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  • For Appellant/Petitioner/Plaintiff: P.K. Bose
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  • G.N Prasad, J.
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Advocates
  • For Appellant/Petitioner/Plaintiff: P.K. Bose
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  • G.N Prasad, J.
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Smart Summary

Concise Analytical Summary of the Opinion

Factual and Procedural Background

The Union of India, owner of the Eastern Railway Administration, filed an application under Section 25 of the Small Cause Courts Act challenging a decree of the learned Small Cause Court Judge, Sitamarhi. The Small Cause Court had awarded plaintiffs (Opposite Party Nos. 1 and 2) a decree of Rs. 116.56 in S.C.C. Suit No. 76/212 of 1962 for non-delivery of one tin of ghee from a consignment of three tins.

Material factual chronology in the opinion:

  • Consignment of three tins of ghee was booked at Bairgania (North Eastern Railway) for carriage to Sitarampur (Eastern Railway). Booking date recorded as 29-8-1961.
  • Only two of the tins were delivered to the plaintiffs' customer at Sitarampur on 12-9-1961; the plaintiffs complained by letter Ext. 3(f) dated 12-9-1961.
  • Correspondence followed between plaintiffs and Eastern Railway: Chief Commercial Superintendent's letter (Ext. 3(d), dated 22-12-1961) stating an inquiry was on and requesting contact with the Claims Inspector at Asansol; subsequent communications (including Ext. 3(b), dated 5-2-1962) advised plaintiffs to take delivery of a crate at Sitarampur and submit an amended claim.
  • Plaintiffs insisted that the crate at Sitarampur was not theirs and sought open delivery (Ext. 3(c) and Ext. 3(g) referenced); ultimately they instituted suit on 15-12-1962 after serving notices under Section 77 of the Railways Act and Section 80 CPC. The suit named both Eastern and North Eastern Railway Administrations; it was dismissed against North Eastern Railway for lack of proper notice.
  • Claim in suit: Rs. 146.00 (price of one tin Rs.110; proportionate freight Rs.2; loss of profit Rs.22; cost of notice Rs.12). The Small Cause Court allowed price (as worked out Rs.104.56) and Rs.12 costs of notice but disallowed freight and loss of profit, entering decree for Rs.116.56; the Small Cause Court held suit was not barred by limitation.

Legal Issues Presented

  1. Whether the plaintiffs' suit for non-delivery of part of a consignment is barred by limitation under Article 31 of the Limitation Act, 1908 (one-year period for actions against carriers for non-delivery/delay, counting from "when the goods ought to be delivered").
  2. Whether correspondence from the railway to the plaintiffs (letters Ext. 3(d), 3(b), etc.) constituted an acknowledgment of liability sufficient to create a fresh starting point for limitation.
  3. Whether plaintiffs were entitled, as of right, to "open delivery" of the crate at Sitarampur and whether refusal of open delivery justified their refusal to accept the crate and entitled them to recover the price of the missing tin.

Arguments of the Parties

Plaintiffs' Arguments

  • Plaintiffs alleged non-delivery of one tin from a three-tin consignment and sought compensation for the price of the tin, proportionate freight, loss of profit and costs of notice.
  • They contended the crate at Sitarampur that the Railway offered for delivery was not theirs (no railway/private mark), and they insisted upon "open delivery" to inspect the contents before accepting.
  • Plaintiffs served notices under Section 77 Railways Act and Section 80 CPC before instituting suit and relied on the railway administration's conduct in correspondence as part of their claim process.

