Bangalore District Court
The Himalaya Drug Company Limited vs Mahaveera Transport Pvt Limited on 28 February, 2024
1 O.S.No.6216/2016
KABC010198362016
IN THE COURT OF THE XII ADDL. CITY CIVIL JUDGE,
AT BENGALURU
Dated this the 28 th day of February, 2024
PRESENT: SRI. GANGADHARA.K.N., B.A.,LLM.,
XII ADDL.CITY CIVIL & SESSIONS JUDGE
(CCH.No.27), BENGALURU
O.S.No .6216/2016
PLAINTIFFS : 1. M/s. Himalaya Drugs Co., Ltd.,
Bengaluru 562 123.
R/by subrogee/power agent
M/s. Oriental Insurance Co., Ltd.,
No.221, 1st Floor,
India Mutual Building,
N.R.Square, Bengaluru 560 002.
R/by Divisional Manager,
H.B.Shivakumar,
aged about 58 years.
2. M/s.Oriental Insurance Co. Ltd.
No.221, 1st Floor,
India Mutual Building,
N.R.Square, Bengaluru 560 002.
R/by Divisional Manager,
H.B.Shivakumar,
aged about 58 years.
(By Sri. P.S.R. Advocate)
2 O.S.No.6216/2016
VS.
DEFENDANT: Mahaveera Transport Pvt. Ltd.,
H.O. C-1/14, II Floor,
Behind Ambika Society,
Prashanth Vihar,
Delhi - 110 085.
R/by its Manager,
(By Sri.R.A.N. Advocate)
Date of Institution of the : 25/8/2016
suit
Nature of the suit : Money Suit
Date of commencement of : 10/8/2022
recording of the evidence
Date on which the : 28/02/2024
Judgment was
pronounced
Total Duration Years Months Days
08 06 03
(GANGADHARA.K.N.)
XII ADDL.CITY CIVIL & SESSIONS JUDGE
BENGALURU CITY
JUDGMENT
The plaintiffs have filed the suit for recovery of Rs.75,000/- with future interest @ 12% p.a.
2. The brief facts of the plaintiff's case is as 3 O.S.No.6216/2016 follows;
3. The plaintiffs contention is that, plaintiff No.1 is into business of Pharmaceuticals and plaintiff No.2 is the Public Limited Company, incorporated under the Companies Act., 1956, who is a general insurer having registered office at Delhi and divisional office at Bengaluru. Their contention is that, the defendant is a common carrier for reward, who is also a Private Limited Company, having head office at Delhi and branch office at Bengaluru.
4. The 1st plaintiff during the course of their business dispatched a consignment of empty plastic tubes 34 mm 45600 boxes with master card board paper, covered under the invoices bearing Nos.0671 valued at Rs.284337/-, invoice No.0972 valued at Rs.513504/- an invoice No.668 valued at Rs.513504/-, all dated 7/8/2013 from Noida to Hyderabad, which is the office of the consignee. The consignment were packed securely in 4 O.S.No.6216/2016 a good order and condition, entrusted with the defendant common carrier for safe carriage and delivery at the destination. For booking of consignment with the defendant, who had issued consignment notices No.4215921 and 4215919, both dated 7/9/2013. On the said product, the plaintiff No.1 insured with the plaintiff No.2 under policy bearing No.421801/21/2013/29. But, the defendant delivered the consignment in a damaged condition, which is against to the undertaking. In this regard the plaintiff got issued notice of loss on 24/8/2013, to that effect defendant issued two damage certificates dated 21/11/2013. Thereafter the plaintiffs have appointed one Sri. Bodapati Srinivasa Rao, who is an independent licensed surveyor to assess the loss, who issued the report vide reference No.9495-BSR-08-2013 dated 11/9/2013 by assessing the loss. Due to the damage, the plaintiff suffered loss of Rs.1,08,855.96. But, the plaintiff No.2 being the insurer had settled 5 O.S.No.6216/2016 Rs.75,000/- vide bill dated 23/12/2013. To that effect the plaintiff No.1 executed the letter of subrogation and Special Power of Attorney in favor of plaintiff No.2 to file suit against the defendant herein to recover the said amount settled in favor of plaintiff No.2 as provided under Section 79 of the Marine Insurance Act.
