Bangalore District Court
) M/S.The Himalaya Drug Company vs M/S.Karnataka Roadlines Pvt. Ltd on 5 April, 2021
Govt.of Karnataka TITLE SHEET FOR JUDGMENT IN SUITS
From No.9(Civil)
Title Sheet for
Judgment in suits
(R.P.91)
IN THE COURT OF THE VI ADDL. CITY CIVIL & SESSIONS JUDGE
AT BENGALURU CITY : (CCCH.11)
Dated this the 5th day of April 2021
PRESENT: Sri. Rama Naik, B.Com., LL.B.,
(Name of the Presiding Judge)
O.S.No :532/2018
PLAINTIFFS 1) M/s.The Himalaya Drug Company
Makali, Tumkur Road
]
Bengaluru -562 123
Reptd.by Power Agent/Subrogee
The Oriental Insurance co. Ltd.,
CBO-I, NR Square
Bengaluru -560 002.
Reptd.by their Div.Manager
2) M/s.Oriental Insurance Co. Ltd.,
CBO-I, NR Square
Bengaluru -560 002
Reptd. by their Div.Manager.
[By Pleader Sri.P.S.Ranganathan]
/Vs/
DEFENDANT M/s.Karnataka Roadlines Pvt. Ltd.,
No.13/1, Rangappa Reddy Complex
(Near Minerva Circle), R.v.Road,
Bengaluru -560 004.
[Exparte]
OS.532/2018
2
Date of Institution of the suit : 19.01.2018
Nature of the Suit : Money suit
Date of commencement of recording
of evidence : 11.02.2021
Date on which the Judgment was
pronounced : 05.04.2021
Year/s Month/s Day/s
Total Duration : 03 02 16
---
(RAMA NAIK)
VI ADDL.CITY CIVIL & SESSIONS JUDGE
BENGALURU CITY
JUDGMENT
This suit is filed by Plaintiffs for recovery of a sum of Rs.53,499/- with interest at the rate of 12% per annum from the date of suit till realization and for costs of the suit.
OS.532/2018 3
2) In brief, Plaintiffs' case is that 1st Plaintiff is a Company and 2nd Plaintiff is a Public Limited Company incorporated under the Companies Act, 1956, having its branch office at Bengaluru. Both are represented by their respective Divisional Managers.
3) It is stated that Defendant is a Private Limited Company incorporated under Companies Act, having its Office at R.V.Road, Bengaluru.
4) It is stated that 1st Plaintiff, in the course of their business, purchased a consignment of 85 Drums of Rhodapon ALS (each 235) from their consignor M/s.Rhodia Specialty Chemical India Ltd., Mumbai to their consignee office at M/s.Naxpar Pharma Pvt. Ltd., Solan, vide Tax Invoice No.108000870 dated 03.06.2014 at Rs.8,47,033.50. Said consignment was entrusted with Defendant at OS.532/2018 4 the Mumbai office for delivery to their consignee office at Solan. Defendant acknowledged the consignment in good order and condition vide Consignment Note No.280765 dated 03.06.2014 and undertook to deliver the same in good order. 1 st Plaintiff had insured the consignment with 2nd Plaintiff vide Policy No.421801/21/2014/32.
5) It is stated that Defendant delivered the consignment in a damaged condition at destination on 10.06.2014, accordingly, a statutory notice of loss was issued to Defendant on 10.07.2014 informing Defendant about the loss and claiming loss amount from them. Defendant issued certificate No.KRL/BN4-2014-15 dated 29.09.2014 admitting damage delivery and value of loss. It is stated that they appointed licensed Surveyors Mr.Sutinder Kumar Sharma, Insurance Surveyors & Loss Assessors to assess the damage suffered by them, who assessed the loss and issued report OS.532/2018 5 No.OIC/Bangalore-Himalaya-M-23/14 dated 02.10.2014.
