M/S. Malhotra Card Manufacturers ... vs M/S. Ashtbhuj Ocean Movers
2008 Latest Caselaw 1261 Del

*                          HIGH COURT OF DELHI : NEW DELHI

                        Judgment reserved on: July 31, 2008
                      Judgment delivered on : August 7, 2008

+                                R.F. A. No. 219/2004

         M/s. Malhotra Card Manufacturers
         & Another                           ...    Appellants
                         Through: Mr. D.K. Rustagi, Advocate

                                             versus

         M/s. Ashtbhuj Ocean Movers          ... Respondent
                         Through: Mr. Arvind Chadha, Advocate

CORAM:

HON'BLE MR. JUSTICE T.S. THAKUR
HON'BLE MR. JUSTICE SUNIL GAUR

1.       Whether the Reporters of local papers may
         be allowed to see the judgment?

2.       To be referred to Reporter or not?

3.       Whether the judgment should be reported
         in the Digest?

SUNIL GAUR, J.

1. This appeal has been preferred against judgment and decree

dated 3rd February 2004 of the Additional District Judge, Delhi,

whereby counter claim of Rs.4,98,347/- of the Appellant/

defendant has been dismissed not on merit but by holding that it is

time barred and the suit of the Respondent/plaintiff for recovery of

Rs.1,73,878/- with pendentelite and future interest @ 9% per

annum has been decreed with costs.

2. The broad facts of this case are that the Appellant firm is

engaged in the business of forwarding of freight by Air and Sea and

the Respondent firm had handed over five shipments for onward

delivery by Air Freighting on 10th December, 1998 with the

pre-condition that the above said five shipments should definitely

reach the destination at Uganda by 15 th December, 1998.

Respondent had advised the Appellant to send the above said

shipment through Gulf Air by paying extra freight of almost

Rs.60,000/-, so that the said shipment would reach the destination

by 16th December 1998 positively.

3. Appellant had agreed to send the above said five shipments

through Gulf Air Carrier to Uganda on the assurance given by the

Respondent that the said consignment would reach the

destination by 16th December 1998. However, the aforesaid

consignment of the Appellant was off-loaded on the way by Gulf

Air and it could not reach the destination in time and the buyer of

the Appellant were not able to distribute the Christmas Cards,

Diaries, Calendar and Promotional items in time and so the

payment of the Appellant was stopped, which led to loss of

business worth lacs of rupees and the Appellant had to visit

Uganda to settle the issue of delayed receiving of goods and on

that account, counter claim was made for not receiving the entire

payment of the goods, expenses incurred for travelling to Uganda

and back and damages on account of loss of future business etc.

Whereas, the suit of the Respondent pertained to the recovery of

the outstanding principal amount of Rs.1,73,878/- with interest

towards the air freight charges for the above said five shipments.

4. On the claim and counter claim, the issues framed by the

Trial Court read as under:-

"1. Whether the plaintiff is entitled to the amount claimed by them in their claim alongwith interest and costs? OPP

2. Whether the defendant is entitled to the amount claimed in their counter claim alongwith interest and costs? OPD

3. Whether the suit is bad for non-joinder and mis-joinder of the parties? OPD

4. Relief."

5. Shri P.K. Malhotra, partner of the Appellant/defendant firm

had deposed as DW-1 and Capt. Sudhir Kapoor, Managing Partner

of the Respondent/plaintiff firm had deposed as PW-2 and the

Respondent herein had got examined Assistant Manager of Jet Air

Ltd., (which was general sales agent for Gulf Air) as PW-1 to prove

letter Ex. P-2 to indicate that the above referred shipment was to

arrive at the destination on 16th December 1998 but it got off

loaded due to heavy rush of Christmas and non-availability of

space and it had arrived at the destination in parts, i.e., on 20 th

December 1998 and 23rd December 1998 and thereafter. Apart

from the above referred evidence, consisting of three witnesses,

no other evidence was led before the Trial Court by either side.

6. After a contest, vide impugned judgment and decree, Trial

Court has decreed the suit of the Respondent/plaintiff and has

dismissed the counter claim of the Appellant/defendant as

indicated in opening paragraph of this judgment.

7. Both the sides have been heard in this appeal and the record

of this case has been perused by us.

8. During the course of the arguments, the challenge to the

impugned judgment was confined by the learned counsel for

Appellant to the rejection of the counter claim of the

Appellant/Defendant and in our view, it was rightly done, as we

find that the claim of the Respondent/plaintiff to the Air Freight

charges is legitimate one and it could not have been withheld.

There is no dispute that the outstanding principal amount, after

adjusting the part payment received, is Rs.1,73,878/- and in the

light of the evidence led, there is no justification for withholding it

and we find that the Trial Court rightly decreed the aforesaid

amount with reasonable rate of interest @ 9% per annum.

Therefore, the challenge in this appeal to decree of Rs.1,73,878/-

with costs and pendentelite and future interest @ 9% per annum

fails. However, we have given our anxious consideration to the

dismissal of the counter claim of the Appellant which has been out

rightly done by the Trial Court by holding that it is time barred.

