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South India Insurance Co., Ltd. and anr. Vs. the Union of India (Uoi) Owning the Indian Railways Represented by the General Manager, Southern Railway and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Reported in(1971)1MLJ373
AppellantSouth India Insurance Co., Ltd. and anr.
RespondentThe Union of India (Uoi) Owning the Indian Railways Represented by the General Manager, Southern Rai
Cases ReferredJones v. Bellgrove Properties Ltd. L.R.
Excerpt:
.....the evidence independently, they have clearly erred in such appreciation and assessment of the evidence. 8. the trial court has rightly found that the railways have clearly failed to discharge their duty as bailees in regard to the consignments. 384, it has been held that where a consignment is booked at railway risk for carriage to the destination, the railway, as a bailee, is bound under section 160 of the contract act to return the goods at the destination and that once the failure to return the goods bailed is established it will be presumed to be the bailee's default, in the absence of a satisfactory explanation. the trial judge has rightly found that the certificate of short delivery in each of the first two suits clearly amounts to acknowledgment of liability on the part of..........unloading clerk in royapuram station, alone has been examined to speak to the delivery of, the goods. the trial court accepted the evidence of p.w. 2 and relied on several other circumstances in finding that the goods were consigned, as alleged in the plaint and that there was short delivery of the goods in each of these suits.6. the judges of the new trial bench have purported to independently appreciate the evidence in reversing the finding of the trial court. in fact, they have observed:having gone through the entire documents in the case and the oral evidence let in by the parties we have come to the conclusion that the onus which lay on the plaintiff initially to prove the actual number of articles loaded by them has not been discharged at all.they have commented on the learned.....
Judgment:

R. Sadasivam, J.

1. The second petitioner in these petitions, the Madras Circle pipe Dealers' Association Ltd, now Tubes and Malleables Limited placed orders with Indian Tube Company, Ltd., for supply of galvanised R.L.S. and Section light tubes. The goods were despatched from Tata Nagar, but when the second petitioner took delivery of the same, there was shortage. The second petitioner had insured the goods with the South India Insurance Company Ltd., the first petitioner herein, and recovered the value of the goods short delivered. Both the petitioners joined together and filed the four suits, 5393, 5394, 5395 and 5398 of 1962, to recover Rs. 270.55, being the value of 3 bundles of 9 lengths, short delivered in the first suit, Rs. 276.48 being the value of 4 bundles of 12 lengths, short delivered in the second suit, Rs. 899.98, being the value of 36 lengths short delivered in the third suit, in respect of one railway receipt, R.R. No. 168861, as the value of 21 lengths short delivered in another railway receipt R.R. No. 168866 in that consignment was paid by the railways and a sum of Rs. 139.66, being the value of 2 bundles of 3 lengths short delivered in the last suit. The respondents representing the Railways contended that the suit by the first petitioner was not maintainable, that the first two suits, 5393 and 5394 of 1962 were barred by limitation as the said suits were filed more than a year after open delivery of the goods, that they were not liable for the reason that the railway receipt merely referred to the fact that the consignment was only said to contain a certain quantity of the goods and that they were not liable as the consignments had not been packed as per conditions prescribed in the Indian Railways Conference Association Goods Tariff.

2. The trial Court negatived all these contentions and decreed the suits as prayed for in favour of the first petitioner. But on New Trial Applications filed by the respondents herein, the suits were dismissed with costs throughout.

3. In view of the Bench decision in Sri Sarada Mills Ltd. v. Union of India : (1996)2MLJ16 , the first petitioner as the insurer has satisfied the claim of the second petitioner in respect of the short delivery of the goods hence it is subrogated to the rights of the second petitioner. Further, both the petitioners have joined together in filing the suit. The learned Advocate for the respondents did not dispute the fact that the suit filed by the first petitioner is maintainable.

