High Court · 2009

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 30/10/2009C O R A MTHE HONOURABLE Mr.JUSTICE C. NAGAPPANAppeal Suit No. 214 of 2004M/s. Parakh Roadlines (Bombay)408, Bharat Chambers, 52-C, Baroda StreetMumbai 400 009....Appellant/Defendant Vs1. M/s. National Polyplast (India) Ltd,rep. By its Agent The National Insurance Company Limitedhaving Administrative Office atThiru Complex,44, Pantheon Road, EgmoreChennai 8.2. The National Insurance Company Ltd.,Administrative OfficeNo.3, Milton RoadKolkatta 700 001.... Respondents/Plaintiffs Appeal against the judgment and decree dated 27.8.2002 made inO.S.No. 5905 of 1998 on the file of IV Addl. Judge, City CivilCourt, Chennai.For Appellant ... Mr. Shandeep Sha for M/s. Shah & Shah For Respondents ... Mr. N.Venkatramanfor M/s. Nageswaran & Narichania J U D G E M E N TThe defendant has preferred the appeal challenging thejudgment and decree dated 27.8.2002 made in O.S.No. 5905 of 1998on the file of IV Additional Judge, City Civil Court, Chennai.2. Briefly, the case of the plaintiffs is that the firstplaintiff purchased one Windsor Injection Moulding Machine with https://hcservices.ecourts.gov.in/hcservices/ accessories from M/s. DGP Windsor India Ltd. under Invoice dated14.8.1995 to the total value of Rs.54,76,185/- and the machine wasloaded in two vehicles as provided by the defendant Common Carrierby Consignment Note dated 14.8.1995 for safe carriage by road anddoor delivery to the first plaintiff at Madras and the lorrycarrying the Injection unit left on 14.8.1995 enroute Madras viaBangalore and on 20.8.1995, the lorry met with an accident at about1.00 a.m. and the Injection Moulding Machine fell down and sustainedextensive damage and on being notified about the accident, thesecond plaintiff as underwriter of the consignment, appointed anindependent surveyor, who issued a preliminary survey report dated26.8.1995, and the consignor's representative also certified that theunit be sent back to the manufacturer for appropriate assessment ofthe damage sustained and for rectification and repair. It isfurther stated by the plaintiffs that the further survey wasconducted and the survey report dated 15.10.1995 was issued and aftercarrying out repairs and reconditioning, the machine was sentthrough another carrier to Madras under Consignment Note dated26.10.1995 at a cost of Rs.35,560/-, being the freight charges.According to the plaintiffs, the transportation charges from theaccident spot at Bommasandra to Thane including the crane hire chargeworks out to Rs.42,500/- and on 15.12.1995, the defendant CommonCarrier issued a certificate acknowledging the damage sustained bythe consignment, which was in its custody, while in transit. It isfurther stated by the plaintiffs that on 3.1.1996, the firstplaintiff sent a figured notice of loss / claim to the defendantby registered post acknowledgement due and the same was served underPostal Acknowledgement Card on 10.1.1996. According to the firstplaintiff, it sustained a pecuniary loss of Rs.8,04,577.23/- as aresult of negligence on the part of the defendant and the defendantis obliged to make good the loss. It is further stated by theplaintiffs that the suit consignment was insured with the secondplaintiff for transit risk and on receipt of a claim bill from thefirst plaintiff, it was indemnified by the second plaintiff bypaying a sum of Rs.8,18,602/-, which includes the survey fee, and byvirtue of the said settlement under the policy of insurance, thesecond plaintiff is entitled to file and maintain the suit againstthe defendant on its own name and to avoid any technical defence,the suit is filed by both the plaintiffs. It is further stated inthe plaint that the second plaintiff after settlement entrusted theclaim papers to its recovery agent M/s. V.N.C. Narichania (P) Ltd.and the recovery agent lodged a claim on 22.8.1996 with thedefendant's administrative office at Bombay and a reply dated9.1.1997 was sent by the defendant through its advocates denying itsliability and again, the matter was taken up with the Carrier throughits Claim Protection & Financial Indemnity Corporation and thedefendant offered a sum of Rs.30,000/- at the first instance in fullsettlement and that was rejected by the plaintiffs and again, itoffered a sum of Rs.40,000/- and that was also not accepted andhence, the plaintiffs have filed the present suit seeking for ajudgment and decree directing the defendant to pay the second https://hcservices.ecourts.gov.in/hcservices/ plaintiff a sum of Rs.8,04,577/- with interest at 18% per annum fromthe date of suit till realisation and for costs. 