6) It is stated that on account of damage delivery of consignment, they have suffered loss of Rs.53,499/-. Defendant is liable to pay the value of damage delivered consignment as a common carrier.
7) It is further stated that 1st Plaintiff lodged its claim before 2nd Plaintiff under Policy of Insurance and 2nd Plaintiff indemnified 1st Plaintiff and paid a sum of Rs.53,499/-. Upon such indemnification, 1 st Plaintiff executed a Letter of Subrogation and Special Power of Attorney in favour of 2 nd Plaintiff at Bengaluru by subrogating its rights in favour of 2 nd Plaintiff. By virtue of letter of subrogation as provided under Section 79 of Marine Insurance Act, 2nd Plaintiff is entitled to file and maintain a suit in its own name. But to avoid any technical objection OS.532/2018 6 that may be raised by Defendant, the suit is being filed by Plaintiffs jointly. On execution of Letter of subrogation and special power of attorney, Plaintiffs entrusted the claim papers to their recovery agents M/s.VNC Claims Consultancy, who sent a claim letter dated 10.10.2015 calling upon Defendants to compensate the loss. Defendant did not come forward to amicably settle the legitimate claim, hence, pray for decree in favour of 2nd Plaintiff.
8) Defendant has failed to enter its appearance in spite of service of summons, hence, Defendant has been placed ex-parte in this suit.
9) Point that arises for consideration is :
" Whether Plaintiffs are entitled to the relief as prayed for?"
10) In support of the claim of Plaintiffs, Administrative Officer of 2nd Plaintiff has been OS.532/2018 7 examined as P.W.1 and got marked Exs.P.1 to P.18 in this suit.
11) Heard learned counsel for Plaintiffs. Perused the written arguments and the records.
12) My answer to the above point is in the affirmative for the following :
REASONS
13) By this suit, Plaintiffs claim a sum of Rs.53,499/- from Defendant, contending that the consignment purchased by them was entrusted to Defendant at the Mumbai office for delivery to the consignee office at Solan. Said consignment was insured with 2nd Plaintiff vide Policy No.421801/21/2014/32. Defendant, though acknowledged the consignment in good order and condition vide Consignment Note No.280765 dated OS.532/2018 8
03.06.2014 and undertook to deliver the same in good order, delivered the consignment in a damaged condition at destination on 10.06.2014, which was admitted by Defendant vide certificate No.KRL/BN4-2014-15 dated 29.09.2014. On account of damage delivery of consignment, they have suffered loss of Rs.53,499/-. Defendant is liable to pay the value of damage delivered consignment as a common carrier.
14) It is further stated that 1st Plaintiff lodged its claim before 2nd Plaintiff under Policy of Insurance and 2nd Plaintiff indemnified 1st Plaintiff and paid a sum of Rs.53,499/-. Upon such indemnification, 1st Plaintiff executed a Letter of Subrogation in favour of 2nd Plaintiff at Bengaluru by subrogating its rights in favour of 2nd Plaintiff. By virtue of letter of subrogation as provided under Section 79 of Marine Insurance Act, 2nd Plaintiff is entitled to file and maintain a suit in its own name. But to avoid any OS.532/2018 9 technical objection that may be raised by Defendant, the suit is being filed by Plaintiffs jointly. On execution of Letter of subrogation and special power of attorney, Plaintiffs entrusted the claim papers to their recovery agents M/s.VNC Claims Consultancy, who sent a claim letter dated 10.10.2015 calling upon Defendants to compensate the loss. Defendant did not come forward to settle the legitimate claim.
15) 2nd Plaintiff has examined its Administrative Officer, Mrs.A.Priya, as P.W.1, who has reiterated the plaint averments on oath in her examination-in- chief and has produced Tax Invoice, Excise cum Tax Invoices, Consignment Note, copy of notice, acknowledgment, Certificate of facts, Marine Survey report, Marine Insurance Inland transit claim form, discharge voucher, letter of subrogation, notices, postal receipts, acknowledgments and authority OS.532/2018 10 letter which are marked as Exs.P.1 to P.18 in support of Plaintiffs case.
