Delhi District Court
M/S. Emu Lines Private Limited vs Mr. Prashant DingraProprietor Of M/S. ... on 12 August, 2011
IN THE COURT OF SH. PITAMBER DUTT; ADJ (CENTRAL)17,DELHI
Suit No. 349/09
Unique Case ID No. 02401C0143722006
M/s. EMU Lines Private Limited
201, 35A, Siddharth ChamberII,
Kalu Sarai, Hauz Khas,
New Delhi110016 .......Plaintiff
Versus
1. Mr. Prashant DingraProprietor of M/s. Tarun Exports
Plot No. 21, Sector6, Imt, Manesar, Gurgaon, Haryana120016
Alternate Address:
D/4A/7, DLF PHASEI, Gurgaon, Haryana122001
2. Mr. Arun Mishra, Proprietor of M/s. S. G. Travels and Cargo
B138, 3rd Floor, Mohammed Pur,
Opp. Bhikaji Cama Place, New Delhi110066 .........Defendants
Date of Institution of Suit : 25.02.2006
Date when reserved for orders : 08.08.2011
Date of Decision : 12.08.2011
JUDGMENT
1 Vide this judgment I shall decide a suit for recovery of Rs. 4,43,960/ filed by the plaintiff against the defendant The brief fact necessitating in filing the present suit are given as under: 2 That plaintiff is a Company duly registered with Registrar of Companies and engaged in the business of forwarding of freight by Suit no. 349/09 1/18 sea. Defendant no. 2 is also engaged in the same business. Defendant no.2 approached the plaintiff for shipment of the consignment belonging to defendant no.1 which consisted of 97 packages said to contain readymade garments with the place of destination at Rotterdam (Netherlands). The defendants agreed to pay freight and freight related charges. Plaintiff issued MTD (Multimodal Transport documents) vide no. EMUDLH04/0004827 dated 19.02.2005 in respect of the said consignment. The said consignment was handed over to the plaintiff by defendant no.2. The said shipment sailed on Vessel: Iran Hesabi1246 dated 27.02.2005 from JNPT Port which arrived at its destination on 27.03.2005 and notice of arrival was duly given to the consignee.
3 The plaintiff vide letter dated 11.04.2005 called upon the defendants to get the said consignment cleared and also pay freight and charges which had become due towards demurrages. Defendant no.1 vide letter dated 13.04.2005 informed the plaintiff that his buyer was out of country and the delivery would be taken within 1015 days. The plaintiff again called upon the defendants vide letter dated 01.07.2005 to get the cargo cleared at destination after paying freight and other charges. Defendant no.1 wrote a letter dated 02.08.2005 thereby informed the plaintiff that due to certain logistical difficulties the cargo could not be cleared earlier. He also requested for reduction Suit no. 349/09 2/18 of demurrages charges from Euro 4800 which had been initially demanded. Upon his request, charges were reduced to Euro 2000 and the defendants were called upon to clear the shipment immediately after paying the charges due towards freight and demurrages. Defendant no.1 vide letter dated 31.08.2005 assured the plaintiff that delivery of the cargo would be taken by 15.09.2005 on payment of agreed reduced demurrages charges, however, defendants have failed to do so. As per book of account of the plaintiff, an amount of Rs. 1,13,960/ is due towards freight and Rs. 3,30,000/ is due towards demurrages charges. Thus both the defendants are liable to pay a sum of Rs. 4,43,960/ jointly as well as severely which they have failed to pay till date. On the basis of the above averments, present suit has been filed by the plaintiff against the defendants. 4 Pursuant to the summons, both the defendants appeared and filed their separate written statement. Defendant no.1 filed his written statement taking preliminary objections that plaintiff is guilty of suppressio veri and suggetsio falsi, that the suit is not maintainable as the claims made by the plaintiff are highly exaggerated, that same is without any cause of action against defendant no.1, that suit is bad for nonjoinder of necessary parties, that suit has not been filed by a duly authorized person.
Suit no. 349/09 3/18 5 On merit, averment relating to booking of consignment, issuance of MTD documents by the plaintiff to defendant have been admitted, however, it is denied that defendant no.1 was liable to pay any freight or demurrges charges. It is stated that as agreed between the parties, freight, demurrages and all the other charges were payable by the consignee only. It is also stated that the claim of the plaintiff for Euro 2000 is highly exaggerated as the same were not the charges prevalent at the time when the shipments were sailed. It is denied that an amount of Rs. 1,13,960/ is due towards freight charges. It is also denied that a sum of Rs. 3,30,000/ is due towards demurrages charges. All other averments have also been denied. It is prayed that suit be dismissed with cost.
