(1) The Sterling General Insurance Co. Ltd. (respondent No. 1.) and the Hindustan Times Ltd. (respondent No. 2) filed the suit out of which this appeal arises against the appellant Union of India for recovery of Rs. 70,000.00. The suit was decreed by the trial Court by its Judgment and decree dated January 15, 1962 against which the Union of India have filed this appeal.
(2) Respondent No. 2 owned two aircrafts which were insured with respondent No. 1 These aircrafts were burnt on May 8, 1958 while in the hangar at the Delhi Flying Club. Safdarjung Aerodrome, New Delhi, when a Vampire aircraft belonging to the Indian Air Force hit the ground at the side aerodrome and crashed into the hangar resulting in the fire to the two aircrafts belonging to respondent No. 2. Respondent No. 1 paid claims of Rs 60,000.00 for one of the aircraft and of Rs. 10,000.00 for the other aircraft to respondent No. 2 on May 21, 1958 in pursuance of the policies of insurance and became subrogated to all rights, titles and interests of respondent No. 2 in respect of the loss and damage caused to the two aircrafts belonging to respondent No. 2. It was alleged in the plaint that the accident was caused as a result of the gross negligence and dereliction of duty on the part of the authorities having control of the aircraft of the Indian Air Force which caused the accident and which was the result of uncalled for trespass committed in the premises where the two aircrafts belonging to respondent No. 2 were lying. The appellant, Union of India, was sought to be made liable for the aforesaid loss on the ground that the aircraft aurhorities having control of the aircraft of the Indian Air Force were employees of the Central Government under the Ministry of defense. A notice under section 80 of the Code of Civil Procedure was served on the appellant and on non-payment, the suit was filed for recovery of Rs. 70,000.00 on April 16, 1960, in the trial Court.
(3) The appellant tiled their written statement raising various pleas denying the validity of the notice under sction 80 of the Code of Civil Procedure, alleged gross negligence and derelication of duty and the absence of particulars in that behalf; the absence of justiciable cause of action and the maintainability of the suit against the appellant on the ground that the aircraft in question was on an official flight when it crashed and immunity on account of an Act of State and the non-liability of the appellant for any allegd tortious act of their employees.
(4) Nine Issues were framed by the trial Court but the only Issues which have been pressed are Nos. 3 to 6 which are :-
'3.Whether the suit is incompetent against the defendant 4. Whether the accident was caused on account of grass-negligence and dereliction of duty on the part of the employees of defendant If so, to what effect 4A. Whether the accident was the result of any uncalled for trespass alleged to have been committed by the defendant's aircraft. Note :- This issue will also include in rebuttal whether the Government is not liable for the tortious acts of its employees 5. Are not the plaintiffs bound to give further particulars of the alleged negligence and dereliction of duty on the part of the authorities having control on the Air Force Aircraft and to specify the authorities 6. Whether the aircraft that crashed was on official flight and whether the defendant is not liable to compensate the plaintiffs for the damage alleged to have been caused by the accident as alleged in para 4 of the preliminary objections of the written statement ?'
(5) In coming to the conclusion that there was negligence on the part of the pilot flying the aircraft of the Indian Air Force, the trial Court applied the principle rest ipsa loquitur as stated in 1865 3 Ii &C; 596 in re : Scott v. London and St. Katherine Docks Co. that 'where the thing is shown to be under the management of the defendant or his servants, and the accident is such as in the ordinary course of things does not happen if those who have the management use proper care, it affords reasonable evidence, in the absence of Explanationn by the defendant, that the accident arose from want of care and came to the conclusion that negligence must be assumed in this case. The trial Court then rejected the plea of the appellant that the act was an Act of State and while holding that the aircraft of the Indian Air Force which caused the accident was on official flight came to the conclusion that an official flight could not constitute an Act of State The trial Court further held that having paid the insured amount to respondent No. 2, respondent No. 1 was subrogated to all the rights of the former and decreed the suit against the appellant.
(6) In our opinion, the trial Court was right in applying the principle rest ipsa loquitur to the facts of the present case and in coming to the conclusion that in the absence of evidence produced by the appellant, negligence on the part of the pilot of the aircraft of Indian Air Force must be taken to have been established. The trial Court was also right in its conclusion that the tort committed could not be said to be an Act of State.
(7) It is settled law that there can be no Act of State between the sovereign and the subjects. In Walker v. Bawd (1892) A C. 491) it was observed that between Her Majesty and one of her subjects there can be no such thing as an Act of State. This was accepted in Johnstone v. Pedlar (1921) 2 A.C. 262 and in Eshugbayi Eleko v. Government of Nigeria 1931 A.C 662. In the latter case, Lord Atkin pointed out that an Act of State, -
'IScapable of being misunderstood. As applied to an act of the sovereign power directed against another sovereign power not owing temporary allegiance, in pursuance of sovereign rights of waging war or maintaining peace on the high seas or abroad, it may give rise to no legal remedy. But as applied to acts of the executive directed to subjects within the territorial jurisdiction it has no special meaning, and can give no immunity from the jurisdiction of the Court to inquire into the legality of the act.'
