Delhi District Court
The New India Assurance Co Ltd vs Chetak Logistics Ltd on 12 January, 2026
CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
IN THE COURT OF SH. GAUTAM MANAN
DISTRICT JUDGE - COMMERCIAL COURTS-03
SOUTH-WEST, DWARKA COURTS, NEW DELHI
In the matter of:
DJ (COMM) No. 117/2021
CNR No. DLSW01-003421-2021
1.M/s The New India Assurance Co. Ltd.
Regional office at SCO 36-37, Sector-17A, Chandigarh - 160017 Through its Deputy General Manager
2. M/s Swaraj Engine Ltd. Industrial Area, Phase IV, S.AS. Nagar, Mohali, Punjab - 160055 ...........Plaintiffs Versus M/s Chetak Logistics Ltd.
Chetak House, Old Delhi, Gurgaon Road Kapashera, New Delhi - 110037 Through Managing Director/Chief Executive/Director .........Defendant Date of institution 19.03.2021 Order reserved on 19.12.2025 Date of Judgment 12.01.2026 Judgment
1. The plaintiff has filed the present suit for recovery of Rs.1,50,54,929/- along with pendente lite and future interest from the date of filing the suit till realization of money.
Judgment 1 of 36
CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
Plaint
2. In the plaint, it is averred that the plaintiff no.1 is a company incorporated under the Companies Act and is engaged in the business of General Insurance and has filed the present suit through Smt Raj Kumari, Deputy General Manager of the plaintiff no.1 and its Authorized signatory.
3. The plaintiff no 2 is also a company incorporated under the Companies Act and is engaged in the manufacturing activity and has executed a letter of subrogation and power of attorney in favour of the plaintiff no. 1 thereby authorizing it to sign, verify and institute the present suit.
4. It is stated that the defendant is engaged in the business of transportation of consignments from one place to other and in this regard had setup various offices all over India.
5. It is averred that the plaintiff no. 2 obtained a Marine Cargo Specific Voyage Policy issued by the plaintiff no.1 company whereby the consignment containing (H M C MAZAK HCN 6800 smooth G with tool ATC) was covered under the policy. The coverage in respect of the same was provided vide Marine policy no. 35020021170100000352 was issued on 18.12.2017 for covering the transit risk of the aforesaid machine.
Judgment 2 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
6. It is the case of the plaintiffs that the plaintiff no. 2 entrusted a consignment to defendant on 18.12.2017 for carriage a consignment containing (H M C MAZAK HCN 6800 smooth G with tool ATC). The defendant on receipt of the consignment issued the GR No. 213010019232 dated 18.12.2017 acknowledging the said consignment and another GR. No. 213010019233 dated 28.12.2017. The said consignment was to be brought by the defendant from M/s Yamazaki Mazak India P. Ltd. and was to delivered to plaintiff no. 2 at SAS Nagar, Mohali. The gross value of the consignment was Rs. 2,43,43,400/- on the Goods Receipt (GR) which was issued by the defendant company.
7. It is stated that the defendant was responsible for safe custody and efficient transportation of the consignment from the time of loading and upto the time of proper delivery at the destination. In case of any loss due to non delivery, short delivery, material mixing, wrong delivery or damages caused to the Machine the full cost as per invoice was recoverable from the transporter. The plaintiff no. 2 entrusted the consignment to defendant for carriage and delivery at the destination.
8. It is the plaintiff's that the consignor properly loaded the machine after taking all precautions for the safe carriage. The machine was properly secured to the base of the frame and the moving parts were also secured with lock-plates. The Judgment 3 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
whole package was finally covered with tarpaulin and stacked/ latched on flat bed trailer with the help of ropes and chains.
9. It is averred that the said consignment on the way was damaged after the vehicle carrying the said machine overturned. The incident has solely occurred due to the negligence of the driver who failed to exercise reasonable care and was driving the vehicle in rash and negligent manner as a result of which it overturned and caused damage to the machine which was properly secured by the consignor before its dispatch.
10.The loss was notified and the plaintiff no. 1 company appointed the surveyor namely M/s Sapient Insurance Surveyors & Loss Assessors Pvt. Ltd. and who after visiting the site submitted its report thereby assessing the net loss of Rs 1,62,27,699/-. (Rupees One Crore, Sixty Two Lakh Twenty Seven Thousand Six Hundred Ninth Nine only).
11.The plaintiff no 2 lodged the claim for a sum of Rs.
2,70,59,489/- upon the defendant vide letter dated 23.02.2018 as per the provisions of the Act. The said letter was duly received by the defendant company. The defendant company vide letter dated 06.02.2018 issued the certificate confirming the damage to the machine.
Judgment 4 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
12.It is stated that the defendant company took a frivolous plea regarding the status of the machine. The plaintiff no. 2 had lodged a monetary claim upon the plaintiff no. 1 and also lodged claim with the defendant under section 16 of the Carriage by Road Act. The said notice was duly served upon the defendant, however, despite receipt of said notice the defendant had failed to settle the claim of the plaintiff no. 2.
13.It is averred that since the plaintiff no. 2 was holding the indemnity policy issued by the plaintiff no. 1 as such, the plaintiff no.1 company on the basis of the survey report and as per the terms and condition of the policy, duly approved, paid and settled the said insurance claim for a sum of Rs. 1,50,54,929/- and paid to the plaintiff no. 2 in full and final settlement.
