Sriram Arjundas v. Governor General In Council

JUDGMENT

1. In this suit the plaintiff claims recovery of Rs. 9036/- from the defendant in the following circumstances. On January 26, 1943, the plaintiff delivered to the North Western Railway at Lahore several cases containing wrosted dress materials for carriage from Lahore to Howarh. The plaintiff was the consignee. The goods arrived in Calcutta on or before the 23rd July, 1943, and they were delivered, except one case containing 8 pieces of wrosted dress materials of the aggregate length of 291½ yds. On August 3, 1943, the East Indian Railway issued a short delivery certificate for non-delivery of the one case to which I have referred.

2. On August 25, 1943, the plaintiff made a claim under Section 77 of the Indian Railways Act, for Rs. 9,036/- by a letter addressed to the Chief Commercial Manager, East Indian Railway Howrah. That letter was acknowledged and the plaintiff was informed by the Chief Commercial Manager by a letter dated the 31st August 1943, that the matter would receive attention.

3. On December 23, 1943, the plaintiff wrote a letter to the Chief Commercial Manager complaining of the delay in the settlement of his claim and requesting payment without any further delay. On the 27th January, 1944, the Chief Commercial Manager in his reply asked for the original Beejuck and stated that the matter was receiving his bast attention. The original Beejuck was sent by the plaintiff by a letter dated the 5th February, 1944, in which the plaintiff stated that the original beejuck had been produced at the time the short certificate was granted. Nothing was done by the defendant and on April 17, 1944, the plaintiff again sent a reminder and requested payment of the claim without any further delay.

4. On April 25, 1944, the Chief Commercial Manager regretted the delay and stated that he was unable to dispose of the claim unless he received authority to do so from the Chief Commercial Manager, North Western Railway, Lahore, as that Railway was responsible for the loss of the consignment. Another letter was written on behalf of the plaintiff on the 10th August, 1944, asking for a speedy settlement of the claim. On March 10, 1945, the Chief Commercial Manager, wrote to the plaintiff to send him the original short certificate. The original short certificate was sent on March 16, 1945. On March 22, 1945, the Chief Commercial Manager wrote the following letter to the plaintiff:

“I beg to advise you of having issued a Pay Order 597/36 of March 22, 1945, for Rs. 9036/- in your favour on the Chief Accounts Officer, East Indian Railway, Calcutta in full and final settlement of your claim in this case. Please call on that officer to receive payment by a crossed cheque after a fortnight from date and note that the pay order if not cashed within 3 months from the date of issue is invalid.”

5. On April 3, 1945, the plaintiff sent a man of the name of Bansidhar to the Treasurer, East Indian Railway with a letter authorising Bansidhar to receive payment of the sum of Rs. 9,036/-. It appears that payment was not made. On the next day the plaintiff wrote to the Chief Accounts Officer asking him to arrange for payment without any further delay.

6. On April 24, 1945, the Chief Commercial Manager wrote to the plaintiff as follows:

“In supersession of my letter of even No. of 22/26-3-45, I beg to advise you that the Chief Commercial Manager, North Western Railway Lahore has informed me that the consignment was lost over his railway in a running train theft and has accordingly instructed me to repudiate your claim on behalf of the North Western Railway.”

7. Notice under S. 80 was sent on the 2nd June 1946. On January 20, 1947, this suit was filed.

8. The written statement alleged that the loss was due to theft and or pilferage from a running train while the consignment was in transit between Lahore and Khanalampura station on the North Western Railway administration concerned and that the Railway Administration took all reasonable and proper steps for the due security and delivery of the goods and that the defendant was not therefore, liable.

9. Paragraph 6 of the written statement is in the following terms:

“By its letter dated 2nd March, 45 the East Indian Railway Administration offered to pay Rs. 9,036/- to the plaintiff in full and final settlement of his claim in suit. Subsequently it had been discovered that the bundle in question was lost due to a running train theft and the said Railway Administration repudiated the plaintiff's claim. The defendant states that the railway administration concerned rightly withheld and refused payment of the aforesaid sum to the plaintiff.” It was also alleged that the suit was not maintainable because no claim had been preferred under Section 77 of the Indian Railways Act, and that the plaintiff's claim was barred by limitation.

