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Gajanand v. Union Of India

Patna High Court
Mar 16, 1954
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Structured Summary of the Court Opinion

Factual and Procedural Background

The petitioners (plaintiffs in the original suit) booked a consignment of 200 bags of sugar from Bagaha (O.T. Railway section) to Katrasgarh (E.I. Railway section) on 23 March 1950 under railway receipt no. 61756. When the consignment reached Katrasgarh, 8 bags were found cut and damaged; on reweighing there was a shortage of 11 maunds and 1 seer. The petitioners took delivery of the 200 bags on 5 April 1950 under a qualified receipt.

The petitioners wrote to the Chief Commercial Manager, East Indian Railway, and received a reply dated 8 June 1950 in which the railway disclaimed liability and stated it could not entertain a claim for compensation. The petitioners served notice under section 80 of the Code of Civil Procedure and instituted a suit on 7 June 1951. From that suit arose the present revision application under section 25 of the Provincial Small Cause Courts Act.

At trial in the Small Cause Court two primary issues were considered: (1) whether the shortage resulted from misconduct or negligence by the railway administration, and (2) whether the claim was time-barred under the Limitation Act. The trial judge found negligence/misconduct in favor of the petitioners on the first issue, but held the claim barred by limitation, applying Article 30 of the Limitation Act. The petitioners challenged that limitation finding in this revision.

Legal Issues Presented

  1. Whether the shortage of sugar was caused by misconduct or negligence on the part of the railway administration.
  2. Whether the petitioners' claim was barred by the Limitation Act, and specifically which article of the Limitation Act (Article 30 or Article 31 of Schedule I) applied to the claim.
  3. Whether the railway's letter of 8 June 1950 (Exhibit 1(g)) amounted to an acknowledgment of liability under section 19 (Explanation I) of the Limitation Act, thereby extending or reviving the limitation period.

Arguments of the Parties

Petitioners' Arguments (as presented in the opinion)

  • Article 31 of the Limitation Act is the proper article to apply because short delivery of goods does not necessarily amount to loss or injury to the goods themselves; Article 30, which deals with loss or injury to goods, is not necessarily applicable to short delivery.
  • Short delivery should be treated as non-delivery/delay (Article 31) rather than loss (Article 30); the petitioners relied on prior decisions, including Bengal and North Western Railway Co. Ltd. v. Kameshwar Singh Bahadur, to support the view that time may run from a later definite refusal to deliver.
  • The petitioners also contended that the railway's letter of 8 June 1950 amounted to an acknowledgment of liability under Explanation I to section 19 of the Limitation Act, which could affect the running of limitation.

Opposite Party's Arguments (as presented in the opinion)

  • The opposite party (railway) relied on precedents such as Rameshwar Das Mali Ram v. The East Indian Railway Company, Ltd. and Gopi Ram Gouri Shanker v. The Great Indian Peninsular Railway Co. to argue that in the circumstances of this case short delivery amounted to loss of goods and therefore Article 30 of Schedule I to the Limitation Act applied.
  • The opposite party contended that, if Article 30 applied, the suit (instituted on 7 June 1951) was beyond the one-year limitation period and therefore time-barred.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Bengal and North Western Railway Co. Ltd. v. Kameshwar Singh Bahadur Authority for the proposition that where part of a consignment is delivered piecemeal and correspondence is ongoing, the date when goods "ought to be delivered" may not be the date when part was delivered; supports running of time from a later definite refusal where applicable. The court described the facts of that case and distinguished them from the present facts: there, piecemeal delivery and ongoing correspondence supported a later reckoning of time, whereas in the present case the entire consignment was delivered on one date.
M.A.P. Palanichami Nadar v. Governor-General of India in Council Holds that where part of a consignment is later made good and there is ongoing correspondence, the time to sue may begin only after a definite refusal or declaration of inability to deliver by the carrier. The court used this precedent to explain the circumstances in which limitation may start from the carrier's refusal, and contrasted those facts with the present case where no such continuing opportunity to deliver existed.
Raigarh Jute Mills Ltd. v. Commissioners for the Port of Calcutta Similar principle to M.A.P. Palanichami Nadar: non-delivery cases where subsequent events and correspondence affect the date when limitation begins to run. The court noted that the position in that case was similar to those where time runs from a definite refusal; it was cited and distinguished on the facts of the present case.
The Governor-General in Council v. Kasiram Marwari Establishes that the question "when the goods ought to be delivered" is essentially a question of fact and no universal rule can be laid down; time may run from the carrier's refusal in appropriate facts. The court relied on this principle to analyze whether the goods in the present case ought to have been delivered on the date of actual delivery (5 April 1950) and concluded that that date was the relevant one for limitation purposes in the present facts.
Rameshwar Das Mali Ram v. The East Indian Railway Company, Ltd. & Gopi Ram Gouri Shanker v. The Great Indian Peninsular Railway Co. Cited for the proposition that short delivery may, in some circumstances, amount to loss of goods such that Article 30 of the Limitation Act applies. The opposite party relied on these authorities to support the application of Article 30; the court acknowledged that short delivery can in some cases amount to loss and that the choice between Article 30 and Article 31 depends on the facts.