14.It is stated that the plaintiff no. 2 after receiving the aforesaid amount executed letter of subrogation and undertaking in favour of the plaintiff no. 1 thereby subrogating all their rights in favour of plaintiff no. 1 company to recover the sum of Rs. 1,50,54,929/- from defendant.
15.It is averred that in view of the payment made by the plaintiff no. 1 company to plaintiff no. 2, plaintiff no.1 company has right to recover the aforesaid amount from the defendant company. Even otherwise also as per the terms of the insurance policy the plaintiff no 1 company gets legal rights Judgment 5 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
for the recovery of aforesaid amount from defendant company who was the carrier of the consignment. That the plaintiff company is entitled to the recovery of Rs. 1,50,54,929/- as the defendant undertook to pay for the entire loss in case of any damage during transportation. Even otherwise it was responsibility of the defendant to deliver the consignment in sound condition.
16.It is averred that the defendant is bound to pay the amount as the consignment was lost due to mishandling, negligence and rashness of the defendant. That despite repeated request and reminders the defendant company has failed to pay the amount to the plaintiff. Thus, plaintiff has prayed for a decree of Rs. 1,50,54,929/- in favour of the plaintiff no.1 company & against the defendant along with interest @ 18% p.a from the date of filling the present suit till its realization.
Written Statement
17.In the written statement, the defendant has taken preliminary objection that the defendant is neither a party nor privy to the contract of Insurance. It is stated that at the time of entrustment of goods for carriage, the consignor M/s Yamazaki Mazak India Pvt Ltd did not disclose any insurance cover in respect of the consignment under transit and in the GR No.233 against the column Insurance "No" is mentioned and hence defendant is not bound by the terms and conditions Judgment 6 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
of insurance contract between plaintiffs no.1 and 2 and has no concern with the same.
18.It is stated that the consignor committed flagrant breach of contract of carriage and the provisions of the Carriage by Road Act 2007, and hence the defendant is not liable to pay any compensation.
19.The defendant has submitted that as per the survey report dated 09.08.2018, the consignment was in the nature of Over Dimensional Cargo (ODC) and Overweight Cargo (OWC). It is stated that as per the survey report the breadth and the height of the cargo exceeded the limits and as such it breached the warranty and had a direct bearing on the accident in question.
20.Defendant has averred that the truck containing consignment severed out of control while Driver was negotiating a sharp curve on a winding Hillside slope. It is stated that the consignor did not disclose to the defendant regarding ODC of consignment which amounts to concealment and withholding of material facts from the defendant and, as such defendant is not liable to pay any amount to the plaintiff.
21.It is further stated that in this regard a penalty of ₹24,460 was paid by the defendant which was subsequently reimbursed by the plaintiff to the defendant on 04.06.2019, in terms of the Judgment 7 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
defendant freight bill dated 25.01.2018, without any protest or demur.
22.Defendant has also taken an objection that the plaintiff no.1 acted in collusion with the surveyor in illegal and fraudulent manner by condoning the breach of policy warranty with regard to pre-inspection and ODC loading supervision by the consignor. It is stated that exoneration given by plaintiff No.1 or their surveyor to plaintiff No.2 is collusive.
23.Defendant has taken a objection that the suit is bad for non joinder of the necessary party that is the consignor who has committed flagrant breaches of the contract of carriage.
24.It is stated that the plaintiff no.1 in collusion with the surveyor unilaterally changed the terms and conditions of the policy with a view to pay a fraudulent and excessive claim of plaintiff no.2, and to seek recovery of the same from the Defendant.
25.Defendant has averred that as per Clause 1 of the terms and conditions of the contract of carriage printed on the reverse of GR No. 233 in question, the consignment was carried at the owner's risk, otherwise and until specifically agreed to by the defendant by charging specific risk charges as mentioned on the front of the GR. The consignor also specifically undertook as per terms and conditions printed on the front of the GR that the consignment was booked by the consignor Judgment 8 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
with the full knowledge of the terms and conditions of the consignment note appended on the reverse thereof which were duly accepted by the consignor. Admittedly no such specific risk charges were demanded or received by the Defendant at the time of entrustment of the goods by the consignor to the Defendant for carriage, and hence no liability attaches to the Defendant. It is further submitted that even otherwise as per second proviso to Section 10(2) of the Carriage by Road Act 2007, the common carrier shall not be liable if such carrier proves that such loss of, or damage to the consignment had not taken place due to his fault or neglect or that of his servants or agents thereof.
26.It is alleged that the accident occurred on account of improper packing of the consignments in the trailer of truck No. HR 38U 9231, and flagrant breach of pre-inspection and ODC warranties under the policy by the consignor. It is stated that the consignment was not properly packed and stacked on the body of the trailer, taking into account the centre of gravity, as it had important bearing on the safety of the trailer while negotiating sharp curves, and that too on a winding hillside on to a downward slope.
27.It is further stated that the consignor failed to comply with Rule 10(1) of the Carriage by Road Rules, 2011, to declare in the GFN as per Form 7, nor gave any details of the consignment. It is stated that packing lists of the Judgment 9 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
consignments were also not disclosed by the consignor to the defendant at the time of entrustment of the goods for carriage.
28.It is stated that the plaintiff no.2 raised a fraudulent monetary claim on plaintiff no.1 in respect of the 3 cases transported in the two vehicles for Rs.2,43,43,400.00 being the invoice value of the entire machine. Plaintiff No.2 however is alleged to have lodged monetary claim dated 23.02.2018 on the Defendant for Rs.2,43,43,400.00, i.e. the invoice value of the entire machine, which on the face of it is false and fraudulent.
