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Steel Authority of India Limited Vs. the Union of India Owning Southern Railway and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Reported in(1981)1MLJ126
AppellantSteel Authority of India Limited;The Trustees of the Port of Madras;The Trustees of the Port of Madr
RespondentThe Union of India Owning Southern Railway and anr.;hindustan Steel Limited and ors.;The Hindustan S
Cases ReferredManicklal v. Trustees of
Excerpt:
- - the suit has been filed only against the southern railway as well as the port trust railway-according to the first defendant, the madras port trust railway is the destination railway and therefore it alone is liable to pay compensation for the short delivery. the word 'otherwise' occurring in that provision clearly indicates that the railway owned by the port trust can be used for purposes of transport of goods other than the goods landed or to be shipped. the definition of 'railway company' is wide enough to include any person, owning or running a railway and this definition will therefore taken in even a statutory body like the madras port trust, if it owns and runs a railway. according to the learned counsel for the plaintiff/appellant a suit against a carrier like the second.....g. ramanujam, j.1. these appeals arise out of four suits filed by the same consignee for compensation against the railways for short delivery of the goods and the common questions that arise in all these appeals are:(1) when the goods are carried by various railways, which of the railways is liable for the shortage?(2) whether the suits so far as they relate to the madras port trust will be barred by the provisions of section 110 of the madras port trust act, 1905?a.s. no. 311 of 1976.--hindustan steel limited, the plaintiff in o.s. no. 3209 of 1972 on the file of the city civil court, madras, is the appellant herein. hindustan steel limited, hereinafter referred to as the company, booked at railway risk from alloy steel plant, durga-pur-8, a consignment of 18.750 metric tonnes of alloy.....
Judgment:

G. Ramanujam, J.

1. These appeals arise out of four suits filed by the same consignee for compensation against the railways for short delivery of the goods and the common questions that arise in all these appeals are:

(1) When the goods are carried by various railways, which of the railways is liable for the shortage?

(2) Whether the suits so far as they relate to the Madras Port Trust will be barred by the provisions of Section 110 of the Madras Port Trust Act, 1905?

A.S. No. 311 of 1976.--Hindustan Steel Limited, the plaintiff in O.S. No. 3209 of 1972 on the file of the City Civil Court, Madras, is the appellant herein. Hindustan Steel Limited, hereinafter referred to as the company, booked at railway risk from Alloy Steel Plant, Durga-pur-8, a consignment of 18.750 metric tonnes of Alloy Steel Billets and Rounds under railway invoice, dated 25th November, 1969, in a wagon to be delivered to it at Madras Harbour. The aforesaid wagon arrived in Madras Harbour on 13th December, 1969 with packing conditions disturbed. Hence the plaintiff-company requested for re-weighment before delivery. On re-weighment, the materials were found to weigh only 10.136 metric tonnes of Alloy Steel Billets as against the R.R. quantity of 18.750 metric tonnes, resulting in a shortage of 8.614 metric tonnes of Alloy Steel Billets, the value of which was Rs. 25,637.24 as per the invoice. The plaintiff therefore filed the said suit against the Union of India, owning the Southern Railway and the Madras Port Trust as defendants 1 and 2 for recovery of the said sum of Rs. 25,637.24, being the value of the shortage on the ground that the defendants are jointly and severally liable to the plaintiff to the said sum as the shortage had occurred as a result of the negligence on their part. Before filing the suit, the company had issued a notice under Section 78(b) of the Indian Railways Act, 1890, on 30th January, 1970. It had also sent a notice required under Section 110 of the Madras Port Trust Act, 1905 on 3rd March, 1970. It further sent a notice under Section 80 of the Code of Civil Procedure on 30th November, 1971.

3. The suit was resisted by the first defendant contending that it was not aware of the alleged re-weighment done by the Madras Port Trust at its premises, nor was any notice given to them before reweighment, that a wagon in question was correctly handed over to the Madras Port Trust, the second defendant, that the second defendant had accepted the wagon, without any remarks, in sound condition and therefore the second defendant is estopped from contending that the alleged shortage had occurred due to the negligence of the Southern Railway. It specifically denied any negligence or misconduct on its part and stated that it had exercised all reasonable care in the carriage of goods and it put the plaintiff to strict proof of the actual damage. It also pleaded that the second defendant being the destination railway, it alone is answerable to the consignee for the shortage. The first defendant also pleaded that it being an intermediate railway, it is not liable to the suit claim unless damage is proved over the southern railway.

