Union of India v. M/s. The Tata Iron & Steel Co. Ltd

Judgment

This Civil Miscellaneous Appeal under Section 23 of the Railway Claims Tribunal Act, 1989, is filed by the Union of India rep. by General Manager, South Eastern Railways, assailing the order dated

13.06.2002 passed by the Railway Claims Tribunal at Secunderabad Bench, Secunderabad (for short, ‘the Tribunal’), in O.A.No.32 of 1999.

2. Background facts in a nutshell leading to filing of this C.M.A. by the South Eastern Railways are: a) The applicant M/s.The Tata Iron & Steel Co. Ltd, the respondent herein, booked a consignment consisting of 56.77 Metric Tonnes of TISCON 16 MM bars from CFO, Tatanagar, Jamshedpur, on

20.04.1997 to be carried and delivered to the applicant at TISCO siding Simhachalam, A.P. The appellant accepted the said consignment and undertook for reward to carry and deliver the same at TISCON, Simhachalam, Anahdra Pradesh. The said consignment arrived at Simhachalam on 19.06.1997. Suspecting shortage in the consignment as the consignment was in disturbed condition, the applicant requested the appellant for re-weighment. The appellant permitted re-weighment of the consignment. On re-weighment, a shortage of 1.990 M.Ts. was disclosed. The appellant issued a certificate/re-weighment delivery report. The applicant put in a claim of Rs.50,568.04 ps. for shortage in the consignment by filing application before the Railway Claims Tribunal, Secunderabad Bench, under Section 16 of the Railway Claims Tribunal Act, 1989. b) The appellant filed written statement resisting the claim of the applicant. Booking of consignment has not been disputed by the appellant. It is stated in the written statement that the short delivery certificate was granted without prejudice, basing on the request of the consignee viz., M/s.Venkataramana Engineering, at the destination, only to place on record the actual quantity of the goods received at the destination station. It does not amount to admission of any liability or that the shortage occurred due to the Railway’s negligence in carriage of the consignment. Since the applicant M/s.TISCO had endorsed in the original railway receipt No.LP 093162, dated 20.04.1997 that the goods to be delivered to M/s.Naresh Kumar and Company, in turn to M/s.Venkataramana Engineering, accordingly, consignment was delivered to M/s.Venkataramana Engineering. As per Section 74 of the Indian Railways Act, 1989, the property in the consignment covered by a Railway Receipt shall pass to the consignee or the endorse, as the case may be on delivery of such Railway Receipt to him and he shall have all the rights and liabilities of the consignor. Therefore, the applicant M/s.Tata Iron and Steel Company has no right to sue. The appellant is not responsible for the alleged shortage of delivery and not liable to pay Rs.50,568.04 ps. to the applicant as prayed for or any part thereof and much less for cost and also any interest in the absence of specific agreement or trade practice or usage or custom in vogue as was held by the Supreme Court in AIR 1966 SC

275. c) The Tribunal formulated following issues consideration: “1) Whether the applicant has locus standi to prefer claim and whether action is maintainable? 2) Whether the alleged shortage in the subjet consignment has been established by the applicant? 3) If yes, to what extent are the Railways responsible? 4) To what relief? d) On behalf of the applicant, one witness was examined as AW.1 and six documents were marked as Exs.A1 to A6. On behalf of the appellant, one witness was examined as RW.1 and four documents were marked as Exs.R1 to R4. e) The Tribunal, on considering the material brought on record and on hearing the counsel appearing for the parties, held all the issues in favour of the applicant and thereby allowed the claim of the applicant and awarded compensation of Rs.34,517.44 ps. with interest at 12% p.a. from 12.08.1997 till the date of registration of the application i.e., 12.10.1999 and 6% p.a. from the date of registration of the application till realization, by order dated 13.06.2002. The said order is assailed in this Civil Miscellaneous Appeal.

3. Despite service of notice on the respondent/applicant, it has not chosen to enter appearance.

4. Heard Sri B.H.R.Chowdary, learned Standing Counsel appearing for the appellant and perused the record.

5. Learned Standing Counsel appearing for the appellant submits that admittedly the wagon was loaded the siding of respondent/applicant and was scheduled to be unloaded at private siding at Simhachalam and thereby Section 94 of the Railways Act, 1989, gets attracted. Placing reliance upon Rule 15 of the Goods Tariff Rules, learned Standing Counsel submits that where the goods are loaded by the consignors themselves, the issue of receipt by the railway does not amount to acceptance of the quantity and the burden is always upon the consignor to prove that the goods were filled properly and quantity mentioned by them is correct. He also placed reliance upon Section 102 of the Railways Act, 1989. In support of his submissions, reliance has been placed on the decision of this Court in Union of India v. M/s.Indian Oil Corporation Ltd, Madras[1] and Union of India v. I.B.P. Co. Ltd.[2]

6. In Union of India v. M/s.Indian Oil Corporation Ltd, Madras’s case (1 supra), learned single Judge of this Court has taken note of the Rule 15 of the Goods Tariff Rules and observed as hereunder: “Rule 15 of the Goods Tariff Rules is to the effect that the weight, description and classification of goods in the railway receipts and the forwarding note, are provisional and subject to verification. Wherever the goods are loaded by the consignor, the receipts are issued under a category, known as ‘said to contain’. The very description discloses that the transporter does not vouch for the correctness. When the consignor chooses to load the goods by himself, without the supervision of the railways, that too at their own siding, the relevant provision not only require them to be cautious about the mode of loading and accuracy of the quantity, but also relieves the railways of any loss or damage that may be caused to the goods, subject to the exceptions, provided therefor. The order discloses that the Tribunal did not take these aspects into account. No reference was made to Sections 94, 102 of the Act or the relevant Tariff Rules. It proceeded as though the goods were loaded and transported in the ordinary parlance. When they are covered by special procedure, the legal regime meant therefore, ought to have been applied.”

