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The Gaya Muzaffurpur Roadways Co. and ors. Vs. Fort Gloster Industries Ltd. and anr. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtKolkata High Court
Decided On
Case NumberFirst Appeal No. 488 of 1968 (with Cross Objection)
Judge
Reported inAIR1971Cal494,76CWN17
ActsCarriers Act, 1885 - Sections 2 and 8; ;Code of Civil Procedure (CPC) , 1908 - Section 20 - Order 1, Rule 9 - Order 22, Rule 10; ;Transfer of Property Act, 1882 - Section 135A, 135A(2) and 135(2); ;Contract Act, 1872 - Section 41; ;Evidence Act, 1872 - Section 145; ;Marine Insurance Act, 1963 - Section 4(2)
AppellantThe Gaya Muzaffurpur Roadways Co. and ors.
RespondentFort Gloster Industries Ltd. and anr.
Appellant AdvocateRanjit Kumar Banerjee and ;Bidyut Kumar Banerjee, Advs.
Respondent AdvocatePramatha Nath Mitra, ;Narayan Chandra De, Advs. (for No. 2) and ;Saralendra Prosad Bagchi, Adv. (for No. 1)
Cases ReferredUnion of India v. Kalinga Textiles
Excerpt:
- salil kumar datta, j.1. this is an appeal by a firm, a carrier, and its partners the defendants, against the judgment and decree passed in favour of the plaintiff no. 2 the insurer, in a suit for recovery of compensation and damages.2. according to the plaint, at all material times the defendant no. 1, the firm, used to carry on the business as transport contractor and used to carry and transport goods by road as such. the defendants nos. 2 to 6 had been the partners of the defendant no. 1. a quantity of 125 tons (80 and 88 pieces) of electrolytic copper wire bars were entrusted and delivered to the defendants at k. g. and k. p. docks, calcutta for transport to tatanagar and the defendants agreed to carry the same for reward and to deliver them at destination. the goods were lifted by the.....
Judgment:

Salil Kumar Datta, J.

1. This is an appeal by a firm, a carrier, and its partners the defendants, against the judgment and decree passed in favour of the plaintiff No. 2 the insurer, in a suit for recovery of compensation and damages.

2. According to the plaint, at all material times the defendant No. 1, the firm, used to carry on the business as Transport Contractor and used to carry and transport goods by road as such. The defendants Nos. 2 to 6 had been the partners of the defendant No. 1. A quantity of 125 tons (80 and 88 pieces) of electrolytic copper wire bars were entrusted and delivered to the defendants at K. G. and K. P. docks, Calcutta for transport to Tatanagar and the defendants agreed to carry the same for reward and to deliver them at destination. The goods were lifted by the defendants into lorries on May 11 and 18, 1961, but, the goods were not delivered at all at destination in breach of their obligation. The plaintiff No. 1 hereinafter referred to as 'the company' was the owner of the said goods and suffered loss and damages, assessed at Rs. 61,178-24 P., by the non-delivery of the goods as per details given in the schedule to the plaint, due to negligence or misconduct on the part of the defendants. Alternatively it was stated that the defendants wrongly converted the goods for their own use and benefit. The plaintiff No. 2 hereinafter referred to as the insurer' was the insurer of the goods under the policies issued by it and it was also interested in the goods not delivered. The cause of action of the suit arose on the dates mentioned above when the goods were lifted at the docks within the jurisdiction of the Alipore Court and also at Tatanagar. The plaintiffs in the circumstances prayed for a decree of the said amount as damages suffered by them or alternatively for an enquiry into damages and a decree for the same.

3. The suit was contested by the defendants Nos. 2 to 5 who filed a joint written statement contending that they carried business of commission agents, hiring lorries for transport and charging commission for such work. The contract in respect of the goods was inter alia under the conditions that the freight was accepted at the risk and responsibility of consignor, the owner of the lorry to be fully responsible for goods and that the complaint as to shortage or non-delivery of the goods was to be made within 21 days of the date of the consignment and after which no complaint would be accepted nor would any responsibility stand on the defendant firm. The entire goods of the company were covered by fourteen consignment notes and despatched by fourteen lorries and out of these, twelve lorry-load of goods were duly delivered at destination but two lorry-load goods were not delivered. The defendants' liability was limited by the above conditions embodied in the consignment notes and the lorry owners as agent of the consignor were liable for the loss and the defendants were in no way responsible nor liable for damages. Further the company did not complain about such non-delivery within twenty-one days of the consignment. The defendants also denied that the loss was due to their negligence or misconduct and no particulars in respect thereof were given in the plaint. The allegations about conversion were also denied and it was also stated that for the alleged loss of goods, criminal proceedings against some persons had started and some goods had been recovered and were given to the company for which no mention was made in the plaint. It was further alleged that the company had no locus standi to institute the suit, the suit was bad for mis-joinder and non-joinder of parties, the lorry owners were necessary parties and further the court had no jurisdiction to try the suit. It was submitted that in the premises the suit should be dismissed. The defendant No. 6 subsequently filed a separate written statement adopting the said written statement.