Defendant / Eastern Railway Administration's Arguments

  • The defendants denied liability and contended plaintiffs had themselves failed to take delivery of the third tin lying at Sitarampur.
  • A principal defence was that the suit was barred by limitation (Article 31 of the Limitation Act, 1908).
  • The Railway's written communications asked plaintiffs to take delivery of the crate and submit an amended claim, and did not admit liability to the plaintiffs' claim for non-delivery.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Boota Mal v. Union of India, AIR 1962 SC 1716 Construction of the phrase "when the goods ought to be delivered" in Article 31 — held to mean the reasonable time taken for the carriage from despatch to destination; correspondence does not generally give rise to estoppel unless it discloses acknowledgment of liability (which would restart limitation). The court relied on this Supreme Court decision as authoritative to hold that the limitation period began when the reasonable time for carriage had elapsed (here, 12-9-1961), and that subsequent correspondence did not amount to acknowledgment of liability; therefore the suit (instituted 15-12-1962) was barred by Article 31.
Governor-General in Council v. Kasiram Marwari, AIR 1949 Pat 268 This decision (as relied upon by the Small Cause Court Judge) was used by that Judge to support a later starting point of limitation (22-12-1961) rather than the date when goods ought to have been delivered. The present court noted that the trial Judge relied on this decision, but treated the authority as superseded or addressed by the Supreme Court's ruling in Boota Mal, and therefore did not follow the trial Judge's reliance upon it for fixing the starting point of limitation.
Union of India v. Khemchand, (1958) B.L.J.R. 677 Relied upon by the Small Cause Court Judge (as supporting a later starting point of limitation). The court observed that the trial Judge relied on this authority, but in light of Boota Mal the earlier approach was rejected for the purpose of fixing the starting point of limitation in this case.
Civil Revision No. 1199 of 1962, Dated 22-2-1966 (Pat) — (unreported bench decision) Authority cited for the proposition that a consignee cannot claim "open delivery" as a matter of right. The court referred to this bench decision (along with another) to indicate that open delivery is not an absolute right of the consignee; this informed the court's view that refusal to grant open delivery did not automatically entitle the plaintiffs to the price of the ghee.
Letters Patent Appeal No. 52 of 1960, Dated 27-7-1966; reported AIR 1967 Pat 32 Another bench authority for the principle that open delivery is not an automatic right of the consignee. The court cited this authority to support the proposition that plaintiffs were not entitled, as of right, to insist upon open delivery and thereby treat offered delivery as no delivery at all; instead they could seek to prove loss by evidence if the goods accepted were inferior or different.

Court's Reasoning and Analysis

The court's analysis proceeded in structured steps strictly tied to the facts and authorities cited in the opinion:

  1. Identification of the relevant limitation provision: the court accepted the learned Small Cause Court Judge's identification of Article 31 of the Limitation Act, 1908 as the applicable provision, which prescribes a one-year limitation for suits "against a carrier for compensation for non-delivery of, or delay in delivering, goods," and specifies that the period begins "when the goods ought to be delivered."
  2. Establishing the factual starting point: the court reviewed the dispatch and delivery dates in the record — booking at Bairgania on 29-8-1961 and delivery of two tins on 12-9-1961 — and concluded that all three tins formed one consignment covered by a single Parcel Way Bill; therefore the third tin ought to have been delivered along with the other two on 12-9-1961. The court held that 12-9-1961 is the starting point for limitation.
  3. Application of precedent: relying on Boota Mal v. Union of India, the court adopted the Supreme Court's construction that "when the goods ought to be delivered" means the reasonable time for carriage from despatch to destination, and that generally correspondence does not alter the starting point unless it constitutes a clear acknowledgment of liability which would give a fresh starting point for limitation.
  4. Examination of correspondence for acknowledgment: the court examined the railway letters (Ext. 3(d) dated 22-12-1961 and Ext. 3(b) dated 5-2-1962) and concluded they amounted only to inquiries, proposals to take delivery on valuation, or instructions to take delivery and submit an amended claim. The court found nothing in the correspondence that could be construed as an acknowledgment of liability by the Eastern Railway Administration sufficient to restart limitation.
  5. Consequence for limitation: applying the one-year period under Article 31 from 12-9-1961, the suit instituted on 15-12-1962 was held to be time-barred (more than one year after the starting point). The court noted that even adding sixty days (for the Section 80 CPC requirement) to the one-year period would not save the suit.
  6. Secondary observation on open delivery: although unnecessary to decide the appeal after finding the suit barred, the court addressed the lower court's view that plaintiffs were entitled to the price of the ghee because the railway refused open delivery. The court observed, based on bench authorities, that open delivery is not an absolute right of a consignee; plaintiffs could have proved any loss by evidence (for example, by showing contents were different or inferior), but they had no material to support a claim for compensation in the present action.
  7. Final procedural disposition: because the suit was time-barred and plaintiffs did not produce evidence to substantiate compensable loss, the court concluded plaintiffs were not entitled to any decree; the decree below was set aside and the plaintiffs' suit dismissed. The application by the Union (petitioner) was allowed, with no order as to costs because the plaintiffs did not appear in the court.

