Union Of India v. Banshidhar Prasad And Another

Choudhary, J.

1. This is a defendant's appeal. It arises out of a suit instituted by the plaintiffs against the Dominion of India for damages for the loss suffered by the plaintiffs.

2. The case of the plaintiffs, briefly stated, is as follows: On 4-7-1947, the plaintiffs booked 263 tins of refined ground-nut oil and 253 tins of vegetable ghee which were loaded in a wagon, from Gane Floor Mills Siding at Cawnpur to Arrah. Both these stations were at that time under the administration of the East Indian Railway. When the consignment reached the destination, it was found that 7 tins of ground nut oil were cracked in the middle and were empty, 32 tins were entirely empty and 12 tins were leaking through joints and were partly empty.

It was also found that 4 tins of vegetable ghee were leaking and partly empty. The total shortgage of the ground-nut oil came to be 1 maund 34 seers and that of vegetable ghee to 26 seers. The plaintiffs alleged that the loss to the consignment was due to misconduct on the part of the servants of the Railway Administration and, therefore, they instituted the present suit for recovery of Rs. 1772-0-3 as being the cost of the loss of ground-nut oil, vegetable ghee and profit and expenses.

3. The pleas taken by the defendant which are relevant for the present appeal are that the consignment was not packed in accordance with the instructions Had down in the tariff rules, that as it was booked at "owner's risk", there was no liability on the Railway Administration and that there was no misconduct on the part of its servants.

4. The trial Court held that the goods were consigned at owner's risk and that the plaintiffs had not been able to prove that there was any misconduct on the part of the Railway Administration or its servants. It, therefore, dismissed the suit. On appeal by the plaintiffs the lower appellate Court held that there was misconduct on the part of the servants of the Railway Administration on account of which loss was caused to the plaintiffs, and it, therefore, decreed the suit. The defendant has, therefore, come up to this Court in second appeal.

5. The lower appellate Court has based its findings holding the Railway Administration guilty of misconduct on two circumstances. The first circumstance is that no portion of the contents of the tins could be found on the floor of the wagon. According to it, if flowing or oozing put of the tins was on account of the damage to the tins or because of their detective packing or loose shunting, then naturally the contents of those tins, or, at least, some portion of them must have been found on the floor of the wagon, and as there was no evidence to show that these were found on the floor of the wagon, it could not be said that the loss was occasioned due to damage to the tins or defective packing.

It has relied on the evidence of D.W. 2, a goods clerk, who stated that the goods found on the floor of the wagon had also to be noted in the message hook, and as the message book, Ex. D, produced in this case did not contain any such entry, it held that there must have been pilfering.

The other circumstance on which it relied was that the wagon in question was found to have the seal of Arrah on one side and the seal of Cawnpur on the other. It may be noted that the rivets were found intact on both sides. D.W. 2 stated that as there was no seal, so it was sealed at Arrah, though he admitted that the sea] was not put in his presence. The persons of the Watch and Ward Department and Watchman No. 1757, in whose presence the wagon was opened, have not been examined in the case.

The seal of Arrah that was found on the wagon was that of the Assistant Station Master of Arrah. This Assistant Station Master has also not been examined in the case. An adverse inference was, therefore, drawn against the Railway Administration for their non-examination. On these two circumstances, as already stated, the Court of appeal below held that the Railway Administration was guilty of misconduct.

6. So far as the first circumstance is concerned, namely, the non-finding of the contents on the floor of the wagon, I must observe that the lower appellate Court was not justified in taking this into consideration. This point was not taken in the plaint and was not urged at the trial. For the first time in appeal before the lower appellate Court this contention was raised on behalf of the plaintiffs. In my opinion, the Railway Administration had no opportunity to meet it.

If the point has been taken in the plaint, the Railway Administration could have adduced evidence and made disclosures if it liked to meet it. The fact that the non-finding of the contents is not mentioned in the message book which, according to D.W. 2 should have been mentioned, in my opinion, is not enough for coming to a finding that no contents of the tins were found on the floor of the wagon. This circumstance must, therefore, be rejected from consideration.

The only other circumstance on which misconduct has been inferred is, as already stated, the non-examination of certain witnesses by the Railway Administration. In -- 'Gopal Ram Ram Das Registered Firm v. Union of India, SA No. 2153 of 1948, D/- 20-7-1954 (Pat) (A), it has been held that an inference of legal misconduct from proved facts and circumstances is a question of law which can be agitated in second appeal.

It has, therefore, to be seen whether in view of the legal position of the parties in this case, misconduct can be inferred from the non-examination of certain witnesses by the defendant.

7. It is an admitted fact in this case that the consignment was booked at owner's risk under Risk Note Forms A and Z. Risk Note Form Z is the same as Risk Note Form B, and this is to be used as an alternative to it when the Sender desires to enter into a general agreement instead of executing a separate Risk Note for each consignment. Risk Note Form B is to be used when the sender elects to despatch at a "special reduced" or "owner's risk" rate, articles or animals for which an alternative "ordinary" or ' risk acceptance" rate is quoted in the Tariff. Risk Note Form A is to be used when articles are tendered for carriage which are either already in bad condition or so defectively packed as to be liable to damage, leakage of wastage in transit.