4. The suit was tried on evidence before the learned Subordinate Judge, Eighth Court, Alipore, and, at the hearing the D.W. 2 for the company admitted that the claim in suit was reduced to Rupees 51083-36 P. after crediting the value of goods received on recovery. It also transpired from her evidence that the insurer in the meantime paid the said sum to the company in full and final settlement of the claim under its policies in respect of the suit goods. The learned Judge inter alia came to the finding that the defendants were not Commission Agents for the purpose of arranging hire of the lorries on commission basis but they were the carrier of the goods. It was further held that the defendant No. 1, the firm, was a common carrier and acted as such in respect of carriage of the said goods. It was held that the goods were lost by the criminal acts of the drivers of the said lorries and then associates, in respect whereof criminal proceedings were started. The learned Judge found on evidence of Jitmal Lodha, the defendant No. 2 in the said criminal case as also on the evidence of the D.W. 1 that the defendants had no record to show that the copies of the consignment notes were issued to the company and that no such consignment notes, which according to defendants contained terms of contract of carriage, had been in fact issued to the plaintiff No. 1. The learned Judge was also of opinion that in view of Section 9 of the Carriers Act, 1865 no onus lay on the plaintiffs to prove that such loss or damage for non-delivery of goods was due to negligence or criminal act of the carrier or his servants or agents. It was also held that carrier of the goods need not necessarily ' own the lorries and the lorries owners and drivers acted as defendants' agents and not as agents of the company and the lorries owners and drivers were not personally liable for damages to the plaintiff. The notice of the claim was given within the statutory time limit of 6 months from the time when the loss first came to the knowledge of the company and was held to be valid and the provision in the consignment note reducing the period of notice to twenty-one days was invalid as the parties could not contract out of the statute to reduce the period of such notice for avoiding the liability. The learned Judge also found that the quantum of damages was established and as the insurer by the payment of the total loss was surrogated to the rights and remedies of the company in respect of goods lost it was a necessary party in the suit and was entitled to recover the sum claimed in the suit and non-production of formal letter of subrogation was immaterial. Accordingly, as already stated, the suit was decreed in favour of the insurer for the amount under claim.

5. Against the said decision the defendants Nos. 1 to 6 preferred this appeal and the company has also filed a cross-objection against the form of the decree and certain findings.

6. Mr. Ranjit Kumar Banerjee, the learned Advocate for the appellants, has raised a number of contentions in support of the appeal. His first contention is that the suit on the plaint is not maintainable. The plaintiffs in their plaint have not made a case that the firm, defendant No. 1, was a common carrier. In absence of such pleading the court was not entitled to enter into question as to whether the firm was a common carrier as defined in the Carriers Act in determining its liability. Further the plaintiffs have adduced no proof to establish their claim that the firm was a common carrier. In these circumstances, the suit should have been dismissed by the trial Court.

7. Mr. Pramatha Nath Mitra, the learned Advocate appearing for the insurer, has contended that in the plaint there is sufficient averment in the paragraph 1 of the plaint to indicate the plaintiffs' case that the defendant No. 1 was a common carrier. It was stated therein that at all material times the defendants used to carry on the business of transport contractor and they also used to carry transport goods by road as such. Mr. Mitra has also contended that the plaint should be read as a whole and it will also appear from the evidence of the only witness on behalf of the defendants in cross-examination that they accepted goods from all parties without any discrimination for transport of goods by road, Further no prejudice was caused to the defendants as they were fully aware of the case made by the plaintiffs who made the defendants liable as common carrier.

8. It is undoubtedly true that the word 'common carrier' does not appear in the plaint in the description of the defendant No. 1 but even so the plaintiffs had already stated in paragraph 1 that the defendant No. 1 carried on business of carriage and transport of goods by road as transport contractor. The law says that a carrier would be a common carrier if it carries goods for all persons indiscriminately. The averment in the plaint as already noted does not put any limitation about the extent of the business of the defendant No. 1 so as to exclude the operation of the definition of common carrier which is to the following correct.

'Common carrier' denotes a person, other than the Government engaged in the business of transporting for hire property from place to place, by land or inland navigation, for all persons indiscriminately.' and

'Person includes any association or body of persons, whether incorporated or not.'