29.Defendant has stated that as per Section 10(1) of the Carriage by Road Act, 2007 the liability of the common carrier for loss of, or damage to any consignment shall be limited to such amount as may be prescribed having regard to the value, freight and nature of goods, documents or articles of the consignment, unless the consignor or any person duly authorized in that behalf has expressly undertaken to pay higher risk rate fixed by the common carrier under Section 11 of the Act. In this regard it is noteworthy that as per Rule 12(1) of the Carriage by Road Rules, 2011 the liability of the common carrier under Section 10 for total loss shall be limited to ten times the freight paid or payable, provided that the amount so calculated shall not exceed the value of the goods as declared in the GFN. The freight charges in respect of GR No. 232 dated 18.12.2017 as per Freight Bill No. Judgment 10 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
171816402280 dated 25.01.2018 issued by the Defendant to Plaintiff No.2 was Rs.1,23,625.00, and hence even assuming without admitting that there is any liability (which is otherwise vehemently denied), the same cannot exceed a sum of Rs.12.36,250.00.
30.The defendant has also taken an objection that there is no presumption under law regarding the execution, legality or validity of the Special Power of Attorney/ Letter of Subrogation dated 07.03.2019 in favour of plaintiff no.1 and the plaintiffs are put to the strict proof thereof. It is also stated that the plaintiffs have not produced any documentary proof in respect of full and final discharge receipt by plaintiff no.2 in favour of plaintiff no.1.
31.Defendant has alleged that the payment voucher dated 08.03.2019 is a sham and bogus document. It is submitted that the manner in which the claim of plaintiff no.2 was processed by plaintiff no.1 and a sum of Rs.1,50,54,929.00 was allegedly paid by plaintiff no.1 to plaintiff no.2 clearly suggests that the plaintiffs in collusion with the surveyor have made a fortune out of a misfortune in the nature of the unfortunate accident and the resultant damages to the goods carried therein, which otherwise arose solely on account of defective packing and flagrant breaches and defaults of the pre-inspection and ODC warranties under the policy by the consignor.
Judgment 11 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
32.Defendant has stated that no notice in writing of the loss or damage to the consignment has been served on the defendant within 180 days from the date of the booking of the consignment by the consignor as per mandatory requirement under Section 16 of the Carriage by Road Act, 2007 before filing of the suit, and hence the suit of the plaintiffs is not maintainable in law and the suit of the plaintiff is barred by limitation.
33.It is stated that the plaint has not been signed and verified nor the suit instituted by any authorized person of the plaintiffs, and as such the same is liable to be dismissed. It is alleged that plaintiff has concealed and withheld a large number of documents having important bearing on the questions involved in the suit.
Replication
34.In the replication, the plaintiff reiterated their entitlement to the claim on the suit and denied the avernements made in the written statement.
Issues
35.On pleadings of the parties following issues were framed on 16.07.2022:
1. Whether there is no privity of contract between plaintiff and the defendant as pleaded in the written statement OPD Judgment 12 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
2. Whether the plaintiff is entitled to decree of recovery of Rs. 1,50,54,929/- as prayed for in the plaint? OPP
3. If answer to the issue no. 2 is in affirmative, whether the plaintiff is entitled to interest? If yes, at what rate and for which period? OPP.
4. Relief.
36.On 21.03.2024 following additional issue was framed:
1A. Whether the plaintiff is not entitled to the relief sought in the plaint in view of preliminary objections raised by the defendant in his written statement. OPD Evidence
37. To prove its case, the plaintiffs examined Sh. Kapil Dev Sharma as PW-1 who tendered his affidavit by way of evidence Ex.PW1/A. He relied upon the following documents:
Copy of attorney is Ex. PW1/1 (OSR).
Copy of certificate of Incorporation is Mark PW1/2.
Power of attorney as Ex. PW1/3.
Letter of Subrogation as Ex. PW1/4.
Copy of the policy as Ex. PW1/5.
The GRs as Ex. PW1/6 and Ex. PW1/7.
The invoice as issued in favour of plaintiff no. 2 as Ex. PW1/8 and packing list as Ex. PW1/9.
The report of Surveyor dated 15.01.2018 as Mark PW1/10.
Judgment 13 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
Report of Surveyor dated 09.08.2018 as Ex. PW1/11.
Report of Surveyor dated 12.11.2018 as Mark PW1/12.
The letter of plaintiff no. 2 to Surveyor as Ex. PW1/13.
Letter dated 23.02.2018 is Mark PW1/14 and postal receipt is Ex. PW1/15.
Letter dated 06.02.2018 is Ex. PW1/16.
Inspection report dated 08.10.2018 is Ex. PW1/17.
Claim form is Ex. PW1/18.
Payment voucher is Mark PW1/19.
Copy of notice Ex. PW1/20 & postal receipt as Ex. PW1/21.
38.Defendant examined DW1 Jai Shankar Pandey. DW1 tendered his evidence by way of affidavit Ex. DW1/A and relied on the following documents:
1. Certified copy of Board Resolution as Ex. DW1/1.
2. Goods receipt (GR) no. 233 dated 18.12.2017 issued by the defendant as Ex. DW1/2.
3. Goods receipt (GR) No. 232 as Ex. PW1/D1.
4. Inspection report dated 21.12.2017 of PS Malegaon Taluka, Maharashtra as Mark B (colly).
5.Crane receipt dated 24.12.2017 as Mark C.