4. The second defendant, the Madras Port Trust, resisted the suit contending that a consignment said to contain 657 pieces of steel Billets and Rounds was despatched from Durgapur Steel Plant Exchange-yard, a station on the Eastern Railway to Madras Harbour in a wagon and the said wagon arrived at Madras Harbour on 13th December, 1969 with packing disturbed, that the plaintiff alleging that substantial quantity had been pilfered en route, requested the Port Trust to deliver on weighment, that on re-weighment, it was found to weigh 10.136 metric tonnes as against 18.750 metric tonnes, showing a shortage of 8.614 metric tonnes, that the deficiency was immediately notified by a telegram to the Eastern Railway, South Eastern, South Central and Southern Railways as per Indian Railways Conference Association Rules, calling upon them to accept liability for the shortage noticed in the wagon, but that they had not so far signified of their acceptance of liability, that so far as the Port Trust is concerned, it had delivered the consignment in the same condition as received by it and as such there was no negligence or carelessness on its part, that it had taken as much care of the goods as a prudent man would take of his own goods in similar circumstances and that therefore the Port Trust is not liable to meet the suit claim in any event. The second defendant contended that in any event, the suit so far as the second defendant is concerned, is barred by limitation under Section 11 0 of the Madras Port Trust Act, 1905.

5. After considering the evidence, both oral and documentary, the Court below held that there was a short delivery of 8.614 metric tones of the steel billets of the value of Rs. 25,637.24, that the Southern Railway the first defendant, being an intermediate railway and the shortage not having been traced to that railway, is not liable to meet the suit claim, and that the Port Trust, the Second defendant, being the destination railway is liable to meet the suit claim. However it dismissed the plaintiff's suit on the ground that the suit is barred by limitation under Section 110 of the Madras Port Trust Act, 1905. Aggrieved against the dismissal of the suit, the plaintiff has filed this appeal.

6. In this appeal, the finding of the Court below that there was, in fact a short deliveryasalleged by the plaintiff, has not been challenged by the respondents. We therefore, proceed on the basis that there was in fact a short delivery. The other finding of the Court below is that the first defendant being the intermediate railway was it not liable, to meet the suit claim, but the second defendant, which is the destination railway, alone is liable, is challenged by the Port Trust. The finding on the question of limitation, on the basis of which the suit came to be dismissed has been challenged by the plaintiff.

7. Section 73 of the Indian Railways Act, 1890 imposes in general a responsibility for the loss, destruction, damage, deterioration or non-delivery in transit of goods delivered to the administration to be carried by railway, subject to the exceptions provided therein. Section 80 of the Indian Railways Act provides that a suit for compensation for loss, destruction, damage, deterioration or non-delivery of goods, may be instituted, if the goods were booked through over the railway of two or mere railway administrations against that railway administration, to which the goods were delivered for carriage or against the railway administration on whose railway the destination station lies, or the loss, injury, destruction, damage or deterioration occurred, and such a suit is to be instituted in a Court having jurisdiction over the place at which the goods were delivered for carriage or over the place in which the destination station lies, or the loss, injury, destruction, damage or deterioration occurred. In this case, the goods were booked with the Eastern Railway, Calcutta, on 25th November, 1969, and they were carried by the Eastern Railway, South Eastern Railway, South Central Railway, Southern Railway and ultimately the Madras Port Trust Railway. Under Section 80 of the Indian Railways Act, a suit for compensation has to be instituted against: the railway administration from which the goods were booked or the railway administration on whose railway the destination station lies. The Eastern Railway which booked, the goods has not been made a party to the suit. The suit has been filed only against the Southern Railway as well as the Port Trust Railway-According to the first defendant, the Madras Port Trust Railway is the destination railway and therefore it alone is liable to pay compensation for the short delivery. According to the second defendant, however, though the Port Trust owns the railway, it is not a railway administration as defined in the Indian Railways Act and therefore the Southern Railway, the first defendant, alone is to be treated as the destination railway and made liable for the suit claim. The question is, as between the first and second defendants, who is liable for the short delivery of the goods in this case and that question will naturally depend on the further question which among the defendants is the destination railway. The question as to which of the railways is the destination railway has loomed large because of the fact that the plaintiff has not provided that the loss or shortage has occurred while the goods were in transit in any particular railway. As a matter of fact, the plaint proceeds on the basis that the defendants are liable only as destination railways. It is not in dispute that the goods were taken delivery of by the plaintiff only from the Port Trust railway and not from the Southern railway. If the Port Trust railway is a railway administration as defined in the Railways Act, then the Port Trust railway alone will be the destination railway. But, if as contended by the learned Counsel for the Pert Trust, that Port Trust railway cannot be taken to be a railway administration as defined in the Railways Act, then the Southern Railway will be the destination railway. The question for consideration then is whether the Port Trust railway is a railway administration as defined in the Railways Act.