10. After the case was opened learned counsel for the defendant intimated that he did not desire to contest the claim on merits and raised only the following issues:

1. Was the notice under S. 77 was valid? If not, is the suit maintainable?

2. Is the suit barred by limitation?

3. To what damages if any is the plaintiff entitled?

ISSUE NO. 1:

11. It was admitted that notice under S. 77, had been sent to and received by the Chief Commercial Manager, Howrah. But it was urged that the notice had not been validly served in accordance with provisions of law. S. 77 provides that the claim has to be preferred in writing to the Railway Administration concerned. Section 140 of the Indian Railways Act, provides that when the railway is managed by the Government the notice must be sent to the Manager. It was contended that the word ‘Manager’ meant the Chief Officer of the Railway concerned who was in control of that Railway that the Chief Commercial Manager was not such an Officer and therefore the notice was not one which complied with S. 140. It is said that the Chief Officer is the General Manager and notice under S. 77 ought to have been sent to him.

12. Reliance was placed on the case of ‘Nadir Chand v. Wood’, 35 Cal 194. There a notice of claim for short delivery was served upon the Traffic Manager of a Railway, administered by a Railway Company and not to the Agent. It was held that there was no sufficient compliance with the provisions of Sections 77 and 140 of the Indian Railways Act.

13. The next case cited is ‘Kalachand Shaha v. Secy. of State’, (21 Cal WN 751). In this case notice under S. 77 was served on the Traffic Manager, who was a subordinate official. There was no officer with the designation of “Manager” in the Eastern Bengal State Railway, but there was an “Agent” of that Railway. It appears that the Court was informed that the Government had by a notification in the Calcutta Gazette ruled that the “Agent” should be considered as the “Manager”. The Court was, therefore of opinion that the “Agent” was the “Manager” and that the notice to the Traffic Manager was not sufficient.

14. In the next case cited, ‘Janaki Das v. B.N Railway Co.’, 16 Cal WN 356 a notice of claim for loss of goods despatched by rail was given to the Goods Superintendent. It was held that the claim had not been preferred to the Railway administration so as to satisfy the requirements of Section 77 of the Indian Railways Act.

15. On behalf of the plaintiff reference was made to a case ‘Shamsul Huq v. Secretary of State’, 57 Cal 1286. In that case it was held by Lort Williams, J. that in the case of a Railway administered by Government where there does not happen to be an officer called the “Manager”, a notice sent to the Chief Commercial Manager may be sufficient.

16. Lort-Williams, J. observed as follows:

“It may well be that the Chief Commercial Manager is the person appointed by the East Indian Railway to receive notice of claims or that notice was communicated by him to the “Agent” and it may well be argued that where in the case of a Railway administered by the Government there does not happen to be a Manager, a notice sent to the Chief Commercial Manager will be sufficient.”

17. In ‘Sristhidhar Mondal v. Governor General in Council’, 49 Cal WN 240. It was held by Henderson, J., that a notice served on the Chief Commercial Manager of a Railway, who is responsible for investigating claims instead of on the “Manager” is a good notice to the Railway administration under S. 77.

18. It is admitted that there is no officer of the East Indian Railway with the designation of “Manager” but it is said that there is a “General Manager” who is at the head of the affairs of that Railway. There is no evidence before me that the General Manager is at the head of the East Indian Railway. It may be that the Chief Commercial Officer is the Officer who is empowered to receive notice of claims under S. 77. In this case, the notice was received and acknowledged, by the Chief Commercial Manager and at no stage was it suggested that the notice was not sufficient. Apparently the Railway administration did know about this claim and at one stage the plaintiff was intimated that orders had been issued to pay him Rs. 9,036/- in full payment of his claim.

19. In these circumstances I am of opinion that the notice given to the Chief Commercial Manager was sufficient and that the claim had been validly preferred on the Railway administration who came to know of the claim and dealt with it on the basis that Section 77 of the Indian Railways Act, had been satisfied.

