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Coimbatore District Central Co-Operative Supply And Marketing Society Ltd. v. Union Of India
Structured Summary of the Opinion
Factual and Procedural Background
The revision petitioner is the Coimbatore District Central Cooperative Supply and Marketing Society Ltd. (plaintiff in the trial court). The society acted as stockists/agents for manure on commission on behalf of the State of Madras (second respondent). On 27 August 1963 the Assistant Director, Clearance, Madras, despatched to the plaintiff-society a consignment of ammonium sulphate. When the plaintiff-society sought delivery at Coimbatore, the Station Master demanded Rs. 1,041-30 as undercharges, demurrage and other charges; the society paid Rs. 1,041-30 under protest (receipt Ex. A.1 dated 30 August 1963) and sought a refund from the railway. The society instituted suit impleading the Union of India (owner of Southern Railway) as first defendant and the State of Madras as second defendant, praying for a decree for Rs. 1,221-30.
The first defendant (Union of India) contended there had been an undercharge at the forwarding station of Rs. 1,034-40, that an excess collection of Rs. 41-50 had been refunded, that the society was not entitled to reimbursement of undercharges and that there was no valid notice under Section 80 of the Code of Civil Procedure (C.P.C.). The second defendant (State of Madras) contended the plaintiff was not entitled to reimbursement and that the plaintiff was not acting as the State's agent.
The Subordinate Judge, Coimbatore, held that the S.80 notice (Ex. A-13, dated 25 October 1965 in its original) did not validly satisfy S.80 C.P.C. and that, because property in the goods had not passed to the plaintiff-society, the suit was not maintainable. The trial court also found, however, that under the agreement between the society and the State (Ex. A-8) the society could recover from the State any amount legally paid on account of undercharges. The trial court dismissed the suit without costs.
Legal Issues Presented
- Whether the notice under Section 80, C.P.C. (Ex. A-13) complied with the statutory requirements and was therefore a valid pre-suit notice.
- Whether the plaintiff-society could maintain the suit for reimbursement despite the property in the goods not having passed to it (i.e., whether agency or ownership was required to sustain the claim).
- Which defendant (Union of India or State of Madras) was liable to reimburse the plaintiff-society for the amount paid to the railway, in light of the agreement (Ex. A-8) between the society and the State.
Arguments of the Parties
Plaintiff-Society (Revision Petitioner)
- Paid Rs. 1,041-30 under protest to the railway at Coimbatore as demanded by the Station Master and asserted entitlement to reimbursement from the State of Madras.
- Sent communications to railway authorities (Ex. A-2 dated 5 September 1963) and sought action via the Collector of Coimbatore (correspondence Exs. A-4 to A-7) before issuing the suit notice (Ex. A-13).
- Issued the S.80 notice (Ex. A-13) calling upon both defendants to refund Rs. 1,041-30 (with interest) and threatened suit if not paid within two months.
First Defendant — Union of India
- Contended the consignment had not been charged correctly at the forwarding station and there was an undercharge of Rs. 1,034-40.
- Asserted that Rs. 41-50 (an excess collection) had been refunded earlier.
- Argued the plaintiff-society was not entitled to a refund of the undercharges and that the S.80 notice was invalid (no valid notice under S.80 C.P.C.).
- Urged that demurrage and wharfage were payable only by the plaintiff-society and, if any reimbursement lay, it lay only in respect of undercharges which were not referred to in the notice — making the notice defective.
Second Defendant — State of Madras
- Contended the plaintiff was not entitled to claim reimbursement from the State.
- Contended the plaintiff did not act as the agent of the State of Madras.
