INTERNATIONAL AIRPORTS AUTHORITY OF INDIA vs SOLIDAIRE INDIA LTD

INTERNATIONAL Airports Authority of India opposite party, has come up in appeal against the order of the State Commission dated 21.1.1994 directing payment of Rs. 7,33,861/ - with interest at the rate of 18% per annum on each item from the date of survey till payment. The facts giving rise to the controversy may be briefly stated as under :

THE complainant is a manufacturer of television sets and other allied electronic goods for which it imported 12 items of electronic goods from abroad and those were landed in Madras International Airport on various dates. The goods were taken in custody by the International Airports Authority of India, Madras (hereinafter referred to Authority). At the time of clearance of those consignments, after payment of custom duty, it was found that the packages were in tampered conditions. On open examination, in the presence of Custom Authorities and officials of the Authority, the complainant found that the goods were short delivered. The complainant lodged a claim with the Authority in respect of each consignment. The total value of the missing goods was reported to be worth Rs. 9,85,430/ -. The complainant approached the State Commission on the allegations that the opposite party had not performed its service of keeping the consignment safely. There was negligence and deficiency of service. In these premises, claim for the value of missing items with interest thereon, demurrage charges, in all totaling Rs. 19,86,998/ - was laid before the State Commission. The opposite party contested the complaint on the following pleas.

THE complainant imported the goods for commercial purposes and was not, therefore, a consumer within the meaning of the Consumer Protection Act. The complainant failed to implead the Airlines, the Custom Authority and Break Bulk Agent and the complaint was bad for non joinder of necessary parties. The 12 claims were independent and the complaint therefore, was bad for mis -joinder of causes of action. The matter involved disputed and complicated facts requiring recording of lot of evidence and going through numerous documents, the proper Forum was thus a Civil Court. The opposite party became the Custodian of the goods when the goods were handed over after customs formality. The Authority had taken up the consignment only on "said to contain" basis and it was not liable for the missing items. It collected only handling charges and applicable demurrage on goods not cleared within /days. It was not responsible for loss or damage because of multiple handling. All the consignments were safely kept in their respective locations under lock and key. The goods were not cleared within 45 days. Final notice was sent to the complainant in respect of the consignment. The responsibility of the opposite party did not exceed the care as expected of a man of ordinary prudence.

THE parties availed of the opportunities given to them for adducing evidence in support of their pleas. After considering the material placed on record, the State Commission came to a finding that the complainant was entitled to recover a sum of Rs. 7,33,861/ - from the opposite party with interest at 18% from the date of survey till date. Aggrieved by the order passed by the State Commission, the opposite party has approached this Commission by filing the present appeal.

WE have heard tine learned Counsel for the parties and have gone through the records of the case.

MR . Y.K. Kapur, Advocate, appearing for the appellant, contended that the goods had been imported by the complainant for commercial purposes and the complainant was not therefore, a consumer. The State Commission dealt with this contention and returned the finding that under Section 2(1)(d)(iii) of the Consumer Protection Act, a person is a consumer who hires or avails if any services rendered by the opposite party for consideration and the question whether the services availed of were for commercial purpose or not are of no consequence. The complainant had availed of the services of the opposite party for consideration, namely, payment of handling charges and demurrage for safe custody. In view of this, we are of opinion that the finding recorded by the State Commission is in accordance with law and calls for no interference. The next contention raised by Mr. Kapur was that the complaint was bad for non -joinder of Airlines and the Insurance Company who were all involved in the import of goods. We find no force in this contention as the case of the complainant was that the goods were in sound condition when they landed at Madras Airport and had taken custody of by the opposite party. The damage and the pilferage occurred only when the goods were in the custody of the opposite party. The complainant could succeed only if it had established the facts stated in the complaint. In view of this, we find no force in this contention.

IT was next contended by Mr. Kapur that the complainant ought to have filed 12 separate complaints in respect of each consignment. We also find no force in this contention because a complainant is entitled to unite in the same suit several causes of action against the same defendant.