6. Copy of challan dated 26.12.2017 issued by the Transport Department, Malegaon for ODC as Ex.PW1/D3.
7. Copy of registration certificate, Registration report, Judgment 14 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
National Permit, fitness of the vehicle and authorization certificate of vehicle no. HR38U9231 is Mark E to I.
8.Driving license of Sh. Jora Lal Sharma is Mark J.
9. Freight bill dated 25.01.2018 issued by the defendant to plaintiff no. 2 as Ex. PW1/D2.
10. Statement of Account of HDFC Bank of the defendant from 01.06.2019 to 30.06.2019 is Mark L.
39.I have heard counsel for the parties at length and have gone through the written submissions filed on behalf of parties. I have perused the material available on record.
Analysis Issue No.1: Whether there is no privity of contract between the plaintiff and the defendant as pleaded in the written statement OPD
40.The first objection taken by the defendant is that there is no privity of contract between the plaintiff and the defendant as pleaded in the written statement. However, the plaintiff has not instituted the present suit on the basis of any privity of contract between the plaintiff no.1 and the defendant rather the case set up by plaintiff no.1 is that a consignment was entrusted to the defendant for transportation to Mohali and that during transit the goods were damaged.
Judgment 15 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
41.For the damaged consignment, the plaintiff no.2 had lodged a claim with the defendant under Section 16 of the Carriage By Road Act but the defendant failed to settle the account. Since the consignment was insured by the plaintiff no.1, the amount of damaged consignment amounting to Rs1,50,54,929/- were paid to the plaintiff no.2 by the plaintiff no.1 being insurer of the consignment. Thereafter, a letter of subrogation and power of attorney was executed by plaintiff no.2 in favour of plaintiff no.1.
42.Thus, the present suit is based upon a letter of subrogation and power of attorney executed by plaintiff no.2 in favour of the plaintiff no.1 to recover the damages to the consignment. The plaintiff no.1 (insurer) and consignee have jointly laid the suit to recover the damages. The plea of lack of privity of contract between the defendant and the plaintiff no.1 company are alien to the action on facts and therefore, the suit cannot be stated to be bad for want of privity of contract between the plaintiff no.1 and the defendant. The issue stands answered accordingly, against the defendant.
Issue No. 1A: Whether the plaintiff is not entitled to the relief sought in the plaint in view of preliminary objections raised by the defendant in his written statement? OPD
43.Defendant has taken up-teen number of objections, let us anaylse the objections.
Judgment 16 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
44.Consignor did not submit mandatory Goods Forwarding Note to defendant: It is argued on behalf of the defendant that the equipment was entrusted for transportation to the defendant by M/s Vamazaki Mazak India Pvt Ltd at Pune, Maharashtra for delivery to plaintiff no.2 at SAS Nagar, Mohali, Punjab. It is submitted that as per rule 10 (1) of Carriage by Road Rules 2011, every consignor while booking his goods is mandatory required to execute a Goods Forwarding Note (GFN) as specified under Section 8(1) of the Carriage by Road Act, 2007 containing details of the goods in Form 7 to be submitted to the common carrier in duplicate and to obtain an acknowledgment copy of the GFN from the common carrier, but the consignor did not comply with the mandatory requirement under law and breached the contract of carriage and provisions of the Carriage by Road Act 2007 and, as such the defendant is not liable to pay any compensation.
45.The facts of the case indicate that the defendant company undertook to transport the consignment from Pune to SAS Nagar, Mohali, Punjab and being a transporter, the defendant company was under obligation to see as to whether they have obtained all the information in respect of the consignment. Nonetheless, the defendant has not explained that what relevant information was with-held by the consignor or what damage has been suffered by the defendant by the reason of incompleteness or incorrectness of the particulars on GFN.
Judgment 17 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
46.DW1 Jai Shankar Pandey in his cross-examination admitted that no breaches allegedly committed by the consignor has been mentioned in damage certificate Ex. PW1/16 issued by the defendant. Having failed to narrate any shortcoming or damage suffered on account of that, the defendant cannot be permitted to take shelter in respect of any breach of section 8 of Carriage by Road Act, 2007, thus, this objection taken by the defendant is not tenable.
47.Pre-Dispatch Inspection: The next objection taken by the defendant is that the consignor did not comply with the policy and did not have a pre-dispatch inspection and ODC (over weight and over dimensional cargo) warranty incorporated. It is stated that consignor carried out stacking/lashing of consignment on their own without involvement of plaintiffs and defendant. Let us examine, what DW1 has deposed in this regard:
..... It is correct that consignment was duly examined by our officials before loading the same on the vehicle i.e. trailer provided by the defendant company. I cannot tell if any objection was raised about the weight and dimension of the consignment as I was not present at the site of loading. I had not dealt with the loading and other excercises carried out by the defendant company while transporting the damaged consignment. It is correct that the defendant had issued a damage certificate already Ex. PW1/16. ...
Judgment 18 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
48.In view of the above deposition of DW1, the objection taken by the defendant is wholly misconceived as the defendant's witness admitted that consignment was duly examined by their officials before loading the same on the vehicle and he was unable to tell whether any objection was raised about the weight and dimension of the consignment. The defendant being the transporter was under obligation to see that before loading of the consignment, the everything was in place, and after being satisfied the loading of the equipment was done, thus, consignor cannot be held responsible for avoiding pre-
dispatch inspection.
49. Non-impeadment of M/s Vamazaki Mazak India Pvt Ltd (consignor) as party to the suit: Defendant has submitted that consignor committed flagrant breaches of the contract of carriage, and consignor is party to the contract of carriage with the defendant but consignor has not been im-pleaded as a party to the suit, as such the suit is bad for non-joinder of the said necessary party.