3. The defendant filed written statement denying the suitclaim and stated that the suit is not maintainable for want ofterritorial jurisdiction since no part of the cause of action hasarisen within the jurisdiction of the trial Court. It is furtherstated that the suit is liable to be dismissed as barred bythe law of limitation. According to the defendant, the suit isliable to be dismissed since no statutory notice as required underSection 10 of the Carriers Act was given by the plaintiffs to thedefendant and the alleged subrogation is invalid in law and notbinding on the defendant and the Power of Attorney is also not validsince there is no right of subrogation and the second plaintiff hasno privity of contract with the defendant to maintain the suit andthe plaintiff has no title to the goods and it cannot maintain thesuit. It is further stated by the defendant that there was no damageto the consignment and no survey was conducted and the alleged surveysaid to have been conducted by the plaintiff was without notice orknowledge of the defendant and it cannot be admitted in evidenceas against the defendant and the suit is liable to be dismissed.4. The trial court framed five issues and the plaintiffsexamined P.Ws.1 and 2 and marked Exs.A1 to A26 on their side andthe defendant examined D.W.1 and no document was marked on its side.The trial court, on a consideration of oral and documentary evidence,held that the plaintiffs have proved the suit claim and the defendantis liable to pay a sum of Rs.7,62,077/- to the second plaintiff andgranted the decree for the said sum together with interest at 18% perannum from the date of plaint till the date of decree and furtherinterest at 6% per annum from the date of decree till realisation.Challenging the judgment and decree, the defendant has preferredthe present appeal. For the sake of convenience, in thisjudgment, the parties are referred to as arrayed in the suit. 5. The points for determination in the appeal are -(1) Whether the suit is not maintainable for want ofterritorial jurisdiction.(2) Whether the plaintiffs have substantiated theirclaim and are entitled for the relief sought for. POINT No.1:6. The learned counsel appearing for theappellant/defendant submits that the consignment was entrusted withthe defendant for safe carriage by road and door delivery to thefirst plaintiff at Madras and the defendant in Ex.A3 Consignment Notehas stated 'Subject to Bombay Jurisdiction' and the accident tookplace at Bommbasandra in Bangalore – Hosur National Highway,17 kms. away from Bangalore and no part of cause of action has arisen https://hcservices.ecourts.gov.in/hcservices/ within the jurisdiction of the Court at Madras and hence, the suit isnot maintainable.7. Per contra, the learned counsel for therespondents/plaintiffs submits that in para 2 of the plaint itis averred that the defendant is having a Principal Office at121, Coral Merchant Street, Madras 600 001, within the jurisdictionof the trial Court and there is no denial of the same in the writtenstatement and the witness examined by the defendant as D.W.1, in thecross-examination has admitted that he is employed at Madras andthe counsel further contended that the consignment was sent to Madrasand the subrogation took place at Madras and the same is mentionedin the cause of action part of the plaint and a specific part of thecause of action has arisen within the jurisdiction of the Court atMadras and the suit is maintainable. In support of his submission,the learned counsel for the respondents/plaintiffs relies on twodecisions of this Court.8. It is not in dispute that the first plaintiff entrustedthe Injection Moulding Machine purchased by it from M/s. DGPWindsor India Ltd. with the common carrier, namely, the defendant,for safe carriage by road and door delivery at Madras. Ex.A2 is theInvoice dated 14.8.1995 under which the first plaintiff purchasedthe machine. Ex.A1 is the Inland Transit Policy of Insurancetaken by the first plaintiff with the second plaintiff fortransporting the machinery to Chennai. Ex.A3 is the Consignment Noteissued by the defendant to the first plaintiff and 'Subject to BombayJurisdiction' is found mentioned in it. This Court in the decisionin REVATHI CP EQUIPMENT LTD.. by its power agent Messrs. ORIENTALFIRE AND GENERAL INSURANCE CO. LTD. & ANOTHER V.. MESSRS. PATELROADWAYS PVT. LTD., COIMBATORE AND OTHERS [1988-1-O.W.252] held thatwhere the suit was laid claiming the relief under the Carriers Act,the term relating to jurisdiction found in the consignment note wouldhave no relevance and when a specific part of the cause of actionhad arisen within the jurisdiction of the trial court, the suit ismaintainable. Admittedly, the present suit has been laid invokingthe common law liability under the Carriers Act and it is stated inthe plaint that the defendant is Common Carrier and therefore, bothin law and on facts the defendant is bound to take proper care of thegoods entrusted to it and deliver the consignment in good conditionto the consignor.9. The plaintiffs have specifically averred in the plaintthat the defendant has subordinate office at Madras and there isno denial in the written statement. The witness of the defendant,DW.1 Bajurang Bare was employed at Madras as admitted by him in histestimony. Since the suit consignment was insured by thefirst plaintiff to the second plaintiff for transit risk, the firstplaintiff lodged a claim bill at Madras and the second plaintiffindemnified the same by paying a sum of Rs.8,18,602/- to the firstplaintiff