16) Ex.P.18 authority letter dated 11.02.2021 makes it clear that 2nd Plaintiff had authorized its Administrative Officer, Mrs.A.Priya to appear before the court in this suit, hence, it can be said that 2 nd Plaintiff has been duly represented in this suit. Ex.P.1 is Tax Invoice bearing No.108000870 dated 03.06.2014 for having purchased consignment of 80 drums of Rhodapon ALS (each 235) from their consignor M/s.Rhodia Specialty Chemical India Ltd., Mumbai to their consignee office at M/s.Naxpar Pharma Pvt. Ltd. Solan. Exs.P.2 and P.3 are Excise cum Tax Invoices issued by M/s.Rhodia Specialty Chemical India Ltd., Mumbai, wherein 1st Plaintiff described the consignment which was to be delivered to its office at Solan and also mentioned its value. Ex.P.4 is Consignment Note No.280765 dated 03.06.2014. Ex.P.5 is Notice of claim for OS.532/2018 11 compensation dated 10.07.2014 for value of loss of consignment issued by 1st Plaintiff to Defendant. Ex.P.6 is Acknowledgment. Ex.P.7 is Certificate of Fact dated 20.09.2014 issued by Defendant admitting fact of damage. Ex.P.8 is Survey report. Ex.P.9 is Insurance Transit Claim Form. Ex.P.10 is Discharge Voucher issued by 2nd Plaintiff in full and final settlement of claims arising in respect of loss. Ex.P.11 is letter of subrogation dated 05.01.2015, executed by the 1st Plaintiff subrogating its right, title and interest in favour of the 2 nd Plaintiff. Exs.P.12 and P.15 are claim forms/notices submitted by VNC Claims Consultancy before Defendant claiming a sum of Rs.53,499/-. Exs.P.13 and P.14 are postal receipts for having sent Exs.P.12 and P.15. Exs.P.16 and P.17 are acknowledgment for having received Exs.P.12 and P.15 by Defendant.
17) On perusal of documentary evidence makes it clear that, 1st Plaintiff delivered its consignment to OS.532/2018 12 its Office at Solan vide Ex.P.1 through Defendant Carrier. This has been established at Ex.P.4- Consignment Note. Exs.P.5, P.9 and P.10 establish the fact of loss of consignment to the extent of Rs.53,499/-. Ex.P.8 substantiates the fact that 2 nd Plaintiff, being the insurer of 1st Plaintiff, indemnified the value of loss of consignment to 1 st Plaintiff. Ex.P.11 establishes that the right of 1 st Plaintiff to claim the value of loss of consignment has been subrogated to 2nd Plaintiff. Based on Ex.P.11, 2 nd Plaintiff has filed this suit against Defendant for the value of loss of consignment which amount has already been paid to 1st Plaintiff by 2nd Plaintiff.
18) Here, the question that arises is, whether 1 st Plaintiff can subrogate its right of claim to 2 nd Plaintiff and on the basis of subrogation, 2nd Plaintiff can initiate legal action against Defendant?
OS.532/2018 13
19) At this stage, it is relevant to mention Section 79 of the Marine Insurance Act 1973. Section 79 deals with right of subrogation. It reads as follows :
"(1) Where the insurer pays for a total loss, either of the whole, or in the case of goods of any apportionable part of the subject-matter insured., he thereupon becomes entitled to take over the interest of the assured in whatever may remain of the subject-matter so paid for and he is thereby subrogated to all rights and remedies of the assured in and in respect of that subject-matter as from the time of the casually causing the loss.
(2) Subject to the foregoing provisions, where the insurer pays for a partial loss, he acquires no title to the subject-matter insured, or such part of it as may remain, but he is thereupon subrogated to all rights and remedies of the assured in and in respect of the subject-matter insured as from the time of the casualty causing the loss, in so far as the assured has been indemnified, according to this Act, by such payment for the loss."
