Judgment R. N. Sahay, J. The appellant Bihar State Electricity Board is a corporate body constituted under, Section 5 of the Electricity Supply Act, 1984 and is engaged in development, management control and supply of Electricity in the State of Bihar. It has a electricity generating station at Patratu known as Patratu Thermal Power station. The eastern railway has a station there known as Patratu. Thermal Power Station siding. 2. It appears that the appellant had placed the orders with M/s Bharat Heavy Electricals Ltd. Hyderabad for supply of materials and equipment for its generating station at Patratu. The Bharat Heavy Electrical Ltd. despatched 49 cases containing 4092 pieces of condensor tubes was booked from M.T.S.G. siding station served through Lingam-Palli, station on the South Central Railway to be delivered at Patratu Thermal Station siding under invoice No. 28, R.R. No. 779498 dated 26.3.1974, The entire price of the consignment have been paid to the consignor. The consignment was also insured against transit risk etc with the United India Fire and General Insurance Co. Ltd. 3. On 10.7.1974 the aforesaid consignment was delivered to the plaintiff No. 1 out of which one case was missing and 16 cases were found badly damaged. As such open delivery was demanded which was granted by the Railway Claims Inspector, Eastern Railway Gomoh. After assessment of the damaged packages 375 pieces of condenser tubes was delivered short to the consignee and Certificate issued on 24.9.74. 4. The appellant sent a registered notice to the Chief Commercial Superintendent, Eastern Railway claiming compensation for the shortage. The appellant along with insurance company, thereafter served notice under section 80 of the Code of Civil Procedure to the General Manager, Eastern Railway on 1.7.1977 demanding damages to the tune of Rs. 2,35,950. The appellant as plaintiff no. 1 and United India Fire and General Insurance Co. Ltd. as plaintiff no. 2 instituted suit against the union of India before the Subordinate Judge Hazaribagh claiming a decree for sum of Rs. 2,36,065 and interest pendent lite. 5. The respondents, Union of India opposed the suit inter alia on the following grounds ;- (a) The plaintiff had no right to sue as it had no title to the consignment. (b) The plaintiff no.1 - appellant no.
2,36,065 and interest pendent lite. 5. The respondents, Union of India opposed the suit inter alia on the following grounds ;- (a) The plaintiff had no right to sue as it had no title to the consignment. (b) The plaintiff no.1 - appellant no. 1 not having taken delivery of the consignment within the period prescribed under section 77 I.R. Act, is not in any case entitled to the compensation claimed. (c) The suit was not maintainable because of non joinder of the South Central Railway and South Eastern Railway as consignment was booked by South Central Railway (d) The consignment was loaded by the senders without count or verification of the alleged pieces of condenser Tubes. The Railway receipt was qualified "said to contain" as no Re. weighment of the consignment in question was done in destination station at the time of delivery. Railway receipt in question contained a remark that at the request of the consignment, the consignment in question was loaded in an open wagon at the siding of the consignors without supervision of any railway staff and a qualified railway receipt with the remark "S/C 49 cases of the alleged condenser Tubes" was granted by the Booking Railway with further remarks" loaded in open wagon at the request of the sender, not covered with tarpaulins” i.e. at owner's risk. The short certificate was granted not on the basis of any Railway document but on the basis of the declaration of the party, without prejudice. (e) There was no element of negligence or misconduct whatsoever on the part of the Eastern Railway Administration or its agents or servants for the alleged losses. (f) The delivery having been given at the destination station being the siding belonged to plaintiff no. 1 and the wagon between the Railway Administration and the owner of the siding, namely plaintiff no. 1 on 8.7.1974 and plaintiff no. 1 was duly informed about the said placement of the wagon the railway administration was not responsible for the alleged loss. (f) The suit was barred by limitation. 6. The learned Sub-Judge framed the following issues for trial. (i) Is the suit maintainable as framed? (ii) Has the plaintiff got any cause of action ? (iii) Is the plaintiff owner of the consignment in question.