8. The Madras Port Trust constituted and functioning as a statutory authority under the provisions of the Madras Port Trust Act, 1905, has been authorised to run a railway for certain purposes. Section 35 of the Madras Port Trust Act, 1905, states that the Board of trustees may execute such works and provide such appliances as it may determine to be necessary or expedient for the purposes of the Port and Section 36 provides that such works and appliances may include.

(1) ..............

(2) railways, tramways, locomotives, rolling-stock, sheds, ware houses and other accommodation for passengers and goods and other appliances for carrying passengers and for conveying, receiving and storing goods, landed, or to be shipped or other wise.

Section 39(1) provides that the Beard shall, according to its powers, provide all reasonable facilities for and shall have power to undertake the following services.

(a) ...... .........

(b) receiving, removing, shifting, transporting, storing or delivering goods brought within the Board's premises;

(c) ..............

(d) receiving and delivering, transporting and booking and despatching goods originating in the vessels in the port and intended for carriage by the neighbouring railways, or vice versa, as a railway company or administration under the Indian Railways Act, 1890.

Sub-section (d) of Section 39 says that the Board shall, if so required by any owner, perform in respect of his goods all or any other services mentioned in Clauses (b) and (d) of Sub-section (1), unless any of the services had been relinquished by it under the provisions of Section 41-A. Section 40 provides that the responsibility of the Board for the loss, destruction or deterioration of the goods, of which it had taken charge, shall, subject to the other provisions of the Act and subject also in the case of goods received for carriage by railway to the provisions of the Indian Railways Act, 1890, be that of a bailee under Sections 151, 152 and 161 of the Indian Contract Act. Under these provisions, the Port Trust is in charge of receiving, removing, shifting, transporting, storing or delivering goods brought into the Port premises and for carrying on those services, it is authorised to own and run railways, tramways, 'locomotives, rolling-stock, sheds, warehouses other appliances for conveying, receiving and storing the goods landed, or to be shipped or otherwise. The learned Counsel for the Port Trust submits that having regard to the object of the Madras Port Trust Act, 1905, which is to regulate, conserve and improve the Port of Madras, the Port Trust is expected mainly to carry passengers and also goods landed or to be shipped and is not expected to provide transport to the general public, who have nothing to do with the Port, and this appears to be clear from the provisions in Section 39(d). Section 39(d) of the Madras Port Trust Act atuhorises the Board to undertake the service of receiving, delivering, transporting and booking and despatching originating in the vessels in the Port and intended for carriage by the neighbouring railways, or vice versa, as a railway company or administration under the Indian Railways Act, 1890. Based on this provision, it is contended by the learned Counsel on behalf of the Port Trust that only while receiving, transporting and booking and despatching the goods originating in the vessels in the Port and intended for carriage by the neighbouring railways or vice versa the Port Trust could be treated as a railway administration and not in any other context. But the sub-mission of the learned Counsel overlooks Section 35(2), which says that the Port trust can own railways, tramways, locomotives and other appliances for conveying, and receiving goods landed or to be shipped or otherwise. According to this provision, the railway established and owned by the Port Trust may also be used for purpose of other than transporting the goods landed or to be shipped. The word 'otherwise' occurring in that provision clearly indicates that the railway owned by the Port trust can be used for purposes of transport of goods other than the goods landed or to be shipped. It is not, therefore, possible to agree with the learned Counsel for the Port Trust that the Port Trust is not engaged in any services to goods other than to be shipped or to be landed. For deciding the question whether the Port Trust railway is a railway administration, for the purpose of Section 80 of the Indian Railways Act, we have to look into the definition of 'the railway administration' under that Act. 'Railway' has been defined in Section 2(4) of the Indian Railways Act, 1890. As per the definition 'railway' means, a railway, or any portion of a railway, for the public carriage of passengers, animals or goods. 'Railway company' is defined in Section 3(5) to include any persons, whether incorporated or not, who are owners or lessees of a railway or parties to an agreement for working a railway. The definition of 'railway company' is wide enough to include any person, owning or running a railway and this definition will therefore taken in even a statutory body like the Madras Port Trust, if it owns and runs a railway. Section 3(6) defines 'railway administration' as the carrier of the railway in the case if the railway is administered by the Government and in the case of a railway administered by a railway company, means the railway company. Admittedly the Madras Port Trust owns and runs a railway, though its operations are confined within its premises. None-the-less, having regard to the fact that the railway is intended for the public carriage of passengers and goods, it will come within the definition of railway and railway administration as defined in the Railways Act. Therefore, by virtue of operation of Section 80 of the Indian Railways Act, the Port Trust railway is to be taken as the destination railway, for, it is not disputed that the Port Trust railway, took charge of the goods from the Southern Railway and delivered the goods to the plaintiff, the consignee of the goods. Therefore, it has to be held that the Port Trust being the destination railway, it is liable to meet the suit claim even though the plaintiff has not proved that loss or shortage of the goods occurred when the goods were in movement in the Port Trust railway. The Court below is therefore right in holding that the second defendant alone is liable to meet the suit claim.