6 Defendant no.2 filed separate written statement taking preliminary objection that the there is no privity of contract between plaintiff and defendant no.2, that plaintiff has no cause of action against the defendant, that defendant no.2 is not at all a necessary party.
7 On merit, it is denied that defendant no.2 approached the plaintiff for the shipment for the consignment belonging to defendant no.1. It is stated that defendant no.2 is a custom clearing agent and doing his business as per the law. It is denied that consignment was handed over to the plaintiff by defendant no. 2. It is also denied that Suit no. 349/09 4/18 defendant no.2 is jointly as well as severely liable to pay the amount to the plaintiff. It is prayed that suit be dismissed. 8 Plaintiff filed replication to the written statement filed by defendant no. 1 & 2 thereby denied the averments made in the written statement and reiterated the averments made in the plaint. 9 On the basis of the pleadings of the parties, vide order dated 01.02.2007 following issues have been framed for adjudication:
1) Whether the suit is bad for nonjoinder of necessary parties? OPD1
2) Whether the suit has not been filed by the authorized person? OPD1
3) Whether there is no privity of contract between the plaintiff and defendant no.2? OPD2
4) Whether the plaintiff is entitle for decee of Rs. 4,43,960/ alongwith cost and interest as prayed in the plaint? OPP
5) Relief 10 After framing of issues, defendant no.2 stopped appearing. Consequently, defendant no.2 was proceeded exparte vide order dated 17.01.2008.
11 In order to prove its case, plaintiff has examined Sh. Uday Kumar as PW1 who reiterated the averments made in the plaint. PW1 Suit no. 349/09 5/18 exhibited the certificate of incorporation of the plaintiff as Ex.PW1/1, article of memorandum of association as Ex. PW1/2, extract of the meetings Ex. PW1/3, MTD alongwith shipment bill Ex. PW1/4 & 5, letter dated 11.04.2005 Ex. PW1/6, letter of defendant no.1 dated 13.04.2005 as Ex. PW1/7, letter written by plaintiff dated 31.04.2005 alongwith postal receipts, A.D as Ex. PW1/8 to Ex. PW1/10, fax messages Ex. PW1/11, another letter dated 01.07.2005 alongwith receipt and A.D as Ex. PW1/12 to Ex. PW1/14, another letter dated 02.08.2005 written by defendant no.1 as Ex. PW1/15 & 16, Fax messages dated 16.08.2002 and letter dated 20.08.2005 with postal receipt, acknowledgment and A. D are Ex. PW1/17 to 20, another letter written by defendant no.1 dated 15.09.2005 Ex. PW1/21, debit note alongwith statement of account of the plaintiff Ex. PW1/22 & 23, legal notice alongwith postal receipt and A.D as Ex.PW1/24, 25 & 26. 12 Defendant no.1 examined Sh. Prashant Dhingra as DW1 who reiterated the averments made in the written statement in his examination in chief.
13 I have heard ld. Counsel for the plaintiff. Ld. Counsel for defendant no.1 has not appeared to advance the arguments despite various opportunities. Thus, I proceed to decide the suit after hearing arguments from Ld. Counsel for the plaintiff only as per Order 17 Rule Suit no. 349/09 6/18 2 CPC. My issuewise findings is as under: 14 Issue No.1 Whether the suit is bad for nonjoinder of necessary parties? OPD1 The onus to prove issue No.1 is upon defendant no.1 In Para 5 of the preliminary objection of the written statement. Defendant no.1 has taken a plea that the consignee of the goods i.e M/s. Ezra is necessary and proper party to the suit since the payments towards freight and demurrage charges were payable by the consignee only. The plaintiff filed replication thereby denied the aforesaid plea and stated that the consignment was handed over by defendant no.1 and the charges were also liable to be paid by defendant no.1 as per the terms and conditions mentioned on the MTD issued by defendant.
Defendant no. 1 during crossexamination, admitted that M/s. Ezra Trading Company, the consignee of the consignment were known to him and they were not known to the plaintiff. He further stated that the letter Ex. PW1/7, Ex. PW1/15 are written by them to the plaintiff on behalf of the buyer M/s. Ezra Trading Company. 15 It is the admitted case of the parties that defendant no.2 approached the plaintiff for the shipment of the consignment belonging to defendant no.1 which consisted 97 pkgs said to contain readymade garments. The consignment was related to defendant no.1 which was handed over to the plaintiff by defendant no.2. Plaintiff was Suit no. 349/09 7/18 not having any dealing directly with M/s. Ezra Trading Company. Therefore there was no privity of contract between plaintiff and M/s. Ezra Trading Company. Defendant no.1 has not placed any material on record which can show or suggest that plaintiff dispatched the shipment at the instance of M/s. Ezra Trading Company and not booked by defendant no.1 & 2.