4. Sri S.K.L. Ratan, the learned Advocate for the respondents relied on the unreported Supreme Court decision in Hari Sao v. The State of Bihar C.A. No. 240 of 1966, in support of his contention that where the railway receipt contained the words said to contain certain number of bundles it was not an admission on the part of the railway administration that a particular number of goods was consigned. In C.R.Ps. Nos. 447 and 448 of 1953, the short-notes of which are reported as Kalathy Chetty v. General Manager, B.N. Railway (1955) 2 M.L.J. 46, Rajagopala Ayyangar, J. as he then was, has held that the principle that the Railway authorities will be absolved from liability for any short delivery in cases where they do not affirm or certify the weight or quantity loaded in the wagon, but only issue the receipt as 'stated to contain' is not applicable to a case where the number of units loaded could be assessed with certainty. 'It has been held in that case that such circumstances can be relied upon as absolving the railway from liability only in cases where there is no standard weight for the units loaded in the wagon and there is no means of ascertaining with any exactitude the number of bags loaded into it. Sri S.K.L. Ratan, tried to distinguish this case on the ground that the tubes in this case being of varying lengths could not be of uniform weight. The trial Court has relied on the above decision and held that the fact that the railway receipts Exhibits D-1, D-7, D-16 and D-23 in this case contain the words SC meaning 'said to contain' will not absolve the railways from liability as the number of bundles could be easily verified. It appears from the decision of Rajagopala Ayyangar, J., that the plaintiffs in that case took delivery of the goods without having them weighed at the time of taking delivery just as in the present case. The plaintiffs in that case relied on the entries in the account books to show the quantity of goods received. This was accepted by the trial Court, but the decision was reversed in the New Trial Application and Rajagopala Ayyangar, J., restored the judgment of the trial Court.

5. Even in the unreported Supreme Court decision relied on by Sri S.K.L. Ratan it is stated that where the railway receipt contained the words 'said to contain' it is the duty of the owner to prove the quantity of goods actually consigned by him by adducing such evidence as to how he acquired the goods, what price he paid for the same and what quantity he loaded in the wagons. There is such evidence in the present case furnished by P.W. 2 Mukherjee, General Foreman in charge of the Indian Tube Company, who not only gave evidence about the general practice as to the consignment of the goods, but also gave details as to the actual consignment of goods in this case. He has deposed that before loading all the individual bundles are counted personally by him and by another person to have a double check and that after counting, it is being weighed on one side before loading into the wagon. He has specifically stated that a railway clerk witnessed the actual weighment and that the weighment was recorded in the weighment register. He denied the suggestion that the loading was not supervised as stated in the railway receipt. It is true he could not say who-weighed the pipes and counted before loading without looking into the Forwarding Notes. But the Forwarding Notes were with the railways and they did not cross-examine P.W. 2 with reference to the same. It should he noted that there 5s really no contra evidence as D.W. 1 Francis, unloading clerk in Royapuram Station, alone has been examined to speak to the delivery of, the goods. The Trial Court accepted the evidence of P.W. 2 and relied on several other circumstances in finding that the goods were consigned, as alleged in the plaint and that there was short delivery of the goods in each of these suits.

6. The Judges of the New Trial Bench have purported to independently appreciate the evidence in reversing the finding of the trial Court. In fact, they have observed:

Having gone through the entire documents in the case and the oral evidence let in by the parties we have come to the conclusion that the onus which lay on the plaintiff initially to prove the actual number of articles loaded by them has not been discharged at all.

They have commented on the learned trial Judge having decided the case accepting the entries in the Forwarding Notes as correct and proceeded to observe that if the entries in the forwarding notes are taken as conclusive of the matter, then the railways can have no defence in any suit. These observations show that the Judges who heard the New Trial Application have not read the Judgment of the trial Court properly. There is nothing in the Judgment of the trial Court to show that the entries in the Forwarding Notes were taken as conclusive. The Judges who heard the New Trial Applications seem to be solicitous that the railways should have some defence. Even if they tried the case as an appellate authority, I would have no hesitation in observing that their appreciation of the evidence is wrong. It should be noted that the jurisdiction of the Judges hearing New Trial applications is limited and the Judges who tried the New Trial Applications in this case have completely ignored the same. Section 38 of the Presidency Small Cause Courts Act is as follows:

Where a suit has been contested, the Small Cause Court may, on the application of either party, made within eight days from the date of the decree or order in the suit (not being a decree passed under Section 522 of the Code of Civil Procedure), order a new trial to be held, or alter, set aside or reverse the decree or order, upon such terms as it thinks reasonable, and may, in the meantime, stay the proceedings. Explanation : Every suit shall be deemed to be contested in which the decree is made otherwise than by consent of or in default of appearance by the Defendant.

The general language of Section 38 of the Presidency Small Cause Courts Act may leave the impression that there are no conditions attached to the exercise of the jurisdiction under that section. But the history of the Legislation, the practice of the Courts and the long line of decisions have clearly indicated the restricted scope of the jurisdiction of the Judges hearing a New Trial Application. It is well known that the Presidency Towns Small Cause Courts are summary Tribunals established in 1850 to relieve the Supreme Courts in the Presidency Towns and are largely modelled on the county Courts in England. In England the power to grant new trials conferred on the judges of the county Courts is not an absolute power to be exercised on any grounds which the Judge may think fit, but can only be exercised for such reasons in law as a superior Court would deem sufficient for a new trial. Order 51, Rule 12 of the Rules of Practice in Madras framed under the Presidency Small Cause Courts Act in respect of applications under Section 38 of that Act is as follows:

The application will not ordinarily be granted unless one of the grounds specified in the following clauses is established:

(a) That the decree or order is contrary to some specified law or usage having the force of law.

