Branch Manager Economic Transport Organisation vs Synco Textiles Pvt Ltd

THESE appeals are against the Order of 25th January, 1991 of the State Commission of Rajasthan.

THE brief facts are that on 29th November, 1987 the respondent in Appeal No. 119 (Appellants in Appeal No. 133/91, M/s. Synco Textiles Pvt. Ltd.) sent 400 tins of mustard oil containing 15 kgs. weight (net) each to Bhubaneshwar through the carrier Economic Transport Organisation (for short E.T.O.) having its branches at Jodhpur, Cuttack, Calcuttaand Bombay. The goods were invoiced in the name of Maa Tarini Bhandar, Cuttack, the ultimate buyer. The G.R. (Goods Receipt) was in favour of the State Bank of Bikaner and Jaipur (SBBNJ) and were to be delivered to the Bank for further delivery on its instructions against the surrender of document. The consignment was covered by Transit Risk insurance with the New India Assurance Co. (Respondent No. 3 in Appeal No. 119/91). The goods were said to have been despatched on 30th November, 1987 to Cuttack but the documents were returned dishonoured on the 4th February, 1988. The consignment is reported to have been re -booked to the consignees through the appellants, E.T.O. on the 12th May, 1988. The respondent, Synco Textiles in Appeal No. 119/91 reported to the insurer on 30th May, 1988 that there had been non -delivery of goods and requested for payment of the insurance amount.

ON 16th August, 1988 the Branch Office of the E.T.O. at Jodhpur asked its Branch Office at Cuttack either to recover and pay the amount of the invoiced goods or give non -delivery certificate to the complainant.

ON 12th December, 1988 the Branch Office of the E.T.O. at Bombay informed the complainant consignor, Synco Textiles, that the consignment was lying with their Cuttack Branch and that the consignor complainant could take delivery thereof. But the delivery was not given to the Bank nor was it given to the consignors representative. The Appellants/Respondents however, claim that the consignment was delivered on 10.01.1989, on verbal instructions of the consignor -complainant to the ultimate consignee, Maa Tarini Bhandar bye passing the Bank. After the exhaustive examination of the facts of the case and the version of the parties, the E.T.O., the Indian Banks Association (I.B.A.), the Insurance Company and the consignor, the State Commission rejected the contention of the appellants in Appeal No. 119/91 viz. E.T.O. that the delivery was made to the final consignee viz. Maa Tarini Bhandar on the oral instructions of the consignor given on the 10th January, 1989, The State Commission came to a firm finding ''It appears that in fact no delivery (to Maa Tarini Bhandar) as alleged, by the opposite parties Nos. 1 to 4 (Appellants in Appeal No. 119/91) on the instructions, of goods have taken place and such delivery cannot be availed of by opposite parties Nos. 1 to 4''. In the course of this judgment the statement the State Commission have again remarked: ''The version that the delivery of the consignment was made on the verbal request of the complainant has not been established'' and that ''there was no satisfactory proof regard ing delivery had been placed on record by the opposite parties No.1 to 4.'' As there was no retiring of the documents the G.R. receipt to the Bank, the State Commission came to the conclusion that the Transport Company had committed breach of contract, ''the consignee was the Bank and not the invoiced party, and dealing with it was unauthorised and beyond the scope of the I.B.A. scheme under which the transporter was operating and the terms of the agreement itself. In fact, the State Commission observed ''Even if any delivery was made, it was illegal and does not bind the complainant'' (Synco Textiles).

THE appellants in Appeal No. 119/91 (E.T.O.) had also urged that the ultimate buyer viz. Maa Tarini Bhandar, Cuttack had made a payment in respect of this complainant of Rs. 60,000/ - in stages as under: Rs. 20,000/ - on 4th July, 1988 Rs. 10,000/ -on 23rd August, 1988 Rs. 10,000/ - on 4th January, 1989 Rs. 20,000/ - on 3rd February, 1989 to the consignor and that the amounts had been accepted by the consignor and therefore there was a novation of the contract and the consequential delivery of the goods to the ultimate buyer viz. Maa Tarini Bhandar was not unauthorised.

THE State Commission, after examining the facts, came to the conclusion that on the basis of the alleged payments, it cannot be said that there was a novation of contract and that the complainant started dealing with directly with the opposite parties Nos. 1 to 4 by passing the consignee Bank. Again the State Commission observed that in the absence of any evidence and on the basis of the alleged payments the opposite parties, E.T.O. cannot be absolved from their responsibility on the ground of novation of contract even if it were to be presumed that there was a novation. Further, the Commission observed that ''The contention of Mr. Bhandari (Synco Textiles Ltd.) is correct that the opposite parties Nos. 1 to 4 have failed to establish that as the payments were made to the complainant, delivery was made to Maa Tarini Bhandar on its verbal instructions''. As the Commission rightly emphasised, the ownership of the goods in the consignment could not be transferred until the party concerned retired the documents after making full payment. As already observed above, the State Commission was clearly of the view that the consignee was the Bank and not the invoiced party and any dealing with the latter was unauthorised and even if any delivery was made, it was illegal and not binding on the complainant. The State Commission, therefore, concluded ''It is established from the record that the opposite parties Nos. 1 to 4 (E.T.O.) did not follow the instructions and instead gave the goods to Maa Tarini Bhandar without retiring the documents. The opposite parties Nos. 1 to 4 did not act in a manner which they undertook to perform in pursuance of the contract. There was fault, or shortcoming in the performance of the service. Thus the service suffered from deficiency as envisaged by Sec. 2(1)(g) of the Act''. The State Commission also held that the payments made from time to time totalling Rs. 60,000/ - and referred to above did not pertain to this transaction.