Court's Reasoning and Analysis

The court proceeded in a stepwise fashion, addressing limitation without finally deciding the abstract question whether Article 30 or Article 31 should apply in every short-delivery case:

  1. The court first observed that whether Article 30 or Article 31 applies depends on the facts of each case; no blanket rule can be laid down that every short delivery falls under one article or the other.
  2. The court noted that if Article 30 applied (loss or injury to goods), the one-year limitation would run from the date the loss or injury occurs. In the present case the loss occurred before 5 April 1950 when the consignment was delivered and on weighment the shortage was discovered; therefore, if Article 30 applied, the claim was plainly time-barred.
  3. The court then considered the position on the hypothesis that Article 31 applied (non-delivery/delay). Article 31 gives one year from the date when the goods "ought to be delivered," and the court relied on precedent establishing that this is a question of fact. Where no specific delivery date is fixed, the "ought to be delivered" date is what is reasonable in the circumstances.
  4. Applying that factual inquiry to the present case, the court concluded that the entire consignment ought to have been delivered on 5 April 1950, because the sugar in the short bags could not be delivered at a later date. Consequently, even under Article 31 the limitation period began to run on 5 April 1950.
  5. The court examined the petitioners' contention that the railway's letter of 8 June 1950 (Exhibit 1(g)) amounted to an acknowledgment of liability under Explanation I to section 19 of the Limitation Act. The court stated that Explanation I requires an acknowledgment of liability (even if conditional) and that Exhibit 1(g) expressly disclaimed liability. Therefore the letter did not amount to an acknowledgment that would affect limitation.
  6. Because the suit was instituted on 7 June 1951 (after one year from 5 April 1950), the court concluded that the claim was time-barred whether Article 30 or Article 31 applied, and that the trial judge was correct in dismissing the claim on limitation grounds.
  7. The court also noted, as a practical matter and without ordering relief, that the railway administration remained free to pay compensation despite the limitation bar, but that was a matter for the railway administration's consideration.

Holding and Implications

APPLICATION DISMISSED

Holding (direct effect): The court dismissed the revision application and affirmed that the petitioners' claim is barred by limitation. The court held that, on the facts before it, the one-year limitation period began to run on 5 April 1950 (the date of delivery when the shortage was discovered), and the suit instituted on 7 June 1951 was therefore beyond the applicable limitation period. The railway's letter of 8 June 1950 did not amount to an acknowledgment of liability under section 19 of the Limitation Act.

Implications: The immediate consequence is that the petitioners' remedy in that suit is barred by limitation and the application in revision fails. The opinion notes that the railway administration may nevertheless choose to pay compensation despite the limitation bar, but that is discretionary and not ordered by the court. The court did not purport to lay down any new or general rule beyond applying existing authorities to the facts; whether Article 30 or Article 31 applies in other short-delivery cases will depend on their particular facts.

No order as to costs was made in the circumstances of this case. The Chief Justice (Imam, C.J.) agreed and the application was dismissed.

Show all summary ...