9. The next question that arises for consideration is whether the suit is barred by limitation under Section 110 of the Madras Port Trust Act, 1905. Section 110 of the Madras Port Trust Act, 1905, is as follows:

No suit or other proceeding shall be commenced against any person for anything done, or purporting to have been done, in pursuance of this Act without giving to such person one month's previous notice in Writing of the intended suit or other proceeding, and of the case thereof, nor after six months from the accrual of the cause of such suit or other proceeding.

According to this section, no suit shall be commenced against any person for anything done or purporting to be done in pursuance of the Act, without giving to such person one month's previous notice in writing of the intended suit and of the cause thereof, nor after six months from the accrual of the cause of action for such suit. In this case admittedly the suit has been filed beyond six months referred to in Section 110 of the Act. It is, therefore, contended by the second defendant that the suit is barred by limitation. According to the learned Counsel for the plaintiff/appellant a suit against a carrier like the second defendant for compensation for non-delivery or of short delivery of the goods can be filed within a period of three years when the goods ought to be delivered, under Article 11 of the Limitation Act, 1963, and that the suit not being one for anything done/or purported to be done under the Port Trust Act, the limitation provided in Section 110 of the Madras Port Trust Act will not apply. We are not inclined to accept this contention of the learned Counsel for the appellant for the reasons, which we have already given above in connection with the Board's power to own and run railway. We have held that the Port Trust in owning and running a railway is performing one of the functions assigned to it under the Act, and, therefore the shortage alleged being with reference to one of its duties as a carrier, the suit for compensation should be taken to be in connection with an Act done by the Port Trust under the provisions of the Madras Port Trust Act.