ISSUE No. 2:

20. Is the suit barred by limitation? Article 31 of the Indian Limitation Act, provides for a period of limitation of one year in respect of a suit against a carrier for compensation for non-delivery of or delay in delivering the goods and the time begins to run from the date when the goods ought to have been delivered. In this case the goods which were not delivered formed part of a larger consignment which was delivered in July 1943. The short delivery certificate was issued on August 3, 1943. If the period of limitation is calculated from July 1943, it expired in July, 1944. The suit was not filed till February 1947. It is, therefore clear that if this suit is regarded as a suit for compensation for non-delivery it is barred by limitation. No acknowledgment to save limitation was pleaded in the plaint.

21. Learned counsel for the plaintiff, however, argues that the suit is not one for compensation for non-delivery or for compensation for loss of goods. It is urged that the suit has been framed on the ‘promise’ to pay contained in the letter dated March 26, 1945, to which I have already made reference. It is alleged in paragraph 5 of the plaint that on or about the 26th March 1945, the disputes between parties were settled and the Railway accepted and admitted the plaintiff's claim for Rs. 9,036/- and that the East Indian Railway promised to pay the sum of Rs. 9,036/- by its letter dated March 26, 1945, and called upon the plaintiff to receive payment of the said sum by a crossed cheque from its Chief Account Officer. It is further alleged in paragraph 6 of the plaint that the East Indian Railway wrongfully refused to pay the said sum of Rs. 9,036/- to the plaintiff.

22. The question, therefore, is whether the suit as framed is for compensation for loss or non-delivery of goods or whether it is a suit based on the “promise” to pay alleged to be contained in the letter of March 26, 1945.

23. The concise statement states that the suit is for recovery of Rs. 9,036/- for the price of material lost and or retained by the East Indian Railway. The concise statement is it is said not a part of the plaint and should not be taken into consideration in judging the nature of the suit. I would be prepared, if necessary to stretch this point in favour of the plaintiff and disregard the concise statement if I am satisfied on a reading of the plaint that the suit is based on a promise to pay.

24. I am of opinion on a reading of the plaint notwithstanding the concise statement it is possible to maintain that the suit has been framed on the promise to pay and that the other matters regarding entrustment of the goods and the loss thereof have been pleaded as matters of inducement.

25. The question then arises: (1) whether the letter dated March 26, 1945, contains any ‘promise’ within the meaning of Section 25(3) of the Indian Contract Act, (2) whether the ‘promise’ was made by a person legally authorised by and or on behalf of the defendant. The relevant portion of Section 25 of the Indian Contract Act, is in these terms:

“(1) An agreement made without consideration is void………… unless……………………

(1)……………………………………

(2)………………………………

(3) It is a promise made in writing and signed by a person to be charged therewith or by his Agent generally or specially authorised in that behalf to pay wholly or in part the debt on which the creditor might have enforced payment but for the law of limitation of suits.

In any of these cases such an agreement is a contract.”

26. It is clear that in order to satisfy the terms of the section (a) there must be a ‘promise’ to pay a debt (b) there must be a debt of which the creditor might have enforced payment but for the law for the limitation of suits (c) the promise must be made in writing (d) the writing must be signed by the person to be charged therewith or by his Agent generally or specially authorised on his behalf. If these conditions are satisfied then the promise becomes a contract, though there may not be any consideration for it.

27. Section 2(b) of the Indian Contract Act, provides:

“When a person to whom a proposal is made signifies his assent thereto the proposal is said to be accepted. A proposal when accepted becomes a promise.”

28. It seems to me that S. 25 requires that before the writing is made and signed there must be an agreement by the acceptance of a proposal and that agreement is to be recorded in writing and signed in accordance with the requirements of the section.

29. Learned counsel for the plaintiff, however, submits that if an offer is made in writing and signed in accordance with the requirements of the section and if that offer is subsequently accepted, it becomes a “promise” to pay within the meaning of the section. He relies in support of his contention on a case reported in ‘Appa Rao v. Suryaprakash Rao’, 23 Mad 94. In that case in a suit for rent filed by a landlord against a tenant the latter pleaded that a portion of the claim was barred by limitation. The plaintiff relied on a letter which had been signed by the defendant after the disputed portion had become barred in which the defendant said “I shall send by the end of Bysakh month”…It was held that the document contained the ingredients required by Section 25(3) of the Indian Contract Act. The learned Judges observed as follows:

“We do not think that to create a ‘promise’ within the meaning of the section it is necessary that there should be an accepted proposal reduced into writing. The definition clause says ‘a proposal when accepted becomes a promise’ It does not say a proposal when accepted and reduced to writing becomes a promise and in our judgment all that is requisite is that there should be a written proposal accepted before action for a written proposal becomes a promise when accepted as was the case here the action not having been brought until the time named in the document for payment had elapsed.”