Das, J.:— This is an application under section 25 of the Provincial Small Cause Courts Act. The facts so far as they are relevant at the present stage are not seriously in dispute and may be stated very briefly. The petitioners were the plaintiffs. A consignment of 200 bags of sugar was booked from a station called Bagaha on the railway section, known then as the O.T Railway, for another station called Katrasgarh on the E.I Railway section on the 23rd of March 1950 under railway receipt no. 61756. When the consignment reached Katrasgarh, 8 bags of sugar were found cut and damaged. Those 8 bags were reweighed and there was a shortage of 11 maunds and 1 seer of sugar. The petitioners took delivery, of the 200 bags of sugar on the 5th of April 1950 under a qualified receipt. Thereafter, the petitioners wrote to the Chief Commercial Manager, East Indian Railway, in Calcutta and received a reply dated the 8th of June 1950. In this reply, the Chief Commercial Manager stated that as there was no proof of misconduct on the part of the railway administration or its servants, he was unable to accept liability for the shortage and he further expressed inability to entertain any claim to compensation. The petitioners then served a notice under section 80 of the Code of Civil Procedure and instituted a suit on the 7th June, 1951, out of which the present application in revision has arisen.

The defendant, opposite party before us, raised several pleas and two points arose for consideration by the learned Small Cause Court Judge. The first point was if the shortage of sugar was due to misconduct or negligence on the part of the railway and the second question was one of limitation. On the first question the learned Small Cause Court Judge found in favour of the present petitioners and held that the loss or shortage of sugar was due to the misconduct and negligence of the railway administration. On the second question, he held against the present petitioners. The learned Small Cause Court Judge held that Article 30 of the Limitation Act applied and in as much as the suit had been brought beyond the period of limitation contemplated by Article 30, the claim was barred by time.

Learned counsel for the petitioners has contended before us that the proper article which should apply in the present case is Article 31. He has argued that short delivery of goods does not amount to loss of goods and the loss or injury referred to in Article 30 is loss or injury to the goods and not loss or injury to the consignee; therefore, it cannot be said that a case of short delivery falls under Article 30 on the ground that it amounts to loss to the consignee to the extent of the goods short delivered. Learned counsel has relied on a decision of this Court, Bengal and North Western Railway Co. Ltd. v. Kameshwar Singh Bahadur. Learned Counsel appearing for the opposite party has placed reliance on certain other decisions of this Court, Rameshwar Das Mali Ram v. The East Indian Railway Company, Ltd. and Gopi Ram Gouri Shanker v. The Great Indian Peninsular Railway Co., and has contended that, in the circumstances of this case, short delivery was really due to loss of goods and the proper Article applicable is Article 30 of Schedule I to the Limitation Act. I apprehend that short delivery may, in certain circumstances, be due to loss of part of the goods; in certain other circumstances, shirt delivery may be due to non-delivery of part of goods particularly when the consignment consists of several units and the units are delivered piecemeal. Article 30 relates to a claim of compensation against a carrier for losing or injuring goods. Article 31 relates to a claim of compensation against a carrier for nondelivery of or delay in delivering, goods. Whether the one or the other article should apply would depend on the circumstances of each case, and I do not think that it can be laid down as a rule of law that every case of short delivery of goods must come within Article 30 or within Article 31. As I have already said, whether Article 30 or Article 31 will apply will depend on the facts of each case.

The case under our consideration can be disposed of without deciding whether the learned Small Cause Court Judge was right in applying Article 30 of Schedule I to the Limitation Act. There is no serious dispute that, if Article 30 applies to the facts of this case, the claim of the present petitioners was undoubtedly barred by time; because the period of one year mentioned in Article 30 runs from the date when the loss or injury occurs. In the case before us, the loss undoubtedly occurred before the 5th of April 1950, on which date the 200 bags of sugar were delivered to the consignee and, on weighment, it was found that there was shortage in 8 bags.

