Tata Iron & Steel Co. Ltd. , Mumbai-1, Represented by its Dy. Manager (Legal Services), Secunderabad v. Union of India, Represented by General Manager, South Central Railway, Rail Nilayam, Secunderabad
2007-06-19
P.S.NARAYANA
body2007
DigiLaw.ai
JUDGMENT Heard Sri Manu, representing Sri K.Somakonda Reddy, the learned counsel for the appellant and Sri T.S. Venkataramana, the learned counsel representing the Respondents-Railways. 2. The appeal is filed as against an order made in TA.No.328 of 1990 on the file of the Railway Claims Tribunal, Secunderabad Bench. Originally instituted a suit, OS.No.1077 of 1989 on the file of the Court of III-Additional Chief Judge, City Civil Court, Secunderabad, for recovery of Rs.2,59,682-78 paise from the concerned Railways and the same was transferred as TA.No.328 of 1990 on the file Railway Claims Tribunal, Secunderabad Bench at Secunderabad, (hereinafter referred to for short as 'the Tribunal' for the purpose of convenience. 3. The Tribunal recorded the evidence of PWs.1 to 3, recorded findings appreciating oral and documentary evidence available on record and both Judicial Member and Technical Member came to a conclusion that for want of evidence the claim to be negatived, but however, differed only on the awarding of costs and the matter was referred to the Chairman of the Tribunal and the learned Chairman agreed with the orders of the learned Judicial Member and thus the application was dismissed without costs. Aggrieved by the said order made by the Tribunal, the present appeal is preferred. CONTENTIONS OF SRI MANU : 4. Sri Manu, representing the appellant had taken this court through the evidence available on record, the evidence of PWs.1, 2 and 3 and also pointed out to the report of the surveyor and the contents thereof and would comment that in the facts and circumstances of the case especially in the absence of any evidence adduced by the Railways negativing the relief and dismissing the application by the Tribunal cannot be sustained. The counsel also pointed out that in the light of the report of surveyor, the contents being self-explanatory, the alleged defects pointed out even by the Judicial Member are totally unsustainable. There is absolutely no vagueness in the evidence available on record. The counsel also further explained that even if the principles relating to the burden of proof to be followed, the appellant had clearly discharged the burden expected to be discharged by the appellant and hence the appellant is entitled to the relief prayed for The learned counsel would also submit that for no fault of the appellant, the appellant was non-suited and hence the appellant is entitled to interest as claimed for.
The learned counsel placed strong reliance on several decisions to substantiate his contention. CONTENTIONS OF SRI T.S. VENKATRAMANA: 5. Per Contra, Sri T.S.Venkataramana, the learned standing counsel for Railways had pointed out to the relevant portions of the findings and also certain decisions, which had been relied upon by the Technical Member and would comment that inasmuch as the burden of proof expected to be discharged by the appellant had not been discharged and in view of the fact that on the strength of such vague evidence, relief cannot be granted, the Tribunal had rightly rejected the same. The counsel also would submit that in the light of the facts and circumstances of the case, it is not a fit case where the well-considered findings of the Tribunal to be disturbed. 6. Heard the counsel. Perused the oral and documentary evidence available on record and the findings recorded by the Member Judicial, Member Technical and also the opinion of the Chairman of the Tribunal and the findings recorded by the said Members and the Chairman in relation to the evidence available on record. POINTS FOR CONSIDERATION IN THE APPEAL: 7. In the light of the contentions advanced by the counsel on record, the following points arise for consideration in this appeal: 1) Whether the findings recorded by the Tribunal can be said to be sustainable findings in the light of the evidence available on record ? 2) Whether the findings recorded by the Tribunal to be confirmed or to be set aside in the facts and circumstances of the case ? 3) Whether the appellant is entitled to the claim made in TA.No.328 of 1990 ? 4) Whether the appellant is entitled to the interest prayed for in the facts and circumstances of the case ? 5) If so, to what relief the parties would be entitled thereto ? 8. Point Nos. 1 to 4 : The appellant is the claimant, who had instituted a suit, OS.No.1077 of 1989 on the file of the Court of III-Additional Chief Judge, City Civil Court, Secunderabad, which was transferred and numbered as TA.No.328 of 1990 on the file of the Railway Claims Tribunal. The following averments were made by the appellant-applicant, hereinafter would be referred to as applicant for the purpose of convenience. It is needless to say that the respondents are the Railways. 9.