Under both these Risk Note Forms, namely, Risk Note Form A and Risk Note Form Z which is the same as Risk Note Form R, the consignor agrees and undertakes to hold the Railway Administration over whose Railway the goods may be carried in transit harmless and free from all responsibility for the condition in which they may be delivered to the consignce at destination and for any loss arising from the same except upon proof that such loss arose from misconduct on the part of the Railway Administration's servants.

Risk Note Form B, however, provides that in cases of (1) non-delivery of the whole of the consignment or of the whole of one or more packages forming part of the said consignment packed in accordance with the instructions laid down in the Tariff or, where there are no such instructions, protected otherwise than by paper or other packing readily removable by hand and fully addressed, where such non-delivery is not due to accidents to trains or to fire and (2) pilferage from a package or packages forming part of the said consignment properly packed as stated above, when such pilferage is pointed out to the servants of the Railway Administration on or before delivery, the Railway Administration shall be bound to disclose to the consignor how the consignment was dealt with throughout the time it was in its possession or control and, if necessary, to give evidence thereof before the consignor is called upon to prove misconduct, but, if misconduct on the part of the Railway Administration or its servants cannot be fairly inferred from such evidence, the burden of proving such misconduct shall lie upon the consignor. There is no such proviso in Risk Note Form A.

Reading the two forms together, the position that seems to be is that, whereas in case of consignment booked under Risk Note Form B, the Railway Administration is liable to make disclosures in certain cases, there is no such obligation on it when the consignment is booked under Risk Note Form A.

It is also well settled that where a consignor has executed two risk notes limiting the Railway's liability, it is open to the Railway Administration to take advantage of either, and if under either it can be shown that the Railway Administration has escaped liability, then the suit must be dismissed, even if some other form of risk note might also have been executed under which it might be held that liability had not been fully taken away.

A reference in this connection may be made to a single Judge decision of this Court in -- 'Governor-General in Council v. Thakursi Dass' AIR 1948 Pat 45 (B) where Meredith, J. (as he then was) made the observation referred to above. This observation was quoted with approval in the aforesaid unreported Bench decision of this Court in -- 'SA No. 2153 of 1948, D/- 20-7-1954 (Pat) (A). Das J. (as he then was) who delivered the judgment, with whom Banerji, J. concurred, observed as follows:

"With regard to the first point as to whether there was an obligation on the railway administration to make a full disclosure, it seems to me that the point is covered by a decision of this Court in AIR 1948 Pat 45 (B)"

His Lordship then quoted with approval the observation referred to above made by Meredith, J. (as he then was) in that case. His Lordship further held that in view of the terms in Risk Note A it was clearly for the appellant to prove misconduct on the part of the servants of the Railway Administration and no inference could be drawn from any non-disclosure of how the consignment had been dealt with by the Railway Administration.

8. In 'Union of India v. Jetha Bhai' AIR 1953 Pat 279 (C) also one side of the wagon was found to be without seal but the rivets were intact and the guard who brought the train to destination was not examined in the case. These facts in themselves were not held to amount to misconduct on the part of the Railway Administration. In -- 'Governor-General in Council v. Jamuna Das' AIR 1949 Pat 119 (D), there was no caution label and seals were found broken on the way to Kharagpur station where they were put again.

It was held in that case that, though these circumstances could lead to an inference of negligence on the part of the Railway Administration, yet no misconduct on its part could be inferred. Their Lordships pointed out that misconduct is not synonymous with negligence and that for an act to amount to misconduct there must be a greater degree of wrong than is required for negligence.

Reliance has, however, been placed on behalf of the plaintiffs on a Bench decision of this Court in -- 'Phul Chand Khandelwal v. Governor-General of India in Council' AIR 1949 Pat 110 (E), in which it was held that the burden of proof of absence of negligence is upon the common carrier on the theory that the loss or damage to the goods is prima facie proof of negligence and that a common carrier in this country is liable as an insurer, that is, he is responsible for the safety of the goods entrusted to him in all events except when loss or injury arises from act of God or enemies of the State. But, it was also held in that case that such liability for loss or injury in respect of the goods carried may be varied by contract.

That was a case of non-delivery to which the terms of Risk Note Form A did not apply. The contract entered into under Risk Note Form A makes the Railway Administration harmless and free from all responsibility for any loss in the case of delivery. But, where the goods consigned are not delivered at all, the contract does not limit the liability of the Railway Administration. The case of AIR 1949 Pat 110 (E) is, therefore, of no assistance to the plaintiffs.

In the present case the general liability, as pointed out in that case, has been varied by the consignor's entering into contract with the Railway Administration in Risk Note Form A.