The real import of the definition, in our opinion, is that a carrier to be a common carrier must be engaged in carriage and transport of goods for hire as a business and not as a casual occupation and that was sufficiently indicated in paragraph 1 of the plaint. Such averment could be challenged by the defendants by showing that the defendant No. 1 did not carry on such work as a business or that he did not carry on business indiscriminately. It will however appear from the written statement that the defendants raised the plea that they were not carriers but commission agents on the terms of the contract as contained in the consignment notes limiting their liability and this was really their defence in the suit. We further find that the D.W. 1 in his cross-examination also admitted that the defendants accepted goods from all parties without any discrimination for transport of goods by road. Even in the memorandum of appeal there is no specific ground that the defendant No. 1 was not a common carrier and in the plaint there is no case that the said defendant was not a common carrier. It does not appear that there was surprise caused to them in permitting the plaintiffs to put' the relevant question eliciting the above reply. On a consideration of all circumstances and the pleading and evidence adduced, we are unable to accept the contention of Mr. Banerjee that the trial Court wrongly decreed the suit on the basis that the defendant No. 1 was a common carrier.

9. Mr, Banerjee next contended that there was no material to hold even on admission of D.W. 1 that the defendant firm carried goods without any discrimination and/or that it was a common carrier. There must be further evidence in support to establish that they carried goods indiscriminately without any right or refusal as was held in the Indian General Navigation and Rly. Co. Ltd. v. Dekhari Co. Ltd., 51 Ind App 28 = (AIR 1924 PC 40). In the said decision, relied on by Mr. Banerjee, it was observed:

'So far as the words 'for alt persons indiscriminately' are concerned these simply mean that persons so engaged in and catering for business satisfy the demands or applications of customers as they come and are not at liberty to refuse business.

This arises from the public employment in which they engaged.'

Mr. Banerjee's contention is that there is no evidence to show that the defendant No. 1 was not at liberty to refuse business and in absence of such evidence the said defendant could not be held to be a common carrier., Mr. Mitra has however contended that the question of refusal of business does not arise here in view of the categorical statement of the D.W. 1 that they carry on business of parties without discrimination and such statement connotes that they were not at liberty to refuse business.

10. In our opinion when the D.W. 1 states that they carried on business of parties Without any discrimination there was no necessity for further proof that they were at liberty to refuse business. The carrying on business o transport of goods of parties by roads indiscriminately as stated by D.W. 1 is in terms with the definition of common carrier under the Act. In fact in the case referred to above there is further observation that there must be facts to show that for the contract in question the contractor, to divest himself of the liability of a common carrier, was departing from his usual business in engaging on different type of business from that or a common carrier. There is no pleading or evidence to show that the defendant No. 1, in respect of the suit goods, was departing from its usual business for a different type of business from that of the common carrier. We, therefore, feel no difficulty in accepting the position that the defendant No. 1 in respect of the suit goods was acting as a common carrier as defined in the Act.

11. Mr. Banerjee has also raised another point about the jurisdiction of the trial Court to try the suit. According to him the contract was entered into outside the jurisdiction of the trial Court and the goods were to be delivered at Tatanagar also beyond its jurisdiction. The suit in the circumstances could be instituted in either of the court having jurisdiction over the said places and the Alipore Court in any event had no jurisdiction to try the suit. There is no dispute that the goods were loaded in the docks at Kidderpore within the jurisdiction of Alipore court and in the explanation III which was inserted to the relevant Section 17 in the earlier Civil Procedure Code it was provided that in suits arising out of contract, the cause of action arises, at the place where the contract was made or to be performed or performance thereof completed. This explanation was omitted in the present Code in Section 20, Clause (e) and the words 'wholly or in part' were provided between the words 'cause of action' and 'arises' so that under the present Code every suit may be instituted in a court within the legal limits of whose jurisdiction, the cause of action, wholly or in part, arises. It is well known that cause of action implies the whole bundle of facts the plaintiff is required to prove if traversed in order to support Ms right to the judgment. Accordingly in this case the performance of the contract started from the entrustment of the goods to be carried which is the loading of the goods into the lorries arranged by the defendants at Kidderpore. The cause of action thus arose in part within the jurisdiction of the trial court. There is therefore no substance in this contention of Mr. Banerjee.

12. Extending his contention that the defendant No. 1 was not a common carrier, Mr. Baneriee contended that the remedy of the plaintiffs would be in an action in tort, and the jurisdiction for such suit, under Section 19 of the Code, would be either the place where the defendants carried on business or where the wrong was done. In either case, the trial court would have no jurisdiction and no decree could be passed on the plaint as filed. As we have held that the defendant No. 1 was a common carrier in respect of the suit goods, the present is not an action in tort but one for damages for loss due to non-delivery of goods by a common carrier,