50.It is argued that the manner of loading of the ODC cargo and compliance, of other mandatory requirements was done by consignor, and those facts were in its special knowledge and not in the knowledge of either plaintiff or defendant as for this reason the consignor M/s Vamazaki Mazak India Pvt Ltd was a necessary party to the suit.
Judgment 19 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
51.The defendant though contended that M/s Vamazaki Mazak India Pvt Ltd being a consignor was a necessary party to the suit but it is matter record that the plaintiffs in the present suit have not sought any relief against the consignor. The plaintiffs are masters of their own suit and cannot be compelled to im-plead any party nonetheless, the defendant in case having felt that any circumstances required to be clarified by the M/s Vamazaki Mazak India Pvt Ltd, could have summoned the relevant record or any witness from the said company. The suit of the plaintiffs is specific and is filed for seeking recovery of damages of the consigned goods and in such a suit, the consignor is not a necessary party. Thus, this objection of the defendant is also not tenable in the eyes of law.
52. Owner's Risk: Defendant has contended that the goods were carried at owner's risk and no specific risk charges were mentioned on the front of the GR as per Cl.1 of terms and conditions of carriage printed on the reverse of GR No.233.
53.Hon'ble Apex Court in "Nath Bros. Exim International Ltd. v.
Best Roadways Ltd., 2000 SCC OnLine SC 586 held as under:
29. "owner's risk" in the realm of commerce has a positive meaning. It is understood in the sense that the carrier would not be liable for damage or loss to the goods if it were not caused on account of the carrier's own negligence or the negligence of its servants and agents. In Burton Judgment 20 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
v. English [(1883) 12 QBD 218 : 53 LJQB 133 :
49 LT 768] and again in Wade v. Cockerline [(1905) 10 Comp Cas 47] it was held that in spite of the goods having been booked at "owner's risk", it would not absolve the carrier of its liability and it would be liable for the loss or damage to the goods during trans-shipment or carriage. These decisions granted absolute immunity to the carrier, but they have lost their efficacy on account of subsequent decisions in Svenssons v. Cliffe S.S.Co. [(1932) 1 KB 490 : 101 LJKB 521 : 147 LT 12 : (1931) 41 Ll LR 262] which was considered in Exercise Shipping Co. Ltd. v. Bay Maritime Lines Ltd. (The Fantasy) [(1991) 2 Lloyd's Rep 391 (QBD)] in which it was observed as under:
"The question whether words such as 'at charterer's risk' can operate as an exemption clause in favour of a party otherwise liable for negligence was decided by Mr Justice Wright (as he then was) in Svenssons Travaruaktiebolag v. Cliffe Steamship Co. [(1932) 1 KB 490 : 101 LJKB 521 : 147 LT 12 : (1931) 41 Ll LR 262] He considered the authorities in detail and concluded:
'It is quite clear, in my judgment, on the authorities as they now stand, that the words "at charterer's risk", standing alone and apart from any other exception in the charter-party, do not excuse the ship-owner in the case of a loss due to the breach of warranty of seaworthiness ... I think that the words standing by themselves have also to be read as limited to losses and damages where there has been no negligence on the part of the shipowner or his servants.' He went on to consider the charter-party terms in that case which also included an exceptions clause, clause 11. He held that that clause should have its full effect whereas if 'at charterer's risk' Judgment 21 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
had included an exception of negligence, it might not have done so.
That judgment has been followed since 1932, for example in The Stranna [1937 P 130 : (1937) 57 Ll LR 231] and East & West Steamship Co.
v. Hussain Bros. [(1968) 2 Lloyd's Rep 145 (SC of Pakistan)] , and it has not, so far as I am aware, been dissented from."
30. In Mitchell v. Lancashire and Yorkshire Rly. Co. [(1875) 44 LJQB 107 : 10 QB 256 : 33 LT 161] it was held that "owner's risk" only exempts the carrier from the ordinary risks of the transit and does not cover the carrier's negligence or misconduct. So also, in Lewis v. Great Western Rly. Co. [(1877) 3 QBD 195 : 47 LJQB 131 : 37 LT 774] the words "owner's risk", were held to mean, "at the risk of the owner, minus the liability of the carrier for the misconduct of himself or servants".
31. Thus the expression "at owner's risk" does not exempt a carrier from his own negligence or the negligence of his servants or agents.
54. Hon'ble Apex Court in "Taj Mahal Hotel Vs United India Insurance Company Ltd CA No. 8611/2019" in para 27 held as under:
69. On a closer reading, we find that the decision in Sheik Mahamad (supra) and the subsequent High Court decisions which followed it were in the context of common carriers as bailees. With respect to liability of common carriers, it is settled that the opinon of Sankaran Nair J now holds the field. A Division Bench of this Court has clarified in Nath Bros.
Exim International Ltd. v. Best Roadways Ltd. .
(2000) 4 SCC 553 that their liability is
Judgment 22 of 36
CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
equivalent to that of an insurer and is absolute. Further, it has been observed that such liability is governed by the Carriers Act of 1865 and not by Sections 151 and 152 of the Contract Act, and can therefore not be excluded by way of a special "owner's risk" clause in a contract. However, given that the present case concerns with liability of a hotel for loss of vehicles of its guest due to negligence, the question arises whether White C.J.'s opinion in Sheik Mahamad holds good with respect to Section 151 and 152 and the prima facie liability standard which we have laid down supra.
