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Union of India (Uoi), Represented by the General Manager, Southern Railway, Madras Vs. ScIndia Steam Navigation Co. Ltd. - Court Judgment

LegalCrystal Citation
SubjectCommercial;Limitation
CourtKerala High Court
Decided On
Case NumberA.S. No. 130 of 1969
Judge
Reported inAIR1974Ker136
ActsCarriage of Goods by Sea Act, 1925 - Schedule - Article III
AppellantUnion of India (Uoi), Represented by the General Manager, Southern Railway, Madras
RespondentScIndia Steam Navigation Co. Ltd.
Advocates: K.P. Pathrose and; P.T. Abraham, Advs.
DispositionAppeal dismissed
Cases ReferredMerchant S. N. Co. v. Thanulineom Pillai
Excerpt:
.....action on the date of suit. as we have pointed out earlier, the reasoning of the decision, very clearly, according to us, indicates that the question of filing a suit would not arise unless it be that the suit is filed within the period specified. but all the same, the court said that the suit was well within time......to the appellant. that is because the court was concerned with an entirely different question in the case cited. the period of one year expired on a holiday and the suit was instituted on the court reopening. this court invoked the principle that the act of the court shall not prejudice any person and since it was because the court was closed that the act of filing within the period was incapable of compliance the suit filed when the court reopened must be held to have been filed in time. it is an entirely different principle that is applied and that has no bearing on the question before us.in the circumstances of the case, we do not think that the appellant should pay the costs. the parties will suffer their costs in this appeal. there is a cross-objection by the respondent in.....
Judgment:

Subramonian Poti, J.

1. The question that we are concerned with in this appeal is one of limitation in a suit for recovery of money said to be the value of goods short-delivered to the plaintiff, the Union of India owning Southern Railway. The defendant, the Scindia Steam Navigation Company Ltd a shipping company is engaged in the business of undertaking the carriage of goods by sea. The Court below has held that the claim for recovery of the value of goods short-delivered is barred by limitation since the suit has been instituted more than one year after the date the goods were short-delivered. That the suit was filed before the Subordinate Judge's Court of Cochin more than one year after the goods were short-delivered is not disputed. But it is said that earlier, a suit was filed before the City Civil Court, Madras and it was represented in the Cochin Court finding that it ought to be filed in the said Court. It is said that the plaintiff bona fide believed that the suit was to be instituted in the City Civil Court, Madras and if Sec. 14 of the Limitation Act; 1908 (which is the Limitation Act applicable to the case) is applied, then the suit would be in time. In other words, in computing the period of limitation prescribed for the suit, the plaintiff seeks exclusion of the period during which he had been prosecuting the proceedings in another Court as according to it, that suit was prosecuted with due diligence and was prosecuted also in good faith, and it is only for defect of jurisdiction that the Court did not entertain the suit.

2. That the period of limitation for such a suit is provided by the provisions of the Carriage of Goods by Sea Act, is evident. It is not any period of limitation under the Limitation Act, 1908 that applied. The Indian Carriage of Goods by Sea Act, 26 of 1925 carries a schedule and the relevant clause (31 in paragraph 6 of Article III in the schedule reads:

'In any event the carrier and the ship shall be discharged from all 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.'

It may be pertinent to notice here that the provision is not that a suit shall be brought within one year from a specified date or that no suit shall be brought after the expiry of one year, but that if the suit is not brought within the time specified, the carrier and the ship would be discharged from all liability in respect of loss or damage. When once the liability of the carrier or ship terminates there is no survival of the cause of action against them for claiming damages caused by short-delivery. We need only advert to the decision of the Supreme Court of India which dealt with the very same clause in a case where the plaintiff sought to apply the provision in Section 19 of Limitation Act. 1908 to a case of short-delivery. In East & West Steamshin Co. v. S. K. Ramalingam, AIR 1960 SC 1058 the Court said in paragraph 25:--

'The question is, however, of some importance in the facts of the Madras case, For if the provision is one of limitation, there would be some scope for argument in the facts of that case that the period was extended by acknowledgments of liability within the meaning of Article 19 of the Limitation Act. The question we have to decide is whether in Baying that the ship or the carrier will be 'discharged from liability,' only the remedy of the shipper or the consignee Was being barred or the right was also being terminated. It is useful to remember in this connection the international character of these rules, as has been already emphasised above. Rules of limitation are likely to vary from country to country. Provisions for extension of periods prescribed for limitation would similarly vary. We should be slow therefore to put on the word 'discharged from liability' an interpretation which would produce results varying in different countries and thus keeping the position uncertain for both the shipper and the ship-owner. Quite apart from this consideration, however, we think that the ordinary grammatical sense of 'dis-charged from liability' does not connote 'free from the remedv as regards liability' but is more apt to mean a total 'extinction of the liability following upon an extinction of the right. We find it difficult to draw any reasonable distinction between the words 'absolved from liability' and 'discharged from liability' and think that these words 'discharged 'from liability' were intended to mean that the liability has totally disappeared and not only that the remedy as regards 'the liability has disappeared. We are unable to agree with the learned Judge of the Madras High Court that these words merely mean that 'that even though the right may inhere in the person who is entitled to the benefits, still the liability in the opposite party is discharged by the impossibility of enforcement.' The distinction between the extinction of a fight and the extinction of a remedy for the enforcement of that right, though fine, is of great importance. The legislature could not but have been conscious of this distinction when using the words 'discharged from all liability' in an Article purporting to prescribe rights and immunities of the shipowners. The words are apt to express an intention of total extinction of the liability and should, specially in view of the international character of the legislation, be construed in that sense. It is hardly necessary to add that once the liability is extinguished tinder this clause, there is no scope of any acknowledgment of liability thereafter.'