at Madras. Ex.A13 is the claim bill and Ex.A14 is the https://hcservices.ecourts.gov.in/hcservices/ Settlement voucher of the claim. Ex.A15 is the Letter ofSubrogation. A Division Bench of this Court dealt with a casesimilar in facts to the present one and held in the decision in BONDFOOD PRODUCTS PRIVATE LTD., AND ANOTHER V.. M/s. PLANTERS AIRWAYSLTD. [2004 (4) CTC 103] that the term "cause of action" used inSection 20(c) of the Code of Civil Procedure denotes the whole bundleof material facts based on which the plaintiffs seek the relief asprayed for and the Letter of Subrogation was executed at Madras andtherefore it is evident that part of cause of action has arisenwithin the jurisdiction of trial court at Madras and the suit filedwas maintainable. The ratio in the above decision is applicable tothe facts of the present case. The Letter of subrogation wasexecuted by the first plaintiff in favour of second plaintiff to laythe suit and part of cause of action arose within the jurisdiction ofthe trial Court and the suit is maintainable. The point is answeredaccordingly. POINT No.2:10. The entrustment of the consignment by the firstplaintiff with the defendant to transport the same to Madras afterinsuring the same, is not in dispute. During the transit, the lorrymet with an accident and the Moulding Machine fell down and sustaineddamage and the first plaintiff notified the accident to the secondplaintiff and as underwriter, the second plaintiff appointed alicensed independent Surveyor and he went to the accident spot andsubmitted Ex.A4 the Preliminary Survey Report. The damaged machinewas sent back to the manufacturer for assessment of the damage,rectification and repair. A further survey was conducted and theSurveyor was examined as P.W.2 in the case. Ex.A6 is the FinalSurvey Report.11. The learned counsel for the appellant/defendant submitsthat no notice of survey was given to the defendant before theassessment of damages and no reliance can be placed on the report.Per contra, the learned counsel for the respondents/plaintiffssubmits that the carrier failed to employ a Surveyor for theassessment of damages on its own and it is only the plaintiffs,who conducted the preliminary survey and the final survey, and theyhave also examined the Surveyor as a witness on their side and theyhave proved the damages.12. Notice was not given to the defendant Carrier beforeconducting the survey, was raised as a contention before the DivisionBench of this Court in the decision referred above and the Benchheld that there was nothing which prevented the Carrier fromemploying a Surveyor for assessment of damages and that was not doneand the Carrier failed to prove that it has not committed negligenceand in those circumstances, the report of the Surveyor and histestimony with respect to the assessment of quantum of damages haveto be accepted. As already seen, in the present case also the https://hcservices.ecourts.gov.in/hcservices/ defendant Carrier did not employ a Surveyor on its own for assessmentof damages.13. As per Section 9 of the Carriers Act, it is for thedefendant to prove that there was no negligence on its part.The Supreme Court in the decision in NATH BROS. EXIM INTERNATIONALLTD. V.. BEST ROADWAYS LTD. [2001-1-L.W. 756] laid down that theliability of a Carrier to whom the goods are entrusted for carriageis that of an insurer and is absolute in terms, in the sense thatthe carrier has to deliver the goods safely, undamaged and withoutloss at the destination indicated by the consignor and in a suit forrecovery of damages, the burden of proof will not be on the owner orthe plaintiff to show that the loss or damage was caused owing to thenegligence or criminal act of the carrier. In the present case,there is a failure on the part of the defendant Carrier to prove thatthere was no negligence on its part.14. The further contention of the learned counsel for theappellant is that the suit is not maintainable as there wasno resolution from the Board of Directors authorising institution ofthe suit as contemplated under Order XXIX Rule 1 C.P.C. No such pleawas taken by the defendant in the written statement. In the plaintaverments it is stated that the suit consignment was insured with thesecond plaintiff for transit risk and the first plaintiff lodged aclaim bill and the second plaintiff indemnified the first plaintiffand therefore, the second plaintiff is entitled to file and maintainthe suit against the defendant Common Carrier in its own name buthowever, with a view to avoid any technical defence being raised bythe defendant, the suit is filed by both the plaintiffs. The learnedcounsel for the respondents submits that the plaint was signed andverified by the Divisional Manager of the second plaintiff and he wasduly authorised by the company to sign and verify the pleadings and,in any event, it is only a technicality, which does not go to theroot of the matter. In support of his submission, he relies on thedecision of the Apex Court in UNITED BANK OF INDIA V.. NARESHKUMAR AND OTHERS [AIR 1997 SC 3]. Their Lordships of