(f) The suit was barred by limitation. 6. The learned Sub-Judge framed the following issues for trial. (i) Is the suit maintainable as framed? (ii) Has the plaintiff got any cause of action ? (iii) Is the plaintiff owner of the consignment in question. (iv) Did the plaintiff not take the delivery of the consignment within the period prescribed u/s 77 of the Indian Railway Act? (v) Is the suit bad for non-joinder of necessary parties ? (vi) Is the suit barred by the law of limitation? (vii) The notices U/S 78 (B) of the Indian Railways Act, and U/S 80 of the C.P.C. Properly served? (viii) To what relief or reliefs, if any is the plaintiff entitled? 7. The learned Sub-Judge decided issues Nos. (iv),(v)and (vi) in favour of the plaintiff. 8. The learned Sub-Judge, however decided Issues Nos. (i), (ii)and (iii) against the plaintiffs and held that the plaintiff had no cause of action and the suit was not maintainable. The learned Sub-Judge has also held that the suit was bad for non-service of notice under section 80 C. P. C. Thus issue No. (viii) was also decided in favour of the Union of India. 9. In the result, the learned Sub-Judge held that the plaintiff was not entitled to any relief hence the suit was liable to be dismissed. 10. Mr. B.S. Lal, learned counsel appearing for the appellant-Bihar State Electricity Board has challenged the judgment of the Sub-Judge on the following grounds: (A) The learned Sub-Judge has failed to notice the precise averment made in para 3 of the plaint that the plaintiff no. 1 had paid the full price to the BHEL has not been specifically challenged in the written statement by the contesting defendant. (B) The appellant no. 1 being holder of the railway receipt was entitled to being the suit since the respondents had not challenged the payment of consideration money to the consignor. (C) The finding that there was no proper notice under Section 80 C. P. C. was vitiated for the reason the postal receipt showing despatch of the notice under section 80 C.P.C. to the address of the contesting defendant proved proper service of notice. 11.
(C) The finding that there was no proper notice under Section 80 C. P. C. was vitiated for the reason the postal receipt showing despatch of the notice under section 80 C.P.C. to the address of the contesting defendant proved proper service of notice. 11. Shri D. N. Chatterjee learned counsel for the Union of India has supported the finding of the learned Subordinate Judge and contended had been placed at the siding of the appellant, the liability of the - railway administration ceased then and there in terms of Sec. 76 C of the Indian Railways Act. 12. It would be appropriate at this stage to refer the finding of the learned Subordinate Judge in respect of the issue Nos. (i), (ii) and (iii). The learned Sub-Judge held that no doubt plaintiff no. 1 was named as consignee in the R. R. which is Ext. 1 and in the forwarding note which is Ext. B and railway receipt is a document of title but he held that the title is in the limited sense. The appellant being consignee were not entitled to sue although the railway receipts was in the name of the consignee. This finding of the learned Sub-Judge is based on the decision of the Supreme Court in Union of India Vrs. W.P. Factories : A.I.R. 1966 SC. 395. The question is as to whether the Consignor or consignee has right to sue has been the subject matter of serious controversy ever since the Indian Railway Act, 1891 was enacted. This controversy has not been set at rest by enacting Section 74 of the Indian Rail ways Act, 1979 which provides "the property in the consignment covered by Railway receipt shall pass to the consignee or the endorsee as the case may be on the delivery of railway receipt to him and he shall have all the rights and liabilities of the consignor"- As observed by H.L. Anand, J. in Union of India Vrs. M/S Jashan Mal and Co. Fruit and Vegetable Merchants Subzimandi. A.I.R. 1976 ; Delhi 335 the examination of the question by the various courts has produced a established conflict or judicial opinion not only between various court but even within certain high courts and have for the years led to unfortunate un-certainty now the law relating to the right to sue to the railway on the basis of a railway receipt.
