy and stated that the Policy was issued subject to the terms and conditions mentioned therein. The liability of the second defendant was in accordance with the Marine Insurance Act. As per the terms and conditions of the Insurance Policy, it covers only theft, pilferage and non-delivery. Further, under Section 76 of the Marine Insurance Act, where the subject matter insured is warranted free from particular average, the assured cannot recover for the loss, or part, other than the loss incurred by a general average sacrifice, the contract contained in the policy is free from particular average, and therefore, they are not liable to indemnify the first respondent herein/plaintiff for the loss. The second defendant also stated that there was no proof of theft or pilferage of the consignment during the currency of the policy in question. Therefore, they are not liable to pay any amount.
7.On the basis of the above pleadings, the Trial Court framed the following Issues:-
i)Whether the suit is barred by limitation?
ii)Whether the defendants are not responsible for the short landing of goods?
iii)Whether the plaintiff is entitled to the interest as claimed?
and
iv)To what relief, the plaintiff is entitled to?
8. On the side of the plaintiff, P.W.1 was examined and totally, 13 documents were marked. On the defendants' side, neither was any witness, examined, nor was any document, marked.
9. The Trial Court, after framing issues, after the examination of witnesses and marking of documents, answered Issue i) holding that the suit was not barred by limitation. Issue iii) was answered in favour of the plaintiff holding that the plaintiff was entitled to the interest at the rate of 12%. While answering Issue ii), the Trial Court held that the second respondent/second defendant was not liable to pay any amount and it was seen from the evidence of P.W.1 and the documents produced on the side of the plaintiff that short landing of cargo was not due to any theft or pilferage at the Madras Port. As per the weighment certificate issued by the Madras Port Trust, only 3,99,240 kgs of iron was delivered and as per Ex.A.2, Bill of lading, 4,16,810 metric ton of Iron was entrusted with the Vessel. As per the Indian Customs Act, 1962, the person in charge of the Vessel has to entrust the manifest of the goods, which are to be discharged from the Vessel to the Customs Officer and that copy of the manifest was available with the appellant/first defendant and that would prove the exact quantity of cargo discharged from the Vessel, but, the same was not produced by the appellant. Therefore, the appellant/first defendant has to pay the amount for the loss caused to the plaintiff. Aggrieved by the same, the present Appeal was filed.
10. The learned counsel appearing for the appellant submitted that the Trial Court, without properly appreciating Exs.A.2 and A8, erred in holding that the appellant is liable to pay the value of the goods, which were short delivered, as per the Bill of lading. The learned counsel submitted that as per Ex.A2-Bill of lading, the cargo is said to contain M.S.Re-Rollable Scrap, used Structurals consisting of joists, channels, etc., said to weigh 4,16,810 metric ton. Therefore, the weight given in the Bill of lading was the weight given by the Consignor and the cargo was not actually weighed by the appellant, and therefore, it cannot be stated that 4,16,810 metric ton of cargo was loaded in the appellant-Vessel. The learned counsel, therefore, submitted that in the absence of any proof that the first respondent proved that they entrusted 4,16,810 metric ton of goods, viz., M.S.Re-Rollable Scrap, with the appellant-Vessel, they cannot make any claim against the appellant.
11. The learned counsel for the appellant further submitted that the first respondent also admitted in their notice-Ex.A8, sent to the second respondent/Insurance Company, wherein, they have stated that after the Vessel reached the Madras Port Trust, the appellant's carrier delivered full cargo and the theft or pilferage was taken place, while the goods were lying in the Madras Port Trust's custody, and therefore, directed the second respondent/Insurance Company to pay the amount as per the policy and having stated that the appellant's carrier delivered full cargo and due to theft or pilferage, there was short delivery, the first respondent cannot make any claim against the appellant.
12. The learned counsel for the appellant relied upon the following reported judgments in support of his case :-
i) (1998) 1 L.W. 16 in the case of (Union of India rep. by the Ministry of Agriculture and Irrigation, etc., Vs. Tatvani Shipping Company and another) and
ii) A.I.R. (1976) Andhra Pradesh 261 in the case of (The Shipping Corporation of India Ltd., Bombay and another Vs. The Union of India and another)
13. Though the first respondent was served through paper publication and their names were also printed in the causelist, there is no appearance on their behalf and hence, the first respondent was set ex parte.
14. The learned counsel appearing for the second respondent has submitted that the Trial Court exonerated the second respondent from liability, and therefore, they cannot be made liable and they are only formal parties to the Appeal.