IT was next contended by Mr. Kapur that the matter involved complicated questions of facts and law and the proper Forum was a Civil Court. The State Commission recorded the finding that there was no complicated question of facts and law involved so as to necessitate depriving of the complainant of the benefit of Consumer Protection Act. The State Commission relied upon two decisions of this Commission in the case of S.K. Abdul Sukur v. State of Orissa & Ors., wherein it was held that if jurisdiction was declined by the Special Redressal Forums set up under the Act in all such cases on the mere ground that examination and cross -examination of witnesses would be necessary, it would amount to unjust denial of the benefits of the Act to the aggrieved consumer by erroneous abdication of its jurisdiction by the Forums. We see no legal infirmity in the finding recorded by the State Commission on this point. The next contention raised on behalf of the appellant was that the State Commission had failed to appreciate that there was absolutely no material or evidence to prove in what manner the appellant could be held negligent or had failed in its duty to take reasonable care of the goods as a man of ordinary prudence. On this aspect the State Commission recorded the following finding: "Under Section 16 of the International Airport Authority the function of the opposite party -International Airports Authority is to manage the Airports efficiently. It has to provide such services and facilities as are necessary or desirable for the efficient operation of Air Transport Services. It is also empowered to establish warehouse for the storage or processing of goods, make appropriate arrangements for watch and ward at the Airports and take all such steps as may be necessary or convenient for or may be incidental to, the exercise of any power or the discharge of any function conferred or imposed on it by this Act. Section 30 of the International Airports Authority Act of 1971 lays down that the opposite party -International Authority ''shall provide for securing the safe custody and restoration of any property which, while not in proper custody, is found on any premises belonging to the Authority or under its over -all control or in any aircraft on any such premises''. It is therefore obligatory on the opposite party, the International Airport Authority to take proper care of the goods entrusted to it. This service is not rendered by the opposite party gratis, but for a consideration known as handling charges. If the consignment is not cleared for more than 7 days, the opposite party is entitled to claim and recover the demurrage. In case, the consignee fails to take delivery within 45 days from the date of landing, it is open to the opposite party to sell the same under Section 48 of the Indian Customs Act and apply the sale proceeds in accordance with the provisions of Section 150 of the said Act. The responsibility of the opposite party to take proper care of the goods entrusted to his custody continues till the goods are delivered to the consignee after customs clearance and after payment of handling and demurrage charges or till the goods are sold under Section 48 of the Customs Act. Apart from the provision of Section 30 of the International Airport Authorities Act, the liability of the opposite party -International Airport Authorities is that of a bailee covered by Sections 151 and 152 of the Indian Contract Act, which run thus : "Section 151: In all cases of bailment the bailee is bound to take as much are of the goods bailed to him as a man of ordinary prudence would, under similar circumstances, take care of his own goods of the same bulk, quality and value as the goods bailed. Section 152: The bailee, in the absence of any special contract, is not responsible for the loss, destruction or deterioration of the thing bailed, if he had taken the amount of care of it described in Section 151."

The opposite party is bound to take as much care of the goods as a man of ordinary prudence would in similar circumstances take care of its own goods. The burden of proof lies on the bailee to show that such care as a man of ordinary prudence would have exercised was duly exercised by it. (Maung PO Theik v. Maung Tha Byawe, 74 Indian Cases Page 18 Quoted in Sanjiva Row''s Indian Contract Act Page 1681 6th Edition). The law is thus stated in Indian Contract Act by Pollock & Mulla, 10th Edition page 785: "In cases governed by the provisions of Sections 151 and 152, the loss or damage of goods entrusted to a bailee is prima facie evidence of negligence, and the burden of proof, therefore, to disprove negligence lies on the bailee."