THE counsel for the appellants in Appeal No. 119/91 E.T.O. during the hearing reiterated that the State Commission had failed to take into account the letter of the 10th January, 1989 from Maa Tarini Bhandar to the consignor complainant (Synco Textiles Ltd.) that the consignment of G.R. of 29th November, 1987 of 400 tins of mustard oil stating that he had made settlement with Shri Bhandari of Synco Textiles, that he had earlier made a deposit of Rs. 75,000/ - with the party paid Rs. 10,000/ - in cash and that therefore he was taking delivery of the goods directly and also of the letter of 3rd February, 1989 from Maa Tarini Bhandar to Synco Textiles Ltd. giving details of the payments of Rs. 60,000/ - made in July, August of 1988 and January and February, 1989 - details already given above. He also urged that the State Commission had failed to appreciate that there had been a novation of contract and. that it was legally in order to have made delivery directly to the ultimate buyer, Maa Tarini Bhandar and not through the Bank after retirement of the documents.

HE also raised the question of jurisdiction he maintained that the jurisdiction in this case lies with the Calcutta Forums and not with the State Commission of Rajasthan. He also made a point that the case was sub judice inasmuch as an F.I.R. had already been filed at Cuttack on 17.1.89 about the loss of this consignment. In particular, he stressed that no notice had been served on the appellants under Sec. 10 of the Carriers Act and as notice was mandatory its absence was fatal to the proceedings before the Consumer Forum. The notice under the provision 10 of the Carriers Act, 1865, is mandatory where a suit has to be instituted under the Carriers Act. The State Commissions deal with complaints under the Consumer Protection Act relating to supply of defective goods and deficiency in service. These are not subject matter of suits under the Carriers Act as such the provisions of Sec. 10 of the Carriers Act are not attracted in this case.

WE find that the State Commission had taken note of all the documents including the letters of 10th January, 1989 and 3rd February, 1989 and the payments said to have been made in advance, the question of jurisdiction, absence of notice under the Carriers Act etc. The State Commission have given their findings after considering the facts and the law and we are in full agreement with their conclusion about the deficiency in service on the part of the appellants. The appeal No. 119 of 1991 is, therefore, dismissed. In the cross appeal No. 133 of 1991 the appellants, Synco Textiles Ltd. has assailed the order of the State Commission on the ground that reliefs granted are not adequate and fair: (1) The appellant complainant had prayed for interest at the rate of 21 per cent per annum from the date of invoice on the invoiced value plus the bank charges. But, the State Commission has allowed interest only at the rate of 12 per cent per annum. We agree that the appellant complainant is entitled to interest at 21 per cent per annum from the date of invoice till the payment is made. (2) We also agree that the interest has to be allowed from 10 days alter the date of dispatch of the goods and not from the date of filing of the complaint as has been done by the State Commission. The appellant complainant has to pay interest to the Bank on the finance it has received on this consignment from the date of invoice and not from the date of filing the complaint. (3) The State Commission has allowed payment of the invoiced amount viz. Rs. 1,66,571/ whereas the appellant complainant has claimed Rs. 1,72,952/ -including the bank charges and interest. This is a legitimate claim on the part of the appellant and is allowed accordingly. It can be readily verified from the Bank as to amount that has been paid by way of bank charges and interest on the invoiced value. (4) The appellant complaint has claimed Rs. 25,000/ - as costs. This has been disallowed altogether by the State Commission. The amount claimed by the appellant complainant is exhorbitant. The appellant is allowed costs of Rs. 10,000/ - in all for prosecuting his case both before the State Commission as well as before the National Commission. (5) The appellant complainant has claimed damages of Rs. 3,33,158/ - on account of harassment and mental agony caused to him by the carriers. While there is no doubt that the appellant complainant has suffered harassment because of the deficiency in service on the part of the respondents E.T.O. s. The amount claimed as damages is exhorbitant. We allow a sum of Rs. 10,000/ - as damages to the partly. The appellant complainant has also prayed for stricture being passed against the I.B.A. who had approved of this Transporters Organisation as carriers.

THE appellant complainant cannot maintain the complaint against the I.B.A. inasmuch as there is no consideration paid by him to the I.B.A. and as such the appellant complainant is not a consumer vis -a -vis the I.B.A. The appellant complaint has also prayed that respondent No. 6, the New India Insurance Co. should be made liable for the decretal amount. He has urged that a case of non -delivery was fully covered under the concerned insurance policy. It is because of the failure of the Transport Company, the E.T.O., which did not the non -delivery certificate nor handed back original lorry receipt and as such it was not possible for him to comply with the letter of the insurance contract about furnishing to the insurer either the non -delivery certificate or the original lorry receipt.

AT the hearing the Counsel for the Respondent Insurance Company explained that the insurance policy covered risk during transit and for 7 days after arrival of the goods at destination. According to the insurers counsel there was no evidence, of the loss of goods either in transit or during the period of 7 days after the delivery at the destination. We uphold the contention of the Respondent No. 6 (Insurance Co.). The Cross Appeal No. 133 of 1991 is disposed of granting the reliefs as set out above. F.A. No. 133 of 1991 is disposed of.