The following averments were made by the appellant-applicant, hereinafter would be referred to as applicant for the purpose of convenience. It is needless to say that the respondents are the Railways. 9. It was averred that on 31-5-1986 under RR.No.D/041470, the applicant company booked a consignment of 48.9 metric tones of 30 lbs untested rails from KMCEI station situate on the South Eastern Railway for carriage to Maula Ali Station in the South Central Railway via Nagpur on the Central Railway and delivery at Maula Ali. The consignment was booked at Railway risk. When the same arrived at Maula Ali on 9-7-1986, the applicant suspecting shortage, requested the first defendant, the South Central Railway, for open delivery and re- weighment. The re-weighment was however refused. The applicant then got the consignment reweighed in the presence of CF Pereira of the Indian Surveyors Private Limited and their own representative and it was found that the goods were short by 19.54 M.T. The applicant thereafter sent a notice to three defendants-respondents (respondents for short) under section 78-B of the Indian Railways Act on 25-7-1984. The respondents received the notices but the applicant's claim was not settled. The applicant has therefore been constrained to file the suit, after service of a notice under Section 80 CPC for recovery of Rs.1,67,926-76 paise towards the value of the goods short delivered and a further sum of Rs.9,757-02 paise towards interest on the value of the goods at the rate of 18% per annum from 31-5-1986 the date of booking till suit, in all Rs.2,59,683-78 paise, the shortage of the goods having occurred to transit on account of the negligence of the respondents and their servants. 10. After the matter was transferred to the Tribunal, a joint reply was filed by the respondents taking a stand that the consignment was to be allotted by the senders at their own siding without the supervision of the Railway staff and a 'said to contain' R.R. was issued. The goods were therein (RR) as one wagon said to contain 308 pieces of steel materials 30 lbs rails.
The goods were therein (RR) as one wagon said to contain 308 pieces of steel materials 30 lbs rails. The consignment was neither weighed nor the number of rails counted by the Railway staff of the Forwarding Station at the time of booking and the weight of the goods as mentioned by the consignor in the forwarding note was incorporated in the Railway Receipt for the purpose of calculating the freight and other charges. The Railway Administration was, thus not aware of the quality, quantity, the number of pieces or the weight of the goods loaded in the wagon. The consignment arrived at the destination without any delay and interference in transit and the wagon in which it was loaded was placed at the Tata siding of Maula Ali station at 13.30 hours of 4-7-1986 for unloading. Instead of unloading the wagon the consignee made a request for open delivery with a false allegation that there was some discrepancy in the wagon. The request for the open delivery was rejected by the Senior Divisional Commercial Superintendent and on 10-7-1986, the delivery was affected to the consignee under a clear signature. The contract of carriage, thus, came to an end on 10-7-1986. The respondents are not aware of the transactions between the consignees and the private surveyor about the time and date of the private assessment regarding the weight of the goods and no member of Railway staff witnessed the alleged private survey. There was no shortage of 19.54 MT in the consignment at the time of delivery as alleged. If at all there was any shortage, it may be due to short loading by the consignor or mischief played by the consignees or their servants, who had delayed the unloading of the wagon for four days after it was placed in their siding. The respondents being not responsible for the shortage are not liable to pay any compensation in that regard. The applicant's claim for interest cannot be allowed as it amounts to damages on damages and there is no trade usage, express or implied agreement between the parties for payment of such interest. 11. On the strength of these pleadings, the following issues were settled for determination: 1) Whether the applicant entrusted to Railways for carriage 48.9 MT of steel rails ?
11. On the strength of these pleadings, the following issues were settled for determination: 1) Whether the applicant entrusted to Railways for carriage 48.9 MT of steel rails ? 2) Whether the goods delivered to the consignees at the destination was short of those entrusted by 19.4 metric tones and if so, whether the Railways were responsible for the shortage? 3) Whether the applicant's claim for pre-suit interest is valid and tenable? 4) To what relief ? The Judicial Member recorded findings commencing from paragraph nos. 4 to 12 and ultimately dismissed the application but without costs. Member Technical recorded separate reasons referring to several decisions and came to the conclusion that the application be dismissed on contest with costs. However, in the light of the reasons recorded by the Chairman of the Tribunal as majority opinion, the T.A. was dismissed without costs. 13. On careful analysis of the findings recorded by the Member Judicial though the learned Member agreed on several factual aspects mainly on the ground that there is no acceptable or convincing evidence relating to the difference of consignment loss, the learned Member was not inclined to grant the relief. The case of the applicant is that the steel rails loaded in the wagon in question and entrusted to the respondents-railways at the forwarding station weighed 48.9 MT (and were 308 in number) and the stand taken by the respondents-railways is that the loading of the goods carried by the consignor had not been witnessed by the Railway staff. They were not aware of the weight and number of rails loaded in the wagon and that was the reason as to why a 'said to contain' R.R. was issued and the further stand taken by the respondents-railways is that the weight of the goods as given by the consignor in the forwarding note was incorporated in the R.R. that too only for the purpose of calculating the freight and in determining the question as to whether or not the consignor of steel rails weight 48.9 MT when they were accepted for carriage by the Railways after they were loaded in the wagon by the consignor.
