Lachminarayan Tarachand vs Union of India (UOI)

Lahiri, J.—The only question which arises for consideration in this Rule is whether the Plaintiff''s claim for compensation against the Union of India represented by the Eastern Railway is barred by limitation. The Plaintiffs are the assignees of a consignment of Biri tobacco consisting of 400 bags despatched from Nepani Out Agency on the Southern Railway to Shalimar which was, at the material time, under the Eastern Railway. The consignment was booked at Nepani on April 18, 1952, and all the bags except five were delivered to the Plaintiffs on May 21, 1952, with a certificate of short delivery which contained the following entry:

Extent of Shortage-five bags of tobacco Weighing 6 maunds 10 seers.

On August 20, 1952, the Plaintiffs served a notice upon the General Manager of the Eastern Railway u/s 77 of the Indian Railways Act and, thereafter, some letters passed between the Plaintiffs and the Railway, of which two, dated December 15, 1952, ext. 6(a) and April 15, 1953, ext. 6(b) both of which were written by the Railway, are really important for the purposes of the present Rule. On February 26, 1954, the Plaintiffs filed the suit claiming Rs. 1,886-13-0 as compensation for the price of five bags together with Central Excise duty alleged to have been paid by them. The defence of the Railway was that the goods had been lost while in transit, because the consignment was tampered with by unknown miscreants while the train was in motion near Andul and that the Plaintiffs'' claim was barred by limitation.

On the question of limitation, it was agreed between the parties in the courts below that Article 31 of the Indian Limitation Act would apply to the case. The trial court decreed the suit in part holding that limitation would run under Article 31 from April 15, 19-53, when the Railway finally repudiated its liability. On an application u/s 38 of the Presidency Small Cause Court Act, however, a Full Bench of Small Cause Court has reversed that decision and dismissed the suit in its entirety on the ground that limitation under Article 31 would run from May 21, 1952, that is, the date when the major part of the consignment was delivered to the Plaintiffs with a certificate of short delivery. Against that decree, the Plaintiffs have obtained the present Rule and Mr. Bhattacharya appearing for the Plaintiffs Petitioners have raised three points before me: (A) That the letters, exts. 6(a) and 6(b) written by the Railway constitute an acknowledgment of liability so as to give a fresh start of limitation u/s 19 of "the Indian Limitation Act, (B) that limitation under Article 31 runs from April 15, 1953, when the Railway finally denied its liability and (C) that the suit is governed by Article 30 of the Indian Limitation Act and as the railway has not proved when the less or injury occurred, the suit is not barred. I shall consider these points in the order in which they have been argued.

The letters exts. 6(a) and 6(b) upon which strong reliance has been placed for bringing the case u/s 19 of the Indian Limitation Act are in the following terms:

Ext. 6(a)-With reference to your above I have to state that preliminary enquiries made by this department indicate the possibility of the loss being due to "theft in transit and the case is, therefore, under investigation by Watch and Ward Department and Govt. Railway Police.

I shall let you hear further regarding disposal of your claim immediately on receipt of their reply.

Ext. 6(b), dated April 15, 1953, is in these terms:

In reply to your above quoted letter I have to inform you that the loss in this case was due to a running train theft while the van carrying the consignment was in transit under circumstances beyond the control of the Railway Administration.

The theft was reported to the Govt. Railway Police who after investigation declared the shortage to be due to running train theft.

The Railway took necessary care and caution and has fulfilled the obligation as bailees. There is no evidence of any negligence or misconduct on the part of the Railway Administration or its servants.

Besides, the consignment was booked at owners'' risk rate of freight, the conditions of which absolve the Railway from all responsibility for any loss, damage, etc., in transit. In the circumstances, I regret, I am unable to entertain any claim for compensation in this case.

u/s 72 of the Indian Railways Act the responsibility of a Railway for the loss, destruction or deterioration of goods is that of a bailee under the Indian Contract Act. u/s 151 of the Indian Contract Act a bailee is required to take as much care of the goods bailed as a man of ordinary prudence would, under similar circumstances, take in respect of his own goods. The question now is whether the letters upon which reliance has been placed constitute an acknowledgment of liability within the meaning of Section 72 of the Indian Railways Act read with Section 151 of the Indian Contract Act. It is true, as pointed out by Chakravartti, J., as he then was, in the case of Jainarain Vs. The Governor-General of India, , that the scope of the main body of Section 19 has been enlarged by explanation (1) to that section and it is not necessary that the acknowledgment should be an acknowledgment of the particular liability sought to be enforced in the suit. But, nevertheless, it is necessary that the acknowledgment should be an acknowledgment of all the facts upon which the liability is founded. The two letters relied upon by the Petitioners, do not, in my view, satisfy this test. They undoubtedly admit the fact that the goods were delivered to the Railway for carriage and that the Railway failed to deliver the goods to the Plaintiffs. But they contain no admission of the fact that the Railway failed to take as much care of the goods as a man of ordinary prudence would take of his own goods. On the other hand, the letters suggest that the goods were lost under circumstances beyond the control of the Railway and specifically allege that the goods were lost in spite of due care and caution taken by the Railway Administration. For these reasons, it is impossible for me to hold that the letters constitute an acknowledgment of all the facts upon which the liability is founded in the present case. For that reason, I overrule the first point urged by Mr. Bhattacharya in support of the Rule.