55.The defendant has not pleaded any specific contract between defendant and the consignor which exonerates the defendant from his liability to make good the damages caused to the consignment. In view of above authoritative judgments the objection taken by the defendant does not holds good.
56. Defendant not responsible for damage: Another preliminary objection taken by the defendant is that the defendant is not liable to pay any amount to the plaintiffs in view of the fact that the loss or damage to the consignment has not taken place due to fault of defendant or neglect or that of its servants or agents, as per the proviso of Section 10(2) of Carriage by Roads Act, 2007.
57.The case set up by defendant is that the accident occurred on account of improper packing, breach of ODC/pre-inspection warranty, the Ld Counsel for the defendant has pointed out to cross examination of PW1, which reads as under:
Judgment 23 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
"Q. I put it to you that the vehicle did not overturn due to any fault of the driver but it occurred due to improper packing of the consignment by the consignor without taking into account the centre of gravity of the equipment which was ODC. What do you have to say?
A. At this stage, I cannot comment upon it."
58.On the basis of the above deposition of PW1, Ld Counsel for the defendant has argued that the deposition of PW1 conclusively establishes that the accident occurred on account of improper packing of the consignment and deliberate breach by consignor of pre-inspection and ODC warranties in the policy, and hence defendant is not liable to pay any compensation to plaintiffs.
59.The above suggestion put to the PW1 indicates that the defendant has put the responsibility of the accident due to improper packing of the consignment by the consignor without taking into the account of center of gravity of the equipment, however, the fact of the matter is defendant is a company responsible for the transportation of the goods.
60.It was the responsibility of the defendant to see whether the equipment which is to be transported was properly packed taking into consideration of all the factors including the centre of gravity of the equipment.
Judgment 24 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
61.By putting the above suggestion to the witness, the defendant has rather admitted that the accident occurred due to improper packing and without taking into the centre of gravity of the equipment, and if that was the case, then the responsibility for the proper packing and placing of the equipment on the vehicle was always on the defendant being the transporter of the goods.
62.In this regard, the deposition of DW1 in his cross-
examination reads as under:
Our authorized had carried out the examination of the vehicle before loading the consignment. It is correct that no inspection report is filed on record. It is wrong to suggest that since no inspection was carried out was carried out regarding the fitness of vehicle to carry such kind of consignment accordingly the same has not been filed on record. It is correct that I hadnot placed on record any report obtained by the defendant company after the loss spelling out the reasons for the damaged to the consignment. It is correct that the truck got over turned while coming down from Choundhi Ghat (Mountain Pass) while negotiating the curve. It is correct that the Nakka (the joint which joins the main horse with the trailer) was broken as a result of which it had over turned. It is wrong to suggest that it was broken due to negligence of the defendant company as no regular checks and maintenance of the vehicle were carried out by the defendant. It is correct that we have not filed any maintenance record of the said vehicle involved in the accident.
Judgment 25 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
It is correct that surveyor was appointed for the assessment of the loss by the insurance company. The defendant company had not made any communication with the surveyor. It is correct that we had never disputed the value of consignment as declared by the consignor at the time of getting issued the GR. It is correct that the consignment was delivered in the damaged condition at the destination. ....
63.Above deposition of DW1 indicates that Nakka (the joint which joins the main horse with the trailer) of the vehicle got broken as a result of which it had over turned while coming down from Choundhi Ghat (Mountain Pass) and negotiating the curve. There is absolutely no evidence on record to suggest that on account of improper packing or breach of ODC/pre-inspection warranty by the consignor the accident happened. The defendant has failed to bring any evidence on record to establish that the damage of equipment did not take place due to his fault. Thus, the objection taken by the defendant in this regard is not sustainble.
64.False Declarations: It is argued that the defendant is not liable to pay any amount to plaintiff no.1 in view of the false declarations made in the Good Receipt in respect of description of the goods and the value thereof, however, the defendant has not proved anything on record to indicate that what exact were the false declarations made by the consignor.
65.Even it is persumed that some incorrect/ false declaration was made by the consignor, the defendant has failed to indicate or Judgment 26 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
establish that it suffered any damage on account of such incorrectness or incompleteness of the particulars mentioned in the the goods forwarding note. As stated above, DW1 has admitted that the damage certificate Ex PW1/16 does not record any such breach. In the absence of any such evidence, the defendant cannot escape the liability to pay the damages.
66. Suit filed by Special Power of Attorney (SPA) : It is submitted on behalf of the defendant that suit filed by plaintiff no.1 on the basis of SPA (Ex PW1/3) dated 07.03.2019 executed by plaintiff no.2 in its favor is not maintainable. It is stated that SPA in no way is bestowing of any power as in favor of plaintiff no.1. It is stated that SPA is also not executed or authenticated by a Notary Public. This contention of the defendant is wholly misconceived as in the Special Power of Attorney Ex.PW1/3, the plaintiff no.2 has mentioned that it would provide assistance reasonably required from it to the plaintiff no.1 in exercising the rights and remedies available to the plaintiff no.1.
67.It is not the case here that plaintiff no.1 has been isolated in the suit rather the plaintiff no.2 has joined as the plaintiff in present suit in seeking the claim from the defendant, therefore, the contention of the defendant that the suit is not maintainable is liable to be rejected.
Judgment 27 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
68. No basis of claim:It is submitted that plaintiffs have not shown any basis for the claim of Rs.1,50,54,929.00 allegedly paid by plaintiff no.1 to plaintiff no.2 by way of settlement of their insurance claim.