A scrutiny of the forwarding note and the Railway Receipt, the two documents evidencing and governing the contract of carriage would suffice and it would not really be necessary to examine the other materials and hence in the light of these documents the stand taken by the appellant cannot be sustained. The 'said to contain' remark in the Railway Receipt relates only to the nature and number of the materials loaded in the wagon and so far as the weight of the goods is concerned, the said remark had no significance. No doubt, the Member Judicial recorded certain reasons in relation to the weight and other aspects of the documents available and was not inclined to rely upon the oral evidence of PWs.1 to 3 and also documentary evidence placed before the Tribunal and ultimately negatived the relief on the ground that there is no acceptable or convincing material before the Tribunal. AT the outset, it may be stated that none had been examined on behalf of the respondents-railways. 14. The learned counsel representing the appellant placed strong reliance on the decision of the Supreme Court in UNION OF INDIA AND ORS. V/s. SUGAULI SUGAR WORKS (P) LTD 1., wherein the Supreme Court at paragraph nos. 13 and 14 observed as hereunder: The liability of the railway was that of a bailee. The consignments were booked at railway risk. The onus of proving that the railway employees took the necessary amount of care and that they were not guilty of negligence rested on the Railway Authorities. The High Court held that it was not a case of unavoidable accident and that the Barge sank because of gross negligence of railway employees and the railways did not take the amount of care, which it was required to take as a bailee. The question of onus is not important when the entire evidence is before the Court. The High Court found that Rasul the Sarang of 'Chapra' was responsible for the accident because he had failed to exercise proper judgment while maneuvering his own vessel for the purpose of heaving up the anchor of Barge No. 6 and he failed to exercise initiative to save the barge by breaching it on the nearest char, instead of taking it to the Simariaghat goods jetty.
The High Court also held that the Commander of the ferry found that he visited the steamer 'Samastipur' and Barge No. 6 when there was difficulty in heaving the anchor of the barge and thereafter went away, leaving the matter entirely in the hands of the sarang. The High Court held that these officers were responsible for not staying on board until the barge was out of trouble. 15. The learned counsel relied upon a decision in FIRM OF CHABILDAS MANIKDAS AND BROTHERS, HYDERABAD V/s. THE UNION OF INDIA 2. Further reliance was placed on a decision in UNION OF INDIA V/s. BIHAR STATE FOOD AND CIVIL SUPPLY CORPORATION LIMITD 3, wherein the learned Judge of Ranchi Bench in the case of claim for short delivery and claim of damages in relation to consignment booked at railway risk rate, it was held that the loss alleged to be due to misconduct and negligence on the part of the railways - Section 76-F of the Railways Act, 1890 would not attract and Railways not showing cause of short delivery and damage and also not disclosing what care it took in carriage of goods, railways would be liable to pay damages. 16. The learned counsel further relied upon a decision in SHIV SARAN DASS V/s. UNION OF INDIA4, while dealing with Section 73 (new) of the Railways Act, 1890 (as amended in 1961), it was held that prior to the Amendment in 1961 the responsibility of the Railway Administration with respect to loss, non-delivery etc., of the goods entrusted for carriage by railway was that of a bailee only. The Amendment made the liability as of a common earlier. Even when the railway administration can claim exemption from liability under any of the clauses of Section 73 (new) the burden is cast on the railway administration to prove further that it had exercised reasonable foresight and care in the carriage of goods. 17. In FIRM OF T.MUDDU VEERAPPA SONS AND K.H. VEERANNA SETTY V/s. UNION OF INDIA AND ANOTHER 5, the responsibility of the Railway administration for damages of goods and the general responsibility of the Railway administration for loss of goods had been dealt with. 18.
