JUDGMENT - P.S. SHAH, J.:---These three appeals raise common questions of law and fact which can be disposed of by a common judgment. The appellant in all these appeals is the Union of India and the respondent is a firm, Messrs Jayantilal Mangaldas Co. The respondent-firm filed three different suits against the appellant, the Union of India. representing the railways, for damages alleged to have been caused to them on account for the negligence on the part of the railway administration and their servants in not taking proper care of three separate consignments whereunder the firm despatched potatoes to different places. First Appeal No. 504 for 1967 arises out of Special Civil Suit No. 148 for 1963 filed by the firm against the Union of India in the Court of the II joint Civil Judge (Senior Division), Poona. The plaintiff firm entrusted a consignment of 335 bags of potatoes, with the railways at Poona on October 15, 1962 for being despatched to Cuttack under the railway receipt No. 109748 dated October 15, 1962. According to the plaintiffs, in the ordinary course, the consignment should have reached the destination within about 7 days, while actually it reached the destination station on November 24, 1962. According to the plaintiffs, it was the duty of the railway administration to reach the consignment in reasonably good time and to deliver the goods safely and in good condition to the consignee or his endorsee. It is further the case of the plaintiffs that the potatoes when accepted by the railways on October 15, 1962 were in good condition and due to the negligence and misconduct of the railways and due their servants, the consignment reached the destination on November 24, 1962, with the result that the potatoes were badly damaged and became rotten as a result of which heavy loss of Rs. 9,380/- was caused to the plaintiffs. It appears that the plaintiffs asked for open delivery and therefore the railway authorities assessed the damages and gave delivery of the goods on November 24, 1962. On December 22, 1962, the plaintiff firm served notices under section 78-B of the Indian Railways Act, 1890, and demanded compensation from the concerned railway administration. The plaintiffs also gave a notice dated February 6, 1963 under Section 80 of the Civil Procedure Code.
On December 22, 1962, the plaintiff firm served notices under section 78-B of the Indian Railways Act, 1890, and demanded compensation from the concerned railway administration. The plaintiffs also gave a notice dated February 6, 1963 under Section 80 of the Civil Procedure Code. As the defendants failed to pay the compensate on claimed by the plaintiffs, on December 17, 1963, the plaintiffs filed the Special Civil Suit No. 148 of 1963 in the Court of the Civil Judge, Senior Division, Poona against the Union of India owning and representing the Southern Railway and the South Eastern Railway and their respective administration claiming a decree for Rs. 11,566.30. In the plaint, the plaintiff claimed compensation of Rs. 9,380/- being the deficit amount realised by sale of the damaged goods together with interest at 12 percent p.a. from October 22, 1962 amounting to Rs. 2,166.30 and also an amount of Rs. 20/- by way of notice charges. The total claim of the plaintiffs as per the particulars in the plaint comes to Rs. 11,566.30. This suit was resisted by the defendants by their written statement, Ex. 14. The defendants besides raising several technical contentions to the maintainability of the suit, they also contended that the potatoes were not of good quality and they were not booked and despatched at railway risk. They denied that there was inordinate delay in reaching the consignment to the destination Station. They also denied that the goods were damaged due to negligence or misconduct on the part of the railways or their employees. On the question of quantum of damages, they denied the plaintiffs case that damages to the extent of Rs. 9,380/- were caused to the plaintiffs as alleged by them. According to the defendants, the damages claimed by the plaintiffs were exaggerated. The defendants also relied on a certain rule of the goods of tariff, Part-I, under which the goods were accepted for carriage by the railways, which provides that the railways do not guarantee the despatch of goods by any particular train, nor will they be responsible for arrival of the goods at any station within any definite time. It was further contended that the plaintiffs themselves were responsible for the damages as the packing conditions were not complied with by them, and, therefore, the defendants were not at all liable to the plaintiffs claim for damages.