13. The next point urged by the appellants concerns about the maintainability of the suit for defect of parties. According to Mr. Baneriee, on May 9, 1962 the date when the suit was instituted, company was the person entitled to the suit goods and to all claims arising therefrom. On that date the insurer had no interest in the suit goods, and in fact, it had thus no cause of action then against the defendants and there can be no dispute that the cause of action must precede the institution of suit. Even so the insurer was also claiming a decree against the defendants to which it was not entitled. The suit being bad for misjoinder of parties, should have been dismissed which in the circumstances was not maintainable in law. Again immediately after the payment by the insurer on Mav 10, 1963, even on the case of the plaintiffs, the interest of the plaintiff No. 1 in the suit goods insured was extinguished and it was no longer a necessary party. These contentions have been disputed by Mr. Mitra who has drawn our attention to Sub-section (2) of Section 135-A of the Transfer of Property Act, 1882. The sub-section provides that on payment of a total loss, as here, the insurer is subrogated to all the rights and remedies of the insured person in respect of the subject-matter insured as from the time of the casualty causing the loss. In view of specific provision of law, the insurer had the cause of action against the defendants retrospectively as from the date of casualty. There was thus no mis-joinder of parties as contended by the defendants.

14. As will appear from the Order 1, Rule 9 of the Code of Civil Procedure, a mis-joinder of parties is not fatal to a suit. The objection as to mis-joinder of parties in the form as now argued before us, was not raised in the written statement nor was any specific issue raised in the trial court. In the written statement there was a general objection that the suit was bad for misjoinder and non-joinder of parties and causes of actions and the lorry owners were necessary parties. In this state of affairs, the suit proceeded in the usual manner on the above pleadings. The insurer made, the payment of total loss to the company on May 10, 1963, though this fact was not disclosed till August 27, 1967 when the hearing of the suit was in progress These facts, according to Mr. Banerjee, should have been incorporated in the plaint by an amendment and the insurer brought on record within the statutory time limit which was not done. Even if it was not done, it could not be said in our opinion, that it led to fatal consequences as contended by Mr. Banerjee. By the said payment, under provisions of Section 135-A(2), the insurer took over the interest of the insured in goods and as subrogee to the company, became entitled to the rights and remedies of the company in the subject-matter insured as from the time of the casualty causing the loss, assuming that there was a legal and valid subrogation. The insurer thus was a necessary party in the suit since its inception being entitled to the rights and remedies of the company in the goods insured as from the date of the casualty and accordingly impleading the insurer as co-plaintiff could not be ask to be irregular or contrary to the provisions of law in the events that happened. The objection of Mr. Banerjee which is highly technical and not taken even in the memorandum of appeal cannot be sustained in the circumstances.

15. As a corollary to the above contention. Mr. Baneriee has relied on Section 41 of the Contract Act, 1872, which provides that when a promises accepts performance of the promise from a third person he cannot afterwards enforce it against the promisor. It was contended that even on the plaint and the evidence of the payment of the total loss to the company, performance of the promise for transit could not be enforced by the company against the defendants. Reliance was placed' on the decision in Har Chandi Lal v. Sheoraj Singh, AIR 1916 PC 68 = 44 Ind App 60 in which it was observed that the section applies only where a contract has been in fact performed by some person other than the person bound thereby. Reliance was also placed on the decision in Textiles and Yarn (P) Ltd. v. Indian National Steamship Co. Ltd.. : AIR1964Cal362 in which it was held, following the decision in Kapur Chand v. Himayatalikhan, : [1963]2SCR168 , that Section 41 was a clear bar to a suit by the promises if he accepts performance of the promise from a third person. After the receipt of the total loss, the company was out of court and could not maintain the suit. It was also contended that though the insurer became entitled to the rights and remedies of the company on May 10, 1963, the fact was disclosed on August 27, 1967 when the claim was already barred and no steps were taken in time to implead the insurer in its capacity as subrogee. The suit was thus not maintainable even by the insurer also if viewed on this aspect. Mr. Mitra on the other hand, contended that Section 41 had no application as there was no performance of the contract of transit by the insurer and no question of limitation arose in case of devolution of interest while the insurer had always been on record of the suit as a party.

16. Assuming as contended, that the company's right to compensation for short delivery or non-delivery arises from and is inextricably bound with the contract of transit so that after payment by the insurer the company had no right to the compensation for damages for failure to deliver the goods in terms of the contract, it is also seen that under Section 135-A(2) of the Transfer of Property Act, in cases of such payment by the insurer, there is a statutory vesting and subrogation whereby the insurer becomes entitled to the interest as also to the rights and remedies of the insurer in the subject-matter insured. This is accordingly a case of devolution of interest under the statute. In the present case, the payment having been made in course of proceedings, the provisions of Order 22, Rule 10 of the Code would be applicable. It is settled law that the person upon whom the interest has devolved, may with leave of court continue the proceeding and application for such leave may be made at any time during the pendency of such proceeding. In the present case the insurer was a party to the suit all along as one interested in the claim in suit and in evidence at the hearing, the fact of payment for the total loss by the insurer was brought to light, and there could be no reason that the suit would not be maintainable for any of the reasons urged by the defendants nor could there be any question of the suit being barred by limitation.

