National Consumer Disputes Redressal
M/S. Sun Pharmaceutical Industries vs Managing Director, Exfin Shipping ... on 23 May, 2007
Equivalent citations: AIR 2007 (NOC) 2278 (NCC) (NCDRC)
NCDRC NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI Original Petition No. 196 of 1995 M/s. Sun Pharmaceutical Industries Complainant (Formerly M/s Gujarat Lyka Organics Ltd) 401-D, Poonam Chambers A Wing, 4th Floor, Dr Anne Besant Road Worli, Bombay 400 018 Vs. 1. Managing Director, Exfin Shipping ( India) Pvt., Ltd., A 4, Chittaranjan Park, 3rd Floor, Outer Ring Road, New Delhi 110016. 2. Managing Director, Bright State Company Ltd., 3rd Floor, Bangkok Bank Building, 14 20 Bonham Strand West, Sheung Wan, Hong Kong. Opposite parties BEFORE: HON'BLE MR. JUSTICE M.B. SHAH, PRESIDENT HONBLE DR P D SHENOY, MEMBER For the Complainant Shri S.D. Mokashi, Advocate Shri S.S. Pushkarna, Advocate For the Opposite Parties NEMO Dated the 23rd May, 2007 . O R D E R
M.B.SHAH, J., PRESIDENT None appears for the Opposite Parties.
It is the say of the complainant M/s. Sun Pharmaceutical Industries (formerly M/s. Gujarat Lyka Organics Ltd.), which has merged with M/s. Sun Pharmaceutical Industries Ltd., that it deals in the production and sale of life saving drugs, such as, Cephalexin Monohydrate, Ampocillin Trihydrate, Amomycillin Trihydrates etc., and is having global market. On the basis of contract for sale of 2 M.T. Cephalexin Monohydrate BP/ USP at U S $ 140 per kg. entered into with one M/s.Condea Chemical Trading Company, Hong Kong, the Complainant has engaged the services of Opposite Party No.1 Exfin Shipping (India) Ltd., Shipping Agent, for sending one consignment of 1000 kgs of Cephalexin Monohydrate packed in 40 fibre drums from Bombay to Foshan in China. Opposite Party No. 1, acting as an agent of Opposite Party No. 2 issued airway bill dated 21st October, 1994, in the name of Opposite Party No. 2., Opposite parties No. 1 and 2 were to deliver the consignment to the ultimate consignee in Foshan against the production of original documents routed through the Bank. It is pointed out that the freight charges for the goods were pre-paid at Bombay. Condea Chemical Trading Company agreed to pay the prices by means of a letter of credit (90 days sight) which was opened on 30th September 1994 by the Hong Kong & Shanghai Banking Corporation Ltd, Hong Kong (hereinafter referred to as HSBC) in favour of the complainant. One of the stipulations in the said letter of credit was that the said goods must be forwarded to the consignee through Opposite Party No.1 and one of the documents to be negotiated under the said letter of credit was the airway bill issued by Opposite Party No. 1. Under the terms of the letter of credit, the consignee copy of the airway bill was required to be sent to the HSBC, Hong Kong and non-negotiable photocopy was to be sent to the Condea Chemical Trading Company. It was made clear that the goods were thus to be delivered only on production of consignee copy of the airway bill by the consignee, i.e Foshan Feedmill Ltd., at Foshan in China. It is emphasized that opposite parties No.1 and 2 were prohibited from delivering the goods without production of the consignee copy of the airway bill dated 21st October, 1994.
The complainants negotiated the documents with their Bankers, State Bank of India, Shiv Sagar Estate Branch, Worli, Bombay, under the Letter of Credit issued by the HSBC, Hong Kong. However, due to some alleged discrepancies the said documents including the original airway bill dated 21st October 1994 were returned to the complainants by the said Bank. Thus, neither the Condea Chemical Trading Company nor the consignee of the goods viz., Foshan Feedmill Ltd., were in possession of the consignee copy of the airway bill and the goods could not and ought not to have been delivered at the destination. Besides, the letter of credit not having been encashed/honoured, the complainant were concerned about the rebooking of the consignment back to Bombay. The complainants therefore, frantically wrote letters and followed up orally with the opposite parties to enquire about the whereabouts of the consignment. But the opposite parties failed and neglected to respond to the requests made by the complainants. When pressed further, the opposite party No. 2 informed the complainants on 11th February 1995 that the consignment had been delivered to the consignee on 31st October, 1994. The complainants were surprised and shocked to learn so belatedly that the consignment had been delivered without the production of the consignee copy of the airway bill which was then in the possession of the negotiating Bank.