17. In FIRM OF T.MUDDU VEERAPPA SONS AND K.H. VEERANNA SETTY V/s. UNION OF INDIA AND ANOTHER 5, the responsibility of the Railway administration for damages of goods and the general responsibility of the Railway administration for loss of goods had been dealt with. 18. In KHADIGRAMODYOD BHAVAN V/s. UNION OF INDIA 6, While dealing with pilferage of consignment in transit, when the railway administration failed to disclose how consignment was dealt with, when it was in its possession, it was held that inference can be drawn that pilferage occurred as a result of negligence or misconduct of railways and consignee is entitled to damages. 19. The aspect, who can sue consignor or consignee or the Commission Agent in relation thereto had been dealt with in UNION OF INDIA V/s. M/s. B. PRAHLAD AND COMPANY 7. 20. As already referred to supra, though there is evidence of PWs.1, 2 and 3, no evidence had been let-in on behalf of respondents-railways. The evidence of PW.1 is that the applicant company booked the wagon No.ER-BFR-98677 with the Railways to carry 48.900 metric tones of 30 lb Rails from Kumardhubi/Jamshedpur/Barkar to Moula Ali, Andhra Pradesh. This witness also stated that 48.900 metric tones of 30 lbs Rails were loaded in the above said wagon and was handed over to the Railways to be carried to the destination station. The above said fact is borne out by the records. On the date of invoice and on the date of RR.No.D/041470 dated 31-5-1986, the market value of the said steel was Rs.8,894-00 per metric tonne. But through the notice an amount of Rs.8,594-00 per metric tonne was claimed excluding stock-yard margin of Rs.300/- per metric tonne. PW.1 stated that when the said consignment reached Moula Ali after more than a month, the said consignment was in a disturbed condition with binding wire cut and with the Rails overlapping the chains used for packing and the chains were also in loose condition. Suspecting shortage due to pilferage and negligence of the Railways, the applicant company requested for re-weighment immediately on the arrival of the said wagon. But the railways without any proper reason regretted and rejected the weighment. The applicant company immediately intimated an independent surveyor to inspect and conduct a survey and also to witness unloading and re-weighment.
Suspecting shortage due to pilferage and negligence of the Railways, the applicant company requested for re-weighment immediately on the arrival of the said wagon. But the railways without any proper reason regretted and rejected the weighment. The applicant company immediately intimated an independent surveyor to inspect and conduct a survey and also to witness unloading and re-weighment. The applicant company intimated the Station Master of the first respondent railway about the survey and he was requested to depute their representative to witness the survey and reweighment but no one turned up. The survey was conducted on 9-7-1986 and 10-7-1986. The Rails were also counted at the time of unloading. This witness also stated that only 206 Rails were received and there was a shortage of 102 Rails, the said consignment was then loaded into two tractors-trailors and reweighed and the Railway accepted weigh bridge in the presence of the surveyor. On reweighment, it was found that the consignment weighed only 29.360 metric tonne i.e., there was a shortage of 19.540 metric tones. This witness also specifically stated that he was present during the entire operation of unloading and reweighment and he had witnessed the condition of the consignment immediately on the arrival of the said wagon at the destination station. 21. PW.2 stated that he has been working in the applicant company from 6-3- 1985 and well acquainted with the facts of case. This witness also deposed that the applicant company is a registered company under the Indian Companies Act. The applicant company booked Wagon No.ER/BER?98677 with the respondent No.2 Railway to carry 48,900 metric tones of 30 LB rails from Barakar/Jamshedpur to Moula Ali, Secunderabad. This witness also stated other particulars. 22. These witnesses, PWs.1 and 2 were cross-examined but no serious contradictions as such had been elicited in the evidence of PWs.1 and 2. 23. PW.3 is an important witness, who is Insurance surveyor and his Licence number is SLA-1571 and this witness stated that he was requested by the applicant company to conduct survey and witness unloading and reweighment of wagon no.ER-BFR-98677, as the respondent no.1 Railway refused to reweigh the said wagon at the destination station, Moula Ali, Andhra Pradesh. This witness also stated that on seeing the said wagon he found that the binding wire was cut and the chains used for strapping were found loose and some of the Rails were overlapping the chains.