Holding and Implications

Holding: APPLICATION ALLOWED; THE PLAINTIFFS' SUIT IS DISMISSED.

Implications (direct consequences stated in the opinion):

  • The court set aside the decree of the Small Cause Court awarding Rs. 116.56 to the plaintiffs and dismissed the plaintiffs' suit as barred by limitation under Article 31 of the Limitation Act, 1908.
  • The court held that the relevant starting point for limitation was 12-9-1961 (the date by which the goods ought to have been delivered), and that subsequent correspondence did not amount to an acknowledgment of liability sufficient to restart limitation.
  • The court indicated that refusal to grant open delivery does not of itself entitle a consignee to treat offered delivery as no delivery; instead, the consignee could prove loss by evidence. In this case, plaintiffs had no material to support such a claim.
  • No costs were ordered against the plaintiffs in this Court because the plaintiffs did not appear.
The opinion does not indicate the creation of a new legal precedent beyond application of existing authorities (notably Boota Mal) to the facts; the decision's primary effect is to dispose of the parties' dispute by applying Article 31 and established case law to hold the suit time-barred.

Disposition in the opinion: "The decree of the Court below is set aside and the plaintiffs' suit is dismissed. The application is allowed. But there will be no order for costs since the plaintiffs did not appear in this Court." (Final paragraph of the opinion.)

Show full summary ...

    Union Of India v. Jutharam And Another Opposite Parties.

    1. The Union of India, as owner of the Eastern Railway Administration, has preferred this application under Section 25 of the Small Cause Courts Act against the decision of the learned Small Cause Court Judge, Sitamarhi, awarding to the plaintiffs (Opposite Party Nos. 1 and 2) a decree against the petitioner for a sum of Rs. 116.56 in S.C.C Suit No. 76/212 of 1962. The relevant facts are as follows.

    2. A consignment of three this of ghee was booked by the plaintiffs at Bairgania station on the North Eastern Railway for being carried to Sitarampur station on the-Eastern Railway. At Sitarampur, only two of the this were delivered to the plaintiffs' customer. Accordingly, the plaintiffs made a complaint to the authorities of the Eastern Railway about non-delivery of the third tin in a letter, Ext. 3(f) dated the 12th September, 1961, addressed to the Chief Commercial Superintendent, Eastern Railway. On the 22nd December, 1961, the Chief Commercial Superintendent wrote to the plaintiffs that the matter was being enquired into and that they should contact the Claims Inspector at Asansol and take delivery of one tin upon valuation, which was lying at Sitarampur. Thereupon the plaintiffs sent a letter Ext. 3(c) dated the 12th January, 1962, to the Claims Inspector, Asansol, saying that the tin lying at Sitarampur was not the tin of the plaintiffs since it did not bear the railway mark or the private mark of the plaintiffs. The plaintiffs further mentioned in the letter Ext. 3(c) that arrangement should be made for making delivery of the correct tin or in the alternative, the price of the article might be paid to the plaintiffs. The plaintiffs did not receive any reply from the Claims Inspector, Asansol, but the Chief Commercial Superintendent wrote a letter Ext. 3(b) dated 5-2-1962 advising the plaintiffs to take delivery of the crate lying undelivered at Sitarampur and to submit an amended claim.

    3. In reply, the plaintiffs wrote a letter Ext. 3(g) dated 2-3-1962 saying that the Traffic Inspector should be directed to make open delivery of the tin to the plaintiffs. This, however, was not done, and, ultimately, the plaintiffs instituted the present suit after serving a notice under Section 77 of the Railways Act upon the Eastern Railway Administration as also a notice upon the said Railway Administration under Section 80 of the CPC. The suit was, however, instituted not only against the Eastern Railway Administration, but also against the North Eastern Railway Administration. The total claim in the suit as laid at Rs. 146.20 as detailed below:—

    (i) Price of one tin of ghee not delivered Rs. 110-00 (ii) Proportionate railway freight Rs. 2-00 (iii) Loss of Profit Rs. 22-00 (iv) Cost of notice Rs. 12-00 Total Rs. 146-00

    4. The defendants denied the plaintiffs' claim and assessed that they were not entitled to any decree substantially for the reason that they had themselves failed to take delivery of the third tin which was lying at Sitarampur. Another substantial defence taken was that the suit was barred by limitation.

