Lakshmi Chand Textiles vs Union Of India (Uoi) And Ors.
2004 Latest Caselaw 830 Del

JUDGMENT

Mukundakam Sharma, J.

1.This appeal is preferred by the appellant contending, inter alia, that the learned Additional District Judge in his judgment and decree dated 27th July, 1981 erred in law in holding that the plaintiff is only entitled to recover damages on the basis of the assessment made by the railway about the loss and also in holding that the plaintiff is not entitled to interest under any law. According to the appellant/plaintiff the appellant is entitled to recover damages on a higher rate than what is assessed by the railway and also for payment of interest on the entire amount, which is awarded as damages.

2.The appellant herein, as plaintiff, filed a suit for recovery of Rs.84,570/- along with interest both pendente lite and future. The plaintiff filed the aforesaid suit contending, inter alia, that the plaintiff through their Bombay office tendered a consignment comprising 12 bales containing Indian Sewing Thread weighing 25.10 quintals to the Western Railway for onward dispatch to New Delhi under Invoice dated 8.11.1974; that the plaintiff sought booking of the said goods under 'Quick Transit Service' system and was booked at the railway risk rate; that on 14.11.1974, the plaintiff sent their representatives to the New Delhi Railway Station for taking delivery of the said goods; that it was found that the entire suit consignment was fully burnt and was in badly damaged condition; that later on the defendants through their Goods Inspector asked the plaintiff to take delivery of the railway receipt and remove the sound goods leaving the burnt and damaged goods for assessment by them; that on 19.11.1974 the plaintiff took delivery of the railway receipt on payment of the railway charges; that the plaintiff requested the defendants to grant open delivery of the partly damaged three bales on assessment of the damages as the remaining 9 bales had been completely burnt and were valueless; that the consignment was inspected jointly by the Goods Inspector of the defendants with the representatives of the plaintiff. It was also contended that subsequently the suit consignment was jointly examined by the A.T.S (C), Northern Railway, the Goods Inspector along with the representatives of the plaintiff and in that assessment 75% loss was assessed in 8 bales and 30 % loss in 21 bundles and 5% loss in remaining 139 bundles; that the plaintiff requested the defendant by their letter dated 29.11.1974 not to detain the goods and to seek opinion of two independent and respectable persons in order to assess the damage and loss whereupon the plaintiff sought opinion from two independent agencies/surveyors about the loss caused to the goods and the said surveyors after examining the suit consignment and considering the independent opinion prepared a report dated 6.12.1974; that the defendant also sought opinion from two respectable agencies/surveyors, namely, M/s.Delhi Cloth Mills and Shree Handloom Bhandar, Delhi, who submitted their reports on 19.12.1974 and 20.12.1974 respectively giving different assessment than what was assessed by the railways. On the basis thereof, the plaintiff lodged a claim for a sum of Rs.58,584/- with interest and served a notice on the railways under Section 78-B of the Indian Railway Act. In the said suit the plaintiff claimed Rs.56,010/- as loss of damaged goods and Rs.28,560/- as interest at 17% p.a and the claim of the plaintiff is, therefore, valued at Rs.84,570/-.

3.The defendants contested the suit on various grounds as set out in the written statement. On the pleadings of the parties, seven issues were framed. The learned Additional District Judge, after hearing the counsel for the parties, proceeded to decide the suit by recording his findings and conclusions issuewise. So far Issues 1 to 5 were concerned, all the aforesaid issues were held in favor of the plaintiff, appellant herein, and the said issues are not under challenge in the present appeal. The most vital and important issue in the suit was Issue No.6, which was framed as under:-

"6. To what amount of compensation, if any, is the plaintiff entitled?

4. The parties hereto led their evidence, both oral and documentary. The plaintiff examined two witnesses whereas the defendants examined four witnesses. Parties exhibited several documents, which are part of the records. The counsel appearing for the parties have taken us through the evidence adduced by the parties, both oral and documentary, in support of their respective submissions. Counsel appearing for the appellant/plaintiff drew our attention to the averments made in para 19 of the plaint. In the said para the plaintiff has given in a nutshell the assessment made in respect of the goods, which were burnt, in the following manner:-