In view of the above facts and circumstances, I am of the considered view that M/s. Ezra Trading Company is neither the necessary nor proper party in the present suit. Defendant no.1 has thus failed to discharge the onus of issue No.1, same is accordingly decided against the defendant.
16 Issue No.2 Whether the suit has not been filed by the authorized person? OPD1 Defendant no.1 in the written statement has taken a plea that the suit has not been filed by a duly authorized person. In Para 1 of the plaint, it is mentioned that plaintiff is a company engaged in the business of forwarding of freight by sea and is duly registered with the Registrar of Companies. Sh. Uday Kumar employed as Manager with the plaintiff company is duly authorized to file the present suit vide resolution passed in the meeting of the Board of Directors held on 03.01.2006. On the basis of the said resolution, present suit has been filed by Mr. Uday Kumar.
Suit no. 349/09 8/18 17 In order to substantiate the above plea, plaintiff examined Mr. Uday Kumar as PW1 who reiterated the said fact in Para 1 of his examination in chief. He has also placed on record the certified copy of the certificate of incorporatioin of the plaintiff with the Registrar of Companies Ex.; PW1/1, memorandum and article of association Ex. PW1/2. He has also placed on record the certified copy of the resolution dated 03.01.2006 Ex. PW1/3. During crossexamination, PW1 deposed that he has not brought the minutes book in respect of the board resolution dated 03.01.2006. He denied that no such resolution has been passed by the plaintiff. He further denied that no minutes are maintained by the plaintiff company or that no meeting took place in respect of Ex. PW1/3. Defendant no.1 examined Sh. Prashant Dhingra as DW1.
18 An examination of the material placed on record undisputedly shows that plaintiff is a company duly registered with the Registration of Companies vide certificate of incorporation Ex. PW1/1. Therefore having separate legal entity and can act only through a duly authorized person. The present suit has been filed by Mr. Uday Kumar who has been duly authorized by the board of directors of the plaintiff company vide resolution dated 03.01.2006 Ex. PW1/3. Defendant has not placed any material on record on the basis of which it can be assumed that Mr. Uday Kumar was not duly Suit no. 349/09 9/18 authorized person on behalf of the plaintiff to file the present suit and to make the statement on behalf of the plaintiff.
19 The plaintiff has thus successfully proved on record that the present suit has been filed by a duly authorized person on behalf of the plaintiff. Defendant no.1 has failed to discharge the onus of issue No.2, same is accordingly decided against the defendant. 20 Issue No.3 Whether there is no privity of contract between the plaintiff and defendant no.2? OPD2 The onus to prove issue No.3 is upon the defendant no.2. Plaintiff in Para 2 of the plaint has mentioned that defendant no.2 is engaged in the business of forwarding of freight by sea. It approached the plaintiff for the shipment of consignment belonging to defendant no.1 which consisted 97 pkgs said to contain readymade garments. It is further mentioned that defendants agreed to pay freight related charges. In Para 3, it is mentioned that the consignment under reference was handed over by defendant no.2 for which MTD was issued on 19.02.2005 by the plaintiff company. Defendant no.2 filed its written statement and denied the afore stated averment, however, after filing of written statement, defendant no.2 failed to contest the suit therefore, it was proceeded exparte vide order dated 17.01.2008. Suit no. 349/09 10/18 21 In order to prove the averment made in the plaint, plaintiff examined Sh. Uday Kumar as PW1 who reiterated the afore stated averment in Para 2 & 3 of his examination in chief. The testimony of PW1 with reference to the fact that defendant no.2 handed over the consignment of defendant no.1 to the plaintiff and both the defendants are jointly and severely liable to pay the amount to the plaintiff remained uncontested as defendant no.2 failed to carry out any cross examination of PW1 nor it led any evidence to prove that it was not liable to pay the charges to the plaintiff.
Defendant no.2 has thus failed to prove on record that there was no privity of contract between the plaintiff and defendant no.