    5. The learned Small Cause Court Judge dismissed the suit against the North Eastern Railway Administration on the ground that notice, under Section 77 of the Railways Act and Section 80 of the CPC had not been served upon that Railway Administration. Such notices were served only upon the Eastern Railway Administration. The learned Judge has held that the plaintiffs were entitled to insist upon open delivery of the tin which was lying at Sitarampur, and since open delivery was not acceded to by the railway authorities, the plaintiffs were justified in declining to take delivery of the tin offered to them at Sitarampur.

    6. Accordingly, the plaintiffs were entitled to the price of one tin forming part of the consignment which worked out at Rs. 104.56 The learned Judge further found the plaintiffs entitled to the sum of Rs. 12 as cost of notice. The remaining parts of the plaintiffs' claim in connection with the railway freight and the loss of profit were, however, disallowed and a decree for Rs. 116.56 has been passed in favour of the plaintiffs against the petitioner. The view taken by the learned Judge is that the suit was not barred by limitation.

    7. I will first deal with the question of limitation. The relevant Article of the Limitation Act, 1908, as rightly held by the learned Judge, is Article 31 which provides a period of one year for a suit “against a carrier for compensation for non-delivery of, or delay in delivering, goods”. The period of one year begins to run from the time “when the goods ought to be delivered”. The moot question for consideration, therefore, is, when the third tin forming part of the consignment ought to have been delivered to the plaintiffs or their customer. The consignment had been booked at Bairgania on 29-8-1961. Two of the tins forming part of the consignment were delivered to the plaintiffs' customer at Sitarampur on 12-9-1961, and it was in consequence of that, that the plaintiffs had addressed their complaint to the Chief Commercial Superintendent, Eastern Railway, through the letter Ext. 3(f) dated 12-9-1961.

    8. Upon these facts alone, it is manifest that the third tin forming part of the consignment ought to have been delivered to the plaintiffs or their representative alone with the other two tins on 12-9-1961 itself. All the three tins formed one consignment and were covered by one railway receipt or one Parcel Way Bill which bore No. 678408. The mere fact that there was further correspondence between the plaintiffs and the railway administration subsequent to 12-9-1961 would not alter the position that the third tin ought to have been delivered by the railway administration to the plaintiffs or their representative on 12-9-1961. Therefore, 12-9-1961 must be deemed to be the starting point of the limitation period of one year provided under Article 31 of the Limitation Act, 1908. In this view, the suit which was instituted on 15-12-1962 must be held to be barred by limitation, even if the period of sixty days requisite for the notice under section 80 of the CPC were to be added to the period of one year computed from 12-9-1961.

    9. The learned Small Cause Court Judge has held that the starting point of limitation was the 22nd December, 1961, when the Chief Commercial Superintendent wrote the letter Ext. 3(d) to the plaintiffs, and in support of his view, he has relied upon the Governor-General in Council v. Kasiram Marwari, AIR 1949 Pat 268 and Uuion of India v. Khemchand, (1958) B.L.J.R 677 at p. 680. But the legal position has now been authoritatively settled by the decision of their Lordships of the Supreme Court in Boota Mal v. Union Of India ., AIR 1962 SC 1716. In that case, their Lordships construed the words “when the goods ought to be delivered” occurring in the third column of Article 31, and held that these words can only mean the reasonable time taken for the carriage of goods from the place of despatch to the place of destination.

    10. Their Lordships further observed that the view taken by some of the High Courts that the time begins to run from the date when the railway finally refuses to deliver cannot be correct, for, the words in the third column of Article 31 are incapable of being interpreted as meaning the final refusal of the carrier to deliver. Their Lordships pointed that the very fact that Article 31 deals with both cases of non-delivery and delay in delivering the goods, shows that in either case the starting point of limitation is after reasonable time has elapsed for the carriage of goods from the place of despatch to the place of destination. As to the question as to what is the reasonable time, their Lordships have laid down that, that would depend upon the circumstances of each case. Their Lordships have further observed.

    “Nor do we think that there could be generally speaking any question of estoppel in the matter of the starting point of limitation because of any correspondence carried on between the carrier and the person whose goods are carried. But, undoubtedly if the correspondence discloses anything which may amount to an acknowledgment of liability of the carrier, that will give a fresh starting point of limitation. As we have said already, the words in the third column refer to reasonable time taken for the carriage of goods from the place of despatch to the place of destination and this reasonable time generally speaking cannot be affected by the subsequent conduct of the parties”.