5. After service of suit summons the defendant appeared, filed his written statement admitting that they are common carriers with whom the plaintiff No.1 booked a consignment as contended in the plaint to deliver the same in a safe manner. But the said material got damaged during the transit, which happened naturally. In fact, the defendant had taken all proper measures to deliver the consignment in a safe condition. They admitted that the plaintiff No.1 insured the consignment with plaintiff No.2. They admitted issuance of two damage certificates stating the quantum of loss suffered by the plaintiff and they admitted that the plaintiff No.2 6 O.S.No.6216/2016 might have settled Rs.75,000/- against to the total loss. But, they denied that just because of issuance of damage certificate, it does not mean it amounts to admission on their negligence in transporting the consignment or admitting the loss or damage. In fact, they contended that they have transported the consignment at owner's risk. The plaintiff No.1 had insured the said consignment with plaintiff No.2 by paying the huge amount as premium to cover the risk. Accordingly, plaintiff No.2 had settled. Thus it is the defendant is not liable to pay the said amount to the plaintiff No.2 herein. Further contended that the plaintiffs have suppressed the true facts that, as per the consignment note, it is the Court at Delhi has the jurisdiction and in fact, in the said clause there is an arbitration clause. Thus this Court both on the subject matter and on territorial has no jurisdiction to adjudicate the dispute. Thus prayed to dismiss the suit.
7 O.S.No.6216/2016
6. By considering the pleadings of the parties this court was pleased to frame the following issues.
1. Whether plaintiff proves that it is entitled to recover sum of Rs.75,000/- from the defendant?
2. Whether plaintiff proves that it is entitled for interest at the rate of 11% p.a. from the date of the suit till realization?
3. Whether defendant proves that suit of the plaintiff is not maintainable in view of the Arbitration clause?
4. Whether the defendant proves that plaintiff is not entitled for suit claim?
5. What order or decree?
7. The issue No.3 was treated as preliminary issue. On which this Court after hearing the parties was pleased to hold it as negative. Thus this Court is duty bound to answer only on issue No.1, 2, 4 and 5. 8 O.S.No.6216/2016
8. The defendant in his written statement contended that, as per the consignment note issued by the defendant, it is both the plaintiff No.1 and defendant have agreed that the Court at Delhi alone had the jurisdiction to adjudicate the suit. Considering the same, this Court felt, it is proper to frame the additional issue on the jurisdiction. Thus the following additional issue is framed for adjudication :-
Addl. Issue no.1:
Does the defendant proves that thisCourt has no jurisdiction to adjudicate the suit, thus the same is to be dismissed?
9. The plaintiff No.2 in order to prove their case examined its official as PW.1, produced in all 12 documents which were marked as Ex.P.1 to 12. The authorized person of defendant Company was examined as DW.1 and produced in all 4 documents in support of his case, which were marked as Ex.D.1 to 4.
10. Heard the arguments of learned counsel for the 9 O.S.No.6216/2016 plaintiffs and defendant
11. My findings on the above said issues are as follows :-
Issue No.1: In the affirmative Issue No.2: In the affirmative Issue No.3: This issue has been dealt as preliminary and hold it as negative. Issue No.4: In the negative Additional Issue: In the negative Issue No.5: As per final order, for the following:-
REASONS
12. Issue No.1, 2 & 4: Since all these issues are interconnected, thus they are taken up for common discussion.
13. Before adverting on the disputed facts, it is proper to culled out the admitted facts in this case. It is not in dispute that the plaintiff No.1 is into Pharmaceutical business and the plaintiff No.2 is the insurer which is a Public Limited Company and the 10 O.S.No.6216/2016 defendant is a common carrier for reward, who is also a Private Limited Company.
