NATIONAL CONSUMER DISPUTES REDRESSALCOMMISSION, NEW DELHI

 

 

ORIGINAL PETITION NO. 99 OF 1995

 

 

Sunil & Company                                          …      Complainant

 

Versus

 

All India Goods Transport Co. & Ors.              …      Opposite Parties

 

 

BEFORE :

 

                   HON’BLE MR. JUSTICE M.B. SHAH, PRESIDENT

MRS. RAJYALAKSHMI RAO, MEMBER

 

 

For the Complainant                           :          Mr. S.K.  Sharma,

                                                                        Advocate.       

                                                           

For the Opposite Party No.1 & 2           :        Mr.  S.K.  Chachra, Advocate

 

For the Opposite Party No.3 & 4           :        Mr. S.S. Lingwal, Advocate

 

For the Opposite Party No. 5 & 6          :        Ms. Pankaj Bala Verma,  Advocate                                       

 

 13.06.2005

 

O R D E R

 

M.B. SHAH, J. PRESIDENT

 

 

                        It is the say of the complainant that the complainant, a firm, having its office at Jodhpur, is engaged in processing, manufacturing and selling of dyed, bleached and printed textile fabrics which are mostly used by garments exporters for fabricating and exporting readymade garments and that the said goods were supplied by the complainant firm to parties in India and Nepal.  In the case of new or casual customer to safeguard its interest, the complainant despatches the goods through Indian Bank Association’s (hereinafter referred to as IBA) approved transport companies and documents are lodged through banks for collection.  Bank is the consignee and the documents are  lodged through bank with the instructions to intimate the ordering party to  get  the documents  released after making payments, that is to say, notified party is to be informed by the collecting banker on receipt of the documents by them.

 

                   The present complaint is directed against the carrier, Opponent Nos. 1 to 4 and against Insurance Companies, Opponent Nos. 5 and 6 and the notified party, buyer – M/s. Kumari Fashion Industries Pvt. Ltd.  Opponent No.1 is All-India Goods Transport (carrier) and Opponent No. 2 Mr. M. K. Gupta is its proprietor;  Opponent No. 3 is South Asian Roadways Company, the agent appointed by the Opponent No. 1 and opponent No. 4 Mr. G.S. Panwar is the Chairman of opponent No. 3. 

 

                   It is the case of the complainant that all the goods were despatched from Delhi to Kathmandu and the booking carrier was All-India Goods transport Company (O.P. No. 1).  O.P. No. 1  appointed its agent, South Asian Roadways Company, O. P. No. 3, for transporting the goods. It is the contention of the complainant that OP No. 3 is having its registered office at 603, Nirmal Tower, 26, Barakhamba Road, New Delhi and other offices and godowns in Nepal.  It is the contention of the complainant that the South Asian Roadways Co. Pvt. Ltd., Nepal is only a branch and extension of South Asian Roadways Co. Pvt. Ltd., New Delhi.

 

                   It is pointed out that  by letter dated 4-10-1993 O.P. No. 1, All-India Goods Transporters goods company, confirmed its status as an IBA approved carrier and also confirmed that “in no case will the goods be delivered to the invoiced party without receipt of fully discharged original consignee copy or consignee Bank’s letter”.  That letter is produced on record and so mentioned in paragraph 6 of affidavit by way of evidence by the complainant.

 

                   It is also pointed out that all the goods so sent were insured for “all risks as per clause 1, 11 and 24 Warehouse to Warehouse” through National Insurance Company Limited, New Delhi.  It is also pointed out that Warehouse to Warehouse (Amendment) Clause, reads as under :-

“The Warehouse to Warehouse (Amendment Clause modifies the Transit Clause (incorporating warehouse to warehouse clause) of the Institute cargo clauses.  It may be recalled that, as per Institute Cargo Clauses, the policy shall cease either on delivery –

(a)              to consignees or other final warehouse or place of storage at the destination named in the policy or

(b)              to other warehouse or place of storage, whether prior to or at the destination named in the policy, which the assured elects to use either,

(i)                for storage other than in the ordinary course of transit

(ii)              for allocation or distribution or

(c)              On the expiry of 60 days after completion of discharge over side of the goods from the overseas vessel at the final port of discharge which first occurs.