Qty.of goods

Opinion of Railways

Opinion of Surveyor

Opinion of DCM

Opinion of Shree Handloom Bhandar

Opinion of the plaintiff

8 bales totally burnt from all sides

75% loss

99% loss

80% loss

97% loss

100% loss

21 burnt bundles out of one partly burnt bale

30% loss

75% loss

80% loss

92.5% loss

90% loss

19 bundles less damaged out of one partly burnt bale

5% loss

25% loss

50% loss

35% loss

35% loss

120 bundles i.e 3 bales damaged by water, fire & heat

5% loss

25% loss

25% loss

35% loss

35% loss

Relying on the same, the counsel appearing for the plaintiff/appellant submitted that the aforesaid chart would prove and establish that what was assessed by the railways was much less than what was assessed by the two surveyors appointed by the respondents themselves. Counsel further submitted that the learned Additional District Judge erred in law and also on facts in awarding compensation/damages on the basis of the assessment made by the railways, which is much less than the opinion given by the two surveyors appointed by the respondent/defendant themselves and, therefore, the damages awarded are required to be enhanced.

5. The next submission of the counsel appearing for the appellant was that the learned Additional District Judge erred in law and also on facts in not awarding interest to the appellant/plaintiff at least for the pendente lite and future period.

6. In order to appreciate the contention of the counsel appearing for the appellant/plaintiff, we have perused the entire records. A close scrutiny of the said records discloses that an assessment was made by the railways in respect of the loss suffered by the appellant because of the destruction of their goods due to fire, which took place when the aforesaid goods were in the custody of the railways. The aforesaid assessment of damage by the learned Additional District Judge, is not under challenge in this appeal and, therefore, the assessment of damage to the aforesaid extent by the learned Additional District Judge cannot be assailed at this stage nor the same could be interfered with. However, so far the contention of the counsel for the appellant pertaining to the assessment made by its own surveyors, namely, the agency appointed by the plaintiff/appellant and also the opinion of the two surveyors, namely, M/s.Delhi Cloth Mills and Shree Handloom Bhandar, who were appointed by the respondents, are concerned, the said opinions have not been proved in the suit in accordance with law. Photo copies of the two opinions of the two surveyors, namely, M/s.Delhi Cloth Mills and Shree Handloom Bhandar, were placed on record.

7. On scrutiny of the original records, we find that the plaintiff/appellant filed an application under Order 11 CPC before the trial court seeking for a direction for production of four original documents, which included the two surveyors reports as well. The said application was registered as I.A.3616/1979. The defendants took time in the trial court for placing the documents on record and ultimately filed photo copies of the aforesaid two documents, namely, the surveyors reports. Even the report of the surveyor of the appellant/plaintiff is also on record but all the aforesaid three reports have neither been produced nor proved in the trial court in accordance with law. Counsel for the appellant/plaintiff also sought to submit that the aforesaid two reports of the surveyors and the assessment given therein are admitted in the written statement and, therefore, the said documents were not required to be proved as it is settled law that a fact admitted is not required to be proved. In support of the said contention, counsel relied upon the provisions of Section 58 of the Evidence Act.

The aforesaid contention of the counsel for the appellant/plaintiff was although very attractive but, unfortunately, cannot be accepted in view of the fact that the railway administration nowhere admitted the said opinion and the assessment made by the two surveyors, namely, M/s.Delhi Cloth Mills and Shree Handloom Bhandar. We have gone through the entire written statement. It only stated that the railway had assessed the damages by independent parties. But it is nowhere admitted in the written statement or the evidence adduced that the said assessment and rates given therein are legal and valid. It is only the fact that assessment of the damages was got effected by the railway and by private surveyors also. This limited admission does not prove and establish the claim of the appellant either in the suit or in this appeal unless and until the said fact that the assessment of the damages by the independent surveyors is also admitted as legal and valid. The assessment and the opinion in respect of damages by the independent parties was required to be proved by leading cogent evidence and by proving the said documents on record, which was not done in the instant case. In the absence of the same, it is not possible for this court to hold that the assessment made and the opinion given by the two surveyors in respect of the quantum of loss allegedly suffered by the appellant is cogent and reliable evidence. Therefore, damage cannot be assessed on the basis of the said opinion and assessment.

8. Counsel appearing for the appellant relied upon the decision of this court in M/S.RUDNAP EXPORT-IMPORT VS. EASTERN ASSOCIATES COM AND OTHERS reported in AIR 1984 Delhi 20 and in SUDIR ENGINEERING COMPANY VS. NITCO RODWAYS LTD. , in support of his contention that if the denial is evasive, then it should be accepted by the court that there is, in fact no denial and there is admission of the fact. However, in our humble opinion, the ratio of the aforesaid decisions are not applicable to the facts of the present case inasmuch as even if we assume that there was an admission on the part of the respondent/defendant, the said admission was only to the limited extent that the railways had got the damages assessed by appointing two independent surveyors. The said fact, although admitted, does not by itself prove the assessment of the damages. As such the opinion given by them in these reports cannot bind the parties unless these reports are proved in the trial in accordance with law.