(b) That there was a substantial error in the procedure as prescribed by these rules or by any other enactment applicable to the Court which has produced error in the decision of the case on the merits.

(c) That the applicant has discovered new and important matter or evidence which would affect the decision of the case on the merits and which, after the exercise of due diligence, was not within his knowledge and could not be produced by him before the Court at the time when the decision was passed.

In Fire Stone Tyre etc. Co. v. Ramanuja Aiyangar (1951) 1 M.L.J. 81, Balakrishna Ayyar, J., has referred to the earlier Full Bench and other decisions of this Court and pointed out the nature of the jurisdiction conferred under Section 38 of the Presidency Small Cause Courts Act. He has pointed out that the jurisdiction of the Small Cause Court under Section 38 of the above Act is substantially in the nature of revisional jurisdiction. The Judges of the Presidency Small Cause Courts exercising powers under Section 38 of the Presidency Small Cause Courts Act do not constitute a Court of appeal and they cannot arrogate to themselves the powers of an appellate Court. It is however true that the powers under Section 38 of the Presidency Small Cause Courts Act are not so restricted as those mentioned in Section 115 of the Code of Civil procedure. Misappreciation of evidence would not entitle the Judges hearing a New Trial application to interfere with findings of fact, though they Could do so where there is misunderstanding of evidence. In Sadasook v. Kannayya I.L.R.(1896) Mad. 96 , it was held that a Full Bench of the Small Cause Court could not decide a question of fact and that it could not interfere with the decision of the trial Judge unless it was such as no reasonable man could have come to, that is, unless there was practically no evidence to support it. In Sat Sikandar v. Ghouse Mohideen : (1917)32MLJ213 , it was held that the above Full Bench case was rightly decided and should in any case be followed as the decision was on a point of practice which had now stood for many years and their reversal must seriously affect the settled practice of the Court. In Madras Cine Service v. Shyamala Pictures {P.) Ltd. : (1968)2MLJ205 Ramaprasada Rao, J., has held that the new trial Bench has no jurisdiction to reverse the findings of fact as their jurisdiction is-purely revisional and not appellate in character and that where the new trial Bench is of the opinion that the findings-of the fact of the trial Court cannot be sustained, it can remit the matter to the trial Court for a reconsideration of the entire issue. I have already pointed out the scope of the said revisional jurisdiction of the Judges of the Presidency Town Small Cause Courts in interfering with a finding of fact by the trial Judge, There can be no doubt in this case that the judges who dealt with the New Trial applications have taken a wrong view of their jurisdiction in differing from the finding of the trial Court on their own appreciation of the evidence in the case. As already stated, the appreciation of the evidence by the judges who heard the New Trial applications is not correct. I have already pointed out that even if they were sitting on appeal and were entitled to appreciate the evidence independently, they have clearly erred in such appreciation and assessment of the evidence. In my opinion, they had no jurisdiction to interfere with the clear findings of fact arrived at by the trial Judge on a proper appreciation of the evidence.

7. The trial Court has rightly rejected the plea of the railways that as the loading was not done properly inasmuch as it is admitted that the consignment had been only slant loaded and not flat loaded, the railways are not liable It should be noted that it is only the railways that supplied the wagons in which the goods could not be flat loaded, but only slant loaded and this was done in the presence of a Railway clerk. Further, one cannot understand how there could be any shortage of goods on account of slant loading.

8. The trial Court has rightly found that the railways have clearly failed to discharge their duty as bailees in regard to the consignments. In Union of India v. Motilal A.I.R. 1962 Pat. 384, it has been held that where a consignment is booked at railway risk for carriage to the destination, the Railway, as a bailee, is bound under Section 160 of the Contract Act to return the goods at the destination and that once the failure to return the goods bailed is established it will be presumed to be the bailee's default, in the absence of a satisfactory explanation. In Gopi Krishna v. Union of India : AIR1961Pat473 , it was held that, in a consignment booked under railway risk, the shortage in weight of the goods delivered was prima facie proof of negligence of the bailees and that it was for the administration to discharge its responsibility by showing how the goods were dealt with in the course of transit. In Manickam Chettiar v. Union of India : (1959)2MLJ365 , it has been laid down that where the damage cannot be attributed either to defective condition of the goods, or the defective packing of the goods, the primary onus of a bailee to show that he had taken such care of the goods as a man of ordinary prudence would take in the case of his own goods must be discharged by the railway administration for denying relief to the plaintiff. This decision has been followed : Union of India v. Brijlal : AIR1963All1 and in Virat Pal v. Union of India : AIR1963All2 . There was short delivery of goods in every one of these suits and the railways have not adduced any evidence to show how they dealt with the goods from the time when they were consigned till they were delivered to the second petitioner at Madras. The trial Court has rightly held that the defendants not having explained how the shortage had occurred must be held to have acted negligently in carrying the consignments from the place of origin to the place of destination.