2. Defendant has thus failed to discharge the onus of Issue No.3, same is accordingly decided against defendant no.2.
22 Issue No.4 Whether the plaintiff is entitle for decee of Rs.
4,43,960/ alongwith cost and interest as prayed in the plaint? OPP The plaintiff has set up a case that it is engaged in the business of forwarding of freight by sea. Defendant no.2 has approached it for the shipment belonging to defendant no.1 consisted 97 pkgs said to contain readymade garments with the place of destination at Rotterdam(Netherlands). The consignment was handed over by defendant no.2 on behalf of defendant no.1. Plaintiff issued Suit no. 349/09 11/18 MTD(Multimodal Transport Document))vide No. EMUDLH04/0004827 dated 19.02.2005 and the said shipment was sailed on Vessel: Iran Hesabi1246 dated 27.02.2005 from JNPT Port and arrived at its port of destination on 27.03.2005, however, despite the notice of arrival of the shipment to the consignee, he did not cleared the consignment. Plaintiff requested the defendants to clear the consignment and pay the freight and damarrage charges but despite various communications, they failed to do so.
23 On the other hand, defendants have set up a case that although the consignment was booked by the defendant with the plaintiff, however, as agreed between the parties, freight and other charges were payable by the consignee and not by the defendant. 24 In order to prove its case, plaintiff examined Sh. Uday Kumar as PW1. In his crossexamination, PW1 admitted that they have not made any claim against Ezra who was the consignee in India or at Rotterdam. He admitted that according to Ex. PW1/4, all the charges including freight charges etc. were payable by the consignee i.e M/s. Ezra. He volunteered that ultimate responsibility to pay the freight and freight related charges was of the consignee who is the defendant no.1 in the present case and as per the terms and conditions mentioned in the Multimodal Transport Document. He denied that the Suit no. 349/09 12/18 rates at which the invoice Ex. PW1/22 was raised were exorbitant and were not the prevalent rates of the market. He also denied that prevalent rate of ocean freight at the relevant time was 1025 USD. He also denied that the rate of demurrages charges was not 7500 USD. He also denied that they agreed to settle the claim at 2000 Euros against their claim because the amount charges by them were exorbitant. He admitted that their accountant who was maintaining the account in respect of the suit transaction still working with them. He also admitted that there is no agreement with defendant no.1 in writing or otherwise in respect of interest. He volunteered that defendant no.1 is liable to pay all the amount due. He also admitted that the goods which were shipped to Rotterdam are not in existence as of now. He denied that the goods have not been delivered to the consignee. He volunteered that the consignee did not take delivery of the goods. He denied that defendant no.1 is not liable to pay demurrages, freight and other related charges. He also denied that no interest is payable by the defendant no.1. He denied that all the charges were to be paid by the consignee only.
25 Defendant no.1 examined Sh. Prashant Dhingra as DW1. During his crossexamination, DW1 deposed that the document Ex. DW1/4 was not received by them. He further deposed that he cannot remember whether any MTD was issued by them. He can not say Suit no. 349/09 13/18 whether the terms and conditions mentioned in MTD mark B are the same and similar to the MTD issued to them as he does not recollect having received the MTD document. He denied that ultimate liability to pay the amount was of the defendant in case the consignee failed to pay the amount. He admitted that even though they have described the charges claimed by the plaintiff as highly exaggerated, they have not specified any alternate charges which they deemed reasonable. He further stated that they have received letter Ex. PW1/6. He has not sent any reply to the said letter. The letter Ex. PW1/12 has also not been received by them. He denied that the demurrage charges amounting to Rs. 3,30,000/ were payable by them in case the consignee failed to pay the same.