It was further contended that the plaintiffs themselves were responsible for the damages as the packing conditions were not complied with by them, and, therefore, the defendants were not at all liable to the plaintiffs claim for damages. With a view to explain the delay in reaching the consignment to the destination station within the normal period, the defendants contended that there was dislocation of trains between Waltair and Tuni during the period from October 25, 1962 to November 5, 1962 due to breaches beyond Tuni on Southern Railways, and on account of these circumstances beyond the control of the railway, if any loss is occasioned to the plaintiffs, it would not be open to them to claim any damages from the defendants. The defendants also denied the plaintiffs claim on account of the interest and notice charges. Second Appeal No. 633 of 1970 arises out of Civil Suit No. 1052 of 1963 filed by the plaintiff firm against the Union of India for similar reasons but relates to another consignment of 335 bags of potatoes booked on the same day, that is, on October 15, 1962, at Poona for being despatched by railway to Behrampur (Ganjam) under railway receipt No. 109750. The consignment reached Behrampur on November 11, 1962. Similar allegation like those made in the Special Suit No. 148 of 1963, viz. that the consignment in the ordinary course should have reached the destination station within about 7 to 10 days from the date of despatch while it actually took much longer time as a result of which the potatoes were badly damaged and the plaintiffs were put to heavy loss, were made in this suit also by the plaintiffs. In this suit also the plaintiffs alleged negligence and misconduct on the part of the railway administration in not taking proper care to see that the consignment reached the destination within a reasonable time. The plaintiffs claimed Rs. 9,983.72 in all by way of damages and notices charges. Similar contentions as raised in Special Suit No. 148 of 1963, and referred to above, were also raised by the defendants in this suit also by their written statement, Ex. 12. It is unnecessary to repeat these contentions here.
The plaintiffs claimed Rs. 9,983.72 in all by way of damages and notices charges. Similar contentions as raised in Special Suit No. 148 of 1963, and referred to above, were also raised by the defendants in this suit also by their written statement, Ex. 12. It is unnecessary to repeat these contentions here. Second Appeal No. 634 of 1970 arises out of suit No. 1051 of 1963 filed by the plaintiffs against the defendants on similar allegations in respect of a third consignment claiming damages of Rs. 8,608.65. The consignment consisted of 335 bags of potatoes handed over to the railway administration on October 18, 1962 for being despatched to Cuttack under railway receipt No. 109876. This consignment actually reached Cuttack on November 10, 1962. As a result of the delay in reaching the consignment to the destination, the goods were badly damaged and, therefore, the plaintiffs claimed damages together with interest and notice charges. This suit was resisted by the defendants by their written statement at Ex. 11 raising contentions similar to those in the other two suits referred to above. All the three suits were heard together and evidence was recorded in the Special Suit. On a consideration of the evidence on record, the trial Judge rejected the technical objection raised by the defendants and assessed damages to which the plaintiffs were entitled in respect of each of the three consignments in the three different suits. The trial Court also awarded interest at the rate of Rs. 9 per cent p.a. on the amount of damages found due in each of these cases from the date of notice till the date of suit. In Special Suit No. 148 of 1963, the trial Court awarded to the plaintiffs Rs. 9,380/- as damages together with interest of Rs. 832.47 from the date of notice till the date of the Suit and Rs. 20/- by way of notice charges and thus passed a decree for Rs. 10,232.47 in favour of the plaintiffs. In Suit No. 1052 of 1963, (Second Appeal No. 633 of 1970), the trial Court awarded Rs. 8837/- as damages as well as the interest of Rs. 784.29 at 9 percent p.a. from the date of notice till the date of suit as Rs. 20/- by way of notice charges, i.e., Rs. 9,641.29 in all.
In Suit No. 1052 of 1963, (Second Appeal No. 633 of 1970), the trial Court awarded Rs. 8837/- as damages as well as the interest of Rs. 784.29 at 9 percent p.a. from the date of notice till the date of suit as Rs. 20/- by way of notice charges, i.e., Rs. 9,641.29 in all. In the third Suit No. 1051 of 1963 (Second Appeal No. 634 of 1970), a decree for Rs. 5,498/- by way of damages together with interest of Rs. 405/- and Rs. 20/- by way of notice charges i.e., in all Rs. 5,923/- was passed by the trial Court in favour of the plaintiff. Aggrieved by the decision in Special Suit No. 148 of 1963, the defendants have preferred First Appeal No. 504 of 1967. The defendants also preferred Civil Appeal No. 231 of 1967 against the plaintiffs in the District Court from the decree in Suit No. 1052 of 1963, which, however, came to be dismissed, and, therefore, they have filed Second Appeal No. 633 of 1970 challenging the decree in favour of the defendant. Similarly, the defendants filed Civil Appeal No. 305 of 1967 in the District Court challenging the decision in Suit No. 1051 of 1963. The learned Assistant Judge partly allowed the defendants appeal holding that the plaintiffs were entitled to compensation of only Rs. 5,498/- and, therefore, passed a decree for Rs. 5,923/- inclusive of notice charges and interest. The defendants have preferred Second Appeal No. 634 of 1970 challenging the decree passed by the learned Assistant Judge. The plaintiffs have also filed cross-objections challenging the decision of the Assistant Judge to the extent to which the defendants appeal was allowed by him. The courts below have held that the normal and reasonable period within which the consignment ought to have reached the destination stations was about 7-10 days and the delay caused in reaching the consignment to the destination station was due to the gross negligence on the part of the employees of the railway administration and their failure to take proper steps, which they ought to have taken having regard to the perishable nature of the goods in question. The explanation given by the defendants that the delay was on account of the circumstances beyond their control.