20) Section 79 of the Act specifically states that where the insurer pays for a total loss either of a whole or in the case of goods of any apportionable part of the subject matter insured, the insurer is thereupon subrogated all rights and remedies of the assured.
OS.532/2018 14
21) In the case of Economic Transport Organization Vs. M/s.Charan Spinning Mills (P) Ltd.& Anr., [2010 (1) SCC 658], the Hon'ble Supreme Court was pleased to hold as follows :
" Doctrine of Subrogation - Scope and ambit of - 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 assured fully, by reimbursing the entire loss, there will be no equitable assignment of the claim enabling 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 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 authorizes insurer to recover the amount settled and paid by insurer, from the third party wrong-doer as a Subrogee-cum-Attorney-When the Insurer obtains an instrument from the assured on settlement of the claim, whether it will be a deed of subrogation, or subrogation-cum- assignment, would depend upon the intention of parties as evidenced by wording of the document-The title or caption of the document, by itself, may not be conclusive-It is possible that the document may be styled as 'subrogation' OS.532/2018 15 but may contain in addition an assignment in regard to the balance of the Claim, in which event it will be a deed of subrogation-cum-assignment-It may be a pure and simple subrogation but may inadvertently or by way of excessive caution use words more appropriate to an assignment - If the terms clearly show that the intention was to have only a subrogation, use of the words "assign, transfer and abandon in favour of" would in the context be construed as referring to subrogation and nothing more."
22) Principles of law of subrogation enunciated in the above judgment are aptly applicable to the case of Plaintiffs. Hence, in view of Section 79 of the Act and the principles as laid down by the Hon'ble Supreme Court, this Court comes to the conclusion that 2nd Plaintiff is having right to institute this suit for the value of loss or short of delivery of consignment against Defendant.
23) Next question is, as to what extent the Defendant can be liable for the short of delivery of consignment? Admittedly, Defendant is a Carrier. It undertakes to deliver the goods to the destination OS.532/2018 16 which it agrees. Ex.P.4, Consignment Note substantiates this fact. Sections 9 and 10 of the Carriers Act read as follows :
"9. Plaintiffs, in suits for loss, damage, or non-delivery, not required to prove negligence or criminal act - In any suit brought against a common carrier for the loss, damage or non-delivery of [goods including container, pallets or similar article of transport used to consolidate goods)entrusted] to him for carriage, it shall not be necessary for the plaintiff to prove that such loss, damage or non-delivery was owing to the negligence or criminal act of the carrier, his servants or agents.
10. Notice of loss or injury to be given within six months.- No suit shall be instituted against a common carrier for the loss of, or injury to [goods including container, pallets or similar article of transport used to consolidate goods) entrusted] to him for carriage, unless notice in writing of the loss or injury has been given to him before the institution of the suit and within six months of the time when the loss or injury first came to be knowledge of the plaintiff."
24) In this case, Defendant undertook to deliver the consignment to the destination. Under such circumstance, it was its bounden duty to deliver the consignment in good order and condition during the OS.532/2018 17 period of undertaking. If Defendant fails to do so, the liability would be fastened on Defendant to reimburse the value of loss of consignment. Section 9 of the Carriers Act deals with rebuttable presumption of law which states that it shall not be necessary for Plaintiffs to prove that, loss, damage or non-delivery was owing to the negligence or criminal act of the carrier, his servants or agents. As per Section 9 of the Carriers Act, the burden lies upon Defendant to prove that, the loss, damage or non delivery of the goods is not on the part of the Defendant. Under such circumstances, it shall be presumed that the loss of consignment is owing to the negligence of Defendant and therefore, it is liable for the same.