30. I am disposed to think on a reading of the section that the proposal must be accepted and become a promise before or at the time when the writing is made and signed.

31. It is however not necessary to decide the point because even if an offer made in writing which is subsequently accepted is a “promise” within the meaning of S. 25 such promise was not on the facts before me made or signed in accordance with the requirements of the section. On a reading of the letter of March 26, 1945, it is clear that it does not contain an express promise to pay. The letter if it contains any promise at all contains an implied promise to pay and not an express promise. There are authorities which have decided that an implied promise is not sufficient. Further the promise must be made in writing and signed by the person to be charged therewith. In this case the person to be charged is the Governor-General-in-Council, who did not make the promise in writing or sign it. The next question is whether it was signed by the defendant's Agent generally or—specially authorised in that behalf. It appears from the letter dated March 26, 1946, that it was signed by somebody possibly a clerk for the Chief Commercial Manager. There is no evidence that he had any authority general or special to pay wholly or in part a barred debt. It is true that the question of authority was not raised in the written statement. But it must be remembered that the plaint did not allege that the defendant or any person authorised to pay a barred debt promised to pay in writing. The allegation was that the East Indian Railway promised to pay. It is, therefore, clear that the plaint does not contain the necessary allegation in order to bring the case under Section 25(3) of the Indian Contract Act nor is the evidence adduced before me sufficient to enable me to hold that any ‘promise’ was made in writing signed by the defendant or by his agent generally or specially authorised to pay a barred debt.

32. Assuming, however, that there is a promise in writing to satisfy the requirements of S. 25(3), that promise is a contract. Section 175(3) of the Government of India Act, provides how such a contract is to be made. Such contracts must be expressed to be made by the Governor General and must be executed on behalf of the Governor General by such persons and in such manner as he may direct or authorise.

33. In this case the contract has not been expressly made on behalf of the Governor General nor is there any evidence that it has been executed on behalf of the Governor General by any person authorised to do so.

34. It is argued by learned counsel for the plaintiff that Section 175(3) of the Government of India Act, refers only to executory contracts and not to contracts like the one in suit. It is urged that in this case the contract which was a contract for carriage has been executed giving rise to rights and liabilities. It is true that there has been a breach of contract of carriage by non-delivery of a portion of goods but the contract on which the plaintiff relies is ‘promise to pay’ made in the letter to which I have referred. It seems to me that contract is an executory contract assuming that S. 175(3), refers only to executory contracts about which I am not at all satisfied.

35. It is next contended that S. 175(3), does not refer to contracts made by the Governor General in carrying on the Railway administration. I do not think that this contention has any substance. The section refers to all contracts made in exercise of the executive authority of the administration. I think that a contract made by or on behalf of the Governor General in carrying on a Railway administration is made in the exercise of the executive authority and not of any other authority.

36. Learned Counsel for the defendant argued that in any event there is no promise to pay a barred ‘debt’ but to nay a certain sum as damages for failure to deliver the goods.

37. It is pointed out that the suit was a suit for compensation for non-delivery and even if there was a promise to pay it referred to payment of unliquidated damages and therefore Section 25(3) has no application. It is urged that in order to attract the provisions of Section 25(3) of the Indian Contract Act there must be an existing ‘debt’ before the promise to pay is made. It is difficult to say that before the letter dated March 26, 1945 there was any ‘debt’ due by the defendant to the plaintiff. There was only a claim for damages by the plaintiff against the defendant.

38. For all these reasons I have come to the conclusion though with great reluctance that there is no promise sufficient to satisfy the requirements of S. 25(3). Therefore there is no contract by the defendant to pay within the meaning of that section. The suit therefore, must be held to be barred by limitation and must be dismissed with costs.

K.S

39. Suit dismissed.