The explanation given by the defendants that the delay was on account of the circumstances beyond their control. viz., on account of the breaches being caused was rejected on the ground that the defendants failed to lead any evidence on this point. They also rejected the contention of the defendants that the damages was the result of defective packing. The contentions raised by the defendants on the basis of certain rules referred to above were also rejected. Dr. Naik, the learned Counsel appearing for the Union of India submitted that the delay in rejecting the consignment to the places of destination was not on account of any negligence on the part of the railway administration but was occasioned due to circumstances beyond the control of the railway. He also relied on the goods tariff rule in support of his contention that the railways were under no obligation to reach the consignment in a particular time. He urged that it was quite likely that the damages to the plaintiffs goods in the three consignments in question might have arisen due to the defect in packing conditions and in this connection he relied on the remarks on the forwarding-note to the effect " P7 not complied with" suggesting thereby that the goods were not properly packed. He also submitted that even assuming that some loss was caused to the plaintiffs, it was necessary for them to prove the market rate on the date on which the damages were caused to them, but in the present case the plaintiffs have failed to prove the same. Lastly he submitted that the plaintiff ought not to have been awarded interest till the date of judgment, and in any event till the date of suit . In this connection, he relied on a decision of this Court in the case of a (Ratanlal v. Brijmohan)1, 33 Bom.L.R. 703 and on the decisions of the Supreme Court in the case of (Union of India v. W.P.Factories)2, A.I.R. 1966 S.C. 395 and in the case of (Union of India v. Watkins and Co.)3, A.I.R. 1966 S.C. 275. Dr. Naik was unable to point out any evidence on record to show that it was on account of the breaches caused that there was delay in reaching the consignments to the respective destinations. The burden of proving this contention lay on the defendant.
Dr. Naik was unable to point out any evidence on record to show that it was on account of the breaches caused that there was delay in reaching the consignments to the respective destinations. The burden of proving this contention lay on the defendant. It was easy for the defendants to produce documentary evidence in support of this contention that during the period in question, the train traffic was dislocated on account of the breaches as alleged by them. In the absence of such evidence, it is impossible to accept the contention that they delay in reaching the consignment to the proper destination was due to circumstances beyond the control of the railway administration. It is true that the forwarding notes bear a remark " P7 not complied with" indicating thereby that the goods were not properly packed, but the evidence clearly shows that it is the invariable practice of the railways to make such endorsements in cases of perishable goods. If such remarks are made on the forwarding notes merely as a routine matter, it is impossible to place any reliance on them and no inference can be drawn that the goods were not properly packed when they were handed over to railway administration by the plaintiffs. On the other hand, the plaintiff had led congent evidence to show that the goods were properly packed before they were handed over to the railways by them. In support of their contention that the goods were properly packed, the plaintiffs have examined two witnesses, Damodar Naik (P.W. 2) who was working as the carting agent of the plaintiff firm for last 40 years, and Ramanlal Shah (P.W. 3), who was serving as Diwanji of the plaintiff firm who was himself present at the time of taking the potatoes. Damodar Naik has stated in his evidence that he had consigned the plaintiffs goods in respect of three consignments. He had also seen the potatoes and he found them of a good quality and according to him they would have reached the destination provided they were taken to the respective places in the normal period. As regards packing, he stated that the potatoes were packed in thin single new gunny bags that could give proper air to the goods. We do not see any reason to reject the evidence of this witness.
