Muhammadi Steamship Co. v. Keserishih Vallabdas — 1955 DIGILAW 168 (KER)

JUDGMENT : N. Varadaraja Iyengar, J. This second appeal is filed by defendants 1 and 2 in a suit for compensation for non-delivery of goods by a carrier. 2. The facts may be shortly stated as follows: The Industrial Leather Company Limited, Bombay, shipped from Bombay to Cochin Port a consignment of five bundles of leather goods valued at Rs. 1,039-8-0 on board the ship “S.S. Mount Kyllene” belonging to the 1st defendant Steamer Company in the month of August 1948. On the arrival of the steamer at Cochin Port and the unloading of the cargo the plaintiff’s agents Sitaram Warehouse, Mattancherri, were informed by the 2nd defendant who was the local agent of the 1st defendant that the goods had arrived. Thereupon the plaintiff’s agents handed over the shipping documents and got the delivery order Ext. A on 21st January 1948 from the 2nd defendant. The goods were however not delivered on presentation of the delivery order. The plaintiff then forwarded a bill for the value of the goods and freight with 10 per cent added towards damages and incidental charges. On this the defendants wanted time to investigate but ultimately, after a good deal of correspondence, on 23rd February 1950, plaintiff was informed that his claim in respect of the goods stood rejected because it had been made too late. According to the plaintiff the defendants had been taking time on false pretext and prevented him from seeking remedy earlier. The suit was therefore laid on 5th April 1950 as for compensation for non-delivery of goods and as against both the defendants 1 and 2. 3. Defendants 1 and 2 contested the suit. The 1st defendant rested his defence mainly on a plea of limitation. According to him the goods ought to have been delivered as soon as the ship had arrived at Cochin Port on 6th September 1948. The cause of action for damages for non-delivery should therefore be deemed to have arisen on such date. The suit brought by plaintiff more than one year later must accordingly be held to be barred. Contention was also raised that the plaintiff was not entitled by way of loss of profit to the extent of Rs. 109-2-0 claimed in the plaint. The 2nd defendant denied liability because he was only an agent of the 1st defendant in the whole matter. 4. Contention was also raised that the plaintiff was not entitled by way of loss of profit to the extent of Rs. 109-2-0 claimed in the plaint. The 2nd defendant denied liability because he was only an agent of the 1st defendant in the whole matter. 4. The trial court decreed the suit as prayed for and this decree has been confirmed by the District Court in appeal by the defendants. Hence this second appeal. 5. The points that arise for consideration are: (i) whether the plaintiff had lost his remedy by lapse of time; (ii) whether the plaintiff’s claim for loss of profits was not maintainable; and (iii) whether the 2nd defendant should have been exonerated from liability. 6. Mr. Rama Iyer, learned Counsel for the special appellants took the first point in this way. The bill of lading which evidenced the contract of carriage in the case incorporated by reference all the terms, provisions and conditions of the Indian Carriage of Goods by Sea Act, XXVI of 1925, and the Schedule thereto. The 1st defendant carrier was in consequence entitled to the benefit of the immunity contained in paragraph 6 of Art. III of the Schedule to the Act, viz., “In any event the carrier and the ship shall be discharged from liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered.” The date when the goods ought to have been delivered within the meaning of this clause could not under any circumstance, go beyond 9th September 1948 when the ship left the Cochin Port. Plaintiff’s claim by way of suit was only on 5th April 1950 and therefore he could not have any remedy. Alternatively and assuming Art. 31 of the Limitation Act applied the terminus a quo must be computed from the date when the goods ought to have been delivered which again was 9th September 1949 at the latest and this was so irrespective of the correspondence that ensued between the parties after that date, and the suit would then have to be held to be barred by limitation. 7. It should however be noticed at the outset that the bill of lading on the contents of which learned Counsel relies has not been filed in the case by either of the parties. 