69.PW1 Kapil Dev Sharma, Senior Divisional Manager of plaintiff in his affidavit Ex PW1/A stated as under:
..... The loss was notified and the plaintiff no 1 company appointed the surveyor namely M/s Sapient Insurance Surveyors & Loss Assessors P. Ltd. and who after visiting the site submitted his report. The surveyor after visiting the place of accident submitted his report assessing the net loss of Rs. 1,62,27,699/-. (Rs One Crore, Sixty Two Lakh Twenty Seven Thousand Six Hundred Ninth Nine only) The plaintiff no 2 lodged the claim for a sum of Rs. 2,70,59,489 /- upon the defendant vide letter dated 23/02/2018 as per the provision of the act. The defendant company vide letter dt. 06.02.2018 issued the certificate confirming the damage to the machine. The defendant company took frivolous plea regarding the status of the machine. The plaintiff no. 2 had lodged a monetary claim upon the plaintiff no 1 company. The reports of Surveyor dated 15.01.2018, 09.08.2018 and 12.11.2018 are exhibit PW1/10 to 12 respectively. The letter of plaintiff no 2 to surveyor is exhibit PW1/13, Letter dated 23/02/2018 is exhibit PW1/14 and Postal Receipt is exhibit PW1/15 and letter dated 06.02.2018 is exhibit PW1/16.
70. By proving the surveyor's report as Ex PW1/10 to Ex PW1/12, the plaintiff no.1 has duly proved the extent of damage to the equipment and quantification of the loss of the Judgment 28 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
equipment to be Rs. 1,62,27,699/- as per report of surveyor, and finally the claim of plaintiff no.2 was settled at Rs.1,50,54,929.00. In view of prove of above documents, the contention of the defendant that plaintiffs have not shown any basis for the claim is contrary to the evidence brought on the record.
71. Fraudulent Claim: It is the submission of the defendant that plaintiff no.1 settled the claim of plaintiff no.2 in a fraudulent manner but it is a bald assertion of the defendant.
72. Defendant has not lead any evidence to indicate that the claim of the plaintiff no.2 was settled by plaintiff no.1 in a fraudulent manner, rather, the survey report bought on record explaining the extent of damage to the equipment, the photographs of the spot and the damage report Ex.PW1/16, given by the defendant itself clearly establish the damage to the equipment which led to the settling of the claim of the plaintiff no.2 by the plaintiff no.1. Thus, this objection of the defendant is also not sustainable.
73. Suit not instituted by Authorized Person: The defendant has also taken an objection that plaint has not been signed and verified or the suit instituted by an authorized person of plaintiffs. PW1 Kapil Dev Sharma has duly proved a power of attorney Ex.PW1/1 in his favour issued on behalf of plaintiff company. Defendant has brought any evidence Judgment 29 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
contrary to that. Ex PW1/1 establishes the authority of PW1 to institute, prosecute the suit and depose on behalf of the plaintiff company. Thus, this objection of the defendant is stands rejected.
74. Limitation: The defendant though took an objection in respect of limitation period of the suit but, in view of order dated 08.03.2021 passed by Hon'ble Supreme Court of India in Suo Motu Writ Petition (Civil) No.3 of 2020 condoning the delay on account of national lock-down consequent to COVID-19 Pandemic, this objection was not pressed by the defendant.
75. Concealment of documents: It is submitted by the defendant that the commercial suit filed by plaintiffs against defendant is not maintainable in view of concealment of large number of documents from the Court by the plaintiffs but defendant has not explained what what were the nature of documents withheld by the plaintiffs or what weightage those documents carried so to influence the final outcome of the case. This objection taken by the defendant is wholly misconceived.
Issue No.2: Whether the plaintiff is entitled to decree of recovery of Rs. 1,50,54,929/- as prayed for in the plaint? OPP
76. PW1 Kapil Dev Sharma testified on the lines of the plaint and has duly proved a copy of attorney in his favour as Ex. PW1/1, a power of attorney executed by the plaintiff no.2 in Judgment 30 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
favour of plaintiff no.1 as Ex. PW1/3, a letter of Subrogation duly executed by plaintiff no.2 thereby subrogating its right and remedies in favour of plaintiff no.q as Ex. PW1/4, a copy of the insurance policy as Ex. PW1/5 wherein the damaged equipment was insured by plaintiff no.1, The Goods Receipts issued in respect of consigned equipment as Ex. PW1/6 & Ex. PW1/7, invoice as issued in favour of plaintiff no. 2 as Ex. PW1/8 and packing list as Ex.PW1/9, report of Surveyor in respect of damaged equipment as Ex. PW1/11, a letter of plaintiff no. 2 to Surveyor as Ex. PW1/13, a letter dated 06.02.2018 issued by the defendant in respect of damage to the consignment as Ex.PW1/16, an inspection report as Ex. PW1/17, claim form as Ex. PW1/18.
77. Hon'ble Apex Court "Economic Transport Organization v.
Charan Spg. Mills (P) Ltd., (2010) 4 SCC 114 " has held as under:
26. 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 the assured fully, by reimbursing the entire loss, there will be no equitable assignment of the claim enabling the 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 Judgment 31 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
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 authorises the insurer to recover the amount settled and paid by the insurer, from the third-party wrongdoer as a subrogee-cum-attorney.
78. Plaintiff no.1 has duly compensated the plaintiff no.2 by settling his claim in respect of damaged equipment and the plaintiff no.2 has then subrogated his rights in favour of plaintiff no.1 vide letter of subrogation as Ex. PW1/4. As such, plaintiff no.1 has a right to recover the said amount from the defendant.