14. It is not in dispute that, plaintiff No.1 dispatched a consignment of empty plastic tubes 34 mm 45600 boxes with master card board paper which were packed in a good order and entrusted in a good condition to the defendant to deliver the same to the consignee under the invoices bearing Nos.0671 valued at Rs.284337/-, invoice No.0972 valued at Rs.513504/- an invoice No.668 valued at Rs.513504/-. To that effect, even the defendant issued consignment notices bearing No.4215921 and 4215919, both dated 7/9/2013. To that effect even the plaintiff produced the tax invoices at Ex.P1, P2 and P3.
15. It is the plaintiff No.1 had insured the consignment with the plaintiff No.2. It is not in dispute that the consignment were packed in a good condition, the defendant is obligated to deliver the said goods to the 11 O.S.No.6216/2016 consignee in a safe and secured manner, without causing any damage. To that extent even the defendant has admitted that they are bound to deliver the goods in safe manner. But the defendant had delivered the goods in a damaged condition. To that effect the defendant thselves have issued the damage certificate as per Ex.P6 and P7 dated 21/11/2013 stating that the worth of damage comes of Rs.63,047 and Rs.48,147/- which comes of Rs.1,11,194/-.
16. It is not in dispute that the plaintiff No.1 appointed independent licensed surveyor Sri. Bodapati Srinivasa Rao to assess the total loss, who by assessing the damage caused to the consignment, issued the report as per Ex.P9. According to which the value of the damaged goods comes of Rs.1,11,152/-, which is as per Ex.P9.
17. It is also not in dispute that against to the loss of 1,11,194/- assessed by the defendant himself and 12 O.S.No.6216/2016 against to the loss assessed by the expert as per Ex.P9 of Rs.1,11,152/-. However, the plaintiff No.1 agreed to receive Rs.75,000/- as full and final settlement from the insurer - plaintiff No.2 who settled the said amount as per Ex.P10. To that effect issued the discharge voucher as per Ex.P11 and after receipt of Rs.75,000/- from the plaintiff No.2, the plaintiff No.1 herein had executed the letter of subrogation in favor of plaintiff No.2 to recover the amount settled under Ex.P11 from the defendant carrier. These aspects are undisputed.
18. What is disputed is that, defendant has vehemently contended that they have transported the consignment at owner's risk and they were diligent and vigilant in transporting the goods. But, somehow in a natural wear and tear, the goods have got damaged. Though they have issued the damage certificate in favour of plaintiff No.1, which do not mean that the defendant had acknowledged his negligence or liable to pay the 13 O.S.No.6216/2016 value of the damaged goods described under Ex.P6 and P7. He also further contended that the plaintiff No.1 executed the subrogation in favor of plaintiff No.2, thus the plaintiff No.2 had no right to recover the said amount from the defendant. This aspect of the defendant cannot be accepted for the reason that the Hon'ble High Court of Madras in Patel Roadways Ltd., (formerly Patel Roadways Pvt. Ld.,) Bombay V/s. Seshasayee Industries Ltd., had held as follows :-
. Carriers Act, 1865, Section 9 - Driver of truck parked truck on road side and did not take proper care - Truck overturned and goods were damaged - Accident occurred on account of negligence of driver and it cannot be termed as act of god - Principles of owner's risk will not apply - Person whose goods were damaged in such accident need not prove that goods were damaged on account of negligence of carrier even if goods were sent at owner's risk.
19. If that aspect is considered, even though if the 14 O.S.No.6216/2016 goods were transported at owners risk, if the said goods were damaged, on account of negligence on the carrier, then it is the carrier is obligated to compensate the value of the goods.
20. The defendant further contended that the plaintiff No.2 is the insurer, who had received the huge premium from the plaintiff No.1 and he is obligated to settle the worth of damaged goods to the plaintiff No.1, who has no right to claim the said amount on the ground of subrogation. The Hon'ble Apex Court in Economic Transport Organization, Delhi V/s. Charan Spinning Mills Pvt., Ltd., and another reported in (2010) 4 SCC 114 held as follows :-
(F) Obligations Law - Subrogation -
Equitable right of subrogation - Accrual of and its effects - Held, it arises by automatic operation of law without any need for evidence in writing when insurer settles claim of assured
- Insurer then sands in the shoes of insured 15 O.S.No.6216/2016 and can exercise rights of latter against wrongdoer in the name of insured - Restitution
- Subrogation.