The second question raised is what was the starting point, of limitation under Article 31. The Petitioners have relied upon the decision of Chakravartti, J., as he then was, in the case of Jainarain v. The Governor-General of India (supra), where it has been held that if no time is fixed for delivery and where after the discovery of non-delivery, correspondence ensues between the consignor and the Railway Administration in the course of which the Railway goes on promising enquiries and never denying its liability, limitation does not begin to run till the correspondence ends with a final statement by the Railway of its inability to deliver or a final repudiation of the consignor''s claim. On the other hand, it has been held by Mookerjee and Mitter, JJ. in the case of Darjeeling Himalayan Rly. Co. Ltd. and Others Vs. Jetmull Bhojraj and Another, , that in a case of short delivery of a consignment, limitation under Article 31 runs from the date when a substantial portion of the consignment was delivered. In this case, however, their Lordships did not consider the matter very fully, because the Appellant succeeded on another point before their Lordships, and they qualified their expression of opinion on the question of limitation in the following words:

In view of our decision on other points, it is not necessary to consider this defence at greater length.

In the case of Union of India v. Meghraj Agarwalla AIR [1958] C.I. 434, Das Gupta and U.C. Law, JJ. held that in most cases it would be proper to hold in the absence of peculiar circumstances that the date when the major portion of the consignment was delivered would be the date when the rest of the consignment ought also to have been delivered. Upon the authorities it is clear that nondelivery may take place in three classes of cases, (a) non-delivery of an entire consignment, (b) non-delivery of a part of the consignment where the entire consignment was carried by the Railway at one time and (c) non-delivery of a part of the consignment where the entire consignment was carried at different times by the Railway. In all the three classes of cases, if no time is fixed for delivery and correspondence ensues between the Plaintiff and the Railway which promises to hold enquiries as to the factum of the loss, time does not begin to run till the correspondence ends. This was laid down by Chakravartti, J., as he then was, with regard to the first class in the case of Jainarnin v. The Governor-General of India (supra) and with regard to the third class by Gentle, J. in the case of Raigarh Jute Mills Ltd. Vs. Commissioners for the Port of Calcutta, . With regard to the second class of cases also the same principle would apply, if any communication of the Railway induces a belief in the mind of the Plaintiff that the Railway itself is in doubt as to whether there has been a loss. But where, as in the present case, the entire consignment is carried at one time and the major part of the consignment is delivered on a particular date with a certificate-of short delivery, there is hardly any room for doubt that the part which was not delivered ought to have been delivered on the date on which the certificate of short delivery was granted and time begins to run under Article 31 from that date unless by any subsequent. letter the Railway causes the Plaintiff to believe that it was holding an enquiry as to the factum of the loss. The special circumstances referred to by Das Gupta and U.C. Law, JJ., in the case of Union of India v. Meghraj Agarwalla (supra) are circumstances which induce a belief in the Plaintiff''s mind that an investigation was being carried on by the Railway Administration on the question whether the goods had been lost. The correspondence exhibited in the present case did not turn on the question whether the goods had been lost, but on the question as to the manner in which the loss had taken place, that is whether the loss was due to negligence or misconduct of the Railway or due to circumstances over which the railway had no control. That is how I read the letters, exts. 6(a) and 6(b) which constitute the sheet anchor of the Plaintiffs'' claims. That the goods were lost was stated by the Railway in the certificate of short delivery and that statement was not modified or withdrawn by any subsequent communication. The Railway in this case did not tell the Plaintiffs at any point of time that it Was holding an enquiry on the question whether the goods had been lost. Accordingly, the Plaintiffs were left in no doubt that the goods ought to have been delivered on the date on which the remaining portion of the consignment had been delivered. For these reasons, I have reached the conclusion that in this case limitation under Article 31 of the Indian Limitation Act ran against the Plaintiffs from the date on which the certificate of short delivery was granted and as the suit was instituted more than one year from that date, it was barred under Article 31. The second point raised by Mr. Bhattacharya, therefore, also fails.

The third point raised by the Petitioners can be disposed of easily. The question is whether the suit is to be governed by Article 30 of the Indian Limitation Act and whether it is barred even under that Article. The suit, as framed, is a suit for compensation for non-delivery of a part of a consignment and not one for compensation for losing or injuring the goods and, therefore, it is to be governed by Article 31 and not Article 30. That is probably the reason why it was admitted in both the courts below that Article 31 applies to this case. But I allowed Mr. Bhattacharya to argue this point because it was a pure question of law. Assuming that Article 30 applies, it appears from the evidence of Babulal Agarwalla who is witness No. 1 for the Plaintiffs and is a manager for the Plaintiff firm that the Plaintiffs were informed that loss took place on the section of the Eastern Railway alone, and therefore, the Plaintiff firm served a notice on the General Manager of the said Railway u/s 77 of the Indian Railways Act. From this evidence it is clear that the Plaintiffs were aware of the loss before they served a notice u/s 77 of the Indian Railways Act on August 20, 1952. If the Plaintiffs knew about the loss before August 20, 1952, it was not necessary for the Railway to prove when the loss occurred and as the suit has been instituted more than one year after August 20, 1952, it is barred even if Article 30 of the Indian Limitation Act applies.

Mr. Bhattacharya wanted to raise a new point in reply and that is to the effect that the Railway is guilty of concealed fraud and as such the Plaintiffs are entitled to the benefit of Section 18 of the Indian Limitation Act. I have not allowed him to raise this point for the first time in reply in view of the fact that this point was not raised in the courts below nor even in his opening address by Mr. Bhattacharya. On the merits of this argument it is impossible to see how there can be any question of any concealed fraud. The letter ext. 6(a) upon which reliance has been placed for substantiating this point does not leave the Plaintiffs in any doubt as to whether the goods had been lost. It only states that the Railway was making enquiries as to how the loss had taken place. There is, therefore, no reason to hold that the Plaintiffs were kept from the knowledge of their rights within the meaning of Section 18 of the Indian Limitation Act.

As all points raised by the Petitioners in this case fail, this Rule must be discharged with costs-hearing fee being assessed at two gold mohurs.