25) Even the Hon'ble Supreme Court was pleased to hold in the case of Economic Transport Organization stated supra that :
OS.532/2018 18 " Consumer Protection Act, 1986 - Section 2(1)(g) - Deficiency" - "Deficiency" means any fault, imperfection, short-coming, or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service."
26) Hence, negligence of Defendant in delivering the consignment in good condition squarely comes under the ratio laid down in the judgment supra.
27) Section 10 of the Carriers Act specifically states that, no suit shall be instituted against the Carrier unless notice in writing has been given to him before institution of the suit within six months of time, when the loss or injury came to the knowledge of Plaintiff. Here, the consignment was sent through Defendant on 03.06.2014, which was received on 04.07.2014 at Plaintiff's destination at Solan. Loss of consignment was brought to the notice of Defendant by Plaintiff on 10.07.2014.
OS.532/2018 19 Same was brought to the notice of Defendant within six days from the date of short of consignment. Hence, it can be said that the suit is filed after due compliance of Section 10 of the Carriers Act.
28) For the foregoing discussion, I am of the opinion that, the damage/short of consignment has been duly proved by Plaintiffs and Plaintiffs have also proved the value of loss of consignment, which was paid to 1st Plaintiff by 2nd Plaintiff and thereby, 1st Plaintiff's right has been subrogated to the 2 nd Plaintiff in accordance with law. Negligence on the part of the Carrier has also been proved and in this circumstance, presumption of negligence shall be drawn in view of Section 9 of the Carriers Act against the Carrier. Moreover, Plaintiffs have brought this suit after complying with the provisions of Section 10 of the Carriers Act. In view of statutory right of subrogation, Plaintiff No.2 is entitled to claim the amount from Defendant with 12% interest per OS.532/2018 20 annum. Accordingly, I answer the above point in the affirmative and proceed to pass the following :
ORDER (1) Suit of Plaintiffs is hereby decreed with costs.
(2) Defendant is hereby directed to pay a sum of for Rs.53,499/- (Rupees Fifty-three Thousand Four Hundred and Ninety-nine Only) to the 2nd Plaintiff with interest at 12% per annum from the date of suit till realization.
(3) Draw decree accordingly.
(Dictated to the Judgment Writer directly on computer, typed matter corrected and then pronounced by me in open court, on this the 5th day of April 2021) (RAMA NAIK) VI Addl.City Civil & Sessions Judge Bengaluru City OS.532/2018 21 ANNEXURE I. List of witnesses examined on behalf of :
(a) Plaintiffs side :
P.W.1 - Mrs.A.Priya, dtd.11.02.2021
(b) Defendant's side : N I L II. List of documents exhibited on behalf of :
(a) Plaintiffs side :
Ex.P.1 Tax Invoice dtd.03.06.2014 Ex.P.2 Excise cum Tax Invoice dtd.03.06.2014 Ex.P.3 Excise cum Tax Invoice dtd.03.06.2014 Ex.P.4 Consignment Note dtd.03.06.2014 Ex.P.5 Office copy of Notice dtd.10.07.2014 Ex.P.6 Acknowledgment Ex.P.7 Certificate of Fact issued by Karnataka Roadlines Pvt. Ltd. Dtd.20.09.2014 Ex.P.8 Marine Survey Report Ex.P.9 Marine Insurance Inland Transit claim form Ex.P.10 Discharge voucher Ex.P.11 Letter of Subrogation dtd.05.01.2015 Ex.P.12 Notice dtd.10.10.2015 issued by VNC Claims Consultancy Ex.P.13 Postal Receipts - 2 Nos and Ex.P.14 Ex.P.15 Notice dtd.10.10.2015 issued by VNC claims Consultancy OS.532/2018 22 Ex.P.16 Acknowledgments - 2 Nos and Ex.P.17 Ex.P.18 Authority Letter dtd.11.02.2021 isused by Plaintiff No.2
(b) Defendant's side : N I L
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VI Addl.City Civil & Sessions Judge Bengaluru City.