- (At trial) the State's written statement did not object to validity of the S.80 notice, a fact noted by the revisional court in its reasoning about waiver.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Dhian Sing v. Union of India, A.I.R. 1958 S.C. 274 | Notice under S.80 C.P.C. should not be scrutinised pedantically or divorced from common sense, despite strict construction. | The court applied this principle to hold that omission to specify "undercharges" in the preamble of Ex. A-13 did not automatically invalidate the notice when considered on its substance. |
| Union of India v. Jeewanram, A.I.R. 1958 S.C. 905 | Illustrates that variation between relief in notice and in plaint does not render the notice invalid if there is no substantial difference in substance. | The court relied on this reasoning to support the conclusion that Ex. A-13 substantially complied with S.80 despite minor inaccuracies. |
| Venkataramakrishnaiyer v. Secretary of State for India in Council, 23 L.W. 464 | Notice under S.80 may be sufficient even if it is not identical in particulars to the pleas in the plaint (substantial sufficiency). | Used as authority for substantial compliance approach to S.80 notices. |
| Walluram v. Union of India, A.I.R. 1961 Punj. 329 | A notice under S.80 that does not give all details may still be valid if it otherwise substantially complies with S.80 requirements. | Cited to demonstrate that lack of complete detail in Ex. A-13 did not necessarily invalidate it. |
| Bhegwanlal v. Union of India, A.I.R. 1961 Pat. 200 | A bona fide clerical mistake in particulars of a notice (e.g., wrong identifying number) does not render a notice invalid. | Applied as an example where accidental errors did not vitiate a S.80 notice; supported the court's view of tolerating incidental inaccuracies in Ex. A-13. |
| Ramanand v. Union of India, A.I.R. 1958 Raj. 23 | If a notice fails to indicate any relief proposed to be asked for (as required by S.80), it is defective. | The court distinguished this case from the present facts, holding Ramanand inapplicable because Ex. A-13 did indicate a demand for refund of Rs. 1,041-30. |
| Meenakshiamma v. Madras Province | An error in describing the subject matter that is substantial (not merely clerical) can vitiate a S.80 notice. | Distinguished on facts: the court considered Meenakshiamma not applicable because the present omission (failure to name "undercharges" in the preamble) was not a substantial misdescription of subject matter. |
| Bhian/Bhian Singh v. Union of India (as cited in the opinion) | A party's failure to raise objection to notice in pleadings may justify an inference of waiver of any defect in the notice. | The court relied on this authority to infer that the State of Madras waived any objection to the S.80 notice, since no objection to notice validity appeared in the State's written statement. |
Court's Reasoning and Analysis
The revisional court undertook a stepwise analysis:
- Examination of the S.80 notice (Ex. A-13): the court noted the factual sequence (demand at Coimbatore, payment of Rs. 1,041-30, receipt Ex. A.1, communications Ex. A-2 and Exs. A-4 to A-7). The court identified a factual inaccuracy in the notice's preamble: it described the sum as demurrage and wharfage whereas the sum in fact comprised undercharges, demurrage and other charges; specifically, the notice omitted explicit reference to "undercharges."
- Applicability of S.80 jurisprudence: the court acknowledged that S.80 must be strictly construed, but relied on Supreme Court and other authorities (as catalogued) for the proposition that notices should not be scrutinised in a pedantic manner and that substantial compliance is the standard. The court reviewed precedents where minor variations, omissions or bona fide clerical errors did not invalidate notices.
- Application to Ex. A-13: applying the substantial compliance approach, the court held that the absence of explicit reference to undercharges in the preamble did not render Ex. A-13 invalid because the notice otherwise conveyed that Rs. 1,041-30 had been collected wrongly and demanded refund of that amount. The court emphasised that the controversy related to a single consignment and that what the plaintiff sought was reimbursement of an amount alleged to have been illegally collected.
- Waiver by the State of Madras: the court observed that the State's written statement did not challenge the validity of the S.80 notice; relying on authority permitting an inference of waiver, the court concluded the State had waived any such objection.
- On the ownership/standing point: the revisional court found the trial judge erred in treating absence of property passing as fatal to the claim. The plaintiff's suit was for reimbursement as the agent of the State; it was unnecessary for the plaintiff to prove ownership of the goods to sustain a claim for reimbursement.
- On inter se liability between defendants: the court accepted the trial court's finding that Ex. A-8 (agreement between society and State) obligated the State to reimburse the society where railway freight or a portion had not been previously paid and the society had paid to take delivery and prefer a claim. The revisional court treated that contractual term as clearly enabling the society to claim refund from the State for undercharges omitted at forwarding.
The court therefore concluded that (a) the S.80 notice was not invalid for the reasons found by the trial court, (b) the plaintiff-society could maintain the suit despite not owning the goods, and (c) the State of Madras was liable under the agreement to reimburse the society for the undercharge component.
Holding and Implications
Holding: The revision petition is allowed insofar as it pertains to the second defendant (State of Madras) and is dismissed insofar as it pertains to the first defendant (Union of India).
Direct consequences and orders:
- The suit is decreed against the State of Madras for Rs. 1,034-40 with interest at six percent per annum from 30 August 1963.
- The State of Madras is to pay full costs in both courts.
- The revision petition as against the Union of India (first defendant) is dismissed; in that respect the dismissal is ordered without costs.
Implications beyond the parties: The opinion applies established authority on substantial compliance with S.80 C.P.C. and the circumstances in which clerical or minor inaccuracies in a S.80 notice will not invalidate it. The court did not purport to lay down a new legal principle beyond applying these precedents; the decision's primary effect is the reversal as against the State of Madras and the grant of the monetary decree specified above.
Rendered by V.C.S. (as indicated in the opinion).
