Dodsal Private Ltd. v. Narmada Seaways Ltd.

1. This is a Notice of Motion taken out by the 5th defendants for dismissal of the suit as against them for absolute want of cause of action against them and in the alternative for stay of the suit under S. 34 of the Arbitration Act.

2. The material facts in nutshell are these: The two plaintiffs and each of the defendants Nos. 1 to 5 are Companies registered under the Indian Companies Act. The 6th defendants are the Oil & Natural Gas Commission. In or about May 1983 the 6th defendants had invited tenders for laying of land line pipes from Umrat to Hazira in the State of Gujarat. The said tender was ultimately awarded by them to the 1st plaintiffs. The 2nd plaintiffs are Insurers of the 1st plaintiffs. We are here concerned with the 1st plaintiffs alone. I shall refer to them as ‘plaintiffs’. The terms and conditions of the work a re recorded in an Agreement dt. 21st Aug. 1984. It appears that the work, inter alia, involved the transportation of coal tar enamel and Reinforced Concrete Costed Pipes from Mangalore to Magdala in Gujarat. The plaintiffs under their agreement undertook this job also. It appears that while the proceedings relating to the finalisation of the tender were still not concluded, the plaintiffs entered into a contract with the 1st defendants on 29th May 1984 for transportation of the said pipes from Mangalore to the designated Steel Yard at Magdala. The 2nd defendants are a sister concern of the 1st defendants. The 1st defendants entered into a contract with their sister concern and entrusted them a part of the work. The 2nd defendants in their turn entered into two separate and independent Charter-party Agreements with the 3nd and 5th defendants for carriage of the pipes by Sea from Mangalore Port to Magdala Port. Here it may be noted that at Mangalore, initially the pipes were to be transported to the Port from the Yard by road and next by barges to the mother ship. After the goods were loaded on to the ship, the defendants 3 and 5 were to carry the goods to Magdala. At Magdala, again the same process of transporting the pipes from the shop to the jetty by barges and eventually from the jetty to the work site by road was to follow in the reverse order. It is not disputed and this ought to be noted that the job of defendants 3 and 5 under their separate contracts was restricted to carriage of the pipes by ship only, that is from the port of goods being loaded into the ship at Mangalore up to the point of discharge from the ship to the barges at Magdala. For the purposes of this motion, we are concerned only with the case of the 5th Defendants who were responsible for carriage of 738 pipes, which they did in their ship “M.V Jay Ambika”.

3. According to the plaint averments, extensive damage was caused to these pipes carried by the 5th defendants and other 683 pipes carried by the 3rd defendants. The plaint further avers that the damage was caused during the course of the entire journey, (that is, by road, barges and ships) and that this was due to the negligence of the servants/employees/representatives of the defendants. The primary claim of the plaintiffs for damages in the sum of Rs. 77,02,725.15 is against the 1st defendants with whom they had entered into the contract of 29th May 1984. In the alternative they also claim damages from defendants 2 to 5. The averments in relation to the alternative claim are principally contained in para 15 of the plaint.

4. Shri Vernekar for the plaintiffs clarifies that although there is no direct privity of contract between the plaintiffs and the 5th defendants, the cause of action against the latter is two-fold: (i) the plaintiffs were bailees in respect of the goods at the time of carriage by sea and therefore they have a good cause of action against the 5th Defendants on the ground of negligence and (ii) the plaintiffs have a right to sue, emanating from the Bill of Lading issued by 5th defendants in favour of the 6th defendants, describing the plaintiffs as, “A/c Dodsal Pvt. Ltd”. As against this the contention of Shri Venkiteshwaran is that these averments, even if treated as proved, do not in law constitute any liability against the 5th defendants and as such the suit should be dismissed.

5. At the outset, I may make it clear that for the purpose of deciding whether any cause of action arises against the 5th defendants, I shall treat every averment in the plaint as factually true, and on that basis decide whether any Vinculum jurisarises for damages between the two sides.

6. For the first branch of his submission, Shri Vernekar relies on a Calcutta decision, (Division Bench), reported in AIR 1984 Cal 230. Smt. Umarani Sen v. Sudhir Kumar Datta. It is held in that case that a suit can be successfully founded by a bailee under S. 180 of the Contract Act against a common carrier under the Carriers Act, 1865 for their negligence. This decision will not help Shri Vernekar for the simple reason that the 5th defendants are not common carriers as defined in the aforesaid Act. S. 2 of the Act defined “Common Carrier” as denoting a person, other than the Government, engaged in the business of transporting for hire property from place to place by land or inland Navigation, for all persons indiscriminately.” The carriage of good's in the present case by defendant No. 5 was admittedly by Sea, certainly not by land or inland navigation. If an authority is a tall needed for the proposition that a carrier by sea is not a Common Carrier within the meaning of the Carriers' Act of 1865, reference may be made with advantage to a Division Bench ruling of our own Court: AIR 1928 Bom. 5, Bombay Steam Navigation Co. v. Vasudeo Baburao Kamat. The provisions of this Act will not therefore apply to the facts of the present case. The provisions relevant for our purposes would be those of the Indian Carriage of Goods by Sea Act, 1925. The Calcutta decision does not help the plaintiffs to any extent.

7. Apart from what is stated above, in order to successfully found an action in tort on the ground of negligence, the plaintiffs will have to show that the 5th defendants owed a legal duty to them (that is the plaintiffs) to take care of the goods. As the plaint averments themselves go, the goods were consigned to the 5th defendants by the 2nd defendants and not by the plaintiffs. In this connection, Shri Vernekar refers to the Bill of Lading issued by the 5th Defendants in favour of the 2nd defendants. It is Ex. B to the plaint. The description of the consignee is given there in the following terms:

“Consignee

Oil & Natural Gas Commission

A/C Dodsal Pvt. Ltd. (Plaintiffs)

42, Paribrahma Society,

Ramdhar Road,

Surat”

8. Relying on this particular description containing reference to the plaintiffs, Shri Vernekar stressed that the plaintiffs should be deemed to be the consignees in the present case. I cannot accept this submission for two reasons. In the first place, the sustainability of the cause of action has to be decided on the averments made in the plaint. There is no averment whatever in the plaint that the plaintiffs were constituted as consigness under the Bill of Lading, although there is a mention that they were bailees. Secondly, the consignees are expressly described in the Bill of Lading as the 6th defendants. Simply because the plaintiffs' name figures in it as A/c Dodsal Pvt. Ltd., it cannot be held that the plaintiffs were the consignees, either independently of, or jointly with the 6th defendants.

9. Under S. 1 of the Indian Bills of Lading Act, 1856, the right to sue vests only in the consignee of goods named in the Bill of Lading, or an endorsee. The present plaintiffs do not fill either of these two descriptions. Neither branch of Shri Vernekar's two fold submission can be accepted. He does not rely on any other provisions of law including those of the Carriage by Sea Act, 1925, to spell out the liability of the 5th defendants towards the plaintiffs, de hors the two aspects considered above. The result of the above discussion is that treating the plaint averments as true, they do not disclose any cause of action as against the 5th defendants. The plaint will therefore have to be rejected as against them under O. 7 R. 11(a) of C.P.C I am now not called upon to decide the alternative prayer in the Notice of Motion, relating to the stay of the suit under S. 34 of the Arbitration Act.

10. The Notice of Motion is accordingly made absolute with costs in terms of prayer cl. (a) and the plaint stands rejected with costs under O. 7 Rule 11(a) C.P.C as against the 5th defendants. The suit shall now proceed further as against other defendants only.

Rule made absolute.