7. In Union of India v. I.B.P. Ltd’s case (2 supra), learned single Judge of this Court, after referring to Section 94 of the Railways Act, 1989, observed as hereunder: “In the instant case, as per the applicant, the bottom seals of the wagon was found intact, but the top seal was found missing. There is no evidence to show that there is a shortage due to the opening of top lid at the delivery point. In the absence of any such evidence and in the absence of railway supervision at the time of loading and unloading, Section 94 of the Act gives protection to the Railway authorities from paying the compensation. In the instant case, admittedly goods were loaded and delivered only at the siding of the applicant which did not belong to Railway Administration and therefore, I am of the view that the Railways are not responsible for any loss of the said shortage of M. S. The Tribunal below, without considering any of the contentions raised by the Railways and without dealing with any of the legal provisions contained tinder section 94 of the Act, simply allowed the application on the ground that there is no law which prohibits the Railways to supervise the loading and unloading. It is not the case of the applicant that the Railways have supervised the loading and unloading. In the absence of any proof that Railways have supervised the loading and unloading, I am of the opinion that the respondent herein is not entitled for any compensation in view of section 94 of the Railways Act, 1989 and as such the order of the Tribunal below in oaa No. 108 of 1998 dated 7-6-1999 granting compensation of Rs. 68,362/- to the respondent herein is liable to be set aside.”

8. The issue that arises for consideration in this appeal is, whether the respondent-M/s.Tata Iron and Steel Co. Ltd. is entitled to claim compensation for shortage in the subject consignment?

9. Indisputably goods have been loaded at a siding not belonging to a railway administration and so also delivery by the railway administration at a siding not belonging to the railway administration. The railway receipt, which has been exhibited as Ex.R.1, contains ‘said to contain’ clause. Rule 15 of the Goods Tariff Rules, is to the effect that the weight, description and classification of goods in the railway receipts and the forwarding note, are provisional and subject to verification. Wherever the goods are loaded by the consignor, the receipts are issued under a category, known as ‘said to contain’. The very description discloses that the transporter does not vouch for the correctness. When the consignor chooses to load the goods by himself, without the supervision of the railways, that too at their own siding, the relevant provision not only require them to be cautious about the mode of loading and accuracy of the quantity, but also relieves the railways of any loss or damage that may be caused to the goods, subject to the exceptions, provided therefor.

10. Under Section 94 of the Railways Act, 1989, the railway administration absolved from loss, damage or non-delivery of the goods if the goods are to be delivered at a siding which does not belong to the railway administration, or when the wagon containing the goods has been placed at a place where the wagons are exchanged between the railway administration and the owner of the siding which has been informed in writing that the wagon was so placed.

11. Rule 15 of the Goods Tariff Rules is to the effect that the weight, description and classification of goods in the railway receipts and the forwarding note, are provisional and subject to verification. Rule 15 fell for consideration before this court in Union of India v. M/s.Indian Oil Corporation Ltd, Madras’s case (1 supra), wherein it has been held as hereunder: “Wherever the goods are loaded by the consignor, the receipts are issued under a category, known as ‘said to contain’. The very description discloses that the transporter does not vouch for the correctness. When the consignor chooses to load the goods by himself, without the supervision of the railways, that too at their own siding, the relevant provision not only require them to be cautious about the mode of loading and accuracy of the quantity, but also relieves the railways of any loss or damage that may be caused to the goods, subject to the exceptions, provided therefor”. A shortage certificate amounts neither to an acknowledgement of liability nor holds out any hope to the consignee as to the time of delivery and is merely evidence of actual event that certain goods or articles have fallen short with reference to what the plaintiff states to have been despatched. A shortage certificate is no proof of the fact that the quantum of goods claimed to have been despatched has actually been despatched unless the fact of despatch of the quantum of goods is actually established. The Tribunal did not take into consideration Section 94 of the Railways Act and Rule 15 of the Goods Tariff Rules and thereby erred in fastening the liability on the appellant-Railways with regard to the shortage of the consignment.

12. Accordingly, the Civil Miscellaneous Appeal is allowed setting aside the order dated 13.06.2002 passed by the Railway Claims Tribunal at Secunderabad Bench, Secunderabad, in O.A.No.32 of

1999. No costs. ______________________ B.SESHASAYANA REDDY, J. Date:24th November, 2009. Cs THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Civil Miscellaneous Appeal No.2895 of 2002 Dated:24th November, 2009. [1] CMA No.1478 of 1999, dt.15.09.2004 [2] 2005 (2) ALT 596