    11. In the instant case, there cannot be the slightest doubt that the reasonable time for the carriage of the consignment from Bairgania to Sitarampur was the 29th August, 1981 to the 12th September, 1961. In fact, two of the tins forming part of the consignment had been delivered to the plaintiffs' representative on 12-9-1961. There is no reason to think that the reasonable time was different in respect of the third tin included in the said consignment. Therefore, the starting point of limitation must be deemed to be the 12th September, 1961. A fresh starting point of limitation can only arise if there is anything in the correspondence which took place between the parties disclosing an acknowledgment of liability on the part of the Eastern Railway Administration.

    12. In the letter Ext. 3(d) dated 22-12-1961, addressed to the plaintiffs by the Chief Commercial Superintendent, all that was said was that an inquiry was being made into the matter and that the plaintiffs should contact the Claims Inspector at Asansol and take delivery of one tin on valuation which was lying at Sitarampur. By no means, this letter Ext. 3(d) can be construed as acknowledgment of liability of the plaintiffs' claim on the part of the Chief Commercial Superintendent. On the contrary, in the subsequent letter Ext. 3(b) of the Chief Commercial Superintendent, dated the 5th February, 1962, the Railway Administration insisted that the plaintiffs should take delivery of one crate which was lying undelivered at Sitarampur and submit amended claim.

    13. That clearly shows that the Railway Administration were not admitting the plaintiffs' claim on the footing that the tin offered to them for delivery at Sitarampur was not a part of the original consignment. The liberty to the plaintiffs to submit an amended claim clearly shows that the original claim was not accepted by the Railway Administration as correct. I have therefore, no doubt in my mind that the starting point of limitation for the present suit was the 12th September, 1961, and that the suit instituted on 15-12-1962, more than fourteen months after the date when the consignment ought to have been delivered, must be held as barred under Article 31 of the Limitation Act, 1908.

    14. Since the suit has been found to be barred by limitation, it is hardly necessary to go into any other question arising in this case. I wish, however, to indicate that the view taken by the Court below that the plaintiffs were entitled to tile price of the ghee, contained in the tin which was not delivered, on account of the refusal of the railway to give open delivery of the tin which was lying at Sitarampur is not quite correct. The reason is that a consignee cannot claim open delivery as of right. This follows from at least two unreported Bench decisions of this Court, namely, Civil Revn. No. 1199 of 1962, D/- 22-2-1966 (Pat) and Letters Patent Appeal No. 52 of 1960, D/- 27-7-1966: (AIR 1967 Pat 32).

    15. In the instant case, the plaintiffs seem to have insisted upon open delivery since they thought that the tin offered to them for delivery was not the original tin forming part of the consignment and there was ground for suspicion that the contents of that tin were not ghee of the quality which had been booked by the plaintiffs. Therefore, unless open delivery was effected, the plaintiffs would be in dark as to the nature and extent of their loss in the event of the contents being, what the plaintiffs suspected. But it is manifest that in that event, the plaintiffs would not have been without remedy.

    16. They could nevertheless prove by leading satisfactory evidence that the nature and quality of the contents of the tin delivered to them by the Railway Administration were different from or inferior to the commodity which they had tendered to the railway for carriage to Sitarampur.

    17. In that event the plaintiffs would have been entitled to recover from the Railway Administration whatever loss, if any, they suffered by reason of the non-delivery of the original consignment. As it is, the plaintiffs are in possession of no material which they could bring on the record in support of their claim for compensation in the present action. Consequently, the Court is not in a position to hold what loss, if any, was suffered by the plaintiffs in this case so as to be in a position to pass a decree in their favour.

    18. For the reasons which I have given, I have come to the conclusion that the plaintiffs are not entitled to any decree in this action. The decree of the Court below is, accordingly, set aside and the plaintiffs' suit is dismissed. The application is allowed. But there will be no order for costs since the plaintiffs did not appear in this Court.

    EK/JRM/G.G.M

    19. Petition allowed.

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    Comments

    Union Of India v. Jutharam And Another Opposite Parties.
    (Nov 10, 1966)