Friendly Transport,Daily Parcel Services v. C&N Ganges Metalizing P Ltd. & Ors.

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 08.12.2009CORAMTHE HONOURABLE MR. JUSTICE B.RAJENDRANA.S.No. 322 of 2000Friendly Transport,Daily Parcel Services,Rep. by its Manager,having their Head Office atNo.1, "Balaji Building",Bye Pass road,Housur – 635 109,Dharmapuri District.... Appellant/DefendantVersus1. C&N Ganges Metalizing P Ltd., Plot No.83-A, SIPCOT Indl. Complex, Hosur – 635 126, Dharmapuri District. 2. Oriental Insurance Co. Ltd., Represented by its Divisional Manager, D.O.No.1 Sayaji Rao Road, Mysore – 570 001, Karnataka State .. Respondents/Plaintiffs 1 & 2Prayer: Appeal filed under Section 96 of CPC against the judgmentand decree dated 28.03.2000 made in O.S.No.292 of 1996 on the file ofSub Court, Hosur.For Appellant:Mr.V.Kalimuthu for M/s.Subba ReddyFor Respondents:Mr.N.Venkataraman for M/s.Nageswaran & NarichaniaJUDGMENTThe appeal has been filed by the defendant as against thedecree and judgment dated 28.03.2000 made in O.S.No.292 of 1996 onthe file of Sub Court, Hosur. https://hcservices.ecourts.gov.in/hcservices/

2. The first plaintiff is running a factory manufacturingMettalised Polyester Films at Sipcot Industrial Complex, Hosur. Thesecond plaintiff is a company incorporated under the Companies Act,carrying on business of General Insurance which is subsidiary toGeneral Insurance Corporation of India.3. The defendant is a Parcel Service transport operator. On09.07.1992, the 1st plaintiff despatched a consignment of 96 rolls ofmettallised Polyester film property packed through the defendant atHosur for safe transportation to New Delhi to be delivered to theirconsignee M/s.Kuwar Fibres Pvt. Ltd., No.174, Katra Baryan Feteh-puri, Delhi. The said consignment was carried by the defendant fromHosur to Delhi. During the said transport out of the said 96 rollsof Mettallised Polyester Film, 29 Nos. of rolls of the said film werebadly damaged due to rain water and the same was delivered toM/s.Kuwar Fibres Pvt. Ltd., Delhi on 14.07.1992. The said damage tothe consignment was due to the carelessness by the defendant carrier,as the defendant is bound to carry the consignment entrusted to themand deliver it safely. The defendant had issued consignment noteunder G.C.Note No.2201 dated 09.07.92 acknowledging such entrustmentof metallised Polyster Film in good order and condition andundertaking to carry and deliver the same to the 1st Plaintiffconsignee at Delhi. But Contrary to the undertaking, the defendantcarrier did not deliver the said consignment entrusted to it, to the1st Plaintiff's consignee in order. The 1st Plaintiff was in no wayresponsible for the said damage to the consigned goods. Hence, thedefendant is bound to deliver the goods consigned to it in goodcondition and if it is not able to do so, it is bound to make goodthe loss to the 1st plaintiff. 4. Upon receipt of the information of the said damage and lossof the said consignment from the 1st Plaintiff, the 2nd Plaintiff, whois the insurer of the said goods, had appointed an independentsurveyor D.P.S.Malik & Co., 587, Sector-4, Timarpur, Delhi-54 toinspect and assess the loss pertaining to the damaged goods. Thesaid surveyor inspected the goods on 22.07.92 and 23.07.92 at KuwarFibres Ltd., and the said surveyor, after careful survey andassessment, submitted a survey report dated 22.08.92. As per thesurvey report, the net loss is Rs.3,04,203.12/- plus Survey FeeRs.3,612/-, Total Rs.3,07,815.12/-. Then the 1st plaintiff on26.08.92 through its letter dated 18.09.92, sent by R.P.A.D.addressed to the defendant demanded Rs.3,04,203.12/- to pay towardsthe said loss. The defendant received the same on 23.09.92. On itsreceipt, the defendant replied through its letter dated 23.09.92stating that the goods were consigned and were carried at the ownersrisk i.e. at the risk of the 1st plaintiff and since the loss of thegoods were occasioned while the goods were in the 1st plaintiffcustody and during transit, the loss of the goods were not due to thenegligence of the defendant and hence the defendant is not bound topay the sum of Rs.3,04,203.12/- being the value of the loss of the https://hcservices.ecourts.gov.in/hcservices/ said goods damaged plus Rs.3,612/- total Rs.3,07.815.12/- round ofRs.3,07,815/-. 