In I.L.R. 1957 Madras page 840 at 844, the High Court of Madras had held that it is for the bailee who seeks to be relieved of his responsibility for the loss, destruction or deterioration of the goods, to prove that he had taken proper care of the goods to the extent required by Section 151 of the Contract Act. It is also well -established that a bailee is responsible for the damages caused to the goods bailed by the negligence of his servants acting in the course of their employment about the use or custody of the goods. (Hasthmal v. Rafiuddin, AIR 1953 Bhopal 5 and Cooch Vihar Commercial Company v. Union of India, AIR 1960 Calcutta 455 at 45). The proof of loss by private steath committed by a third party is not sufficient to rebut the presumption of negligence of the bailee. (Narasimha Swami v. Muthnkrishna, AIR 1962 Madras 244). It may also be pointed out that under Section 106 of the Indian Evidence Act, when any fact is especially within the knowledge of any person, the burden of proving that fact is upon that person. It is therefore for the opposite party to come and to explain how the goods were dealt with while they were in its custody in its warehouse."

IN our opinion the State Commission correctly analysed the legal provisions and it calls for no interference. The burden of proof lies on the bailee to show that such care as a man of ordinary prudence could have exercised, was duly exercised by it. In view of this, we find no force in the contention raised by Mr. Kapur.

IT was next contended that the State Commission failed to take into account that if the goods were not cleared within 45 days of its arrival, the goods were liable to be disposed of, under Sections 48 and 150 of the Customs Act. Therefore, the question of paying any compensation to the defaulting party did not arise. On the other hand, Counsel for the respondent rebutted the contention of the appellant and urged that it could not be said that there was negligence on the part of the complainant in not clearing the goods within 45 days of arrival since there was no statutory requirement that the respondent was bound to clear the goods within that period. Further Section 48 only gives an option to the Custodian of the goods to sell the same in the event of goods not being cleared within the period of 45 days or such other extended period as may be permitted by the proper officer. Section 150 only lays down the procedure about sale of such goods and application of the sale proceeds. The appellant had not invoked Section 48 while in custody of the goods. The appellant had not even sought the permission of the proper officer under Section 48 of the Customs Act to sell the goods. It could not take shelter under Section 48 or 150 of the Customs Act. The appellant''s attempt to take refuge under Section 48 or 150 of the Customs Act was clearly after -thought as till the filing of the complaint, the appellant had not taken any step for invoking the said provisions of the Customs Act. The appellant was quite satisfied in collecting the rental in the form of demurrage till such time the goods were got cleared by the respondent. Further having collected the demurrages for the entire period as charges for warehousing it did not lie in the appellant''s mouth to state that it was not responsible for the safety of the goods after the expiry of 45 days of arrival. Moreover, no such plea was raised before the State Commission. We have considered the relevant contentions of the parties. We find that the stand taken by the respondent is correct and is in accordance with law. Till filing of the complaint, the appellant had not taken any step for invoking the provisions of Sections 48 and 150 of the Customs Act. Rather the appellant collected demurrage charges for the entire period for warehousing the goods. In view of this, the contention raised on behalf of the appellant is repelled.

IT was lastly urged that the State Commission failed to appreciate that no material or proof had been placed before the Commission to show that all the missing goods were entrusted to appellant when it landed at the Madras Airport. On the other hand, Counsel for the respondent urged that the State Commission had gone into the question as to whether the consignment in question had been handed over intact condition or in a damaged condition. It was only in those cases where admittedly the consignments were handed over by the Airlines to the appellant intact condition and only subsequently at the time of clearance from the custody of the appellant, the packages were found in damaged condition, that the State Commission awarded compensation for the missing items. The State Commission had assessed the compensation item wise. Out of the 12 items, the State Commission allowed damages for missing goods in respect of the package numbers 1,2,3,4,5 and 9 only and rejected the claim in respect of the other packages. The State Commission properly assessed the compensation.

WE have given our thoughtful consideration to this aspect of the case also. We have perused the order of the State Commission. The State Commission dealt with each item separately and had given reasons for allowing or rejecting the claim. The reasons are justifiable and we see no legal flaw in the reasons recorded by the State Commission. This contention of the appellant also fails. As a result, we find no merit in this appeal and it is dismissed with costs which we quantify at Rs. 5,000/ -. Appeal dismissed with costs.