JUDGMENT
The unsuccessful plaintiff before the lower court, the Coimbatore District Central Cooperative Supply and Marketing Society Ltd., is the revision petitioner. The plaintiff-society was acting as Stockists for manure on commis-sion on behalf of the State of Madras, the second respondent herein. On 27th August 1963, the Assistant Director, Clearance, Madras, despatched to the plaintiff-society certain quantity of ammonium sulphate. When the plaintiff-society wanted to take delivery of the goods at Coimbatore, the Station Master at Coimbatere demanded Rs. 1041-30 nP. as being undercharges, demurrage and other charges. The plaintiff-society paid it under protest and called upon the railway to refund the amount. As the claim was not met, the plaintiff-society instituted the suit impleading the Union of India, owning the Southern Railway as the first defendant and the State of Madras as the second defendant and prayed for a decree for Rs. 1221-30.
The first defendant, Union of India, contended that the consignment had not been charged correctly at the forwarding station, there being an undercharge of Rs. 1034-40, that on discovery of some excess collections made subsequently, the said excess collection of Rs 41-50 was refunded to the plaintiff, that the plaintiff-society was not entitled to claim a refund of the undercharges and that, there was no valid notice under S. 80, C.P.C The State of Madras, the second defendant, contended that the plaintiff was not entitled to claim any reimbursement and that the plaintiff did not act as the agent of the State of Madras.
The Subordinate Judge, Coimbatore, held that the notice issued by the plaintiff-society under S. 80, C.P.C under the original of Ex. A. 13 on 25th October 1965 was not a valid notice satisfying the requirements of S. 80, C.P.C, and that as such the suit was not maintainable. He also found that inasmuch as the property in the goods, in respect of which the plaintiff-society paid undercharges to the railway, did not pass to the plaintiff-society, the plaintiff-society was not entitled to maintain the suit. On the question as to who among the defendants was liable, the trial Judge found that under the terms of the agree-meat between the plaintiff-society and the State of Madras, the plaintiff-society was entitled to recover from the second defendant, the State of Madras, whatever amount was legally paid in respect of the consignment on account of undercharges. In the result, he dismissed the suit without costs.
The first question that arises for consideration is whether the notice, Ex. A' 13, is in conformity with the requirements of S. 80, C.P.C it is not in controversy that when the plaintiff-society wanted to take delivery of the gcods, the railway authorities at Coimbatore demanded payment of certain charges as a condition precedent for the delivery of the gcods. The plaintiff-society accordingly paid Rs. 1041-30 and obtained the receipt, Ex. A. 1 dated 30th August 1963, That receipt gives the details that go to make rap the sum of Rs. 1041-30. It is stated therein that (1) a sum of Rs. 1034-40 represented freight including terminals (2) Rs. 4-10 represented demurrage and (2) Rs. 2-80 represented other charges. After making this payment, the plaintiff-society addressed the Chief Commercial Superintendent Southern Railway, under the letter Ex. A-2, on 5th September, 1963, with a copy marked to the Collector of Coimbatore and the secretary, Board of Revenue, Madras, stating that the society had to pay Rs. 1041-30 by way of undercharges etc., and that the society was entitled to be reimbursed, The Collector of Coimbatore took up the matter with the railways and wrote some communications, copies of which ate Exs. A-4 to A-7, requesting that the claim of the plaintiffs-society may be satisfied. As the claim was not satisfied, the plaintiff-society issued the suit notice Ex. A-13 in common to both the defendants setting out that a sum of Rs. 1041-30 had to be paid under the circumstances stated above and calling upon both the defendants to pay the amount with interest and also stating that if amount was not paid within two months from the date of the receipt of the notice, a suit will be instituted against both the defendants. In paragraph 3 of that notice it is alleged that the goods station master refused to deliver the goods stating that the plaintiff-society should pay Rs. 1041-30 towards demurrage and wharfage charges before taking delivery of the goods. There is a slight inaccuracy in this statement. The said sum of Rs. 1041-30 did not represent in entirety the demurrage and wharfage charges. That amount comprised of undercharges, demurrage and other charges. Thus, the notice omitted to refer to undercharges. In paragraph 4 of the notice it is alleged that a sum of Rs. 1041-30 was wrongly collected by the Station master. In paragraph 6 of the notice, in which a demand for payment was made, no reference is made to demurrage, wharfage or undercharges. There is only a general statement as regards the amount which was required to be paid.
The contention urged on behalf of the first respondent, Union of India, which found favour with the lower court is that demurrage and wharfage charges were payable only by the plaintiff-society and that if at all the plaintiff-society was entitled to claim reimbursement in respect of any amount, it was only in respect of undercharges, which was omitted to be collected from the State of Madras at the forwarding station and that inasmuch as the suit notice did not refer to undercharges, it was defective. I am of the view that this contention cannot be sustained. It is true that the terms of S. 80, C.P.C, should be strictly construed. But, as pointed out by the Supreme Court in Dhian Sing v. Union of India A.I.R 1958 S.C 274. the terms of the notice should not be scrutinised in a pedantic manner or in a manner completely divorced from common sense. In Union of India v. Jeewanram A.I.R 1958 S.C 905. in the notice issued under S. 80 C.P.C, the relief claimed was thus expressed:
“ That my client is entitled to be reinstae ted on his former post, and to be paid the amount due to him on the basis of his being treated as if he was not discharged from the date of his discharge upto the date of reimbursement.”