It appears to us that the Supreme Court has, in categorical terms, found that, the provision in the relevant clause is one providing for the extinguishment of the liability of a carrier or ship when once a Suit is not filed within a period of one Year from the specified date. The question as to whether such suit could nevertheless be entertained by reason of the various provisions for exclusion of periods in computing the period of limitation under the Limitation Act does not arise in a case to which this provision in the Indian Carriage of Goods by Sea Act applies. The reason for this approach has also been well indicated in the judgment of the Supreme Court. It is not as if the reasoning of the learned Judges Is applicable particularly to a plea of acknowledgment under the Indian Limitation Act. The approach to the question being that when once the liability of a Party is extinguished, there is no Question of enforcing any right as against that party and for that purpose the provisions of the Limitation Act would be irrelevant, it is immaterial whether the exclusion is sought on the basis of Section 19 of the Indian Limitation Act or any other provision. To us, it appears to be clear that when once it is shown that the suit has not been instituted within the period specified there is no liability on the part of the carrier or ship with the result that they can take UP the defence that there is no cause of action surviving and, therefore, the suit must be thrown out. This is what is contended in this case. The fact is that a suit has been filed in another Court and that Court had no jurisdiction to entertain it. The question is not whether a suit which was filed in a Court which had no jurisdiction was in time, but the suit with which it was dealing was filed before the liability was extinguished. It is only under Section 14 of the Limitation Act that on showing the existence of certain conditions, a plaintiff is allowed to seek exclusion from the period of limitation the period of bona fide prosecution in a Court without jurisdiction. If that provision will not be applicable to a case, the question would only be as to whether the suit which has been properly instituted is a suit which is instituted within time. Possibly, it may not be correct to say that the suit is barred if it is beyond the period of one year specified. It will be more appropriate to view it as a case where the suit has to fail for want of a subsisting cause of action on the date of suit.

3. We have gone into this question in such detail despite the pronouncement of the Supreme Court which appears to us to be directly on point onlv because a learned Judge of this Court has taken a different view from what we have taken here. We are referring to the decision in Merchant S. N. Co. v. Thanulineom Pillai, 1968 Ker LT 486. That was a case which, on facts, is in parallel with the case before us. There again a suit was instituted within the period of one year before a Court which had no jurisdiction and later re-presented in a Court which had jurisdiction butthat was beyond the period of one year and the period of prosecution in the Court which had no jurisdiction was sought to be excluded. The learned Judge referred to the decision of the Supreme Court but after referring to the relevant portion of the judgment observed.

'It is difficult to cull out from the above observation that the Law of Limitation has no application at all to cases arising from the Act. It is significant to note that in the above case no suit was filed within the one year prescribed in Rule 6 of Article III and it is under that circumstance that the Court had to hold that the right was extinct and when the right is extinct the liability is also extinct. But the position in the instant case is different. Here, the suit was filed within the period of one year prescribed by the Act, though in a wrong Court.'

Of course, in the case which was decided by the Supreme Court the facts were those to which the application of Section 19 was sought to be made. But we do not think that makes any difference. As we have pointed out earlier, the reasoning of the decision, very clearly, according to us, indicates that the question of filing a suit would not arise unless it be that the suit is filed within the period specified. The question of exclusion by applying the provisions of the Limitation Act would be out of place in view of the language of clause 3. paragraph 6 of Article III of the schedule to the Act. In these circumstances we do not think that the decision in 1968 Ker LT 486 lays down the law correctly. We hold that the suit has, therefore, to be dismissed as not having been instituted within the period of one year of the date the goods were short-delivered.

4. The appellant referred also to another decision of this Court. That is the decision of the Division Bench in M/s. Madura Co. y. Thangal Kunju Musa-liar, 1963 Ker LJ 1233 = (AIR 1964 Ker 190). There again, the Court was considering the period of one year specified in the relevant clause of the Carriage of Goods by Sea Act to which we have referred to in this decision. The suit was not instituted within a period of one year after the goods were short-delivered. But all the same, the Court said that the suit was well within time. Plaintiff's counsel relies on that decision to support his plea that the decision of the Supreme Court cannot be read as holding that in no case, the suit shall be instituted beyond the period of one year. We do not think the decision on which reliance is so placed is of any assistance to the appellant. That is because the Court was concerned with an entirely different question in the case cited. The period of one year expired on a holiday and the suit was instituted on the Court reopening. This Court invoked the principle that the act of the Court shall not prejudice any person and since it was because the Court was closed that the act of filing within the period was incapable of compliance the suit filed when the Court reopened must be held to have been filed in time. It is an entirely different principle that is applied and that has no bearing on the Question before us.

In the circumstances of the case, we do not think that the appellant should pay the costs. The parties will suffer their costs in this appeal. There is a cross-objection by the respondent in the appeal and It relates to the costs in the Court below.' We do not think that in the circumstances of the case, we should interfere with the discretion exercised by the Court below.


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