10. In Trustees Bombay Port v. Premier Automobiles Limited : [1974]3SCR397 . the scope of Section 87 of Bombay Port Trust Act, 1879, which corresponds to Section 110 of the Madras Port Trust Act, 1905, came up for consideration. In that case, a consignment of 53 bundles of mild steel plates despatched by a Japanese exporter to be delivered at the Port of Bombay was short delivered by one bundle on 19th September, 1959. The consignee demanded the missing bundle. But he was being assured that search for the missing bundle was in progress. Ultimately the plaintiff filed a suit for compensation after six months from the date of delivery. The Port Trust raised among other defences the plea of limitation. This plea was ultimately upheld by the Supreme Court on the ground that where a statute imposes a duty, the omission to do something that ought to be done in order completely to perform that duty, or continuing to have any such duty unperformed, amounts to an act done or intended to be done within the meaning of a statute which provides a special period of limitation for such an act, and that Section 87 will stand attracted, not merely when an act is committed, but also when an omission occurs in the course of the performance of that act. In Madras Port Trust v. Home Insurance Company Limited : AIR1970Mad48 . the scope of Section 110 of the Madras Port Trust Act came to be considered. In that case also, a suit was filed by the consignee for compensation for short delivery, after the period of six months referred in Section 110. One of the questions urged by the consignee was that the shorter period of limitation provided under Section 110 will apply only in respect of compulsory services rendered by the Port Trust and not in respect of optional services, which the trustees may undertake in their discretion. A Division Bench of this Court pointed out that when the Board took charge of the goods under Section 39 of the Madras Port Trust Act, the responsibility of the Board for the loss, destruction or deterioration of the goods of which it has taken charge under Section 40 is that of a bailee under Sections 151, 152 and 161 of the Indian Contract Act, that the Board as a bailee is bound to take as much care of the goods bailed to it, as a man of ordinary prudence under similar circumstances will take care of his own goods, that the loss or damage of the goods entrusted to a bailee is prima facie evidence of negligence, that a breach of the statutory duty as well as an omission to perform a statutory duty, would both fall under the protection given by the provisions of Section 110, that the Board's default in delivering the goods is closely connected with what the Board has to do in the matter of receiving, removing, shifting, transporting, storing or delivering the goods brought within its premises and that therefore any action, which is called for will properly be covered by the words 'anything done or purporting to be done in pursuance of the Act', that the language is of sufficient amplitude to cover even the class of functions for which no duty is cast by Section 39(1) but only power is given to undertake, that though the duty undertaken by the Board is not an obligatory one, the protection of Section 110 will still be available as what was done was only in pursuance of the Act, and that, therefore, once the Board assumes and undertakes a function under the Act, whether optional or obligatory, it can call in aid the protection afforded under Section 110. The Court also pointed out that where there is a special period of limitation having its own starting point, the Court is bound to apply it notwithstanding any inconvenience that may arise from its literal application. The above decisions clearly support the stand taken by the Port Trust that the present suit, having been filed more than six months, is barred by limitation. The learned Counsel for the respondents will, however refer to a decision of Ism ail, J. (as he then was), in Manicklal v. Trustees of the Port of the Madras (1974) 87 LW 490. On a close perusal of the judgment, we are of the view that it cannot be of any assistance to the appellant here. That was a case of demolition by the Port Trust of a building erected by a licencee within the Port premises and the licencee claiming compensation arising out of such demolition. The Court took the view that the demolition of the licencee's superstructure by the. Port Trust authorities cannot be said to be anything done or purporting to have been done in pursuance of the Madras Port Trust Act, so as to attract the application of Section 110 of the Act. Thus the case related only to an act, which was not done under the provisions of the Act and therefore, it was rightly held that Section 110 was not attracted. We are, therefore, of the view that the Court below was right in holding that the suit was barred by limitation. The appeal has therefore to be dismissed and it is dismissed accordingly but without costs.

11. S.A. No. 913 of 1976.--In this appeal, the appellant is aggrieved against the dismissal of its suit, claiming compensation for short delivery on the ground that it is barred by Section 110 of the Madras Port Trust Act. The facts in the case are more or less similar to the facts set out in A. S. No. 311 of 1976 and the consignee is also the same. The Court below has specifically found the shortage alleged by the plaintiff had been established, but that the first defendant, Southern Railway is not liable on the ground that it is an intermediate railway and that the Port Trust is alone liable for the shortage being the destination railway but that the suit was against the Port Trust is barred in view of Section 110. For the reasons given by us in A.S. No. 311 of 1976, this appeal has also to be dismissed and it is dismissed accordingly with costs.