The only relieving feature has been that the controversy has produced some brilliant judgments by eminent Judges. In this very decision it was held that the consignment of goods to a person, who is mentioned in the railway receipt as a consignee or an endorsement of a railway receipt in favour of another would have the effect of not only transferring property in the goods but also the rights under the contract of carriage represented by it". The decision of the Delhi High Court is based on Morvi Mercanitle Bank Ltd. case A.I.R. 1965 ; S.C. : 1954. The decision in A.I.R. 1966 S. C. 395 was fully considered in the Delhi case and the argument advanced on behalf Of one of the parties that observations of Subba Rao' J' in Mercanitle Banks' case (Supra) has lost much of its vitality with the later decisions in A.I.R. 1966 S. C. 395 (Supra) was rejected. In another decision of Delhi High Court in Union of India Vrs. M/S B. Pralhad and Co. reported in. A.I.R. 1976 Delhi: 236 after exhaustive review of all cases including A.I.R. 1966 : S. C. 395. It was held by Awadh-Behari, J.- "This would be the normal state of affairs when goods are consigned under a contact of sale, for the Sale of goods Act, 1930 (see Section 23 and 39) expressly stipulates that in such circumstances delivery to the carrier is deemed to be sufficient delivery to the buyer for the purpose of passing the ownership of the goods. In such a case the consignor is again deemed to be the agent of the consignee for the purpose of making the contract. In this case the consignee can sue the carrier" . It has been held in Ram Das Vithald Vrs. Amar Chand and Co. A.I.R. 1916 : P. C. : 7 a railway receipt is a document of title to goods and an endorsee has sufficient interest in the goods covered by it to maintain an action for the loss. In M/S Bhai Mehar Singh Kishan Singh Fruit merchants Subzi Mandi Delhi-7 Vrs.
Amar Chand and Co. A.I.R. 1916 : P. C. : 7 a railway receipt is a document of title to goods and an endorsee has sufficient interest in the goods covered by it to maintain an action for the loss. In M/S Bhai Mehar Singh Kishan Singh Fruit merchants Subzi Mandi Delhi-7 Vrs. Union of India A.I.R. 1979 Delhi: 158, it was held by M. L. Jain, J. that where the consignee filed the suit for compensation and stated in his application that he was a consignee for consideration and being a commission agent had interest in the goods despatched and explained this in his statement and the consignor-owner did not challenge the title of the consignee, the consignee must be deemed entitled to sue for compensation for damage to goods in transit". In Commissioners for the port of Calcutta Vrs. General Trading Corporation Ltd. A.I.R. 1964 ; Cal: 290, it was held that the consignee is presumed to be the owner of the goods though such a presumption is rebuttable, because he holds the railway receipt, which is a document of title under the Sale of Goods Act. 13. In W. P. Factories Case (Supra) it was held on the special facts of that case that only consignor could sue. The decision does not Lay-down any general rule that only a consignor can sue. This is clear from paragraph 11 of the judgment of Wanchoo 'J' which reads as follows : "The contract between the factories and the J. C. Mills was that delivery would be made by the seller at the godowns of the J. C. Mills. The contract also provided that the goods would be despatched by railway on the seller's risk up to the point named above (namely the Godowns of the J C. Mills). Therefore, the property in the goods would only pass to the J.C. Mills when delivery was made at the godown and till then the consignor would be the owner of the goods and the good') would be at its risk.
Therefore, the property in the goods would only pass to the J.C. Mills when delivery was made at the godown and till then the consignor would be the owner of the goods and the good') would be at its risk. Ordinarily, the consignments would have been booked in the name of "self" but it seems that there was some legal difficulties in booking the consignments in the name of self and, therefore, the J. C. Mills agreed that the consignments might be booked in the Mills name as consignee; but it was made clear by the J. C. Mills that the contract would stand unaffected by this method of consignment and all risk, responsibility and liability regarding these cotton consignment would be of the Factory till they were delivered to the J.C. Mills in its godown as already agreed upon under the contract and all losses arising from whatever cause to the cotton thus consigned would be borne by the Factory till its delivery as indicated above. This being the nature of the contract between the consignor and the consignee in the present case we have no hesitation in agreeing with the Courts below that the property in the goods was still with the Factory, when the fire broke out on March, 1943. Therefore, the ordinary rule that it is the consignor who can sue will prevail here because it is not proved that the consignor had parted with the property in the goods, even though the consignments were booked in the name of the J.C. Mills. We are, therefore, of opinion that the suit of the Factory was in view of these circumstances maintainable"_ 14. Anand, J: in A.I.R. 1976 : Delhi: 352 (Supra) has made a very interesting and significant observations with regard to the shifting stand of the railways in cases that have been coming to Court during the lost a half century. 15. The learned Judge his observed-"A review of the decisions spread over the last half a century brings out a very unfortunate feature of the litigation policy of the Railway Administration. The decided cases indicate that the Railway Administration has been taking absolutely in-consistent and diametrically opposite pleas depending on the case set-up by the plaintiff.