9.The only remaining question to be considered is whether the claims in the first two suits are barred by limitation. Open delivery was effected in the first two suits on 6th May, 1961 and 8th May, 1961 respectively and the suits were filed after one year on 10th July, 1962. Prima facie, the suits were barred by limitation under Article 31 of the old Limitation Act under which the period of one year limitation commenced from the time when the goods ought to be delivered. It is clear from the records in this case that the railways went on taking time after receiving the suit notice under Section 80, Civil Procedure Code, and this was realiy responsible for the delay in filing the suits. It is true that inspite of the dilatory tactics of the railways it is the duty of the plaintiff to have filed the suit within the period of limitation. The plaintiffs relied on the certificates of shortage issued by the Station Master, Royapuram, on 11th May, 1961 as acknowledgments of liability saving the claims on the first two suits from the bar of limitation.

10.The learned Advocate for the petitioners relied on the decisions in Haji Ajam v. Bombay and Persia Steam Navigation Co. I.L.R.(1902) 26 Bom. 562, Rajah of Vizianagaram v. Official Liquidator, Vizianagaram Mining Co. Ltd. (1951) 2 M.L.J. 535 and in Florence Misra v. Daulat Ram : AIR1968All316 , in support of his contention that the certificate of shortage is sufficient acknowledgment of the suit claims in the first two suits. In the first case, the certificate of short delivery was held to be a document acknowledging liability giving a new starting point for limitation. It is observed in this decision.

As pointed out by their Lordships of the Privy Council in Sukhamoni Chowdhrani v. Ishan Chunder Roy I.L.R.(1898) Cal. 84, it is not required the an acknowledgment within the statute shall specify every legal consequence of the thing acknowledged.

In the second case, it was held that the statement in the balance sheet of the company including the suit debt in sundry debts was a sufficient acknowledgment of liability. It is clear from page 550 of the decision that reliance was placed on Jones v. Bellgrove Properties Ltd. L.R. (1949) 2 K.B.D. 700, where the Court of Appeal held that where a balance-sheet presented to the shareholders at annual general meeting of a limited liability company signed by the chartered accountants etc., contained the statement to sundry creditors 7,638 6s 10d and it was proved by a witness from the firm of chartered accountants which had signed the balance-sheet that the debt of 1807 owed by the company to the plaintiff was included in the sum of 7,638 6s 10d stated in the balance-sheet to be due to sundry creditors, the balance-sheet contained an acknowledgment to the plaintiff in writing signed by the agents of the company that the debt of 1807 at the date of the annual general meeting remained unpaid and due to the plaintiff.' It is pointed out in this decision that the provisions of the Limitation Act in England regarding acknowledgment are more stringent that what they are in India and that no reason has been shown as to why the judgment of the Court of Appeal should not be followed. In the last Full Bench Judgment, it was held that the receipt relied on by the plaintiff was sufficient acknowledgment, though it referred only to the promissory note and the suit was filed on the original cause of action which was not referred to in the receipt.

11. The word 'acknowledgment' as repeatedly stated is not a term of art and it ought to be construed in its plain literary sense. Each case relating to the question of acknowledgment saving limitation must be considered independently in the light of the words used and the circumstances of the case to determine whether there is acknowledgment of the particular liability. In the certificate of short delivery issued on behalf of the railways, it is no doubt stated that it has been granted without prejudice to the rights of the railways under law. Even if the acknowledgment is held to be a conditional one, namely, that there should be a claim against the railways it has been fulfilled in this case once it is found that there was consignment of goods, as pleaded by the petitioners in their plaints. The trial Judge has rightly found that the certificate of short delivery in each of the first two suits clearly amounts to acknowledgment of liability on the part of the railways and the finding of the judges of the New Trial Bench, which is contrary to the said finding, is clearly wrong. I therefore find that even the first two suits are not barred by limitation.

12. In the result, the decrees and Judgment in N.T.A. Nos. 162 to 165 of 1966 on the file of the Court of Small Causes are set aside and the decrees and Judgment of the trial Court are restored. The petitioners are entitled to costs in this Court and in the Court of Appeal, in addition to the costs awarded by the trial Court.


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