9. Reference has also been made on behalf of the plaintiffs to another Bench decision of this Court in -- "Jankidas v. Governor-General of India in Council AIR 1946 Pat 336 (F). In that case an argument was advanced on behalf of the defendant that the shortage in the goods at the station was due to the defective packing of the articles consigned in old bag and so one of the bags got torn in transit and a portion of the article was lost.

Their Lordships had to reject this argument on the ground that there was nothing to show that any part of the goods lost was found scattered about in the carriage and collected at the station of delivery. It has been contended on behalf of the plaintiffs that in the present case also there was nothing to show that the contents of the tins or any portion thereof had been found on the floor of the wagon and on the authority of the aforesaid decision it must be held that there had been pilfering in this case.

I have already rejected this argument on the ground that this point was not taken either in the plaint or at the trial. From the report of the case referred to above it does not appear whether this point was taken in the plaint. That case, therefore, can have no application to the present case.

10. For the reasons given above, it is clear that the Railway Administration was not bound to make any disclosure in the present case and the non-examination of the persons referred to above could not, in law, therefore lead to an inference of misconduct on its part.

11. Even on the terms of Risk Note Form Z which also was executed by the consignor, I do not think, the Railway Administration was bound to make any disclosure in the present case. The liability to make a disclosure under the proviso of that agreement arises only where the articles consigned are packed in accordance with the instructions laid down in the Traffic Rules. In this case the finding of the lower appellate Court is that the goods in question were not packed as required by the rules of the traffic Rules. On this finding the Railway Administration could not be held to have an obligation to make any disclosure under the terms of Risk Note Form Z.

Moreover, even under this agreement the consignor is not absolved from the burden of proving misconduct unless from the disclosure made by the Railway Administration misconduct on its part can be fairly inferred. Meredith, J., (as he then was) in the aforesaid case of AIR 1948 Pat 45 (B), referring to the case of Judicial Committee in -- 'Surat Cotton Spinning and Weaving Mills, Ltd. v. Secretary of State' AIR 1937 PC 152 (G) laid down the procedure to be followed in such cases as follows:--

"The Railway Administration must first make the necessary disclosure, and if the consignor is not satisfied with or is doubtful as to the accuracy or truth of the information disclosed and wants evidence then the. Railway Administration must be the first to submit their evidence at the trial. If the consignor is satisfied that full disclosure has been made then he must discharge the onus upon him, and he can do it either by showing that misconduct may be inferred from the evidence led by the Railway Administration or the disclosure made by them, or he may in his turn affirmatively lead evidence which establishes misconduct.

That is one possible course. If, on the other hand, he is not satisfied with the disclosure made, then it is his duty to call upon the Railway Administration for further and better disclosure, or evidence. If he does so, then it will be for the Court to decide whether his demand has or has not gone beyond obligation which lies upon the Railway Administration under the proviso. If the Court holds that his demand for further proof is not justifiable, then of course the Railway Administration need not disclose anything more, and there can be no inference against them from that fact.

The plaintiff still has to discharge his burden. But if the Court holds that the demand is reasonable and in spite of the Court's direction the Railway Administration did not disclose the further particulars called for, then the presumption under Section 114(g), Evidence Act, which says that a presumption may be drawn that evidence which could be and is not produced would, if produced, be Unfavourable to the person who withholds it, will come into operation, and the plaintiff may call upon the Court to draw an inference of misconduct upon the basis of that presumption alone.

But, if the Railway Administration has made the further disclosure and no inference can be drawn from the evidence disclosed, then the burden still lies upon the plaintiff, and he has to discharge it before he can succeed. That is the position with regard to risk notes B and Z, and that is the procedure which should be followed by Courts trying such cases".

12. The procedure as laid down above was reaffirmed by this Court in AIR 1933 Pat 279 (C)'. In the present case, therefore, if the plaintiffs were not satisfied with the disclosures already made by the Railway Administration, they should have asked the Court to direct it to make further disclosure, and it is only on its failure to make such further disclosure as directed by the Court that an adverse inference against it could be drawn.

The lower appellate Court was, therefore, wrong in drawing an adverse inference against the defendant on account of non-examination of certain witnesses.

13. For the reasons given above, it must be held that the plaintiffs have tailed to prove misconduct on the part of the Railway Administration and its servants, and, as such, their suit was bound to be dismissed. The result, therefore, is that the appeal is allowed, the judgment and decree of the lower appellate Court are set aside and the decree of the trial court is restored. The suit of the plaintiffs is dismiss-ed with costs throughout.

14. It may be noted here that on behalf of the appellant a contention was raised that the consignment was made under "said to contain" booking and the Railway Administration had not vouchsafed the correctness of the weight and, as such, it could not be liable for any loss.

This point was not raised in the Court of appeal below, though there is some reference to this point in the judgment of the trial Court Even in the grounds of appeal to this Court this point was not taken, and the learned counsel for the plaintiffs-respondents urges that he is not prepared to meet it. In view of the fact that this point was not raised either in the Court of appeal below or in the grounds of appeal to this Court, I did not allow the appellant to raise it before me.