15. The learned Judge his observed-"A review of the decisions spread over the last half a century brings out a very unfortunate feature of the litigation policy of the Railway Administration. The decided cases indicate that the Railway Administration has been taking absolutely in-consistent and diametrically opposite pleas depending on the case set-up by the plaintiff. If a consignor filed a suit it was claimed that the consignee alone could sue merely by virtue of the fact that he was mentioned as the consignee in the railway receipt. whether, however, a consignee was the plaintiff the right to sue was found by the railway administration only in the consignor in spite of the nature of the transaction which led to the movement of the goods from the consignor to the consignee. The only manifests a wholly unjustified anxiety to resist the claim exactly like an ordinary litigant would with a view to put off the evil day, as it were. This, to my mind, is a very unhealthy and unfortunate feature of the litigation policy of the railway administration" I respectfully entirely agree with the observations of Anand, J. 16. The trial court, therefore, was not correct in holding that the appellant had no right to sue for compensation. The trial court has also taken a technical view of the matter in not acting on the testimony of P.W. 4 who has stated full price of the consignment with the tax etc. had been paid which statement was not challenged nor any evidence was adduced on behalf of the Union of India. The evidence of P. W. 4 was not accepted only because he did not say as to when the price had been paid. In my opinion there is no reason not to accept the Statement of P. W. 4 and it does not matter as to when price was paid. The trial court again erred in not attaching importance to Ext. 6 which contains details of payments made to BHEL from time to time. The appellant had paid about Rs. 30 (thirty) lakhs for parts and equipments. 17. In my opinion, the finding of the learned Sub-Judge that the title of goods had not passed to the appellant is clearly erroneous. The trial court has also failed to notice that the goods were insured against transit risk.
The appellant had paid about Rs. 30 (thirty) lakhs for parts and equipments. 17. In my opinion, the finding of the learned Sub-Judge that the title of goods had not passed to the appellant is clearly erroneous. The trial court has also failed to notice that the goods were insured against transit risk. This leads to irresistable conclusion that the appellant was owner of the goods. 18. The learned trial judge has also decided the issue no. (vii) against the plaintiff that the plaintiffs have not been able to prove notice under section 78 (B) of the I. R. Act, and under Section 80 of the Civil procedure Code was served on respondent - Union of India and was served on Chief Commercial Superintendent and General Manager of the Eastern Railways. Admittedly notices were issued by the registered post with A/D but A/D receipts were not received back by the plaintiff. The Sub-Judge has, held that Section 27 of the General clause is not applicable and presumption under Section 140 of the Indian Railways Act, was rebuttable and since the defendant had denied service of notice the onus was on the plaintiff to prove valid service of notice. Section 142 of the Indian Railways Act, 1890 provides as follows: Presumption where notice is served by post: "Where a notice or other document is served by post, it shall be deemed to have been served at the time when the letter containing it would be delivered in the ordinary course of post, and in proving such service it shall be sufficient to prove that the letter containing the notice or other document was properly addressed and registered," In A.I.R. 1968: Ker; 23: it was held that a claim under Section 78 (B) has to be in account with clause (c) of Section 140 (by forwarding it by post in-pre paid letter and registered under Indian Post Office Act, 1898) and when so forwarded, presumption under section 142 is attracted. In Harihar Banerji Vrs.
In Harihar Banerji Vrs. Ramshashi Roy: A.I.R. 1918 : P. C. 102 : it was observed by their Lordships of the Privy Council as follows: "If a letter properly directed, containing a notice to suit, is proved to have been put into the post office, it is presumed that the letter reached its destination at the proper time according to the regular course of business of the post office, and was received by the person to whom it was addressed and that presumption, would apply, with still greater force to letters the sender has taken the precaution to register, and is not rebutted but strengthened by the fact that a receipt for the letter is produced signed on behalf of the addressee by some person other than the addressee himself. We are concerned here not with a letter sent under registered cover but under ordinary post. Even in that behalf it is permissible to infer that in due course of the business of the post office, a letter which is properly addressed and actually despatched must have reached its destination in course of time". In Union of India Vrs. Kalinga Textiles: A. I. R. 1969 : Bombay: it has been held by a Division Bench of the Bombay High Court: "It may be remembered that compliance with the provisions of Section 140 of the Railways Act, will entitle a party to claim a presumption of service under Section 142. The moment the facts contained in Section 140 are proved, it shall be deemed that the said letter is served. Such a presumption, as a matter of right, is not available to a party under Section 114 of the Evidence Act". 19. The learned trial court has relied on A. I. R. 1972: Patna : 152 to hold that the presumption under section 140 is rebuttable. In the present case, no evidence in rebuttal was offered by the respondent. The trial court failed to notice that in the Patna decision (Supra), the service of notice was denied by examining witnesses. The finding of the trial court is totally erroneous. 20. The trial Court has lastly held that claim for compensation cannot be decreed as the appellant has not proved the price of condenser tubes for the loss of which the suit was instituted. In the Schedule to the plaint it has been mentioned that the price of condenser tubes was Rs.
