JET AIR PRIVATE LTD vs MAKERS AND SELLERS UNION

-HEARD. A short point arises in this appeal whether an agent of an international air carrier, Jet Air Pvt. Ltd. could be held liable if the carrier has committed any deficiency in service in carrying the cargo and delivering it, without collecting the original documents?

THE complainant proprietorship concern exported 56 cartons consisting of 2,608 pcs. Cotton Rayon Powerloom Gents Shirts under Invoice No. 005/18/5/94 and under Airway Bill No. 072-2590-1341 and 22 cartons consisting of 1,980 pcs. Rayon Powerloom Gents Shirts under Invoice No. 006/13/6/94 and under Airway Bill No. 072-2590-1352. Air way Bills were issued on behalf of Gulf Air. According to the complainant''s case, Jet Air Pvt. Ltd. carried on the business of clearing agencies, collecting, air-freighting, and clearing cargo on behalf of exporters who are consumers of these services. Airway Bills were issued by Mercury Travels Ltd. on behalf of the Gulf Air Co. G. S. C. Behrin and on behalf of Kuwait Airways by Mercury Travels Ltd. These goods were to be transported from Bangalore to Zanzibar, Tanzania, East Africa. The value of the goods as per the Invoice was US $ 17,934. Two Air bills were issued accordingly, as aforesaid. The opposite party had delivered the goods either to the consignee or to the notified buyer without collecting the original documents. This non-collection of the original documents by the opposite parties had made the complainant to incur loss to the extent of Rs. 6,91,165 equivalent to US $ 21942. Its banker, Canara Bank had adjusted the said amount towards the over-due bills payable by the complainant/respondent by debiting the amount in the account of complainant/respondent, though the amount was not received by the complainant.

On this basis, the complainant filed a complaint against the agent Jet Air Pvt. Ltd. This Commission vide order dated 19th October, 2005 remanded the matter for consideration of the matter afresh after notice to Gulf Air.

SO far as Jet Air Pvt. Ltd. is concerned, undisputedly the goods were exported and were delivered to the consignee at Tanzania. The Gulf Air also stated that the goods, which were carried, were delivered to the consignee; therefore, there was no deficiency in service on its part. Opposite party No. 2 has also taken exception on the ground of limitation. There is no dispute that the Zet Air Pvt. Ltd. is an agent of opposite party No. 2 Gulf Air.

THE State Commission framed the following issues: (1) Whether the complaint filed by the complainant is liable to be dismissed as barred by time as against O. P. No. 2? (2) Whether the complainant had proved that it has incurred loss to the extent of Rs. 6,96,165 as claimed by it? (3) To what relief the complainant is entitled?

The State Commission decided Issue No. 1 against the Gulf Air. The Issue No. 2 had also been decided in favour of the complainant for the complainant/respondent had suffered loss to the tune of Rs. 6,91,165 and Issue No. 3 while holding that the Jet Air Pvt. Ltd. was an agent of Gulf Air. The State Commission had given the following finding of Issue No. 3: "admittedly, O. P. No. 1 is the agent of OP-2. If OP-2 has committed any wrong in delivering the goods contrary to the terms and conditions of the contract, then both the OPs are jointly and severally liable to pay the amount to the complainant. Accordingly, we hold that the complainant is entitled for the relief as claimed in the complaint. "

The above finding in the third point has been rightly assailed by the Jet Air Pvt. Ltd. on the ground that the agent could not be sued in view of the provisions of Section 230 of the Contract Act which reads as under: "230 Agent cannot personally enforce, nor be bound by contracts on behalf of principal -In the absence of any contact to that effect an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them. Presumption of contract to contrary -Such a contract shall be presumed to exist in the following cases: (1) where the contract is made by an agent for the sale or purchase of goods for a merchant resident abroad; (2) where the agent does not disclose the name of his principal; (3) where the principal, though disclosed, cannot be sued.

About the applicability of Section 230 no doubt could be raised in view of the authoritative pronouncement in the case of Marine Container Services South Pvt. Ltd. v. Go Go Garments, (1998) 3 SCC 247. Following observations are note worthy.

IT is stated in the case of Marine Container Services South v. Go Go Garments (supra) that: "4. We are not a little surprised to read that the Contract Act does not apply to complaints filed under the Consumer Protection Act. The Contract Act applies to all the litigants before the Commission under the Consumer Protection Act included. Whether in proceedings before the Commission or otherwise, an agent is entitled to invoke the provisions of Section 230 of the Contract Act and, if the facts found support him, his defence based thereon cannot be brushed away.

IT is submitted that even the Clause (3) of presumption of contract to contrary of Section 230 would not be attracted to the present case. Jet Air Pvt. Ltd. were and are only the General Sales Agents of Gulf Air and in that capacity the Jet Air Pvt. Ltd. thus were only selling, regulating and monitoring cargo bookings for Gulf Air within India and had no role to play either in regard to actual carriage of the cargo or in regard to the delivery of the same. It is not a case of undisclosed principal and as such the appellants could not be sued, either any contractually or in law. It may be mentioned that Gulf Air Co. , is running its business in India and had filed their reply through Rajeev Raveendra Nambiar, General Manager, India Gulf Air Company, Mumbai. Consequently, it could not be said to be a case where the Gulf Air Co. having its Head Office at Behrin could not be sued in India. In the light of submissions made and what has been noticed hereinabove, it is evident that the Gulf Air Co. having its Head Office at Behrin could be sued in India and they would not be beyond the jurisdiction of Consumer Fora. Consequently, under Section 230, as per allegation made by the complainant, Jet Air Pvt. Ltd. could being agent of Gulf Air could not be sued.

Since according to undisputed evidence on record the goods, which were carried on the Gulf Air Co. were delivered to the consignee so whatsoever deficiency or otherwise could be attributed, it could be attributed only to Gulf Air Co. and not to Jet Air Pvt. Ltd. Consequently, a principal could not succeed in filing a complaint against such a clearing agent if the clearing agent has performed his duty and goods were delivered to Gulf Air Co. or any other carrier.

FOR the aforesaid circumstances, it is very much evident that in view of the provisions of Section 230 of the Contract Act, the Jet Air Pvt. Ltd. could not be held liable by any stretch of imagination. The appeal is accordingly allowed qua the Jet Air Pvt. Ltd. and parties are left to bear their own cost. Appeal allowed.