17. Mr. Banerjee however contended that under Sub-section (2) of Section 135-A of the Transfer of Property Act, the insurer would not be entitled to the rights and remedies of the insured person even on payment for total loss unless there was a deed of assignment assigning the rights of the insured in the goods insured. Reliance was placed on the decisions in : AIR1964Cal362 and in Indian Trade and General Insurance Co. Ltd. v. Union of India, : AIR1957Cal190 . In these cases there were payments of partial loss and under Sub-section (3) of Section 135-A of the Act, it was held that the insurer was thereby, subrogated to the rights and remedies of the insured but unless there was an assignment of the claim or the right of action to the insurer by the insured, the insurer could not maintain a suit in his own name. According to Mr. Baneriee, there was no such assignment in the present case and accordingly the insurer was not entitled to proceed with the suit in its own name and the company having accepted the payment of its claim in full and final settlement was already out of court. The suit in the premises being not maintainable by either plaintiff should have been dismissed by the trial court. On the other hand Mr. Mitra contended that the provisions of Sub-section (2) of Section 135-A, with which we are concerned in the present case are clear and unambiguous. The Sub-section clearly provides that on payment for a total loss, the insurer becomes entitled to the interest of the insured in the goods insured and is thereby subrogated to all rights and remedies of the insured person in the goods insured as from the time of casualty causing the loss, In view of the above provisions, the insurer is entitled to the goods insured and is subrogated to the rights of insured by such payment with the right to sue in its own name and no further assignment is necessary.

18. On a consideration of the relevant provision, it appears to us that the wordings in the said Sub-section are clear and unequivocal and do not admit of different interpretation. Under Sub-section (2), on payment of the total loss of the whole, as here, or of any apportionable part of the goods, the insurer becomes entitled to the subject-matter insured and the subrogation thereby comes into effect by the statute and attaches all the rights and remedies of the insured person unto the insurer, so that on such acquisition of title of the company in the goods insured and subrogation the insurer becomes entitled to institute or proceed with the suit in its own name and no further assignment of the claim or the right of action is necessary. In coming to this conclusion we are fortified by and respectfully follow a Division Bench decision (unreported) of this court in the case of Union of India v. Great American Insurance Co. Ltd, (S. A. No. 381 of 1959 decided on 16-3-70) (Since reported in : AIR1971Cal491 ) in which P. N. Mookerji, J. speaking for the court observed as follows:

'Under Sub-section (3), his rights and remedies are of a limited character as he acquires no title to any portion of the goods insured. Under Sub-section (2), however, the same cannot be predicated and, obviously, the intention was that, thereunder, the insurer will get interest in respect of the subject-matter insured. On this vital distinction, it may well be said that, so far Sub-section (2) is concerned, the insurer stands on a better footing so far as the institution of suit by himself is concerned, and, upon that ground, the decision of G. K. Mitter, J., as he then was, in : AIR1957Cal190 --a case, dealt with under Sub-section (3) by the learned Judge himself, -- may well be distinguished and similar distinction may also be made of the relative observations of our learned brother B. C. Mitra, J. in : AIR1964Cal362 . Apart from that, however, it seems to us that the subrogation, contemplated both under Sub-sections (2) and (3), would entitle the insurer to institute the suit in its own name. Essence of subrogation is substitution. Indeed, on this statutory subrogation, the insurer, on the wordings of the statute itself, becomes entitled to all rights and remedies of the insured person in respect of the lost goods, for which he has made the payment or indemnified the insured. From this point of view, this subrogation is wider than the subrogation, contemplated in this very Act under Section 92 in the case of mortgages. Under Section 92, the sub-rogee becomes entitled to the rights only of the original mortgagee concerned. In spite of that, however, it has uniformly and consistently been held that, by reason of such acquisition of rights, he was entitled to enforce them in the same manner as the original mortgagee concerned, or, in other words, entitled to enforce them on that footing in his own name. We do not think that a different situation was contemplated by using the same words in a more comprehensive form in Section 135-A, Subsections (2) and (3).'

In this appeal, we are concerned with Sub-section (2), a case of total payment, in respect whereof there is or can be no dispute as to the competency of the Insured to enforce the claim in its own name. We accordingly overrule the contention of Mr. Banerjee and hold that no deed of assignment in favour of the insurer was necessary to enable it to continue the proceedings in its name after the payment of the total loss. Mr. Banerjee however assailed the judgment in the above case contending that the court committed an error in holding contrary to the decision in King v. Victoria Insurance Co. Ltd., (1896) AC 250 that legislature made a deliberate departure from that view in Sec, 135-A of the Act. According to Mr. Banerjee, the Sub-sections (2) and (3) of Section 135-A are verbative reproduction of Sub-sections (1) and (2) of Section 79 of the Marine Insurance Act, 1906, in United Kingdom. It will however appear that in Halsbury's Laws of England, 3rd Edition, Vol. 22, Article 311, the case of payment of total loss was treated as one of abandonment, whereby the insurer by virtue of abandonment, became entitled to the goods insured and all rights incidental thereto while by subrogation they became entitled to the rights and remedies of the insured person in the goods insured. Even under the British Law as stated above, the insurer by subrogation and abandonment as in the present case, is entitled to sue in its own name.