In the Warehouse to Warehouse (Amendment) Clause the period of 60 days is reduced to lesser number of days at the discretion of the insurer.  In extreme cases, the period can be reduced to even Nil which implies that the cover would cease as soon as the goods are discharged. 

The Warehouse to Warehouse (Amendment) Clause further provides that in the event of loss or damage, survey must be arranged within a certain number of days specified by the Insurer.”

 

                    Complainant has stated that in all  202 bales of fabric valued at Rs.27,14,185/- were dispatched under the GRs issued by  O.P. N.1  and goods were handed  over to its agent and nominees (O.P.No.3)  South Asian Roadways Company Pvt. Ltd. The documents were routed through Union Bank of India to Nepal Arab Bank Ltd. for delivery of originals against value with consignee being ‘Nepal Arab Bank Ltd.’ and notified party as Kumari Fashion Industries Pvt. Ltd.  The goods were transported on various dates from 18-10-1993 to 17-01-1994.  It is also contended that all the consignments were insured for value of goods + 10% to cover freight and incidental charges in case of any mis-happening.  

 

                   The statement containing the details of the goods dispatched along with the copy of the invoice, goods receipts, and covering letter to the Bank, Hundies to the Bank, certificate of an Insurance Policy cover note are produced on record. The complainant has also produced on record all the relevant documents including transport goods receipt issued by the transport company wherein the bank is shown as consignee. They were dispatched and given to the carrier R-1, All India Goods Transport Company and GRs also issued by the said company. As per the invoices,  the value of the goods was Rs.27,14,185/-.   It is contended that opposite party Nos. 1 to 4 misappropriated the goods/amount of 202 bales and, therefore, made payments of 95 bales through drafts in favour of the complainant.  For this complainant has given a statement that out of 202 bales transported, amount  for  107 bales remains to be  paid by the opposite parties.  The relevant statement is as  under :-

INVOICE

NO.

INVOICE

DATE

AMOUNT

(Rs.)

NO.OF

Bales

 

G.R.

No.

G.R.

DATE

TRANSPORTERS

NAME

INSURANCE

Police No.

 

10556

10.12.93

273326.80

23

5221

10.12.93

ALL INDIA GOODS TRANSPORT COMPANY (Opp. Party No. 1 & 2)

251700/4300641/93

10567

17.12.93

203345.70

16

5229

17.12.93

     - Do -

251700/4300666/93

10568

17.12.93

137177.90

10

5230

17.12.93

     - Do -

251700/4300665/93

10929

24.12.93

357268.30

31

5250

27.12.93

     - Do -

251700/4300668/93

10950

01.01.94

157169.20

14

5306

01.01.94

     - Do -

251700/4200149/94

10965

11.1.94

157480.00

13

6554

11.1.94

     - Do -

251700/4200149/94

TOTAL INVOICE VALUE

1285767.90

107

 

 

 

 

 

                    It is, therefore, submitted that opposite party Nos. 1 to 4 misappropriated the fabrics contained in transported 202 bales.  However, carriers have made payment for 95 bales through bank drafts in favour of the complainant.  Copy of the receipts and drafts are produced at page No. 387 to 399 (annexure 120 of the complaint).

 

                    It is, further contended that as the Insurance Company was not appointing surveyor, Tata Tea Company Limited (agent of Webster, Singapore) who are authorized surveyor of the National Insurance Company Limited were requested by the complainant to carry out investigation and to find out the whereabouts of the goods at the complainant’s cost.  The copy of the said request letter was given to the Insurance Company on 18-7-1994. Thereafter, Tata Tea Company Limited submitted its report with the following conclusion:-

“From the foregoing circumstantial evidences, in our opinion, we feel that Delivery Carrier has either joined hands with the Notify party and/or involved in some fraudulent practice in order to get some monetary gains”.  Page No. 380 to 385 (Annexure –118)

 

                    It is also pointed out that on the basis of the report submitted by Tata Tea Limited, carriers agreed to return 53 bales at Delhi for that rebooking  was done through GR Nos. 5221, 5229, 5230, 5256, 5306, 6554, (Consignment Note No.KTM-00231) dated 9-12-1994 issued by South Asian Roadways Co. Pvt. Limited.  The above said goods were re-booked by handing over of the pragyapan patras  through opposite party Nos. 3 and 4.  Those re-booked bales were also insured through New India Assurance Company.  However, those goods were also not received back.  As an abundant caution for the said goods complainant has approached the State Commission by filing a separate complaint.  However, it is agreed that the said complaint would be withdrawn as soon as final order is passed in this matter.

