Madras High Court
Drs Logistics Private Limited vs Blue Star Limited on 11 December, 2023
S.A.No.68 of 2018
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 11.12.2023
CORAM
THE HONOURABLE MR. JUSTICE S.SOUNTHAR
S.A.No.68 of 2018
DRS Logistics Private Limited
21, 1st Floor, Shivaji Marg, Najafagrh Road
New Delhi 110 015. ...Appellant
Vs.
1.Blue Star Limited
Kasturi Building, Mohan T.Advani Chowk
Jamshedhi Tata Road, Mumbai 400 020
Represented by its Power Agent/Subrogee
The Oriental Insurance Co., Ltd.,
Represented by their
Sr.Divisional Manager R.Viswanathan
2.The Oriental Insurance Company Limited
Oriental House, A25/27, Asaf Ali Road
New Delhi 110 002
Represented by their Sr. Divisional Manager
R.Viswanathan ... Respondents
Prayer: Second Appeal filed under Section 100 of the Code of Civil
Procedure, against the judgment and decree dated 01.09.2017 passed in
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1/18
S.A.No.68 of 2018
A.S.No.78 of 2017 by the XVIII Additional Judge, City Civil Court, Chennai,
confirming the judgment and decree dated 08.11.2016 passed in OS.No.4019
of 2012 passed by the I Assistant Judge City Civil Court, Chennai.
For Appellant : Mr.S.Sathish
For Respondents : Mr.G.Guruswaminathan
for M/s.Nageswara
Naricharia for R1 & R2
JUDGMENT
The unsuccessful defendant in the suit is the appellant. The
respondents herein filed a suit seeking recovery of Rs.7,05,355/- with interest
for the loss caused to the goods of the first respondent, during transit by the
appellant/carrier from Chennai to New Delhi. The suit was decreed by the trial
Court and the findings of the Trial Court were affirmed by the first Appellate
Court. Aggrieved by the same, the unsuccessful defendant has come up with
this Second Appeal.
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2. According to the respondents/plaintiffs, the first respondent
during the course of his business, entrusted 83 numbers of Chest Freezers with
the appellant/carrier for transit from Chennai to New Delhi. It was the case of
the respondents that as a common carrier it was the duty of the appellant to
deliver the goods entrusted in a good condition to the consignee point. It was
further pleaded by the respondents that the appellant delivered only 80 Chest
Freezers out of 83 Chest Freezers in a highly damaged condition. The damage
caused to consignment was intimated to the appellant by way of e-mail dated
22.04.2009 and issued a statutory notice for the loss on 24.04.2009 calling
upon appellant to compensate the loss. The second respondent/insurer
appointed a surveyor to assess the damages and based on his survey report the
second respondent/second plaintiff paid a sum of Rs.7,05,355/- towards the
value of the damaged consignment to the first respondent and indemnified it as
per contract of Insurance. Hence, the first respondent executed a letter of
subrogation in favour of the second respondent. It was specifically averred by
the respondents that the damage to the consignment was due to the negligence
and lack of care on the part of the appellant and hence, they sought for
recovery of the above mentioned sum.
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3. The appellant/defendant filed a written statement denying the
averment found in the plaint as if damage to the consignment was caused to
due to the negligence and lack of care on the part of the appellant. It was the
case of the appellant that they had taken proper measures to transit the goods
in a good condition and the damage to the goods was caused due to the fire
accident originated from the Engine of the vehicle. It was beyond the control of
the appellant.
4. It was further averred that the accident had occurred due to the
technical fault in the Engine which was properly maintained by them. It was
also specifically averred by the appellant that the damaged consignment
namely Chest Freezers were not the one covered under Insurance policy issued
by the second respondent in favour of the first respondent. The second
respondent paid suit amount to the first respondent in respect of the damaged
goods which were not covered under the Insurance policy and therefore, the
suit filed against the appellant for recovery of the amount paid by the second
respondent to the first respondent was not at all maintainable. On these
pleadings, the appellant sought for dismissal of the suit.
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5. Before the trial Court, the Assistant Manager of the second
respondent was examined as PW1 and the Surveyor appointed by second
respondent was examined as PW2. On behalf of the respondents/plaintiffs 14
documents were marked as Ex.A1 to Ex.A14. On behalf of the
appellant/defendant no oral or documentary evidence was let in.