19. Mr. Banerjee next contended that in any event, the liability of the carrier was limited by the consignment notes which constituted the basis of the agreement for transport. Before we proceed to examine the contention, it is necessary to consider whether the consignment notes for the suit goods were at all issued to or accepted by the company. We have seen that the entire goods of the company were carried by fourteen lorries, and for each consignment in one lorry, one set of such notes was issued. Out of the same twelve consignment notes containing endorsement of due receipt by the consignee have been exhibited in this case, being exhibits A to A-11 and conditions of carriage are printed overleaf. As to the suit goods carried by the two lorries, no consignment note was produced. It is an admitted position that the relevant consignment notes were not signed by the company. The learned Judge came to the finding that no consignment notes were issued to the company, firstly because they were not filed in this suit, though stated to have been filed in the criminal proceedings. D. W. 1 stated that the consignment notes were prepared in five copies, three were sent with the driver of the lorry concerned, one was retained in their office and one was sent to the company. The P. W. 2 who had no personal knowledge stated in her evidence that there was a note in her office to the effect that no consignment note was issued to the company but the office note was not produced and this was rightly commented by Mr. Banerjee. The learned Judge also relied on the deposition of D. W. 1 in the criminal court (Ext. 9) where he stated that the original consignment note with three copies, meaning four copies were handed to the driver. Mr. Banerjee took serious objection as to the admissibility of such deposition in criminal court. His contention is that there was no compliance of the requirement under Section 145 of the Evidence Act in that the witness was not confronted with any particular statement which again could only be admitted to shake the credibility of the witness and could not be used by way of substantive evidence as an admission. Mr. Banerjee relied on the decision in Bal Gangadhar Tilak v. Shrinivas Pandit, 19 Cal 729 (742) = (AIR 1915 PC 7 (11) ) in which it was held that in absence of proof of circumstances specified in Section 33 of the Evidence Act, the introduction and use in bulk in a civil suit of depositions of witnesses recorded in a criminal trial for contradicting or discounting the witnesses of the suit without placing the particular matter or point for explanation in view of the discrepancy, 'were illegitimate'. Reliance was also placed on the decision in Bhagawan Singh v. State of Punjab, : 1952CriLJ1131 and it was observed in that case that the witness should be afforded a reasonable opportunity of explaining contradictions after his attention is drawn to them in a fair and reasonable manner.

20. Mr. Mitra has disputed the above contentions and submitted that the deposition given in another proceedings would be admissible in evidence if it relates to the relevant facts. He relied oh the decision in Bharat Singh v. Mt. Bhagirathi, : [1966]1SCR606 in which it was observed that admissions duly proved are substantive evidence by themselves under Sections 17 and 21 of the Indian Evidence Act whether the party making it appeared as witness or not or confronted with the same though they are not conclusive proof of the matters admitted, while the purpose of Section 145 is to throw doubt on the veracity of the witness by contradicting him with a previous statement which does not become substantive evidence. In the above case, the Supreme Court was of opinion that such admissions could be used against the plaintiff making them when the admissions are duly proved long before she entered the witness box and offered no explanation of the admissions nor denied the facts admitted. Mr Mitra also relied on the decision in State of Rajasthan v. Kartar Singh, : 1970CriLJ1144 in which the Supreme Court observed that when a witness admitted having made the statement in another court, but stated that it was made under police pressure, it was pointless to draw his attention to each sentence and ask his explanation which would be the same.

21. In our opinion, the above cases cited by Mr. Mitra are not apposite to the facts of the present case. Here the certified copy of the deposition in the criminal court, it appears, was filed after the evidence was closed and argument concluded and judgment was reserved. Though the order sheet records that the D. W. 1 was confronted with the same, it is not clear that this document was proved in accordance with law as the original records do not appear to have been produced or that the witness was recalled and put on oath before confrontation which was made on the same day the document was filed and there is no record of the witness's reaction on confrontation. The procedure adopted was highly irregular and the learned Judge in the circumstances committed an error in admitting the certified copy of the deposition as substantive evidence and relying on it in holding that no consignment notes were issued to the company. This objection of Mr. Banerjee that Ext. 9 was in the circumstances inadmissible must therefore be upheld.