9. We have perused the record of the trial court. We find that even the original reports have not been placed on record. A typed copy has been filed on record. Without production of the primary evidence no reliance can be placed on the typed copy, more so in the absence of evidence of the assessors. Therefore, as the assessment and the opinion exercised by the two surveyors, on whose reports exclusive and strong reliance has been placed for claiming enhanced amount of damages in the present appeal, have not been proved in the suit in accordance with law, no reliance could be placed on the same. The damage to the consignment is admitted. The defendant has accepted the assessment by its official, the ATS(C), Northern Railway, and has admitted in its written statement that this assessment of damages was correct. The trial court was justified in basing its judgment on this assessment and consequent award of damages. Therefore, the present appeal filed by the plaintiff/appellant to the extent of prayer for enhancement of the damages is found to be without merit and is dismissed.

10. So far the second and the last plea with regard to payment of interest is concerned, we have considered the rival submissions of the counsel appearing for the parties. Counsel appearing for the appellant/plaintiff submitted that the findings and conclusions of the learned Additional District Judge, that no such interest is payable under any law, is ex facie illegal and without jurisdiction whereas counsel appearing for the respondent submitted that since it is a case of assessment of damages and payment of such damages to the appellant, therefore, no such interest is payable on such damages.

11. We have considered the submissions of the counsel appearing for the parties. The suit was filed by the plaintiff/appellant praying for adjudication of the principal sum payable to the appellant/plaintiff as damages. The aforesaid damages were claimed in view of the loss suffered by the appellant/plaintiff because the goods could not be delivered by the respondent/defendant when it was required to be delivered to the appellant/plaintiff and the plaintiff sought payment of the said principal sum payable to the plaintiff. It is an admitted position that there was no interest rate agreed upon between the parties which is required to be paid for any loss suffered by any of the parties envisaged under the contract. Therefore, grant of interest was definitely in the discretion of the court. It is also correct that when a discretion is vested in the court, the discretion is not only extendable to the rate of interest but also to the fact as to whether or not any interest is at all payable. Therefore, the court, in an appropriate case, may also deny to pay any interest but while doing so the discretion is to be exercised judicially in the light of facts of each case. Here, however, the learned trial court has held that no interest is payable in this matter under any law as it was in the nature of a claim for payment of damages.

12. The Supreme Court in the decision of Union of India vs. Punjab Factories Limited held that in the absence of any usage or contract express or implied, or of any provision of law to justify award of interest, interest by way of damages cannot be awarded. In view of the aforesaid decision of the Supreme Court, prayer for payment of interest on the damages for the period prior to filing of the suit cannot be granted.

13. Section 34 of the Code of Civil Procedure deals with interest for the post litigation period. According to this provision where a decree is for payment of money, the court may order interest at a reasonable rate on the principal sum adjudged from the date of filing of the suit till the date of decree, in addition to any interest adjudged for any period prior to institution of the suit. However, the Indian Railways Act or the Rules framed there under do not contain an express provision making Section 34 of the Code of Civil Procedure applicable to proceedings before the claims commissioner. Under the provisions of the Indian Railways Act, the claimant would and could have resorted to a suit for damages in a civil court. In a suit of such nature, the civil court may award post litigation interest. In our considered opinion denial of post litigation interest would amount to depriving the appellant herein of compensation for the loss of his goods from the railways for no default on his part. In that view of the matter, the provisions of Section 34 of the Code of Civil Procedure would be applicable to the facts and circumstances of the present case. In this connection, we may appropriately derive support from a Division Bench decision of the Madhya Pradesh High Court in the case of UNION OF INDIA VS. SMT.LAXMIPATI AND ANOTHER and a decision of the Madras High Court in UNION OF INDIA AND ANOTHER VS. KHANDELWAL BROS (P) LTD. AND ANOTHER .

14. It is not clear from the records whether or not the amount of Rs.29,883.50 was paid by the respondent to the appellant and, if so, when the said amount was paid. The learned Additional District Judge, Delhi by the judgment and order dated 27th July, 1981 held that the aforesaid amount is payable by the respondent.

15. Considering the facts and circumstances of the case, we are of the opinion that the appellant/plaintiff shall also be entitled to payment of interest on the aforesaid amount during the pendency of the suit. Accordingly, it is ordered that the appellant shall be entitled to interest at the rate of 12% p.a from the date of filing of the suit till payment.