the SupremeCourt in the decision, referred above, considered the scope of Order6 Rule 14 and Order 29 Rule 1 C.P.C. in relation to suits filed byor against Public Corporations and laid down as follows -"9. In cases like the present where suits areinstituted or defended on behalf of a publiccorporation, public interest should not bepermitted to be defeated on a mere technicality.Procedural defects which do not go to the root ofthe matter should not be permitted to defeat ajust cause. There is sufficient power in theCourts, under the Code of Civil Procedure, toensure that injustice is not done to any partywho has a just case. As far as possible asubstantive right should not be allowed to be https://hcservices.ecourts.gov.in/hcservices/ defeated on account of a procedural irregularitywhich is curable.10. It cannot be disputed that a companylike the appellant can sue and be sued in its ownname. Under Order 6 Rule 14 of the Code of CivilProcedure a pleading is required to be signed bythe party and its pleader, if any. As a companyis a juristic entity it is obvious that someperson has to sign the pleadings on behalf of thecompany. Order 29 Rule 1 of the Code of CivilProcedure, therefore, provides that in a suit byor against a corporation the Secretary or anyDirector or other Principal Officer of thecorporation who is able to depose to the facts ofthe case might sign and verify on behalf of thecompany. Reading Order 6, Rule 14 together withOrder 29, Rule 1 of the Code of Civil Procedureit would appear that even in the absence of anyformal letter of authority or power of attorneyhaving been executed a person referred to in Rule1 of Order 29 can, by virtue of the office whichhe holds, sign and verify the pleadings on behalfof the corporation. In addition thereto and dehors Order 29, Rule 1 of the Code of CivilProcedure, as a company is a juristic entity, itcan duly authorise any person to sign the plaintor the written statement on its behalf and thiswould be regarded as sufficient compliance withthe provisions of Order 6, Rule 14 of the Code ofCivil Procedure."The second plaintiff as a company is a juristic entity and itsDivisional Manager has signed the plaint on its behalf and that couldbe sufficient compliance with the provisions referred above. Hencethe contention raised by the learned counsel for the appellant isdevoid of merit.15. The plaintiff examined its Assistant Manager as P.W.1and he has testified about the suit claim. Ex.A8 is the invoicerelating to the material cost incurred while repairing andreconditioning the damaged parts. The claim for damages is based onEx.A6 Final Survey Report and its author was also examined as P.W.2and he was cross-examined by the defendant. In fact, before filingthe suit, the first plaintiff issued notice under Section 10 of theCarriers Act and Ex.A11 is the said Notice and Ex.A12 is the PostalAcknowledgement Card evidencing the receipt of the notice by thedefendant. Thus the plaintiffs have substantiated their claim fordamages. Though the plaintiffs have sought for the cost oftransportation charges including crane hire charges of the machineryfrom the accident site to Thane at a cost of Rs.42,500/-, the samewas not granted by the trial Court since no evidence was let in with https://hcservices.ecourts.gov.in/hcservices/ regard to the said charges.16. The plaintiffs have prayed for interest at the rate of18% per annum from the date of suit till the date of realisation.The trial Court has granted the Decree for a sum of Rs.7,62,077/-with interest at 18% per annum from the date of suit till the date ofDecree together with subsequent interest at 6% per annum from thedate of Decree till realisation. The learned counsel for theappellant submits that the interest awarded at 18% per annum isexcessive. The said contention is repelled by the learned counselfor the respondents/plaintiffs stating that it is a commercialtransaction and they have sought for 18% further interest on thesuit claim in the plaint and the trial Court has awarded only alesser interest. It is needless to say that the defendant as aCommon Carrier is transporting the goods on hire charges and it is acommercial transaction. Though the trial Court awarded interest at18% per annum from the date of suit till date of Decree, it hasawarded subsequent interest only at 6% per annum till realisation.In the facts and circumstances of the case, the interest awardedcannot be termed as unjust and excessive. The conclusion of thetrial Court that the plaintiffs have substantiated their claim isbased on proper appreciation of oral and documentary evidence and itdoes not call for any interference by this Court. The point isdetermined accordingly. 17. There are no merits in the appeal and the same isdismissed. However, there shall be no order as to costs.Sd/Asst.Registrar/true copy/Sub Asst.Registrar pb To1. IV Additional Judge, City Civil Court, Chennai. 2. Section Officer, V.R.Section, High Court, Madras.+1cc to Mr.Nageswaran & Narichania, Advocate Sr 57766+1cc to Mr.Shah & Shah, Advocate Sr 57988PUR(CO)km/11.11.A.S.No. 214 of 2004