6. The trial Court on appreciation of oral and documentary
evidence available on record came to the conclusion that the respondents
proved the suit claim and decreed the suit as prayed for. Aggrieved by the
same, the appellant/defendant preferred an appeal in A.S.No.78 of 2017 on the
file of the XVIII Additional Judge, City Civil Court, Chennai. The First
Appellate Court also concurred with the findings of the trial Court. Aggrieved
by the same, the appellant has come up with this Second Appeal.
7. At the time of admission, this Court formulated the following
substantial questions of law:
“1.Whether the Court can disregard the fact that
the goods transported were not mentioned in the
Insurance Policy document and therefore not covered by
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Insurance Contract and still proceed to decree the suit
based on wrong finding and assumptions.
2. Whether the Court can disregard the evidence
and admission of Surveyor (PW2) especially when he
admits that the claim amount has been paid by the
second plaintiff to the first plaintiff in respect of goods
which were not insured. Further, when the witness
concedes that the damage was due to accidental fire.
3. Whether the Courts below can have jurisdiction
on the basis of a Letter of Subrogation and Special
Power of Attorney when the defendant is not a party to
the said documents.”
8. At the time of arguments, the learned counsel for the appellant
mainly submitted his arguments only on 1 st and 2nd substantial questions of
law. It was his submission that the Chest Freezer was not included in the
insurance policy issued by the second respondent in favour of the first
respondent marked as Ex.A2. When the goods damaged were not covered by
the insurance policy, the second respondent ought not to have indemnified the
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first respondent and as a consequence the suit claim for recovery of amount
paid by the second respondent to indemnify the first respondent is not at all
maintainable.
9. The learned counsel for the appellant further submitted that
PW2 Surveyor clearly admitted the damages to the consignment was only due
to the accidental loss and not because of any negligence on the part of the
appellant. In such circumstances, both the Courts below wrongly came to the
conclusion that the appellant was liable to pay the compensation amount to the
respondents.
10. The learned counsel for the respondents submitted that in
Ex.A2 insurance policy though the word Chest Freezer is not specifically
included the words refrigerator, Deep freezer are specifically included with the
suffix etc. Therefore, it should be presumed that Chest Freezer was also
covered by the Policy. The learned counsel for the respondents further
submitted that under Section 9 of the Carrier Act, there is a presumption in
favour of the first respondent/owner of the goods. In a suit for recovery of
damages for damaged goods by owner of goods against common carrier, the
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plaintiff need not lead any evidence regarding the negligence on the part of the
common carrier and it is for the carrier to lead a positive evidence to the effect
that the damage caused was not due to his fault. The learned counsel for the
respondents further submitted that in the case on hand, the appellant/carrier
failed to lead any evidence. Therefore, by virtue of presumption available under
Section 9 of the Carriers Act, the plaintiff is entitled to succeed.
11. In support of his contention, the learned counsel for the
appellant relied on the following judgments;
1) Nath Bros. International Ltd., Vs. Best Roadways Ltd.,
reported in 2001-1-L.W.756
2) Bond Food Products Private Ltd., and another, Vs.
M/s.Planters Airway Ltd., reported in 2004-2-L.W.663.
12. The first question to be decided in this matter is whether Chest
Freezers were included in the risk coverage clause under the Insurance policy
marked as Ex.A2. The risk coverage clause in Ex.A2 reads as follows:
“AIR CONDITIONERS, TRANSIT OF SPLIT MINI
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SPLIT/ROOM ACS SALES RETURN MACHINES ANY
EQUIPMENT RELATED TO AND WATER COOLERS BOTTLE
COLLERS MINERAL DISPENSERS, DEEP FREEZERS
REFRIGERATOR VOLTAGE STABILIZERS ETC.”