 

                    It is also submitted that for 95 bales opposite party Nos. 1 to 4 paid the amount by Bank drafts and for 54 bales opposite party Nos. 1 to 4 issued the cheques with their covering letters for Rs.3,25,000/-, Rs.4,57,262.40 and Rs. 2,40,000/- respectively i.e. the total sum of Rs. 10,17,262.40 (Nepali Currency).   All these three  cheques issued  by O.P. Nos. 1 to 4 were dishonoured. Reference is made to the letter dated 14.12.1994 written by the Director of the South Asian Roadways Co. Pvt. Ltd.  to Sunil & Co., through All India Goods Transport Co., New Delhi, regarding the goods lying in Bonded Warehouse wherein it was stated that due to dispute among the Directors of the Bonded Warehouse they were not in a position to clear the goods lying in the Bonded Warehouse. Hence two cheques for a sum of Rs.3,20,000/- and Rs.4,57,262/- drawn on the Rastriya Banijay Bank in favour of Sunil & Co., were sent as part payment towards the said goods.

           It is, therefore contended  that :-

1.                 There are clear admissions on the part of the opposite party Nos. 1 to 4 that 202 bales of fabrics were delivered to opposite party No. 1 by the complainant for its carriage to Kathmandu;

2.                 Opposite party No. 1 had taken services of opposite party No. 3 as their agent for transportation of the goods;

3.                 The bales containing fabrics were not delivered to the ‘consignee bank’;

4.                 Opposite party No. 1 to 4 have paid the amount for 95 bales.  For the remaining 107 bales of fabrics the amount is required to be paid as the three cheques  for the value of 54 bales issued by opposite party Nos. 1 to 4 were dishonoured and the remaining 53 bales allegedly rebooked were not received by the complainant; and

5.                 In any case, insurance company is liable to reimburse the complainant for the loss suffered by it.

 

Admissions:

(a)     In our view, this is a clear case of various admissions by the opposite parties.  Admittedly, the  goods were booked for transport from Delhi to Kathmandu. O.P.Nos.1 and 2 were the carrier, and  they appointed O.P. No.3 as its agent.  Goods were taken  to Kathmanud.  It is pointed out that  Kathmandu  branch is  that of O.P.No.3  In any case, once it is admitted that carrier has taken the custody  of the goods, it was  its duty to deliver the same to the consignee.  That has not been done.  Therefore, the carrier  would be liable under Section 9 of the Carriers Act, 1865.

 

 (b)    Further, admittedly, opposite parties have  pad the amount for 95 bales.  This admission clearly establishes that they are liable  to pay for the remaining bales of  fabrics to the complainant.   Not only this they have also given 3 cheques for the  value of 53 bales of  fabric.  This also proves beyond reasonable doubt that there was misappropriation of the goods by the carrier, otherwise there was no necessity of giving the cheques which were  dishonoured.  In this view of the matter, carriers  cannot escape their  liability  to reimburse the complainant for the goods  delivered  by the complainant  for transport to Kathmandu which are admittedly not delivered to the  consignee Bank- Nepal Arab Bank Ltd.

 

Conclusions:

 (i)     However, it was contended  on behalf of the O.P.No.1 to 4  that this Commission would have no pecuniary jurisdiction because subject  matter of the complaint is valued at Rs.12,85,789.  In our view,  this contention is not required to be dealt with after a lapse of  10 years.  In any  circumstances the claim is for    more than  Rs.20 lakhs.  The Complainant has prayed for the value of undelivered goods and Rs.6,10,000/- towards interest and other charges for going to Nepal and also for a compensation. Hence there is no substance in this contention.

 

(ii)      Secondly, it was contended that the matter is involved complicated questions of law and facts.  Hence, the complainant should be asked to approach  the competent civil court.   In our view, this submissions deserves no consideration.   In a case  where a carrier commits breach of trust in not delivering the goods, no  complicated questions of  law or fact are involved.