In the plaint, the main relief claimed was a declaration that the order of discharge or removal of the plaintiff was illegal and arbitrary. The question arose whether the variation between the allegations in the notice and the plaint was such as to render the notice invalid. Their Lordships, after examining the substance of the notice and the plaint, held that there was no substantial difference between the relief mentioned in the notice and the relief claimed in the plaint and that, therefore, the notice was not invalid. In Venkataramakrishnaiyer v. Secretary of State for India in Council 23 L.W 464. the suit notice referred to only one declaration whereas in the suit the plaintiff prayed for more than one declaration ia respect of the same land. It was held that the notice was substantially sufficient to satisfy the requirements of S. 80, C.P.C In Walluram v. Union of India A.I.R 1961 Punj. 329. the notice under S. 80, C.P.C, did not give the details of the claim. The plaintiff made a claim in the suit notice for a certain amount upto a particular period. In the suit the claim was made for some period subsequent to the notice also. It was held that the mere fact that the notice did not give all the details of the claim made ia the plaint would not render it invalid, if it otherwise substantially complied with the requirements of S. 80, C.P.C In Bhegwanlal v. Union of India A.I.R 1961 Pat. 200. the notice under S. 80, C.P.C gave a particular description about the identifying number of the railway receipt. But in the suit a different number was given. It was found that due to accidental and bona fide mistake a wrong description of the number was given in the notice. It was held that notwithstanding the said lacuna, the notice was not invalid.
On behalf of the respondents, reliance is placed upon a decision of the Rajastan High Court in Ramanand v. Union of India A.I.R 1958 Raj. 23.. In that case, the notice merely stated that if a particular order was net made within two months from the date of receipt of the notice, the plaintiff would take legal steps to obtain the required redress of his grievence as he may be advised. In construing the terms of the notice, the court held that it was defective as it did not conform to the requirements of S: 80 C.P.C, as no relief which the plaintiff proposed to ask for was indicated in the notice as required muter S. 80 C.P.C In Meenakshiamma v. Madras Province the notice referred to the subject matter as a property bearing R.S No. 722/4-B. But the plaint referred to the property as R.S No. 722/4-A. It was held that the error was not merely clerical but was substantial, vitiating the notice. These two decisions are hardly applicable to the facts of the instant case.
The subject matter of the controversy between the parties in this case was only with regard to one consignment. The plaintiff-society made payment under three heads, but referred to only two heads in the preamble portion of the notice, but made no referency to any of the heads in making the claim for refund in the subsequent portions of the notice. All that the plaintiff-society required was refund of the amount, which, according to the plaintiff-society, was illegally collected from it. Therefore, the absence of reference to undercharges in the preamble does not render the notice invalid.
The lower court was wrong in dismissing the suit evea as against the second defendant, State of Madras, for in the written statement filed by the State of Madras, no objection was taken with regard to the validity of the notice. As pointed out by the Supreme Court in Bhian singh v. Union of India, there is justification for the lnlerence that the State of Madras waived the objection, even if there was any defect in the notice.
The lower court misconstrued the scope of the suit in holding that in as much as the property in the goods did not pass to the plaintiff-society, the suit was incompetent. The plaintiff-society did not seek to recover the amount on the basis that the property in the goods passed. The basis of the suit is one of reimbursement in respect of the amount which the State of Madras as the consignor should have paid at the place where the goods were consigned. To sustain such a claim, it is not necessary for the plaintiff-society, who merely Acted as the agent of the State of Madras, to prove that it is the owner of the goods.
On the question of the liability of the defendants inter se, the lower court found that on the terms of Ex. A. 8, the agreement between the plaintiff-society on the one hand and the State of Madras on the other, the State of Madras is liable. That finding is correct.
That agreement provides that in case where the railway freight or any portion of it has not been previously paid, the stockholders shall pay the railway freight or any portion of it, take delivery of the consignment and prefer a claim for refund from the Collector or any officer authorised by him in this behalf. This term clearly enables the plaintiff society to claim refund from the State of Madras as regards the amount of undercharges which were omitted to be paid by the State of Madras at the time of consignment and which the plaintiff-society paid before taking delivery.
In the result, the revision petition is allowed so far as the second defendant, State of Madras, is concerned and the suit is decreed against the second defendant for Rs. 1034—40 with interest thereon at six per cent per annum from 30th August 1963 with full costs in bosh the courts. The revision petition as against the first defendant is dismissed, in the circumstances, without cost.
V.C.S
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