5. In consequence of the said contract of insurance, the 1stplaintiff submitted claim bill to the 2nd plaintiff, for the abovesaid damage to their goods. The 2nd plaintiff had settled the claimof the 1st plaintiff by paying a sum of Rs.3,07,815/- on 27.11.92.Thereafter, the 2nd plaintiff was subrogated with the rights ofrecovery of the 1st plaintiff as per letter of subrogation and specialpower of Attorney dated 27.11.92 executed by the 1st plaintiff infavour of 2nd plaintiff. Since the 1st plaintiff is the person anddelivery should have been effected at Delhi as per the undertakinggiven by the carrier-defendant, which was not effected by thedefendant, the 1st Plaintiff as the consignor is also joining the 2ndplaintiff in filing this suit though the rights of the 1st plaintiffhave already been subrogated as stated above. The 1st plaintiff hasbeen made a party in this suit in order to avoid technicaldifficulties to be raised by the defendant. The 1st plaintiff has noobjection to a decree passed against the defendant either in favourof the 2nd plaintiff or in favour of both the plaintiffs.6. After the 1st plaintiff had executed the above said letter ofsubrogation and special power of Attorney in favour of the 2ndplaintiff, the 2nd plaintiff had entrusted the matter to M/s. StandardSurveillance Corporation, Claims Recovery Agent, Madras, forrecovering the above said amount of Rs.3,07,815/- by its letter ofauthority dated 02.12.1995. The said recovery agent approached thedefendant for recovering the above said amount from the defendant.But since the defendant had repudiated and declined to admit theliability on the untenable grounds, the plaintiffs were constrainedto file this suit for recovery of the sum of Rs.3,07,815/- withinterest thereon at 12% p.a. from 09.07.92 when the consigned goodswere carried by the defendant. The defendant-carrier is under astatutory obligation to make good the loss sustained by theplaintiffs for the loss of consignment entrusted to them. Theliability of the defendant is absolute and unconditional as per theprovisions of Carrier Act. Hence, the plaintiffs have filed thesuit.7. The defendant has filed written statement contending thatthe goods of the 1st plaintiff were loaded in their lorry andtransported to Delhi and there was no other goods in the lorry. Thegoods were loaded by the workers of the 1st plaintiff company underthe supervision of the 1st Plaintiff Officers. There were twotarpaulins covering the goods as insisted by the 1st plaintiff at thetime of engaging the lorry for transport of goods. This was theprocedure even on previous occasions. The goods were fully coveredwhen 1st plaintiff got the same loaded in the lorry. The goods weresafely delivered at the destination. There was no rain on the wayduring the journey time. The goods delivered were accepted at the https://hcservices.ecourts.gov.in/hcservices/ destination without any protest. If the tarpaulins were wet inside,the consignee would have insisted for open delivery. There was nocertificate of damage recorded then and there. A certificate ofdelivery was given to the transporter and on production of the samethe transporting charges was collected by the Defendant. There wasno scope for any damage when the goods were actually delivered at theplace of the consignee. There was no delay in delivery. There wasno abnormality in transport time. Due care and caution and skill intransport was exercised by the experienced driver of the Defendantcompany who drove the vehicle, the goods were carried safely. Theconsignee has not refused to take the delivery. He has not evenserved a notice of protest at the time of taking delivery. Thedelivery was in good condition. The consignee has not issued thestatutory notice to the carrier within the time stipulated underSec.10 of the Carriers Act. Hence the present claim is time barred.He would also further contend that the driver has not signed anydocument to record damage at the time of delivery. He would furthercontend that the damage was not evidenced by any certificate and noclaim made within the time allowed under the Carrier Act of 1865 (Act3). The defendant would further contend that he is not aware of thealleged appointment of the surveyor to inspect and assess the lossand no intimation was made to him either by the surveyor or by theplaintiff. He would further contend that the assessment made on thebasis of the surveyor's report and the consequent claim is excessiveand is not in accordance with law. Before the settlement of theinsurance claim by the second plaintiff with the first plaintiffcollusively, no notice was given to the defendant nor his objectionwas heard and the alleged payment by the second plaintiff to thefirst plaintiff is collusive and fraudulent in law and fact. Hence,defendant is not liable to pay any amount due thereon. He would alsodeny that there is any liability to pay any interest. Hence, hewould pray for the suit to be dismissed. 