22. Even so, there is no evidence, in our opinion, to establish that any consignment note was issued to the company. According to the defendants, there were office copies of the two consignment notes relating to suit goods which it was stated, were filed in the criminal court but they were not produced at the hearing of the suit. It was admitted that the defendants had no paper to show that the consignment notes were issued to the company. Mr. Banerjee drew our attention to the statement in cross-examination of D. W. 1 who stated that a letter embodying the terms of agreement between the parties for transit was issued to the company. According to Mr. Banerjee, this letter was withheld by the company and he asked us to make adverse presumption for withholding the evidence relying on the principle that the court ought to draw an adverse inference if a party withholds evidence which will throw light on the facts at issue even though the burden of proof does not lie on him as observed in Gopal Krishnaji v. Md. Haji Latif. : [1968]3SCR862 , It is however seen that there is no other evidence about the issue of the letter except the bare statement of D. W. 1 or about its service and no question was put to the witness on behalf of the company while the office copy of the alleged letter has not been produced by the defendants. There is therefore no positive evidence on the part of the defendants about the issue of the consignment notes to the company which again in the circumstances cannot be asked to produce any evidence about the non-receipt of the same. We accordingly are of opinion that the consignment notes were not issued to the company as contended by the plaintiff.

23. Assuming however that the terms and conditions contained in the consignment notes as contained in exhibits A series were also issued to the company, we shall examine the liability of the defendants with reference to the terms therein as also the provisions of the Carriers Act. Under Section 6, a common carrier may by special contract signed by the owner of the goods to be carried or by some person duly authorised in that behalf by the owner limit his liability in respect of the same. Section 8 provides that notwithstanding anything hereinbefore contained, every common carrier shall be liable to the owner for loss or damage to any property delivered to such carrier to be carried when such loss or damage shall have arisen from the criminal act of the carrier or any of his servants or agents. It is accordingly clear that in cases of loss or damage arising from criminal acts of the carrier or his servants and agents, the liability of the carrier cannot be limited by any contract between the owner and the carrier. In the instant case, there is no dispute that the suit goods were lost due to the criminal acts of the drivers of the two lorries who, in view of the unchallenged findings of the trial court that the defendant No. 1 was not a commission agent but was itself the carrier, must be deemed to be its agents or servants. Accordingly the special contract under the consignment note or otherwise limiting the liability of the carrier is of no assistance to the defendant No. 1 when the loss has arisen from the criminal acts of its agents or servants. It must also be remembered that the special contract by the consignment note pleaded by the defendant No. 1 was not admittedly signed by the company or its authorised agent as required under Section 6.

24. Mr. Banerjee next contended that as the notice of loss or non-delivery was not given by the company to the defendant No. 1 within twenty-one days as provided in the last Clause of the consignment note the defendant was not liable for the loss of the goods. This Clause which absolves the carrier if no notice of loss or damage is given within the period of 21 days, cannot in view of the provisions of Section 8, be extended to cover cases when the loss or damage arises from the criminal acts of the carrier, his agents or servants. The Clause which at its highest may prevail in cases of loss or damage for causes other than the criminal acts of the carrier or his agents and servants, cannot, in our opinion, limit the liability of the carrier when loss arises precisely from the criminal acts of such carrier or his agents and servants as otherwise it would be contrary to the mandatory provisions of Section 8. For the reasons noted above, the defendant No. 1 as common carrier cannot escape its liability, even if the terms and conditions contained in exhibit A series governed the contract of carriage of the suit goods, for loss arising from the non-delivery of such goods due to criminal acts of its servants and agents. Under Section 9 again, the plaintiff in a suit against a common carrier for loss, damage or non-delivery of goods entrusted to him for carriage, is not required to prove that such loss, damage or non-delivery is due to the negligence or criminal act of the carrier, his servants or agents. Accordingly in the circumstances, the defendants cannot avoid a decree for damages caused by loss of the suit goods in the said circumstances.