7. It should however be noticed at the outset that the bill of lading on the contents of which learned Counsel relies has not been filed in the case by either of the parties. The plaintiff was no doubt summoned by the defendants to produce the relative bill of lading and did not produce it. But his explanation was that it had been given over to the 2nd defendant in exchange for Ext. A delivery order and it was rather an abuse of process to ask him to produce it. There is no reason way this explanation should not be accepted. Indeed this aspect of exchange had been made clear in the plaint itself and the written statement had not said anything about it. Mr. Rama Iyer then argued that it is possible to infer the contents of the bill of lading and referred us in this connection to a number of other bills of lading issued by the 1st defendant company in connection with the same voyage. These documents would seem to have been produced before the learned Judge in the lower court also but he had refused to entertain them. We do not also find our way to accept this argument. For obviously these other documents cannot properly be referred to determine what exactly were the terms and conditions of the contract of carriage in the instant case. Mr. Rama Iyer finally said that the immunity relied on must be deemed to be statutorily incorporated into every bill of lading by the very force of the enactment of the Indian Carriage of Goods by Sea Act, 1925, and he referred us to the wording of S. 4 of the Act. This argument also is, in our opinion, unsustainable. 8. S. 4 of the Indian Carriage of Goods by Sea Act says: “Every bill of lading, or similar document of title, issued in India which contains or is evidence of any contract to which the rules (the rules set out in the Schedule to the Act) apply, shall contain an express statement that it is to have effect subject to the provisions of the said rules as applied by this Act.” It appears to us that the section is perfectly clear and cannot support the position taken up by learned Counsel. We may also refer in this connection to the decision of the Privy Council in Vita Food Products Inc. v. Unuz Shipping Co., 1950 AC 277. The question there was as to whether a bill of lading which did not contain a statement as required by the section corresponding to S. 4 in the Indian enactment, viz., that it is to have the effect subject to the provisions of the said rules as applied by that Act was invalid on that account or whether it was the document alone which can have the relationship between the parties as distinct from the exemptions and immunities granted by the statute. Lord Wright delivering the judgment of the Judicial Committee held that the disobedience of the terms of S. 4 of the Carriage of Goods by Sea Act did not render the bill of lading illegal but that the instrument alone governed the relationship and not the provisions of the statute. A similar view was expressed by the same learned Lord in the subsequent case of Canada and Dominion Sugar Co. Ltd. v. Canadian National (West Indies) Steamships, Ltd. AIR 1947 PC 40 . Dealing with R. 3 of the Carriage of Goods by Sea Act the learned Lord after referring to the previous case Vita Food Products Inc. v. Unuz Shipping Co. 1939 AC 277: “There is indeed no law which prevents goods being carried at sea without any bill of lading at all or makes any particular form of bill of lading obligatory.” There is again the recent case in Province of Madras v. I.S. & C. Machado AIR 1955 Mad. 519 , where also it was held following the Privy Council Decisions above mentioned, that the provisions of the rules embodied in the Schedule to the Indian Carriage of Goods by Sea Act did not apply proprio vigore to all contracts of carriage by sea, but only in cases where a bill of lading has been issued incorporating the provisions of the Act. (See page 521 of the report). It follows therefore that there is no rule of law by which the bill of lading issued by the 1st defendant in connection with carriage of the goods in this case, could be held to have incorporated the rules, set out in the Schedule to the Indian Carriage of Goods by Sea Act, 1925. 9. It follows therefore that there is no rule of law by which the bill of lading issued by the 1st defendant in connection with carriage of the goods in this case, could be held to have incorporated the rules, set out in the Schedule to the Indian Carriage of Goods by Sea Act, 1925. 9. Even assuming that the Schedule to the Carriage of Goods by Sea Act had been incorporated in the bill of lading by way of reference or by force of law still the question would be what is the date when the goods “should have been delivered” within the meaning of Paragraph 6 of Art. III of the Schedule so as to calculate the one year therefrom within which the suit should be brought. This, in our judgment, is practically the same question which arises for consideration under Art. 31 of the Limitation Act which we are going to take up presently. Learned Counsel however referred to three cases Shakoor v. Hinde & Co. (AIR 1932 Bom. 330), Haji Shakoor Gany Firm v. Volkart Bros. (AIR 1931 Sind 124), and Haji Shakoor Firm v. Volkart Brothers, Firm (AIR 1937 Sind 11), in support of the proposition that under Art. 3 paragraph 6 of the Carriage of Goods by Sea Act the period of one year must be reckoned from the date of the unloading of the ship at the port of destination and cannot admit of extension on any ground. 