8. Based on this pleadings evidence were let in by both theparties, PWs. 1 and 3 were examined on the side of the plaintiff andDW1 was examined on the side of defendant, while Exs.A1 to 13 weremarked on the side of the plaintiff, no document was produced by thedefendant. Based on the oral and documentary evidence, issues wereframed and ultimately on a careful consideration of the facts, theCourt below has decreed the suit as prayed for with interest from thedate of decree at 6% p.a. Aggrieved against the same, the defendanthas preferred the present appeal. 9. Heard the learned counsel appearing for the plaintiffs andthe learned counsel appearing for the defendant/respondent. Theshort and only question that arises for consideration in this appeal,is whether the second plaintiff is entitled to act on the basis ofsubrogation given by the first plaintiff to seek for recovery ofamount from defendant for the damages carried to the goods intransport under the Carrier Act? https://hcservices.ecourts.gov.in/hcservices/

10. The learned counsel for the defendant/appellant hasvehemently argued two important points:(i) At the time of entrusting the goods they have notmentioned about the insurance between the parties.(ii) At the time of delivery of goods no objection was madein writing. No protest was made at the time of payment of thetransport charges. Therefore the presumption is that the goods weredelivered properly and correctly. If there was any damage as claimedby the 1st plaintiff, they should ask for open delivery system orsought the drivers' report or atleast got an endorsement or signaturefrom the driver on the back side of the waybill to show that therewas damages. But the only allegations made by the 1st plaintiff isthat there was an endorsement on the back of the waybill that thegoods were in damaged condition. This has not been established withthe necessary counter signature from the driver. Therefore the claimcould not be made at all. The second argument was that the surveyorappointed by the second plaintiff / insurance company has takensurvey and inspected the same on 22.07.92 and 23.07.92 which has notbeen intimated to the defendant and therefore whatever inspectiondone and whatever assessment made was not intimated to them and anydecree on that assessment is legally not sustainable. Further, theassessor namely the third party has also not given any intimation orassessment about the report under the Carrier Act. A reply has beengiven by the defendant to notice sent by first plaintiff that sincegoods were booked on the owners liability, there is no liability topay and hence the lower Court has wrongly come to the conclusion thatthe amount was payable by them and finding given by the lower Courtis not legally sustainable or maintainable.11. Per contra, the learned counsel for the respondentscategorically brought to the notice of this Court, the fact that thedamages has been done to the goods even at the time of the deliveryis proved beyond any reasonable doubt by the endorsement made on theback which would state that 29 bails were received in wet conditionand damaged during transit and those endorsement has not been countersigned by the driver. Therefore, there is no reply to accept theevidence that there are three copies of the waybill and one copy isthe party copy which is available and other two copies which arecarbon copies are available only with the first defendant / appellantherein and in proving his case, defendant has not chosen to producethese two copies which would clearly established beyond anyreasonable doubt that in the carbon copy the same endorsement havebeen found and that the appellant has not chosen to produce those twodocuments. Therefore when the vital document which is in theircustody have been not produced by the appellant, definitely, documentwhich has been produced by the plaintiff should be accepted and lowerCourt rightly accepted and decreed the suit and hence the appeal https://hcservices.ecourts.gov.in/hcservices/ deserve to be dismissed. The respondent's counsel would furthercontend that as per the statutory obligation under Section 10 of theCarrier Act, notice has to be issued within a period of 6 months fromthe date of damage. In this case Ex.A5 is a statutory notice issuedby the first plaintiff which is dated 18.09.1992 and it was served on23.09.1992 and Acknowledgment Card is Ex.A6 and reply has been givenby defendant under Ex.A7 which is also dated 23.09.1992. Thereforethe 1st plaintiffs issued a legal notice within a period of two monthsfrom the date of delivery of the goods. This is coupled with thefact that in the reply notice, the defendant has not chosen to raisethese defences but chooses to put forward it in the appeal. At thefirst instance when the reply notice was issued that too to thestatutory