(J) Insurance - Generally - Contract of insurance - Nature of implied "subrogation" of insurer under - Held, contract of insurance is a contract of indemnity - Whether insurer pays to insured value of goods lost due to negligence of a third party, held, rights and remedies of insured against such third party stand transferred to an vested in insurer - Such equitable assignment of rights and remedies of insured in favour of insurer, implied in contract of indemnity is known as "subrogation" - Marine Insurance Act, 1963.
21. As per the said guidelines, the insurer by paying the value of the damaged goods step into the shoes of an insured and the has got subrogation, which is a contract. Thus they are entitled to sue against the carrier. In this regard, this Court would like to rely upon the decision of the Hon'ble High Court of Madras in Bond Food Products Pvt. Ltd., and another V/s. M/s. 16 O.S.No.6216/2016 Planters Airways Ltd., reported in AIR 2004 MADRAS 538, wherein it is held as under :-
A) Carriers Act (3 of 1865), S.8 - Liability of carrier - Damages to consignment - Recovery of compensation paid by insurer - plaintiff entrusted insured consignment to carrier for transportation of same from place B to C -
During transit, due to accident said consignment was damaged - No notice was given by insurer to carrier before appointing surveyor to assess damages - On report of said surveyor, compensation amount was plaid by insurer to plaintiff - plaintiff executed letter of subrogation in favour of insurer to lay suit for recovery of amount paid as compensation - Therefore, plaintiff and insurer are entitled to claim damages from carrier - Carrier liable to indemnify loss.
17 O.S.No.6216/2016
22. If the above guidelines are perused, no-doubt, that if the carrier has caused damages on which, if the said product is being insured, if the insurer settle the amount in favor of insured, in that event both the insurer and the insured are entitle to recover the damages from the carrier, who is liable to indemnify the loss. Thus the contention of the defendant cannot be accepted. The defendant alleged that they transported consignment with due diligence but, the damages have caused in its natural course, as it was transported at the owner's risk. For any damages it is the carrier is not liable to compensate the consignor cannot be accepted. Thus this Court is of the opinion that the plaintiff No.2 is entitled to file a suit for recovery of Rs.75,000/- which is the amount settled in favor of plaintiff No.1. Thus the defendant is liable to pay the said value of Rs.75,000/-.
23. With regard to the interest @ 11% p.a. is concerned, the amount claimed by the plaintiff No.2 is 18 O.S.No.6216/2016 against to the commercial contract, for which the defendant is liable to refund the suit claim with interest. But, though the defendant has contested heavily in the matter, but has not taken contention as to why they are not liable to pay 12% interest. In fact, the plaintiff No.2 has settled the suit claim in the year 2014 itself. The suit being filed in the year 2016. There is a delay in making the payment on the part of the defendant herein. However, this Court is of the opinion by considering the nature of transaction held between the plaintiff No.1 and 2, if this Court felt if the defendant is directed to pay the suit claim along with interest @ 9% p.a. that would meets the ends of justice. Accordingly, I answer issue No.1 in the affirmative, issue No.2 partly in the affirmative and issue No.4 in the negative.
24. Additional Issue : The defendant all along the suit has contended that under the consignment receipt both the plaintiff and defendant have agreed that if any 19 O.S.No.6216/2016 dispute arise out of the consignment receipt the suit shall be initiated within the jurisdiction of Delhi. To that effect there is no dispute.
25. But, herein the plaintiff No.1 after receipt of the insured amount against the damaged goods from the plaintiff No.2 had filed the present suit before this Court. Though the plaintiff No.2 alone entitled to file the suit, but to take the extra precautionary for avoiding any inconsistent stand from the defendant, they have impleaded the consignor as the plaintiff No.1. Firstly the parties by way of contract they cannot exclude the jurisdiction of any of the Court. Secondly, it is a suit for recovery. In that event, Section 19 of C.P.C. will come into operation. Where the defendant residents or part of of the cause of action taken place.