12. S.A. No. 796 of 1977.--In this appeal, the Port Trust, is the appellant. In this case, the Court below had held that the suit, though filed after a period of six months referred to in Section 110 of the Madras Port Trust Act, was in time. Aggrieved against the said finding of the Court below, the Port Trust has come before us. For the reasons given by us in A.S. No. 311 of 1976, any suit for recovery of compensation against the Port Trust in respect of any act done or purporting to have been done under the Port Trust Act has to be filed within a period of six months from the date of the cause of action. Therefore the finding of the Court below that the suit was not barred by limitation cannot be accepted. Following our reasoning in A.S. No. 311 of 1976 we have to hold that the suit as against the Port Trust having been filed more than six months after the cause of action is barred by time. But fortunately for the plaintiff in the suit, it has impleaded by way of abundant caution all the railways through which the goods passed and the Eastern Railway, which is the originating railway has been impleaded as a third defendant in the suit. Having regard to the provisions in Section 80 of the Indian Railways Act, the consignee can claim compensation for the short delivery either as against the originating railway or against the destination railway. In this case, the suit as against the Port Trust railway, which according to us is the destination railway, has been held not liable in view of the bar contained in Section 110 of the Madras Port Trust Act. But there is no bar for the grant of decree to the plaintiff as against the third defendant, the originating railway. Order 41, Rule 33 of the Code of Civil Procedure will enable this Court to give relief to a respondent as against a co-respondent in the appeal. Rule 33 of Order 41 of the Code of Civil Procedure, enables the appellate Court to pass any decree which ought to have been passed by the trial Court. The illustration to that rule will clearly indicate that in a suit against both the defendants, if a decree is obtained by the plaintiff against one and if the appellate Court feels that the decree should have been passed only against the order defendant, the appellate Court can pass a decree against the other defendant. In this view of the matter, while setting aside the decree of the trial Court passed against the Port Trust in favour of the plaintiff we grant a decree in favour of the plaintiff as against the Eastern Railway, the third defendant as prayed for in the suit with costs. This second appeal is therefore allowed and the decree of the lower Appellate Court is modified. There will, however, be no order as to costs.

13. S.A. No. 1846 of 1977.--In this appeal, both the Courts below have passed a decree against the Port Trust as the destination railway-as the suit has been found to be in time. The Port Trust is challenging the decree on the ground that it cannot be treated as the destination railway. We have already held in A.S. No. 311 of 1976 that the Port Trust will be the destination railway and that therefore the suit has rightly been filed against the Port Trust railway. In this case, the Port Trust has not challenged the finding of the Courts below that there was a shortage. In fact, the port Trust cannot challenge the factum of shortage as it has granted a certificate to the plaintiff consignee, noting the shortage at the time of the delivery. The only question, is to which of the railways through which the goods were carried is liable for the short delivery. According to the Port Trust, even in spite of Section 80 of the Indian Railways Act, if the Port Trust establishes by positive evidence that it has not acted negligently and, that the loss or damage had not occurred while the goods were carried by it, it will not be liable to meet the plaintiff's claim, and in such case the plaintiff car proceed only against the originating railway. The learned Counsel refers to Exhibits B-4, B-5 and B-6, which are letters sent by the Port Trust to the Eastern Railway, in (sic) the shortage and asking the Eastern Railway to meet the plaintiff's claim and contends that having regard to the fact that the Port Trust had delivered the goods, which it has actually taken charge of, the plaintiff can proceed only against the originating railway or the railway in which the actual loss had occurred. These exhibits indicate that so far as the Port Trust was concerned, it has delivered the goods, which it had actually taken charge of from, the Southern Railway, and that at the time of its handling the goods, it found that the packing has been tampered, while the goods were in transit with the other railways. The complaint of the learned Counsel for the Port Trust is that the relevancy of these documents has not been considered by the Courts below and that in the interests of Justice has to be considered afresh in the light of the above documents by the lower appellate Court. A perusal of the judgment of the lower appellate Court indicates that it addressed itself only to the question as to whether the Port Trust is a railway administration and having held that the Port Trust is a railway administration, it proceeded to hold it is liable for the suit claim as the destination railway. It was not, however, referred to the documents, Exhibits B-4, B-5 and B-6 filed by the Port Trust for the purpose of showing that the loss or shortage had not occurred while the goods were in its charge. Since, we are of the view that the relevancy of these documents has not been considered by the lower appellate Court, the matter has to be remitted to it for fresh consideration.

14. This second Appeal is therefore allowed and the matter is remitted to the lower appellate Court for fresh consideration of the question of the second defendant's liability in the light of the documents Exhibits B-4 to B-6. There will, however, be no order as to costs.


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