notice, it was stated that goods have been delivered atDelhi in a damaged condition as per the endorsement in the waybillfor which also no objection was taken by the defendant till thefilling of the suit and only in the written statement such anobjection was raised. Under law, the evidence of the expert, who isthe surveyor appointed by the authority namely the insurance company,is a valid one and expert evidence have been properly brought out.In any event merely because notice was not issued by the surveyor itwould not invalidate the claim as per the decision of the DivisionBench of this Honourable Court reported in 2004 4 CTC Page 103 (BondFood Products Pvt. Ltd. v. Planters Airways Ltd.) wherein it was heldthat no notice of appointment given to carrier in order to surveybefore conducting the said survey and submitted his report to thecarrier will not disentitle the claimant to claim the relief. Whenthe carrier has failed to appoint the surveyor for assessment ofdamage of goods and also failed to prove that the damage occurred wasnot due to their negligence, the expert's report could be accepted.The surveyor's report, which is marked as Ex.A3, and thecorresponding bill for the same under Ex.A4, clinchingly provesbeyond any reasonable doubt, that the damaged goods are under thesubrogation and the plaintiffs/respondents are entitled to get theremedy and the lower Court has correctly granted the relief.12. On a careful scrutiny of the documentary evidence let in byboth parties and on hearing the submissions made by both sides, theonly question which has been mainly argued by the both parties isthat the damages was not protested at the point of delivery. Acareful scrutiny of the evidence would clearly indicate that thegoods in question was delivered for transport and at the time ofconsignment, it was in good condition. The carrier has neverobjected nor there was any discrepency or any damage at the time ofdelivery for transportation. Eventhough the transport bills wouldshow that goods were duly packed by tarpaulins, at the time ofdelivery at Delhi, the first plaintiff had specifically made anendorsement on the back side of the waybill on the date of deliveryitself as follows:- https://hcservices.ecourts.gov.in/hcservices/ "Received the consignment in damage condition which is found inEx.A1 on the back side and also stated 29 bails in wet condition". 13. The only explanation which the appellant would state isthat when the goods were delivered at the site of the 1st plaintiff,the 1st plaintiff should have taken the signature of the driver. Ifthere is no signature, the endorsement could have always been writtenat a later point of time and therefore, this could not be relied onat all. 14. Per contra, the learned counsel for the respondent hadrightly pointed out that as per the evidence in the crossexamination, it is admitted that there are three copies of the saidwaybill and they have carbon copies and any endorsement made can beproduced by the defendant. Ex.A1 is the copy of the plaintiff andother two copies are in the custody of the appellant. It should nothave taken much time for the appellant to produce those copies of thewaybill to prove before Court that such endorsement is not availablein their copy and that this endorsement could have been made at alater point of time. Thus, the vital document, which is in thecustody of the defendant/appellant herein, was not produced beforeCourt. When such vital document, which is a clinching evidence toprove the very crux of the case had not been produced, as rightlypointed out by the Court below, the Court below has to believe onlythe document relied upon and produced by the 1st plaintiff beforeCourt. In other words, there is no contra evidence to prove that thegoods were duly delivered by the defendant/appellant in goodcondition, as it was entrusted to them at the time of transport.Once if it is proved that the goods were delivered in damagedcondition, especially 19 bails, then automatically the defendantwould be liable to pay compensation.15. As far as question of compensation is concerned, in thiscase, the first plaintiff has insured the property with the secondplaintiff. On such receipt of the damaged goods along with the waybill with an endorsement that 19 bails were damaged, the 1st plaintiffhad immediately intimated it to the insurance company. The Insurancecompany has also, immediately sought for appointment of surveyor toassess the damage. The independent surveyor has also inspected thegoods within the period of 8 days viz., on 22.07.92 and 23.07.92 andassessed the damage and filed a report on 23.08.1992 under Ex.A3giving a total valuation of the damages. The only defence here