26. Admittedly the plaintiffs and defendant are having offices at Bengaluru. Secondly, the plaintiff No.2 who is insured had the divisional office in Bengaluru, 20 O.S.No.6216/2016 who had right to initiate this suit within the jurisdiction of this Court. To that effect this Court would like to rely on the decision of Hon'ble High Court at Madras in Ravichandra Transports Vs. United India Insurance Co., ltd., wherein held as follows :-
Civil Procedure Code (V of 1908), Sec.20(c)
- Marise Insurance Act, (XI of 1963), Secs. 2(1) and 4(2) and Explanation - Maintainability of suit - Gods entrusted to carrier at Mettur, place of destination being Bengaluru - Goods were insured with plaintiff, whose office was located at Madras - Letter of Subrogation executed at Madras and attested by Notary at Madras - Suit by plaintiff against carrier was maintainable at Madras.
27. Even the Hon'ble High Court of Madras in Bond Food Products Pvt. Ltd., & another Vs. M/s. Planters Airways Ltd., held as follows :-
(C) Civil P.C. (5 of 1908) S.9, S.20(c) -
Jurisdiction of Court - Cause of action - plaintiff 21 O.S.No.6216/2016 entrusted suit consignment to defendant to transport same from place 'B' to 'C' after insuring same at 'M' - Said consignment was damaged during transit - On report of surveyor appointed by insurer, compensation amount was paid by insurer to plaintiff at 'M' - In consideration of dame, letter of subrogation was executed by plaintiff in favour of insurer to lay suit for recovery of amount paid - Therefore, part of cause of action arose within jurisdiction of trial Court at 'M' - In circumstances said Court has jurisdiction to try suit.
28. As the insurer who had got the letter of subrogation have the right to initiate the suit within the jurisdiction where the letter of subrogation has been executed or where they are functioning. Considering this fact, this Court has jurisdiction to adjudicate the suit in hand. Thus I answer additional issue in the negative.
29. Issue No.5: In view of my findings on the aforesaid issues, the plaintiffs have proved their case which deserves to be decreed in part. Accordingly I proceed to pass the following :-
22 O.S.No.6216/2016
ORDER The suit of the plaintiffs is allowed in part with cost.
The defendant is liable to pay Rs.75,000/- with interest @ 9% p.a. from the date of filing of the suit to till its realization, to the plaintiff No.2.
Directed the defendant to pay the decretal amount within 60 days from today.
Office is to draw the decree accordingly. (Dictated to the Stenographer, transcript thereof corrected, signed and then pronounced by me, in open Court, on this the 28 th day of February, 2024 (GANGADHARA.K.N.) XII ADDL.CITY CIVIL & SESSIONS JUDGE BENGALURU CITY ANNEXURE I. List of witnesses examined on behalf of:
(a) Plaintiffs' side :
P.W.1: A. Priya
(b) Defendant's side :
DW.1: Arun B.
23 O.S.No.6216/2016
II. List of documents exhibited on behalf of :
(a) Plaintiffs' side :
Ex.P.1 Tax invoice dated 6/8/2013
Ex.P.2 Tax invoice dated 7/8/2013
Ex.P.3 Tax invoice dated 7/8/2013
Ex.P4 Office copy of the letter dt. 24/8/2023
Ex.P.5 Postal acknowledgment
Ex.P.6 Damage certificate dated 21/11/2013
Ex.P.7 Damage certificate dated 21/11/2013
Ex.P.8 Claim Bill
Ex.P.9 Marine survey report
Ex.P.10 Claim form
Ex.P.11 Discharge voucher
Ex.P.12 Letter of subrogation
(b) Defendant's side :
Ex.D.1 Consignment note
Ex.D.2 Consignment note
Ex.D.3 S.P.A. dated 6/3/2023
Ex.D.4 Board resolution dated 6/9/2021
Digitally signed by
GANGADHARA K N
DN: cn=GANGADHARA K
N,ou=HIGH COURT OF
XIIGANGADHARA
ADDL.CITY CIVILKARNATAKA,o=HIGH
& SESSIONS
COURT OF
KN JUDGE, BENGALURU CITY.
KARNATAKA,st=Karnatak
a,c=IN
Date: 2024.03.11 13:12:37
IST