As regards packing, he stated that the potatoes were packed in thin single new gunny bags that could give proper air to the goods. We do not see any reason to reject the evidence of this witness. Ratanla Shah has stated in his evidence that the potatoes were in good condition at the time of the consignment and could easily have lasted at the place of destination, even after reaching there, for a period of 15 days for being sold in the market. He also supported the evidence of Damodar Naik and stated that the goods were properly packed. There is nothing in his cross-examination which would throw doubt on his testimony. Having regard to this evidence on record, we are unable to accept the contention of the Counsel that the goods were not properly packed at the time of the consignment. There is also no merit in the contention based on the rule of goods tariff, Part I, which seems to provide that the railways do not guarantee despatch of goods by any particular train, nor will they be responsible for arrival of the goods at any station within any definite time. In the first place, on the fact of it, this rule has no bearing whatsoever on the question of the liability of the defendants as bailees of the goods under section 72 of the Railways Act. Prima facie, this rule merely indicates that no claim for damages can be based merely on the ground that there has been delay on the part of the railway administration, but this rule does not absolve the railway administration of their responsibility to reach the goods within a reasonable time. Moreover, the liability of the railway administration for loss or damages is governed by the provisions of section 72 of the Railways Act, and in view of this provision, their position is that of a bailee as provided in section 152 and section 161 of the Contract Act. The rule relied on does not and cannot absolve railway administration from the responsibility for loss or damages as bailee of the goods.
The rule relied on does not and cannot absolve railway administration from the responsibility for loss or damages as bailee of the goods. In any event, if this rule is to the interpreted as urged by the railways, it must be held that it is ultra vires the clear provisions of the Railways Act and the plaintiffs right to claim damages caused to them on account of the negligence of the railway administration cannot be affected by such a rule. The courts below have discussed the evidence on record which clearly shows the market rates on the material dates. The evidence led by the plaintiffs show that even the stale and damaged potatoes were sold at Rs. 26/- per maund. The claim made by the plaintiffs, therefore, cannot be said to be improper or unreasonable. The plaintiffs claim is fully supported both by oral and documentary evidence on the question of market prices on the material date, viz. on the date on which the damage was caused to the plaintiffs. Dr. Naik was unable to show that the appreciation of evidence by the courts below is wrong in any manner. The next question that falls to be considered is whether the trial Court and the lower Appellate Court were in error in awarding interest till the date of judgment. The courts below seem to have awarded interest from the date of notice of demand on equitable considerations. The point, however, is concluded by the recent decisions in the cases of Union of India v. Watkins Mayor and Co. and Union of India v. The West Punjab Factories, Ltd. The latter case also arose out of a claim for damages caused to the plaintiff on account of the negligence of the railway administration. In the first case, the Supreme Court has observed: "It is well established that interest may be awarded for the period prior to the date of the institution of the suit when there is an agreement for the payment of interest at fixed rate or when interest is payable by the usage of trade having the force of law, or under the provisions of any substantive law as for instance, under section 80 of the Negotiable Instruments Act, 1881, when no rate of interest is specified in the promissory note or bill of exchange, the Court may award interest at the rate of 6 per cent per annum.
Under the Interest Act, 1839, the Court may allow interest to the plaintiff if the amount claimed is a sum certain which is payable at a certain time by virtue of a written instrument. But where the amount claimed is compensation for unliquidated amount and not a sum certain, the Act has no application and no interest can be granted on the amount claimed. The provision that interest shall be payable in all cases in which it is now payable by law only applies to cases in which the Court of Equity exercises jurisdiction to allow interest. To invoke a rule of equity, the existence of a state of circumstances which attracts the equitable jurisdiction, as for example, the non-performance of a contract of which equity can give specific performance, has first to be established." The legal position is also made clear in the case of (Union of India v. The West Punjab Factories Ltd.,)2, wherein the Supreme Court has expressly held that, in the absence of any usage or contract, express or implied, or of any provision of law to justify the award of interest, interest by way of damages cannot be awarded. No interest could thus be award for the period upto the date of the suit. This view was taken by the Supreme Court on a consideration of various other decisions. Having regard to the law as enunciated by the Supreme Court in a suit for damages, the plaintiffs are entitled to claim interest till the date of suit. The trial Court was, therefore, in error in awarding interest to the plaintiffs from the date of notice till the date of suit. All the appeals will, therefore have to be allowed so far as the claim of interest till the date of suit is concerned. In Second Appeal No. 634 of 1970, the plaintiffs have filed cross objections against the decision of the learned Assistant Judge holding that the plaintiffs were not entitled to anything more than the damages assessed by the railways. The trial Court had assessed the damages at Rs. 7573.75P. The learned Assistant Judge reduced the quantum of damages to Rs. 5498/- on the aforesaid ground. The reasoning of the learned Assistant Judge on this point is contained in paragraph 19 of his judgment.