20. The trial Court has lastly held that claim for compensation cannot be decreed as the appellant has not proved the price of condenser tubes for the loss of which the suit was instituted. In the Schedule to the plaint it has been mentioned that the price of condenser tubes was Rs. 55,000/- This is supported by oral evidence. 21. In the written statement it has been averred that claims are inflated but no contrary evidence had been led, hence the trial court was not justified in dismissing the suit on the ground that the plaintiff has not able to prove the market price of the condenser tubes which had been lost in transit. 22. Shri D. N. Chatterjee, the learned counsel for the respondent has submitted that the claim for compensation was made by the plaintiff long after the goods were delivered to the railways. Hence the claim was barred by the express provisions contained in Section 78 (B) of the Indian Railways Act. Shri Chatterjee has relied upon Governor General in Council Vrs. Musaddi Lal : A.I.R. 1961 : S.C. 725. The Supreme Court was considering the old Section 77 Indian Railways Act, 1819 which is now Section 78 (B). It was held by the Supreme Court: "Section 77 manifestly prescribed a condition precedent to the maintainability of a claim for compensation for goods lost, destroyed, deteriorated while in the custody of the railway administration. The notice prescribed was not served by the respondent upon the railway administration within six months from the date on which the goods were delivered for carriage and prima facie the suit could be barred for non compliance of a statutory condition precedent". 23. Mr. Chatterjee has invited my attention to the fact that the goods were delivered to the railway on 26.3.1974 but notice Under Section 78 (B) was send on 8.1.1975 i.e. long after expiry of six months from the date of delivery to the railways. 24. Mr. B.S. Lal has referred to Ext 4/A which is a letter to the claims Inspector railways for open delivery of goods against R. R. No. 779498, This letter was sent on 13.7.1974. It was specifically mentioned in the letter that the letter was to be treated as a claim for shortage. Moreover, this question was not raised before the trial court. In my opinion, claim was made within six months.
It was specifically mentioned in the letter that the letter was to be treated as a claim for shortage. Moreover, this question was not raised before the trial court. In my opinion, claim was made within six months. Hence the bar Under Section 78 (B) for the maintainability of the suit is not applicable. The contention of Shri Chatterjee cannot be accepted. Another objection has been raised by Shri Chatterjee to the maintainability of the suit with reference to Section 76 (C) of the Railways Act, which provides as follows : Responsibility for goods to be delivered at siding: "In the case of goods to be delivered by a railway administration at a siding not belonging to the administration, the railway administration was not be responsible for loss, destruction, damage, deterioration or non delivery of such goods, from whatever cause arising, after the wagon containing the goods has been placed at the point of interchange of wagons between the railway administration and the owner of the siding and the owner of the siding has been informed in writing that the wagon has been so placed". 25. Shri Chatterjee has submitted that admittedly in the present case the wagon containing the goods was placed at the siding of the plaintiff where delivery was taken, hence the railways imuine previous liability. In my opinion, this plea is not available to the railways firstly because this question was not raised before the trial court and secondly since open delivery was given to the plaintiff, the provisions, of Section 76 (c) will not be applicable. 26. Having considered all the aspects of the case, I have come to the conclusion that the findings recorded by the trial court are palpably erroneous, Hence the judgment in appeal must be reversed. The appeal is accordingly allowed and the judgment and decree of the trial court is set-aside and the appellants suit is decreed in terms of the relief claimed in paragraph 11, (i) and (ii) of the plaint. In the facts and circumstances of the case, the parties shall bear their own costs. Appeal allowed.