10. The case in Shakoor v. Hinde & Co. (AIR 1932 Bom. 330) arose out of non-delivery of certain goods carried by sea, at the port of Bombay and the effect of the incorporation of the provisions in the bill of lading of the English Carriage of Goods by Sea Act was considered. The ship berthed in the Port on the 4th of May 1929 and was completely discharged on 8th of May 1929. The plaintiffs sued on 27th June 1930 to recover the value of goods short delivered to them. It was held that the effect of the incorporation of the provisions in the bill of lading was that the rights of the plaintiff were extinguished in respect of the claim which was made after one year as above. It is noteworthy that the only contest raised in the case was that the limitation of time introduced by the Cl. It was held that the effect of the incorporation of the provisions in the bill of lading was that the rights of the plaintiff were extinguished in respect of the claim which was made after one year as above. It is noteworthy that the only contest raised in the case was that the limitation of time introduced by the Cl. 6 of Art. III within which the plaintiffs had to enforce their right was void under S. 28 of the Contract Act. The plaintiffs had no doubt raised a contention that the claim was not barred by limitation by reason of certain acknowledgment of liability but no argument had been submitted on the basis of that allegation. That case only decided that by the incorporation of Art. III Cl. 6 into the bill of lading the rights of the holders were extinguished in respect of the claim as made and as the plaintiffs had no rights to enforce there was no question of the remedy being barred and S. 28 of the Contract Act did not assist the plaintiffs. Haji Shakoor Gany Firm v. Volkart Bros. (AIR 1931 Sind 124), arose out of a failure of the same carriers and during the course of the same voyage as were involved in the 1932 Bombay case just cited, to land certain other consignments at the Port of Karachi. The ship had landed a part of the cargo intended for Karachi between 29th April 1929 and 2nd May 1929 and then proceeded to Bombay. There also the suit had been filed more than a year later and the delay was sought to be got over on the basis of S. 28 of the Contract Act as in the Bombay case and with the same result. The case in Haji Shakoor Firm v. Volkart Bros. (AIR 1937 Sind 11) is only the appellate judgment in the case reported in Haji Shakoor Gany Firm v. Volkart Bros. (AIR 1931 Sind 124), above mentioned and affirming it. These decisions are not therefore of any help for deciding the exact date on which the goods “ought to be delivered” when special circumstances have intervened and are pleaded as affecting the question. 11. It is interesting at this stage to note the treatment of this subject in Carver’s Carriage of goods by sea, 9th edition. These decisions are not therefore of any help for deciding the exact date on which the goods “ought to be delivered” when special circumstances have intervened and are pleaded as affecting the question. 11. It is interesting at this stage to note the treatment of this subject in Carver’s Carriage of goods by sea, 9th edition. Dealing with the corresponding provision in the Carriage of Goods by Sea Act, 1924 (14 and 15 George V, Chapter 22) it is said at page 189: “A goods owner will lose any remedy he has against the carrier unless he issues a writ against him within one year, or the carrier waives that requirement” (the underlining is ours), and the analogy of clauses limiting time for making claims contained in bills of lading is referred to by the learned author in support of the position. In respect of such clauses it had been held that the party against whom the claim is made may elect to waive such a clause, or the parties may by consent enlarge the stipulated time. See Palmer v. Metropolitan Ry. (1862) 31 LJQB 259). (Vide foot-note No. 13 at page 149 of Carver). We hold therefore that there is no substance in the argument of learned Counsel that by reason of a condition, express or implied, in the bill of lading issued by the 1st defendant in connection with the instant contract of carriage, the plaintiff’s remedy by way of compensation for non-delivery is any way lost. 12. This leads us on to the consideration of the question of limitation under Art. 31 of the Limitation Act. The question as to what is the starting point of limitation in a case of this kind came up for consideration recently before this Court in the case reported in Union of India v. Essack 1956 KLT 40 = ILR 1954 T-C. 298. After an exhaustive review of various cases bearing on the subject, Mr. Justice Joseph Vithayathil delivering the judgment on behalf of the Bench laid down that the question depended in the first instance upon whether there was a contract between the parties as to the date of the delivery of the goods. If there was such date fixed under the contract then that will be the date on which the goods ought to be delivered for purpose of Art. 31. If there was such date fixed under the contract then that will be the date on which the goods ought to be delivered for purpose of Art. 31. If there was no such