Learned counsel for the petitioners does not dispute that, if Article 30 applies, then the claim of his clients is barred by time. He contends, however, that the proper article to apply in the present case is Article 31. Let me, therefore, consider what the position is if Article 31 applies. Under Article 31, the period of limitation is one year from the date when the goods ought to be delivered. As has been observed in The Governor-General in Council v. Kasiram Marwari, the question “when the goods ought to be delivered” is essentially a question of fact. If no particular date is specified for delivery, it must be determined as a matter of what is reasonable having regard to the circumstances of the contract and the conduct of the parties. In the case before us, the entire 200 bags of sugar were made over to the consignee on the 5th April, 1950 and, on weighment, it was found that 8 bags of sugar did not contain as much sugar as they contained when the bags were despatched or consigned. It should be obvious that in a case of this kind, the entire quantity of sugar should have been delivered on the same day, namely, the 5th of April 1950, and the sugar which had been removed or pilfered from some of the bags could not be delivered on a subsequent date. Therefore, having regard to all the circumstances, the date when the goods ought to be delivered should, in the present case, be the 5th of April 1950. Learned counsel for the petitioners has contended before us that the date when the goods ought to be delivered should be reckoned from the date of the letter which the railway administration wrote to the petitioners refusing to entertain the claim of the petitioners. He has relied on four decisions, Bengal and North Western Railway Co. Ltd. v. Kameshwar Singh Bahadur, M.A.P Palanichami Nadar v. Governor-General of India in Council, Raigarh Jute Mills Ltd. v. Commissioners for the Port of Calcutta and The Governor-General in Council v. Kasiram Marwari. In Bengal and North Western Railway Co. Ltd. v. Kameshwar Singh Bahadur, a consignment of 3,229 bundles of round steel rods and 4 wooden frames were despatched. The bundles of round steel rods were delivered piecemeal on three separate dates. The wooden frames were not delivered at all. The claimant wrote to the railway administration and the latter replied that the matter was receiving their attention. In these circumstances, it was held that the date when the goods ought to be delivered was not the date when a part of the consignment was delivered. In M.A.P Palanichami Nadar v. Governor-General of India in Council, there were 4 consignments of arecanuts and, when the consignments were delivered, 15 bags out of the consignments were short. The petitioners carried on correspondence with the railway administration, as a result of which 11 bags were found and delivered, and there was an ultimate short delivery of 4 bags. In these circumstances, it was held that the time to institute a suit against the railway company began to run from after a definite refusal or declaration of inability to deliver by the railway company. In Raigarh Jute Mills Ltd. v. Commissioners for the Port of Calcutta, the position was more or less the same. That was a case against the railway administration for non-delivery of jute loaded in a wagon. The decision in The Governor-General in Council v. Kasiram Marwari, to which I have already made a reference, proceeded on the footing that the question when the goods ought to be delivered is essentially a question of fact and no universal or inflexible one could be laid down. On the facts of that case, it was found that the suit having been brought within one year from the railway's refusal to deliver the consignment, it could not be held that the plaintiff had brought the suit more than a year from the expiry of the reasonable time within which the goods should have been delivered.

The facts of the case before us are entirely different from the facts of the four cases on which learned counsel for the petitioners has relied. In the case before us, the entire consignment of 200 bags was delivered on the 5th of April 1950 and, on weighment, it was found that 8 of the bags of sugar did not contain as much sugar as they should have. Obviously, the entire quantity of sugar ought to have been delivered when the 200 bags of sugar were delivered to the consignee. The shortage could have been made good but the goods consigned, namely, the sugar which was in the 8 bags, could not have been delivered on any subsequent date. In the circumstances of this case, therefore, the period of limitation even under Article 31 of the Limitation Act, assuming but without deciding that article applied, began to run from the 5th of April 1950.

The suit was brought on the 7th of June 1951. Learned Counsel for the petitioners has contended that the letter Exhibit 1(g), which the Chief Commercial Manager, East Indian Railway wrote to the petitioners amounted to an acknowledgment of liability. He relied on explanation I of section 19 of the Limitation Act and contended that an acknowledgment may be sufficient, even though, it is accompanied by a refusal to pay. Explanation I, however, makes it quite clear that there must first be an acknowledgment of liability, even though of a conditional nature. If there is an acknowledgment of liability, it is sufficient even it is accompanied by refusal to pay. Exhibit 1(g), however, contains no acknowledgment of liability; on the contrary, it states in the clearest of terms that the railway administration does not accept any liability for the loss or shortage. In my opinion, the learned Small Cause Court Judge was right in his view that the letter Exhibit 1(g) does not amount to an acknowledgment of liability within the meaning of section 19 of the Limitation Act.

The result, therefore, is that the claim of the petitioners was barred by time in either view of the matter, irrespective of whether the appropriate article to apply in the present case is Article 30 or Article 31 Of Schedule I to the Limitation Act. The application accordingly fails and is dismissed. It is unfortunate that the petitioners brought the suit a few days after limitation had run out. It is, of course, open to the railway administration to pay compensation, even though the claim be barred by time, but that is a matter for the consideration of the railway administration. In the circumstances of this case, there will be no order for costs.

Imam, C.J:— I agree.

S.H
Application dismissed.