isthat such appointment of surveyor was neither intimated by theplaintiffs or the insurance Company or by the surveyor beforeinspection and if it was intimated, he would also taken part in theinspection and verified the above aspects. Since there was no opendelivery system in the delivery, relying upon the evidence of expertcannot be made applicable to the fact of the case. In thisconnection, the learned counsel for the respondents brought to the https://hcservices.ecourts.gov.in/hcservices/ notice to this Court, the decision of the Division Bench of thisHonourable Court reported in 2004 4 CTC page 103 (Bond Food ProductsPvt. Ltd. v. Planters Airways Ltd.) wherein in an identical situationwhere notice was not issued either by the company or by the surveyorand contended that such a report will not be acceptable, relying uponthe decision of the Supreme Court reported in 1991 AJC 811 (GwaliorTransport Co. Ltd. v. National Insurance Co. Ltd.), the DivisionBench concluded that in spite of the notice not having been given,the insurance company is liable to appoint the surveyor and suchreport could be accepted. The relevant portion of the Judgment isextracted hereunder :"14.4. Of course, no notice was given by the secondplaintiff to the defendant before appointing the surveyor(P.W.2) to assess the damages; nor the surveyor (P.W.2)gave any notice to the defendant before conducting thesurvey and submitting his report (Ex.A4) recommending for apayment of Rs.66,368.83p. Even though serious objectionsare made by the learned counsel for the defendant as to thereliance placed on Ex.A4 on those grounds, we are unable toappreciate the same in view of the decision of the MadhyaPradesh High Court in Gwalior Transport Co. Ltd. v.National Insurance Co. Ltd., 1991 ACJ 811, whereinMr.R.C.Lahoti,J., as His Lordship then was, held as under:"The surveyor is an expert in the field ofsurvey and unless there be something positive todiscredit him, his assessment has to be accepted. Itwould have been better if he had assessed the quantumof damages in the presence of the appellant.However, the plaintiff would not be non suited andthe survey conducted by C.P.Sarwahi would not bediscarded solely for this reason. A civil case hasto be decided on preponderance of probabilities. Thegoods were delivered from the custody of the carrierto the consignor who was also the consignee and therewas nothing which prevented the carrier fromemploying a surveyor for assessment of damagesspecially when an open delivery was being insistedupon. The carrier could also have insisted on asurvey being conducted in his presence which was notdone. In the matter of assessment of partial loss tothe goods, some guesswork has to be allowed. Theprice of the contents of bales is based on theinvoices. Discount has been given for the value ofthe salvage. Primarily, the payment was to be madeby the insurance company because the consignor wasclaiming from it. There is no reason to assume thatany extra or unreasonable assessment would have beenacceptable to the insurance company." https://hcservices.ecourts.gov.in/hcservices/

14.5. When the defendant/carrier failed toemploy a surveyor for the assessment of the damageson his own and also failed to prove that they havenot committed any negligence, the evidence of theSurveyor (P.W.2), the report of the surveyor (Ex.A4),and his assessment with respect to the quantum ofdamages have to be accepted."16. The decision of the Division Bench and the Supreme Court isclear that the report filed by the surveyor, which is an expertindependent body, can be accepted by the Court and lower Court iscorrect in accepting such report and passing an award forcompensation payable by the defendant. There is no discrepency inthe decree passed by the lower court. 17. The last question which is tried to be raised is a questionof limitation as to whether under section 10 of the Carrier Act, astatutory notice which is contemplated had been given within a periodof 6 months from the date of damage or not?. Under Ex.A5, the noticewhich has been intimated is as early as on 18.09.1992 which is wellwithin a period of two months from the date of delivery. Therefore,the question of limitation does not arise at all. 18. In the result , there is nothing to interfere with thefindings of the Court below. The appellant has not brought anymaterial to the notice of this Court to interfere with the findingsof Court below. Hence the appeal is dismissed. No costs.Sd/-Asst.Registrar/True Copy/Sub.Asst.RegistrarogyToThe Subordinate Court, Hosur, Dharmapuri.+ 1 CC to Mr.P.Subba Reddy,Advocate,SR.66863+ 1 CC to M/s.Nageswaran & Narichania,Advocate,SR.66923A.S. No.322 of 2000RSM(CO)EM/21.6.10