contract the period of one year should be calculated from the expiry of a reasonable time within which the goods ought to have been delivered having regard to the circumstances of the case and the conduct of the parties. In that case, portion of the goods comprised in the contract of carriage was delivered to the plaintiff on the 23rd October 1944. On the 8th February 1945 the plaintiff sent his claim to the railway company which was the carrier in the case for the value of certain bags short delivered. On 15th February 1945 the plaintiff received acknowledgment letter stating that the matter was receiving the attention of the company. The plaintiff was also asked to send certain documents to enable the company to dispose of the claim early. There was some correspondence between the parties, the plaintiff sending reminders and the company replying that the claim was receiving its attention. Ultimately the plaintiff issued suit notice on the 5th May 1947. The company again called for certain further particulars. The plaintiff sent such particulars on 19th July 1947. Nothing further was done by the company and the suit was filed on 10th February 1948. It was held that the suit was within time since time could be said to run against the plaintiff only from 19th July 1947 when he sent the last letter furnishing the particulars asked for. The principle of the decision is stated in the case in Jainarayan v. Governor-General of India AIR 1951 Cal. 462 referred to by the learned Judge as follows: “Where no time is fixed for delivery and where after the discovery of non-delivery correspondence ensued between the consignor and the railway authorities in the course of which the railway goes on promising enquiries and never denying liability, limitation does not begin to run till the correspondence ends either fruitlessly or with a final statement by the railway of its inability to deliver or final repudiation of the consignor’s claim.” After referring to various rulings on the point Chakravarthy, J., continued. “This impressive array of authorities seems to me to establish beyond doubt that the time ‘when the goods ought to be delivered’ within the meaning of Column III of Art. 31 is not the time when they should have been delivered in the normal course, at least in a case where there is no time fixed for delivery, but the time when they ought to be delivered according to the subsequent promises by the railway which informs the parties that it is carrying on enquiries.” 13. Mr. Rama Iyer, learned Counsel for the special appellants referred to Rajmal Pahar v. Dominion of India, AIR 1955 Punjab 83, where it was held that there was no warrant for the proposition that a claimant by starting into correspondence with the defendant (carrier) can enlarge the period of limitation and the expression “ought to be delivered” in Column III of Article of 31 would remain the same that is the normal period which a consignment would take to travel from one station to another and should be so irrespective of any promises of enquiry made by the railway or actual enquiries by the railway. It is no doubt true that this observation supports the learned Counsel but that case relied upon certain previous cases decided by the same learned Judge and also Gopiram Gourishankar v. G.I.P. Railway Company, AIR 1927 Pat. 335. This case in Gopiram Gourishankar v. G.I.P. Railway Company, AIR 1927 Pat. 335, held that where a great part of the consignment has been delivered on a certain day, there is ordinarily no necessity to enter into evidence on the question of when the balance of the consignment ought to have been delivered, because the time when the consignment as a whole ought to have been delivered is manifestly the time when the greater part of the consignment arrived at its destination. We are not concerned with the delivery of part in course of delivery of the whole. Again the decision in Gopiram Gourishankar v. G.I.P. Railway Company, AIR 1927 Pat. 335, was referred to, and not followed in the Union of India v. Essack, 1956 KLT 40 above referred to. We are not concerned with the delivery of part in course of delivery of the whole. Again the decision in Gopiram Gourishankar v. G.I.P. Railway Company, AIR 1927 Pat. 335, was referred to, and not followed in the Union of India v. Essack, 1956 KLT 40 above referred to. Indeed the case in Rajmal Pahar v. Dominion of India, AIR 1955 Punjab 83, had proceeded to criticise the various decisions in which the period of time taken in correspondence between the railway (carrier) and claimant had been taken to be relevant factors on the ground that the necessary result would be that the terminus a quo in the case of non-delivery would be different from that where delay is alleged, ‘because in all these cases there was delay, and if in a suit on account of delay in delivering the goods the time begins to run when the goods ought to be delivered or would normally reach their destination, then necessarily the same would be the ‘terminus a quo’ in the case of