79. While discussing the liability of common carrier in respect of damage of the consignment during transportation, in Patel Roadways Ltd. v. Birla Yamaha Ltd., (2000) 4 SCC 91 Hon'ble Apex Court has held as under:
40. In the case of Muralidhar Mohanlal v. Rivers Steam Navigation Co. Ltd. [AIR 1967 Ass & Nag 79 : ILR (1964) 16 Ass 10] considering the provisions of Sections 6, 8 and 9 of the Carriers Act, the High Court held that these sections are based on English common law and also the Common Carriers Act of England. The Court placed reliance on the Privy Council decision in Irrawaddy Flotilla v. Bugwandas [Irrawaddy Flotilla Co. v. Bugwandas, ILR (1891) 18 Cal 620 : 18 IA 121 (PC)] in which the legal position was stated in the following words:
Judgment 32 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
"For the present purpose it is not material to inquire how it was that the common law of England came to govern the duties and liabilities of common carriers throughout India. The fact itself is beyond dispute. It is recognised by the Indian Legislature in the Carriers Act, 1865, an Act framed on the lines of the English Carriers Act of 1830."
The Court also relied on the following passage from Halsbury's Laws of England, Third Edition, Vol. 4 at pp. 141-143:
"A common carrier is responsible for the safety of the goods entrusted to him in all events, except when loss or injury arises solely from act of God or the Queen's enemies or from the fault of the consignor, or inherent vice in the goods themselves. He is, therefore, liable even when he is overwhelmed and robbed by an irresistible number of persons. He is an insurer of the safety of the goods against everything extraneous which may cause loss or injury except the act of God or the Queen's enemies, and, if there has been an unjustifiable deviation or negligence or other fundamental breach of contract on his part, he will be liable for loss or injury due to the Queen's enemies or, it would seem, due to act of God.
This responsibility as an insurer is imposed upon a common carrier by the custom of the realm, and it is not necessary to prove a contract between him and the owner of the goods in order to establish liability. Failure on the part of the carrier to deliver the goods safely is a breach of the duty placed upon him by the common law; and therefore an action of tort lies against him for such breach, the owner not being bound to prove any contract. Where, however, there is a contract, liability may arise either at common law or under the contract, and the contract may Judgment 33 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
limit the carrier's responsibility.
A common carrier is liable for loss or injury caused wholly by the negligence of other persons over whom he has no control; as where the carrier's barge runs against an anchor wrongfully left in the water by a stranger, or where the goods which he is carrying are destroyed by accidental fire or by rats, or where they are stolen from him, even though taken by force.
The general obligation of a common carrier of goods to carry the goods safely whatever happens renders it unnecessary to import into the contract for carriage a special warranty of the roadworthiness of the vehicle or the seaworthiness of the vessel, for, if the goods are carried safely the condition of the vehicle or vessel is immaterial, and, if they are lost or damaged, it is unnecessary to inquire how the loss or damage occurred. Where however, a common carrier of goods is seeking relief from liability by reason of one of the excepted perils the condition of the vehicle or vessel is material in determining the question of negligence, and if the carrier fails to provide a sufficient and proper conveyance and loss or damage results therefrom he will be liable."
80. The loss of consignment by the assured and settlement claim by the insurer by paying Rs.1,50,54,929/- is established by evidence. Having regard to the presumption regarding negligence under Section 10 of Carriage by Road Act, it was not necessary for the plaintiff to prove that the loss/damage was due to the negligence of the defendant or its driver.
Judgment 34 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd." 81. As stated above, there is no evidence on record that the
damage to the consigned equipment did not take place due to fault or neglect of defendant or its servants or agents. Presumption regarding negligence was not rebutted by the defendant. Therefore, the plaintiff no.1 is entitled to recover a sum of Rs 1,50,54,929/- from the defendant that is the amount paid by plaintiff no.1 to plaintiff no.2 for the damage to the equipment being the insurer. The issue stands accordingly decided in favour of the plaintiff and against the defendant.
Issue No. 3: If answer to the issue no. 2 is in affirmative, whether the plaintiff is entitled to interest? If yes, at what rate and for which period? OPP.
82. Grant of pendente -lite and future interest is within the discretion of the Court. Plaintiff is claiming interest @ 12% p.a from the date of institution of the suit, however, keeping in view of prevailing bank interest rates, an interest @ 9% p.a are awarded in favour of the plaintiff.
Relief
83. Thus, in the light of above discussions, the suit of the plaintiff is decreed against the defendant in the sum of Rs.1,50,54,929/- (Rupees One Crore Fifty Lacs Fifty Four Thousand Nine Hundred and Twenty Nine Only) along with Judgment 35 of 36 CS (COMM) No. 117/2021 " M/s The New India Assurance Co. Ltd. Vs M/s Chetak Logistics Ltd."
interest @ 7% per annum w.e.f. filing of the suit till the realization of the amount. Plaintiff shall also be entitled to costs of the suit. Decree sheet be drawn.
File be consigned to record room.
Announced in the Open Court on 12th January, 2026.
Digitally
signed by
GAUTAM
GAUTAM MANAN
MANAN Date:
2026.01.12
16:16:43
+0530
GAUTAM MANAN
DISTRICT JUDGE SOUTH-WEST,
COMMERCIAL COURTS-03,
DWARKA COURTS, NEW DELHI
Judgment 36 of 36