25. Mr. Banerjee has next contended that the provisions of Section 135-A are applicable to cases of marine insurance on the basis of definition of 'marine insurance business' then prevailing. 'Marine insurance business' has been denned in Section 2(13-A) of the Insurance Act, 1938 as including contracts of insurance of goods insured for any transit by land or water or both. The law relating to marine insurance business was codified by the Marine Insurance Act, 1963 (Act XI of 1963) which came into force on August 1, 1963 when the suit was pending before the trial court. In this Act in Section 3, 'marine insurance' has been defined as a contract of marine insurance whereby the insurer undertakes to indemnify against marine losses, i.e., losses incidental to marine adventure. 'Marine adventure' under Section 2, Clause (d) as also 'maritime perils' of Clause (e) under the definitions are thus inseparable from perils of the seas. Under Section 4 Sub-section (1), 'marine insurance' has been extended to protect the assured against losses on inland waters or any land risk incidental to any sea voyage. Mr. Banerjee accordingly contended that marine insurance is thus always referable to sea voyage and incidental land risk and not to any transit over land only. Section 91 provides, by way of savings clause, that rules of law, including the law merchant (i.e., the custom of merchants as settled by judicial decisions Osborn) applying to contracts of marine insurance immediately before the commencement of this Act, save in so far as they are inconsistent with the express provisions of This Act, shall continue to apply to contracts of marine insurance. By Section 92, amongst others, Section 135-A of the Transfer of Property Act was repealed and its Sub-sections (1), (2) and (3) being incorporated in Sections 52(2). 79(1) and (2) respectively while Sub-section (4) was in effect incorporated in Section 90. In view of the change in law, Mr. Banerjee contended that under Section 6 of the General Clauses Act after coming into force of the said Act marine insurance policy could not cover purely inland risks of transit under its definition, and, under Section 91, rules of law and law merchant which are inconsistent with the express provisions of the Act had no application. Accordingly the provisions of Section 135-A of the Transfer of Property Act or corresponding sections in the said Act ceased to have application for purely inland transit including the one in suit. The cumulative effect of the coming into force of the Act is that there could be no subrogation by payment even of total loss, as Section 135-A and corresponding sections in the Act applied to marine insurance as defined by it so that the insurer was not competent to sue or continue the suit while the company was already out of picture because of the payment.

26. These contentions, apparently attractive, have, however, no legal basis as pointed by Mr. Mitra who drew our attention to Sub-section (2) of Section 4 of the Act and its Explanation and also contended that the new Act could not affect pending action in absence of express provision. In Section 4, Sub-section (1), it is provided that a contract of marine insurance may, by its terms or usage of trade, be extended to protect the assured against losses on inland waters or on any land risk incidental to any sea voyage. Sub-section (2) provides that where 'any adventure analogous to a marine adventure' is covered by a policy in the form of a marine policy, the provisions of the Act, only as by this section provided, shall apply thereto. The 'Explanation' attached to this Sub-section is to the following effect:

'Explanation-- 'An adventure analogous to a marine adventure' includes an adventure where any ship, goods or moveable are exposed to perils incidental to local or inland transit.'

It is obvious that such an adventure, by its terms includes cases where the goods or moveables arc exposed to perils incidental to local or inland transit. This definition thus obviously covers the present case where the goods entrusted for transit and covered by the policy in the form of a marine policy were wholly through inland routes and exposed to perils incidental to such transit. Accordingly, the provisions of Section 135-A of the Transfer of Property Act as also the corresponding sections of the said Act would, in our opinion, apply to cases of local or purely inland transit if covered by policy in the form of marine policy. The insurer in the present case thus would be entitled to a decree in the suit.

27. As to quantum of damages, it appears that no dispute was raised by the defendants. The schedule to the plaint sets out the calculation which is supported by exhibits 3 and 3 (a). As to the value of the goods recovered and returned to the company a credit of about Rs. 10,000/- was given and no dispute appears to have been raised in respect thereof in the trial court or in the memorandum of appeal or before us.

28. As all contentions raised on behalf of the appellants fail, this appeal is dismissed, parties bearing their own costs in this court in the circumstances.

29. The plaintiff No. 1 has filed a cross-objection against the decree under appeal awarding damages to the insurer only. The contention is that the trial court should have passed a joint decree in favour of the plaintiffs on the basis of its findings that the plaintiff No. 1 was a necessary party to the suit. Reliance was placed on the decision in Union of India v. Kalinga Textiles (P) Ltd.. : AIR1969Bom401 in which it was held that the consignee under Clause 15 of the letter of subrogation bound itself to land its name to every proceeding and even though payment was made to the consignee, its right to recover damages in the circumstances was not affected, In the plaint of the said suit, a recital was made that the court could pass a decree in favour either of the consignee or the insurer and the court on trial chose to pass the decree in favour of insurer in view of the payment. Accordingly it was held that the plaint was properly filed and notice under Section 77 of the Railways Act by the consignee was by the authorised person and on this notice the parties were in contest. The principle enunciated in the above case has no bearing on the present case.

30. We have seen by payment in full and final settlement by the insurer to the company the insurer became entitled to the interest of the insured in goods insured and there was subrogation of the insurer in place of the company. It has been held in the Great American Insurance Co. Ltd.'s case, S. A, No. 381 of 1959. D/- 16-3-1970 = (reported in : AIR1971Cal491 ) referred to above that on such subrogation, the insurer in its own name is entitled to sue for the damages for loss in transit. In the present case the company was a necessary party when the suit was instituted, but in view of the payment and subrogation, and receipt by the company of the amount covered by the policy in full and final settlement it had no subsisting interest in the goods insured which passed on to the insurer and thus it was no longer entitled to the damages or any portion thereof as claimed in cross-objection. There is thus no merit in the cross-objection which is accordingly dismissed without any order as to costs,

Murari Mohan Dutt, J.

31. I agree.


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