26 The plaintiff has raised twofold claim against the defendants, firstly regarding the ocean freight for the shipment sent through New Delhi to Rotterdam and secondly qua demurrage charges for not lifting the consignment within the stipulated time. 27 It is not in dispute that the consignment was booked by defendants with the plaintiff. PW1 during crossexamination has admitted that as per Ex. PW1/4, all the charges including freight charges etc. were to be payable by the consignee, however, he has volunteered that ultimate responsibility to pay the freight and freight Suit no. 349/09 14/18 related charges was of the consignee i.e defendant no.1. The said statement of PW1 has not been controverted by the defendants by giving contrary suggestion. In the plaint, it has been mentioned that after the receipt of the consignment, plaintiff issued Multimodal Transport Document vide No. EMUDLH04/0004827 dated 19.02.2005 to defendants. The said averment has been admitted by defendant no.1 in Para 3 of the written statement. 28 Before leading evidence to prove its case, plaintiff served a legal notice under Order 12 Rule 8 CPC Ex. PW1/27 upon the defendant to place certain original document vide registered post Ex. PW1/28 & Ex. PW1/29. Vide said notice, defendant no.1 was called upon to produce the bill of Lading (MTD) No. EMUDLH04/0004827 dated 19.02.2005. The defendant no.1 despite the service of the said notice has not produced said document. Consequently, plaintiff has proved the photocopy of the bill of lading Ex. PW1/4 as well as the condition of the said document Mark B. The said document contains various terms and conditions of the shipment. Condition 18(5)of the said document stipulates as under "that the consignor by accepting this Multimodal Transport Document, guarantees and accepts his responsibility towards the carrier for payment of freight in all cases whether freight payable at Origin or Freight Collect at Destination. In case the shipment is lying undelivered at destination within duration of Suit no. 349/09 15/18 45 days or lesser as per the Port or Government regulations prevailing at the destination, it shall be the responsibility of the consignor to pay to the carrier for all dues such as freight amounts, Government dues, demurrages, disposal costs, warehousing costs or any other liabilities or fines imposed by the authorities".
29 A perusal of the aforesaid condition clearly shows that it is the consignor who is ultimately liable to pay the freight and other charges if the same has not been paid by the consignee. It is not the case of the defendant that the freight and other charges were paid by the consignee and therefore they are not liable to pay the said amount. Defendant has taken a plea that it is the sole responsibility of the consignee to pay all these charges and the plaintiff can not recover the said amount from the consignor which is not correct as per condition no. 18(5) of bill of leading Ex. PW1/4. It is not in dispute that plaintiff sailed the shipment at the destination, however, consignee has not lifted the goods despite the notice therefore, plaintiff wrote letter Ex. PW1/6 to both the defendants whereby defendants were called upon to request the consignee to clear the shipment at the destination immediately in order to avoid further storage/demurrage charges and confiscation of cargo. Various communications has been exchanged between the plaintiff and defendants regarding the clearance of the shipment of the payment of the freight and demurrages charges, however, same has not been paid. The defendants have not placed any Suit no. 349/09 16/18 material on record to show that the consignee of the said shipment paid the freight charges for the said shipment to the plaintiff. As per the terms and conditions of bill of lading, it is the consignor who is ultimately liable to pay such charges if not paid by the consignee. Therefore, defendants are liable to pay freight charges of Rs. 1,13,960/ as mentioned in debit note Ex. PW1/20 as well as in the statement of account Ex. PW1/23.
30 The plaintiff has also claimed a sum of Rs. 3,30,000/ towards demurrages charges, however, plaintiff has not placed any material on record to prove that any such charges were paid by the plaintiff to the port authorities on behalf of the consignee or the consignor. Unless and until, plaintiff bring on record sufficient material to show that the demurrages charges were actually paid by it on behalf of the defendants, it can not recover the said amount from the defendants.
In view of the above facts and circumstances, I am of the considered view that plaintiff is entitled to recover ocean freight charges of Rs. 1,13,960/ only from the defendants and not demerrage charges of Rs. 3,30,000/ as claimed by the plaintiff.
Plaintiff has also claimed pendentilite and future interest. The defendants, who were the consignor of the said shipment were liable to pay the ocean freight charges to the plaintiff for the shipment handed over to it, however, they have failed to pay the said amount Suit no. 349/09 17/18 despite various requests, thus withheld legally recoverable charges of the plaintiff without any justification, therefore they are liable to pay interest on it.
31 Taking into consideration the facts and circumstances, I am of the considered view that interest of justice would be served, if plaintiff is awarded interest @ 9% per annum from the date of filing of the suit till its actual realization. In view of the above, I am of the considered view that plaintiff has proved on record that it is entitled to recover freight charges of Rs. 1,13,960/from the defendants alongwith interest @ 9% per annum from the date of filing of the suit till its actual realization. Issue No.4 is accordingly decided.
Relief In view of the above, suit filed by the plaintiff against the defendant is partly decreed. A Decree of recovery of Rs. 1,13,960/ is passed in favour of the plaintiff and against the defendants alongwith interest @ 9% p.a from the date of filing of the suit till its actual realization. Decree sheet be accordingly prepared. File be consigned to record room after due compliance.
Announced in the open court (PITAMBER DUTT)
12th August, 2011 Additional District Judge
Delhi
Suit no. 349/09 18/18
Suit no. 349/09 19/18
Suit No.
Present; None
( PITAMBER DUTT)
ADJ; DELHI
Suit no. 349/09 20/18