It is therefore, contended that opposite parties No. 1 and 2 delivered the goods negligently and with mala fide intention without production of the consignee copy of the airway bill which remained in possession of the HSBC.
It is to be stated that in response to the complaint, a written statement has been filed on behalf of OP No. 1 Managing Director, Exfin Shipping India (Pvt ) Ltd., denying its liability and contending that the responsibility was that of OP No.2, namely Bright State Company Ltd., Hong Kong. No written version has been filed on behalf of OP No. 2 Bright State Company Ltd., Hong Kong.
We have gone through the documents which are produced on record. As per the fax message dated 16th October, 1994 produced by OP No. 1, it is clear that OP No. 1 has written to the Bright State Company Ltd., that Condea Chemical Trading Company has nominated OP No. 1 for issuing the airway bill on their LC consignment. In the fax message consignees name is mentioned as Foshan Feedmill Ltd., and notified partys name as Condea Chemical Trading Company. At the end, a certificate is given to the following effect:
Carrier certifies goods described below were received for carriage subject to the condition on reverse hereof. The goods then being in apparent good order and condition except as noted hereon.
It is signed on behalf of Opposite Party No. 1. Thereafter, one shipping bill dated 27th October, 1994 is produced on record which is prepared by Skyplanet Shipping Ltd., wherein shippers name is mentioned as Bright State Company Ltd., Hong Kong and consignees name is mentioned as Foshan Feedmill Ltd. Further, in support of his claim, the complainant has filed an affidavit pointing out that Opposite Party No. 2, Bright State Company Ltd., Hong Kong, fraudulently booked the consignment from Hong Kong to Foshan, China and delivered the goods without the knowledge and consent of the complainant. It is rightly pointed out that the carrier cannot deliver goods to any one without production of the original carrier receipts and without production of the original non-negotiable airway bill.
From the records produced before us it is apparent that Opposite Party No. 1 was appointed as an agent of the consignee i.e. for the purchase of goods, who opened the letter of credit. Even the airway bill was issued by the Opposite Party No. 1. Airway bill is signed by Opposite Party No.1 Exifin Shipping ( India) Pvt., Ltd. Fax message which is produced on record also reveals that Opposite Party No.1 wrote letter to Opposite Party No.2 Bright State Company Ltd., stating that they were nominated by Condea Chemical Trading Company for issuing airway bills on their LC consignments. Carrier certificate is also signed by Opposite Party No.1.
In this set of circumstances, it cannot be said that Opposite Party No. 1 is not liable to reimburse the complainant for the loss suffered due to the negligent delivery of the goods without the production of airway bill being produced or the original documents by the carrier. Carrier acted negligently in handing over the consignment without the original documents, because the documents remained with the bank i.e. HSBC who had issued the letter of credit.
The Complainant has averred in its rejoinder that fraud was committed by the Opposite Party Nos. 1 and 2 in taking away the goods. It has pointed out that Opposite Party No.1 has prepared the air waybill of the Opposite Party No.2 in which the consignees name has been shown as Foshan Feedmill Ltd. and the consignors name is correctly shown as M/s.Gujarat Lyka Organics Ltd. Thereafter, in the air waybill of Cathay Pacific, the consignees name has been fraudulently shown as Bright State Co. Ltd., and the delivery was taken by the Opposite Party No.2 at Hong Kong. Further, the transport from Hongkong was arranged by Opposite Party No.2 through Skyplanet Shipping Ltd. For this, the bill of landing mischievously showed the name of shipper as the Opposite Party No.2 itself, i.e. Bright State Company and the consignee is shown as Foshan Feedmill Ltd. This is all, either fraud or mischievous deficiency in service.
Considering the aforesaid facts, particularly, the fact that the original documents remained with the bank and that the goods were delivered by the carrier to an unauthorized person, opposite parties No. 1 and 2 are liable to reimburse the complainant for the loss suffered by it jointly and severally.
As per the invoice, the goods were worth Rs.44,47,140/- (equivalent to US $ 1,41,000 as on 14th October, 1994 i.e. which is the date of invoice). The complainant has suffered loss of that amount, because of the negligence of the opposite parties No.1 and 2. Hence, they are liable to reimburse the said amount to the complainant.
In the result, the complaint is allowed. It is held that opposite parties No.1 and 2 are jointly and severally liable to pay sum of Rs.44,47,140/-
with interest at the rate of 12% p.a. from 14th October, 1994 till its payment.
Complaint stands disposed of accordingly. There shall be no order as to costs.
Sd/-
...J. (M.B. SHAH) PRESIDENT Sd/-
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(P.D.SHENOY) MEMBER