No case can, thereforee, be said to have been made out by the appellant that the accident in question was as a result of an Act of State. The trial Court, however, did not direct itself to the question whether the aircraft of the Indian Air Force being on official flight, the crash would be relatable to the exercise of sovereign power as distinguished from an Act of State and this is the only aspect of the matter which was argued before us. This question has now been settled by the Supreme Court by its decison : (1966)IILLJ583SC : M/S Kasturi Lal Ralia Ram Jain v. The State of Uttar Pradesh which has laid down the law with regard to the liability of the Govevrnment for the tortious act of its servants. After a review of all relevant cases on the point starting with 196 6 5 Bomb HCR A 1 in re : Peninsular and Oriental Steam Navigation Co. v. Secretary of State for India in Council and ending with the earlier decision of the Supreme Court : AIR1962SC933 : State of Rajasthan v. Mst. Vidhyawati it was observed
'INdealing with such cases, it must be borne in mind that when the State pleads immunity against claims for damages resulting from injury caused by negligent acts of its servants, the area of employment referable to sovereign powers must be strictly determined. Before such a plea is upheld, the court must always find that the impugned act was committed in the course of an undertaking or employment which is referable to the exercise of sovereign power, or to the exercise of delegated sovereign power that in the case of the State of Rajasthan, : AIR1962SC933 this Court took the view that the negligent act in driving the jeep car from the workshop to the Collector's bungalow for the Collector's use could not claim such a status. In fact, the employment of a driver to drive the jeep car for the use of a civil servant is itself an activity which is not connected in any manner with the sovereign power of the State at all. That is the basis on which the decision must be deemed to have been founded; that it is this basis which is absent in the case before us. It is necessary to limit the area of these affairs of the State in relation to the exercise of sovereign power, so that if acts are committed by Government employees in relation to other activities which may be conveniently described as non-governmental or non-sovereign, citizens who have a cause of action for damages should not be precluded from making their claim against the State. That is the basis on which the area of the State immunity against such claims must be limited, and this is exactly what has been done by this Court in its decision in the case of State of Rajasthan.'
(8) It is, thereforee, to be seen whether the negligent act in the present case was committed during the course of employment referable to sovereign powers and in relation to the exercise of the sovereign power or in the exercise of non-governmental or non-sovereign powers. In Mrs. Kasturi Lal Ralia Ram Jain's case (supra), the Police had arrested its partner Ralia Ram Jain and had seized his gold and silver. After his release, the seized gold was not returned to him as it had been misappropriated by the Head Constable Mohammad Amir who had fled to Pakistan. The suit filed by M/s. Kasturi Lal Ralia Ram Jain was resisted by the State, inter alia, on the ground that rt was not liable to compensate the said firm for loss caused to it by the negligence of the public servants employed by the State. The Supreme Court upheld the finding of negligence but dismissed the claim on the ground that the tortious act had been committed by the public servant in discharge of statutory functions which are referable to, and ultimately based on, the delegation of the sovereign powers of the State to such public servant and could not be equated to the tortious act of a servant who might have been employed by a private individual for the same purpose. The question that arises in this appeal, thereforee. is whether the tortious act is referable to the sovereign power of the Government.
(9) Now, as stated earlier, the trial Court came to the conclusion that it had been proved that the circraft of the Indian Air Force which caused the accident was on official flight. For this conclusion the trial Court relied upon the statement of Fit. Lt. Hazara Singh. (After discussing this, the judgment proceeds,). The fact remains that the aircraft in question belonged to the Indian Air Force which is maintained by the Government in exercise of its sovereign power for the defense of the country if and when the need arises. The pilot who was flying the aircraft was an Air Force pilot and there is no reason to disbelieve the testimony of this witness that he was on an exercise flight. While the Government maintains its armed forces including the Air Force for the defense of the country if and when the need arises, it must of necessity indulge in exercises and such exercises must of necessity be also referable to the exercise of sovereign power in times of peace. The flight of an aircraft of the Indian Air Force even in time of peace on an official authorised exercise is clearly referable to the exercise of sovereign power and if any tort is committed by the Air Force pilot during such exercise flight, no action for damages can lie against the Government. The exercise flight by an aircraft of Indian Air Force is an act which cannot be performed by a servant who might be in the employ of a private individual. In our opinion, the principles laid down by the Supreme Court in M/s. Kasturi Lal Ralia Ram Jain's case (supra) fully apply to the facts of this case and the Government cannot be held liable for damagss. Appeal allowed.