13. A perusal of this coverage clause in the insurance policy issued
by the second respondent under Ex.A2 would make it clear that the Chest
Freezers were not included in the risk coverage. However, the learned counsel
for the appellant submitted that the word etc., used in risk coverage clause
would bring Chest Freezer, which is similar to the goods which are specifically
mentioned, within the risk clause. The evidence of respondents side witness
PW2 assumes significance in this regard. PW2 is the Surveyor appointed by
the second respondent/Insurance Company to survey the loss to the
consignment. He deposed in his cross examination as follows:
“th/rh/Mtzk; 2. Kjy; thjpf;Fk;. ,uz;lhtJ
thjpfF
; k; ,ilna cs;s ,d;R{ud;!; ghyprpahFk;/ mjpy; ve;bje;j
bghUl;fs; fhg;gPL bra;ag;gl;Ls;sJ vd;w tptuk; Twg;gl;Ls;sJ/
th/rh/Mtzk; 2y; (chest freezer) ,y;iy/ Deep Freezers
vd;W Twg;gl;Ls;sJ/ th/rh/Mtzk; 3 ,d; tha;!; fhg;gp MFk;
mjpy; Twg;gl;Ls;sJ/ th/rh/Mtzk; 10 vd;Dila mwpf;ifapy;
nrjkile;j bghUs; (chest freezer) vd;W Twpas
[ n; sd;/
vd;Dila mwpf;ifapy; th/rh/Mtzk; 2a[k; ehd; vdJ
mwpf;ifapy; Fwpgg; pl;Ls;nsd;/ Mfnt fhg;gPL bra;ahj
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bghUSf;F fhg;gPL bjhif th';fpas
[ s
; hh; vd;why; rhpjhd;/
bghUl;fSf;F nrjk; (accidental fire) fhuzkhf
Vw;gl;Ls;sJ/”
14. PW2, in his evidence clearly mentioned that Chest Freezers
were not included in Ex.A2 Insurance Policy. He also deposed that the second
respondent paid compensation to the damaged goods which were not covered
under the policy. In the light of the well pronounced admission by the second
respondent's own Surveyor that Ex.A2 policy does not cover Chest Freezer, this
Court is not inclined to accept the arguments of the learned counsel for the
appellants that the expression “etc” employed in the risk coverage clause
would enlarge the meaning of the same and include the Chest Freezer also. If
the Chest Freezer is also a machine similar to the other goods covered under
policy, the Surveyor of the respondents would have clarified in his evidence
that Chest Freezer goods are similar to the other goods covered under the
policy and therefore, the policy would cover Chest Freezer also. But on the
contrary, it was clearly admitted that the policy does not cover Chest Freezer
and the compensation was paid for the goods which were not covered by the
policy.
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15. In view of the admission made by PW2 coupled with the
absence of the words Chest Freezer in the risk coverage clause, this Court
comes to the conclusion that damaged goods namely Chest Freezer was not
covered by Ex.A2 Insurance Policy.
16. Both the Courts below while appreciating the evidence of
PW2, misread his evidence and assumed as if Chest Freezer was included in
Ex.A2 Insurance Policy. He only deposed Chest Freezer was mentioned in the
Invoice Ex.A3 prepared by the first respondent and he never deposed that
Chest Freezer was included in Insurance Policy Ex.A2. Therefore, the
conclusion reached by the Courts below as if Chest Freezer was also included
in Ex.A2 is a clear misreading of evidence and therefore, the findings of fact
arrived at by the Courts below are vitiated by the perversity.
17. In view of the discussions made earlier, both the questions of
law framed at the time of admission are answered in favour of the appellants
and the judgment and decree passed by the Courts below are liable to be set
aside.
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18. The learned counsel for the respondents by relying on Section
9 of the Carriers Act submitted that the first respondent is entitled to maintain
an action against the defendants. He submitted that even assuming that the
Insurance Policy does not cover the goods damaged a presumption is available
under Section 9 of the Carriers Act that damage was caused by negligence or
criminal act of carrier and therefore, the first respondent is entitled to maintain
action for recovery of damages for the loss caused to the goods dehors
insurance policy. Section 9 of the Carriers Act reads thus:
“9.Plaintiffs, in suits for loss, damage, or
non-delivery, not required to prove negligence or cirminal
act:- In any suit brought against a common carrier for the
loss, damage or non-delivery of [goods (including
container pallet or similar article of transport used to
consolidate goods) entrusted] to him for carriage, it shall
not be necessary for the plaintiff to prove that such loss,
damage or non-delivery was owing to the negligence or
criminal act of the carrier, his servants or agents.”
19. Section 8 of Carriers Act, talks about the liability of common
carrier to pay damages to the loss caused to the goods carried by him due to
his negligence or fraud. The relevant provision reads as follows:
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“8.Common carrier liable for loss or damage caused
by negligent or fraud of himself or his agent:-
Notwithstanding anything herein before contained, every
common carrier shall be liable to the owner for loss of or
damage to any [property (including container, pallet or
similar article of transport used to consolidate goods)
delivered] to such carrier to be carried where such loss or
damage shall have arisen from the criminal act of the carrier
or any of his agents or servants [and shall also be liable to
the owner for loss or damage to any such property other than
property to which the provisions of Section 3 apply and in
respect of which the declaration required by that section has
not been made, where such loss or damage has arisen from
the negligence of the carrier or any of his agents or
servants.]”