The trial Court had assessed the damages at Rs. 7573.75P. The learned Assistant Judge reduced the quantum of damages to Rs. 5498/- on the aforesaid ground. The reasoning of the learned Assistant Judge on this point is contained in paragraph 19 of his judgment. It appears that while taking delivery of the consignment, all the bags were opened and then the assessment of damages was made. It appears that the plaintiffs witness Fagumoni Khutia who was present at the time of taking delivery of the consignment demanded assessment of damages before taking delivery which was granted by the railway authorities. The learned Judge has taken the view that inasmuch as it was the plaintiffs own representative who demanded the assessment of damages before taking delivery, he was bound by the assessment of damages made by the railway authorities and that the assessment certificate binds the parties unless a case is made out that the assessment certificate binds the parties unless a case is made out that it was obtained under force or coercion or that the railway administration did not give open delivery. It is impossible to accept this line of reasoning of the learned Assistant Judge. Merely because open delivery is asked for and the consignee while taking delivery demands assessment of damages, it cannot be said that he is bound by the assessment made by the railway officials. It is not the case of the railway that the assessment was accepted as correct by the plaintiffs representative while taking the delivery of the goods. While it can be said that the railway authorities would ordinarily be bound by such an assessment, the plaintiffs would not be precluded from establishing a case that the damages sustained by them are much more than what are assessed by the authorities. It may be that in the absence of any evidence the plaintiff would be bound by such assessment. However, in the present case, the plaintiffs have led congent evidence to establish their case of damages. The plaintiffs would not be estopped from claiming damages merely on the ground that they demanded assessment at the time of taking delivery of the goods. No rule or provision of law has been pointed out before us that an assessment made by the railway authorities while giving the delivery of the goods to the consignee is binding on them.
The plaintiffs would not be estopped from claiming damages merely on the ground that they demanded assessment at the time of taking delivery of the goods. No rule or provision of law has been pointed out before us that an assessment made by the railway authorities while giving the delivery of the goods to the consignee is binding on them. The learned Assistant Judge was, therefore, not justified in reducing the quantum of damages awarded by the trial Court. The cross objections preferred by the plaintiffs must, therefore, succeed. In the result, all the three appeals preferred by the Union of India are party allowed; the decrees passed by the trial Court and the appeal Court in so far as they award interest till date of suit are set aside. Similarly cross objections in Second Appeal No. 634 of 1970 are allowed. In First Appeal No. 504 of 1967, the decree passed by the trial Court is substituted by the following decree "The defendants do pay to the plaintiffs Rs. 9425/-, the proportionate costs of the suit and future interest at 4 percent p.a. on Rs. 9380/- from date of suit till payment" The defendants are given two months time to make the payment to the plaintiffs. The defendants shall bear their own costs of the suit." In Second Appeal No. 633 of 1970, the decree passed by the trial Court is substituted by the following. "The defendants do pay to the plaintiffs Rs. 8857/- with proportionate costs of the suit and future interest at 4% p.a. on Rs. 8837/- from the date of suit till payment". Defendants are given two months time to make payment. The defendants to bear their own costs of the suit." In Second Appeal No. 634 of 1970, the decree passed in appeal is modified as follows "The suit of the plaintiffs is decreed for Rs. 7593.75 P with proportionate costs and future interest from the date of suit at 4% p.a. on Rs. 7,573.75 till realisation. The order regarding costs passed by the lower Appellate Court Second Appeal Nos. 633 of 1970 and 634 of 1970 is maintained. As far as the costs of the appeals before us are concerned, in the circumstances of the case, we direct that the appellants shall pay costs to the respondents in First Appeal No. 504 of 1967.
The order regarding costs passed by the lower Appellate Court Second Appeal Nos. 633 of 1970 and 634 of 1970 is maintained. As far as the costs of the appeals before us are concerned, in the circumstances of the case, we direct that the appellants shall pay costs to the respondents in First Appeal No. 504 of 1967. There shall be no order as to costs in Second Appeal Nos. 633 and 634 of 1970. -----