9. Trial Court has relied upon section 27, 29 & 30 of the

Carriage by Air Act, 1972 and has reproduced the above said

sections in the impugned judgment. As per Section 30 of the

aforesaid Act, the period of limitation for claiming damages on

account of late delivery or non-delivery of the Air Freighted goods

is two years, which has to be reckoned from the date of arrival of

the goods at the destination or from the date on which the Aircraft

ought to have delivered the goods at the destination. Trial Court

has held that the counter claim of the Appellant was made on 1 st

November, 2001 and infact it should have been made by January,

2001 and thus it has been dismissed as time barred. Trial Court

has also relied upon case of M/s. Shailesh Textile Industries

vs. British Airways and Anr., 2003 (IV) Apex Decisions

(Delhi) 276, wherein it has been held that in cases under the

Carriage by Air Act, 1972, right to damages is extinguished, if

action is not brought within the period of two years from the date

of its accrual and the Limitation Act, 1963 would not apply to such

cases.

10. Aforesaid finding of the Trial Court has been assailed before

us by the Appellant by drawing our attention to the pleadings of

the parties, to highlight that neither it was Appellant's case nor it

was Respondent's case that the Respondent was an agent of the

Carriage 'Gulf Air'. After having perused the pleadings of the

parties, we find that there is no whisper in the pleadings of the

parties about Respondent being an agent of the Carrier 'Gulf Air'.

Not only this, the evidence on this vital aspect is also lacking.

Infact, as per the deposition of the Assistant Manager, PW-1, of Jet

Air Limited, the G.S.A. (General Sales Agent) of the Carrier 'Gulf

Air' is Jet Air Limited. It is pertinent to notice that when the

Managing Partner (PW-2) of the Respondent/plaintiff was cross

examined before the Trial Court, it was clarified by him that the

commission charged for air freighting by the Respondent/plaintiff

is in their capacity as freight forwarding agents and the Carrier

'Gulf Air' was not made a party as there was no privity of contract

between the Respondent/plaintiff and said Airlines.

11. In the face of the above referred evidence, it was not open to

the Trial Court to have simply looked into photocopy of Airway Bill

(which is not duly proved on record) to notice that in the column of

issuing carrier agent name and city, the name of the Respondent is

mentioned. It is not disputed not it can be that it has to be first

established that the Respondent is an agent of the Air Carrier 'Gulf

Air' and then only the question of applicability of the Carriage by

Air Act, 1972, would arise. Thereafter only, it can be seen as to

whether the ratio of judgment reported as 2003 (IV) Apex

Decisions (Delhi) 276, applies to this case or not.

12. We are of the considered opinion that the Trial Court has

gravely erred in proceeding on the presumption that the

Respondent is the agent of the Carrier 'Gulf Air', because we have

found that neither there are specific pleadings nor any legal

evidence on record to establish the factum of Respondent being an

agent of the Carrier 'Gulf Air'. To arrive at a just decision in this

matter, we deem it appropriate to frame an additional issue, which

is under:

"Whether the Respondent - Ashtbhuj Ocean Movers acted as an agent of Gulf Air, while issuing the Airway Bills, receiving the consignment and putting the same on board for onward carriage to the destination? If so, whether the claim for payment of damages against the agent is not maintainable under Section 27, 29 & 30 of the Carriage by Air Act, 1972?"

13. In all fairness to both the sides, we also deem it proper that

an opportunity ought to be afforded to the parties to the suit to

lead evidence on the above referred additional issue and direct

the Trial Court to record a finding on the aforesaid additional issue

regarding applicability of the Carriage by Air Act, 1972 to this case.

It is made clear that if the finding on the aforesaid additional issue

is returned in favour of Appellant, then the Trial Court is directed to

decide the counter claim of the Appellant on merits on the basis of

the evidence already recorded. However, it is left open to the Trial

Court to decide if any fresh evidence is required to be brought on

record by the parties to the suit, if any such application is made by

either side.

14. In view of the aforesaid narration, impugned judgment and

decree dismissing the counter claim of the Appellant/defendant is

set aside, leaving the parties to bear their own costs and the

counter claim of the Appellant/defendant is directed to be

registered as a separate suit by the Trial Court which is expected

to decide it afresh after framing the additional issue, as indicated

above. However, impugned judgment decreeing the suit of the

Respondent/plaintiff for a sum of Rs.1,73,878/- with pendentelite

and future interest @ 9% per annum with costs is affirmed.

15. In pursuance to the order dated 9th December 2004 passed

by this Court in this appeal, decretal amount of Rs.1,73,878/- has

been deposited by the Appellant with the Registrar General of this

Court and the same stands invested in Fixed Deposit Receipt. With

the dismissal of this appeal qua the impugned decree of

Rs.1,73,878/- with interest and costs, it follows that the

Respondent/plaintiff would be at liberty to withdraw the aforesaid

amount with interest accrued thereon and to take out the

execution for the remainder, if any.

16. Counter claim of the Appellant is remanded back to the trial

court, to be expeditiously tried afresh as directed above. Both the

sides are directed to appear before the District Judge, Delhi on 5th

September, 2008 for assigning of the counter claim to the Court of

competent jurisdiction. Trial Court record be sent back forthwith.

17. This appeal is partly allowed to the extent indicated above.

SUNIL GAUR, J

T.S. THAKUR, J

August 7, 2008 PKB