This witness also stated that on seeing the said wagon he found that the binding wire was cut and the chains used for strapping were found loose and some of the Rails were overlapping the chains. He suspected that the shortage was due to pilferage en- route because of the above said condition of the consignment. The survey was conducted on 9-7-1986 and 10-7-1986. The said consignment was of 30 lb. Rails. The said consignment of rails was loaded into two tractors-trailors and the consignment was re-weighed on the automatic weighbridge accepted by the Railways. On reweighment, it was found that the consignment was short by 19.540 metric tones and rails were counted. As per the RR the weight of the said consignment is 48.900 metric tones and the number of rails mentioned is 308. On reweighment, PW.3 found that the weight of the said consignment was only 29.360 metric tones and the number of rails was only 206. Accordingly, a survey report dated 14-7-1986 was issued by the company to the applicant company in proof of shortage in the said consignment. 24. The applicant also relied on xerox copy of material transfer memo of Kumardhabi Metal Casting and Engineering Limited, Conversion Agent of Tata Iron and Steel Company Limited dated 22-5-1986. Copy of Central Excise Gate Pass dated 22-5-1986. Copy of letter from appellant to respondent dated 04-7-1986. Copy of Consignment Discrepancy Report, dated 9-7-1986. Copy of Indian Surveyors Report, dated 14-7-1986. Copy of Section 78-B Notice dated 25-7-1986. Copy of Letter from CCO to TISCO dated 21-8-1986. Copy of Section 80 CPC notice dated 11-7-1987. Copy of letter and acknowledgement dated 23-7-1987. Copy of affidavit of Dara Ardeshir in TA.No.328/1990 dated 6-3-1991. Copy of affidavit of Mahabir Ghosh in TA.No.328/1990 dated 06-5-1991. Xerox copy of affidavit of Edwin Pereira in TA.No.328/1990. 25. The oral evidence in nutshell already had been referred to supra. Certain findings had been recorded relating to the dates of reweighment. The evidence of PW.3 already had been discussed above in brief. In the surveyor's report dated 14-7-1986 in the columns survey held it is shown as 9-7-1986 and 10-7-1986. The delay in between the date of reweighment and the date when the goods reached destination had been pointed out.
Certain findings had been recorded relating to the dates of reweighment. The evidence of PW.3 already had been discussed above in brief. In the surveyor's report dated 14-7-1986 in the columns survey held it is shown as 9-7-1986 and 10-7-1986. The delay in between the date of reweighment and the date when the goods reached destination had been pointed out. This appears to be not correct stand, since till reweighment was held on the dates shown in the surveyor's report dated 14- 7-1986 the consignment/goods had been in the custody of the respondents-railways and on the refusal on the part of the respondents-railways to permit such reweighment for reasons best known to them; the applicant-company proceeded with the same as well evidenced by the evidence of PW.3, further as reflected from the report dated 14-7-1986 specified above. Hence, the findings recorded by the Member Technical and the Member Judicial that there is no acceptable or convincing evidence to establish the loss which had been sustained by the applicant cannot be sustained. Apart from this clear evidence available on record, further respondents-railways had not chosen to let-in any evidence at all. In such a case, in the light of the decisions referred to supra, it cannot lie in the mouth of the respondents-railways to contend that the burden had not been discharged in accordance with law. Hence, the findings recorded by the Tribunal in this regard are totally unsustainable findings, since the evidence available on record had not been appreciated by the Tribunal in proper perspective. This court is of the considered opinion that the said findings are liable to be set aside, especially in the light of the clear evidence of PWs.1, 2 and 3 and also report of the surveyor dated 14-7-1986. Apart from the other documents, there is clear evidence relating to the loading of the consignment and the particulars of consignment and the place of destination as well and due to the non co-operation on the part of the respondents-railways the applicant company had chosen to engage PW.3 who had well deposed on this aspect and the contents of surveyor's report dated 14-7-1986 being self-explanatory, no further findings need be recorded in this regard. 26. Certain further submissions were made in relation to the interest and strong reliance was placed reliance on the decision in UNION OF INDIA AND ANR.
26. Certain further submissions were made in relation to the interest and strong reliance was placed reliance on the decision in UNION OF INDIA AND ANR. V/s. KHANDELWAL BROS (P) LTD.& ANR 8, wherein it was held that in the absence of any usage or contract express or implied or any provision of law to justify award of interest, interest cannot be awarded by way of damages and hence in a suit by the consignee against the railway for damages for short delivery of the goods the plaintiff is entitled to interest only from the date of the suit. The learned Judge in fact relied upon the decision reported in AIR 1966 SC 395 . Reliance also was placed on the decision in UNION ; OF INDIA V/s. VISVESWARAYA IRON AND STEEL LTD. AND ORS9. Hence, in the light of the facts and circumstances it would be just and reasonable to grant interest at 9% p.a. from the date of institution of the suit till the date of realization. 27. Point No. 5: In the light of the findings recorded above, the appellant- applicant is bound to succeed and accordingly the appeal is hereby allowed decreeing the claim as prayed for but at 9% interest from the date of institution of the suit till the date of realization. No costs.