15. On the basis of the above submissions, the following Point arises for consideration in this Appeal:-
"Whether the appellant is liable to make good the loss caused due to the short delivery of goods, as alleged by the first respondent?"
16. It is the case of the first respondent that as per the Bill of lading, Ex.A.2, 416.810 metric ton of iron scraps were entrusted with the appellant's Carrier for delivery at Madras Port Trust and as per Ex.A4, viz., the certificate issued by the Madras Port Trust, dated 01.06.1983 the delivered goods weighed only 3,99, 240 metric ton and therefore, there was a shortage of 17.570 metric ton and the value of the goods was Rs.56,224/- and the appellant and the second respondent are liable to indemnify the loss caused to the first respondent.
17. It is seen from Ex.A.2-Bill of lading, wherein, it has been clearly stated that the consignment is said to contain M.S.Re-Rollable Scraps, and it is said to weigh 4,16,810 metric ton. The contention of the appellant is that the consignment was not weighed at the time of entrustment of goods with the appellant, and the weight mentioned in the Bill of lading, was the declaration given by the Consignor and the cargo was not actually weighed by the appellant. Therefore, it cannot be contended that as per Ex.A2, the appellant admitted the entrustment of 4,16,810 metric ton of M.S.Re-Rollable Scraps, and the weight mentioned in Ex.A.2, was the confirmed declaration given by the consignor at the time of entrustment, and it was not the actual weight accepted by the appellant-Vessel. Therefore, in the absence of any proof that 416.810 metric ton of M.S.Re-Rollable Scraps were entrusted with the appellant, the appellant cannot be made liable for any payment.
18. Further, in Ex.A.8, as rightly pointed out by the learned counsel for the appellant, the first respondent has admitted the delivery of full cargo by the appellant. Ex.A.8, is the copy of the letter sent by the first respondent to the second respondent, demanding the second respondent to pay the amount caused due to the theft or pilferage. In that letter, it has been made clear that they cannot claim any amount from the appellant herein, as the appellant's carrier delivered the full cargo. It was also made clear in that letter, that the letter given by the Madras Port Trust clearly confirmed the quantify of the cargo delivered as against the quantity discharged by the Vessel, which clearly indicates that the shortage is due to theft or pilferage while the cargo was lying in the Madras Port premises.
19. Therefore, the first respondent has made clear that the entire cargo was discharged, and, when the cargo was kept in the port trust premises, due to theft or pilferage, there was a shortage of goods, and therefore, as per the policy condition, the second respondent/Insurance Company is liable to pay the amount. Therefore, the first respondent themselves have made it clear that there was no shortage of delivery by the carrier and when the loss was due to the theft or pilferage at the Madras Port Trust, it is not open to the first respondent to make the appellant liable for the said loss.
20. The Trial Court, without properly appreciating Exs.A2 and A8, erred in holding that as per the evidence of P.W.1, it was not proved that the loss was due to the theft or pilferage at the Madras Port Trust and on that ground, the Trial Court has erred in exonerating the second respondent from liability.
21. The Trial Court also erred in holding that the appellant failed to produce the manifest, which was given to the Customs Officer and that would prove the exact weight of the goods delivered and therefore, adverse inference can be drawn against the appellant. As per the provisions of Section 30 of the Customs Act, only list of cargo, which are to be discharged has to be given to the Customs Officer and as the Bill of lading only contains estimated weight, as given by the Consignor, even assuming that the list, which was given to the Customs Officer contains the same weighment, on that ground, it cannot be held that the appellant was not responsible for the shortage.
22. According to me, having regard to the admission made by the first respondent in Ex..A8, that the carrier delivered the cargo, entrusted with it, and the shortage of goods occurred, due to theft or pilferage, when the goods were lying in the Madras Port Trust, the appellant cannot be held responsible for the shortage of goods. Hence, the point for consideration is answered in favour of the appellant and I hold that the first respondent failed to prove the exact quantity of the cargo sent by the consignor, or, in other words, the correct weight of the cargo sent by the Consignor, and having admitted that the entire cargo was discharged and the loss was due to the theft or pilferage at the Madras Port Trust, after the cargo was discharged, as per Ex.A8, the appellant cannot be made liable for the loss caused to the first respondent. Having regard to the discussions, as made above, the necessity to refer to the judgments relied upon by the learned counsel for the appellant does not arise.
23. In the result, the judgment and decree of the Trial Court are set aside and the Appeal is allowed. No costs.
17.09.2013 sd Index : yes/no Internet : yes/no To The III Assistant Judge, City Civil Court, Chennai.
R.S.Ramanathan,J., sd Pre- delivery judgement in A.S.No.1183 of 1994 17.09.2013