 

          (iii)     Learned counsel for the O.P. Nos. 3 and 4 further  contended that as the   53 bales of fabrics were rebooked from  Kathmandu,  without impleading Nepal Transport Company and New India Assurance Company Ltd., the complaint was not maintainable.   This submission does not deserve any further consideration,  because, admittedly, 53 bales  of  fabric even though rebooked, had not reached Delhi  or reached  at the destination at Delhi or  at the destination mentioned by the complainant. The defence taken by the Opposite Parties Nos. 1 to 4 to the extent that reimportation of 54 bales were not permitted is totally unjustified in view of the letter of the Embassy of India in Khatmandu dated 9.12.1994 wherein it is specifically mentioned thus:

                   “Re-importation of goods produced or manufactured in India is allowed under Section 20 of the Indian Customs Act, 1962, and for this no permission is required to be given by this Mission”.

In any case complainant was entitled to recover from the carrier for the bales for which he was not reimbursed by the O.P. Nos. 1 to 4.  Further the liability of the O.P.Nos. 1 to 4 would not cease till the goods are delivered to the consignee bank and admittedly, that has not been in this case.  Hence, there is no substance in the case of O.P.No.1 to 4.

 

(iv)     On behalf of National Insurance Company,  O.P.No.5, it is not disputed that complainant  obtained separate  Marine Cargo/Inland Transit Policy covering  the risk from warehouse to warehouse in respect of 202 bales  of cotton fabrics valued at Rs.27,14,125/- from the National Insurance Company.   It is also admitted that these goods were  transported through the carrier i.e. O.P.Nos. 1 to 4 from Delhi to Kathmandu on different dates.

 

          It is contended that the goods safely reached the carriers godown in Kathmandu and therefore insurance company is not liable.  In our view, this submission is against the term of the insurance policy quoted above as it specifically provides that the policy shall cease either on delivery of goods to the ‘consignee bank’ or  ‘final  warehouse’ or the place of storage at the destination named in the policy.  Admittedly, in the policy consignee’s name is ‘Nepal Arab Bank Ltd’.  This would not mean that if goods are stored in somebody else’s warehouse or carrier’s warehouse, terms of the policy are complied with. Goods should be handed over to the consignee or at the warehouse mentioned in the insurance policy or the place of storage at destination named in the policy or at the warehouse elected by the assured for storage other than in ordinary course of transit or for allocation or distribution. Hence, there is no substance in this contention.  Receipt of the    amount for 95 bales would not  absolve the insurance company  with regard to reimbursement  for remaining  bales  of cotton fabric as complainant was bound to minimize  the loss.  Reimbursement from the carrier is, therefore,  in consonance  with the general principle  of the insurance  policy to minimize  the loss.  Hence for the remaining  value of the bales of cotton fabric not reimbursed by the carrier, insurance company is liable to reimburse the complainant. 

 

          Similarly, with regard to 53 bales of cotton fabrics which were alleged to have been  found also, admittedly, the said goods  had not  reached back and the amount is not  received by the complainant.  Hence, the insurance company cannot escape  its liability.

 

Conclusion:

 

          In the result, the Complainant is allowed. Opposite Parties No.1 to 4 are jointly and severally held liable to reimburse the Complainant for a sum of Rs.12,85,789/- with interest.   Considering the delay, harassment and agony and the rate of interest prevailing at the relevant time, Opposite Parties No.1 to 4 shall pay the said amount with interest @ 12% per annum from 16th June, 1995 i.e. from the date of filing of the complaint with costs quantified at Rs.50,000/-. It is  further directed that if the Opposite Party No.1, the All India Goods Transport Carrier, fails to pay the amount within eight weeks from today, it will be open to the Complainant to inform the Indian Banks Association for taking appropriate action as it is the IBA’s approved transport company.

 

(b)     The Insurance Company is also liable to reimburse the Complainant if the amount is not recovered by the Complainant within six months from today i.e. on or before 31st December, 2005. Thereafter, it would be open to the Insurance Company to recover the same from the Opposite Parties Nos. 1 to 4 jointly and/or severally.

(c)     It is made clear that the complaint filed in the State Commission would not survive and as agreed after recovery of the amount the Complainant shall withdraw the same.

 

……………………………………….J.

(M. B.  SHAH)

PRESIDENT

 

 

…………………………………………

(RAJYALAKSHMI  RAO)

MEMBER