non-delivery of goods.” but this result would be contrary to the intention of the amendment made in the year 1899 by S. 3 of Art. 10 which introduced the words “non-delivery of or” so that under Art. 31 a suit for compensation for non-delivery of or delay in delivering the goods stood on the same footing. We are unable to follow this reasoning. For no differential considerations need arise if you exclude the time taken up by the correspondence which may follow, alike in both the cases of non-delivery of goods and delay in delivering the goods within a reasonable time. Anyway we are prepared to dissent from this ruling to the extent it goes against this Court’s decision in Union of India v. Essack 1956 KLT 40 . Learned Counsel next referred to Dominion of India v. Nagardas & Co. (AIR 1955 Mad. 238), where Justice Mack sitting as a single Judge held that in cases governed by Art. 31 where the carrier did not send any reply at all to the notices sent by the claimant, the question as to the date from which limitation should run would depend on the facts of the case. (AIR 1955 Mad. 238), where Justice Mack sitting as a single Judge held that in cases governed by Art. 31 where the carrier did not send any reply at all to the notices sent by the claimant, the question as to the date from which limitation should run would depend on the facts of the case. But in a case to which Art. 30 applied the fact that the defendant railway ignored a notice without any reply could not have the effect of annihilating for ever any time-bar of limitation and expose it to a suit at any time in future. This decision does not really help the special appellants. The next decision Gajanand Rajgoria v. Union of India ( AIR 1955 Pat. 182 ), also does not help the special appellants since all that was held in that case was that the period of limitation of one year should be calculated under Art. 31 from the date when the goods ought to be delivered and that the question when the goods ought to be delivered was essentially a question of fact. We hold therefore that the period of limitation under Art. 31 begins to run from after a definite refusal or declaration of inability by the carrier to deliver the goods, particularly when there is no definite date of delivery found in the contract of carriage between the parties. 14. On the facts in this case, according to both parties, no date had been fixed for delivery. The ship had arrived at Cochin Port on 6th September 1948 and left the Port on 9th September 1948. Ext. A delivery order was issued on 21st September 1948 as if the goods had arrived but when the plaintiff’s agent sent his men to take delivery, the goods were not available. The plaintiff complained of non-delivery and lodged his claim on 28th September 1948, vide Ext. B. Ext. C was a reminder dated 22nd January 1949 to which Ext. D reply was sent by defendant on 26th January 1949 asking for particulars. The particulars were supplied in Ext. E on 31st January 1949. There was further correspondence and we find Ext. K written by the 2nd defendant on 26th March 1949 in reply to the plaintiff’s letter Ext. J of 21st March 1949 and saying that he will be writing later. After this, there was still more correspondence. The particulars were supplied in Ext. E on 31st January 1949. There was further correspondence and we find Ext. K written by the 2nd defendant on 26th March 1949 in reply to the plaintiff’s letter Ext. J of 21st March 1949 and saying that he will be writing later. After this, there was still more correspondence. It was only towards the end of 23rd February 1950 that the 2nd defendant on instructions from the 1st defendant sent Ext. AM repudiating liability. We think in all the circumstances that the plaintiff was entitled to wait in any event until 26th March 1949 the date of Ext. K and that the suit brought within one year thereof is within time so far as Art. 31 of the Limitation Act is concerned. It follows that the conclusion reached by the courts below on the first point as to limitation is unquestionable. 15. On the second point as to plaintiff’s claim for loss of profits, his learned Counsel Mr. Venkateswara Iyer concedes that it cannot properly arise in the circumstances and he is giving it up. We disallow the claim accordingly. 16. On the third and last point as to the liability of the 2nd defendant, it does not appear that the 2nd defendant seriously pressed the question of his exemption at any time. The appeal memorandum filed in the lower appellate court is also totally silent about it. We therefore affirm the decree of the courts below making him also liable. 17. In the result we dismiss the second appeal except in regard to a small variation as regards the amount of Rs. 109-2-0 claimed by the plaintiff as damages by way of loss of profits. The amount decreed in favour of the plaintiff will thus stand reduced by the abovesaid sum of Rs. 109-2-0. The decrees of the courts below are affirmed otherwise. The plaintiff will get his costs of this Court from the defendants.