20. Close scrutiny of Sections 8 & 9 of the Carriers Act would
make it clear, in case of damage to the goods during transit, the damage caused
by the negligence or fraud of the carrier or his agents or servants, the common
carrier is liable. Further in a suit filed by the owner of the damaged goods for
recovery of damages against the common carrier, it is not necessary for the
plaintiff to prove that the loss or damage was owing to the negligence or
criminal Act of the carrier. Therefore, there is a general presumption in favour
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of the owner of the damaged goods that damage to goods was due to carrier's
negligence or criminal act and it is for the common carrier to the rebut the
presumption by leading evidence that the damages caused to the goods are not
due to his negligence or criminal act.
21. In the case on hand, the respondents examined the Surveyor
appointed by the second respondent as PW2. He in his evidence deposed that
damage to the goods was caused due to the accidental fire. Therefore, it is clear
the damage to the goods was not due to any negligence or criminal act on the
part of the common carrier. When the respondent's witness himself admitted
damage to the goods was due to the accidental fire, there is nothing on record
to show that the damage to the goods was due to the negligence or criminal act
on the part of the appellant/carrier. Of course, there is a presumption available
under Section 9 of the Carriers Act in favour of the plaintiffs in a suit for
recovery of damages for loss to the goods during transit by carrier. However,
the statutory presumption under Section 9 of the Carriers Act was rebutted by
the evidence of respondent's own witness, who admitted that the damage was
caused due to the accidental fire. The said admission would suggest that there
was no negligence or criminal act on the part of the appellant. Therefore,
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statutory presumption under Section 9 of the Carriers Act gets rebutted.
22. In this regard, it would be appropriate to refer to the
observation of the Hon'ble Division Bench of this Court in Bond Food
Products Private Ltd., and another, Vs. M/s.Planters Airway Ltd., reported
in 2004-2-L.W.663. The relevant observation reads as follows:
“14.5. When the defendant/carrier failed to employ
a surveyor for the assessment of the damages on his own
and also failed to prove that they have not committed any
negligence, the evidence of he Surveyor (P.W.2) the report
of the Surveyor (Ex.A4), and his assessment with respect
to the quantum of damages have to be accepted.”
23. In the case on hand, though the appellant failed to lead any
evidence the Surveyor of the second respondent was examined as PW2 and he
in his evidence as well as Surveyor's report Ex.A10, clearly mentioned that
accident had taken place at 12 noon and the damage was caused due to the
accidental fire. In such circumstances, the presumption available under Section
9 of the Carriers Act is rebutted and the appellant is not liable to pay damages
to the respondents in view of the admission made by respondent's own witness
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PW2.
24. In Nath Bros. Exim International Ltd., Vs. Best Roadways
Ltd., reported in 2001-1-L.W.756, while considering scope of liability of
carrier with regard to consignment in his custody, the Hon'ble Apex Court
observed as follows:
“28. From the above discussion, it would be seen
that the liability of a carrier to whom the goods are entrusted
for carriage is that of an insurer and is absolute in terms, in the
sense that the carrier has to deliver the goods safely,
undamaged and without loss at the destination, indicated by
the consignor. So long as the goods are in the custody of the
carrier, it is the duty of the carrier to take due care as he would
have taken of his own goods and he would be liable if any loss
or damage was caused to the goods on account of his own
negligence or criminal act or that of his agent and servants.”
25. As discussed earlier, in the case on hand, the evidence of
respondent's witness as PW2 would suggest that there was no negligence or
criminal act on the part of the appellant/carrier and the accident was only due
to accidental fire and therefore, the first respondent is also not entitled to seek
compensation from the carrier, when it is not due to carrier's negligence or
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criminal act.
26. In view of the discussion made earlier, the second contention
raised by the learned counsel for the respondents is also not acceptable to this
Court. In view of the answer to questions of law 1 & 2, the Appeal is allowed
by setting aside the judgment and decree passed by the Courts below. The suit
filed by the respondents is dismissed.
27. a) In the result, the Second Appeal is allowed by setting aside
the judgment and decree passed by the Courts below.
b) the suit filed by the respondent is dismissed.
c) In the facts and circumstances of the case, there shall be no
order as to costs.
11.12.2023
Index : Yes
Internet : Yes
Neutral Citation Case : Yes
dna
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S.SOUNTHAR, J.
dna
To
1.The XVIII Additional Judge, City Civil Court, Chennai.
2.The I Assistant Judge City Civil Court, Chennai.
11.12.2023
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