Modi Alkalies and Chemicals vs ''K.'' Line and Another

Usha Mehra, J.

(1) By this composite application under Order 38 Rule 5and Order 39 Rules 1 & 2 C.P.C., the plaintiff seeks attachment before the judgment of the containers of the defendants or to furnish security and further the defendants be restrained from alienating the goods stored in or lying in the containers or removing the containers from outside the jurisdiction of this Court.

(2) This application has been contested by the defendants. Mr.R.K.Saini,appearing for the defendants contended that in order to attract the provisions of Rule 5 of Order 38, the plaintiff was to plead and prima facie establish the ingredients of Rule 5 namely that the defendant with intent to obstruct or delay the execution of any decree that may be passed against him (i) is about to dispose of the whole or any part of his property; or (ii) is about to remove the whole or any part of his property from the local limits of the jurisdiction of the Court. In this case, from the perusal of the application it cannot be inferred that the defendants are going to dispose of any part of his property or is going to remove the same outside the jurisdiction of this Court. The only apprehension expressed,-in this applications ,that the defendant No. 1 being a Japanese concern has no assets available within the jurisdiction of this Court and, Therefore, necessary order attaching the containers of defendant No. 1 be passed. The averments are vague. This is not what is stipulated under Rule 5 of Order 38. Therefore, relying on the decisions Bank of India Vs. National Tile Work Industries and Others, , Mr.Saini contended that no ground is made out for attachment of defendants'' goods before judgment.

(3) As regards, the question whether ad interim injunction can be granted, Mr.Saini contended that even for an order under Order 39 Rules 1 & 2, the plaintiff was for attachment to show that the property in dispute is in danger of being wasted, damaged or alienated by any party to the suit, or that the defendant threatens, or intends to remove or dispose of his property with a view to defraud his creditors, or threatens to dispossess the plaintiff. The averments of the plaint do not fall under the provision of Rule I of Order 39, nor Rule 2 can be attracted in the facts of this case. There is in fact no repetition or continuance of breach committed by the defendant. Therefore Rule 2 is also not attracted.

(4) In order to appreciate the objection raised by the defendant, the facts of the case have to be appreciated. The brief facts of the case are that the plaintiff entered in to a contract for the supply of caustic soda flakes to be delivered to the end buyer in China. The said goods were consigned through the Agency of the defendants. Goods were handed to the defendants at Icd New Delhi and thereafter loaded on vessel at Bombay for eventual discharge at Xingang, China. The defendant No.1delivered the goods to the end buyer in violation and contrary to the established internationally accepted practice. It is well settled international practice that delivery of the goods should have been given only upon presentation of the original bill of lading or the valid bank guarantee. The delivery of the goods by the defendants without obtaining the bill of lading or the valid bank guarantee has constituted a breach of terms and conditions of the contract of carriage. The defendant being a foreign company having no assets in India, if the interest of the plaintiff is not safeguarded by passing appropriate interlocutory order, the plaintiff would suffer irreparable loss.

(5) To decide this application, we have to keep in mind three things as to whether plaintiff has made out a prima fade case, balance of convenience is in his favor and if no injunction granted whether he will suffer irreparable loss. Admittedly, the goods had been delivered by defendant No.1 to the end buyer without obtaining the bill of lading. The House of Lords on appeal from the Court of Appeal of the colony of Singapore in the case of Sze Hai Tong Bank Ltd. v. Rambler Cycle Co .Ltd., 1959 J.C.I 576 while dealing with the interpretation of the contract, the Exception Clause in the Conversion Clause and the responsibility of the Carrier when the goods were released without production of bill of lading held that a shipowner who delivers without production of the bill of lading does so at his peril. In delivering the goods, without production of the bill of lading, to a person who, to its knowledge, was other than one entitled under the bill of lading to receive them, the carrier was liable for breach of contract and for conversion, and was not protected by the exception clause 2(c). Therefore, in view of the circumstances explained prima fade, it can be said that the plaintiff has made out a case of breach on the part of the defendants for having delivered the goods without obtaining the bill of lading.

(6) Turning to the second point regarding balance of convenience, one can say that if directions are not passed to safeguard or protect the interest of the plaintiff, and if defendant No.1 is allowed to take away its entire goods i.e. the containers from out of the jurisdiction of this Court, plaintiff would suffer irreparable loss, because defendant is a foreign national having no other assets available. Therefore, in these circumstances, balance of convenience is also in plaintiff''s favor. It is not proper for Mr.Saini to contend that no interlocutory order can be passed irrespective of the fact that prima fade case is made out by the plaintiff and also when the balance of convenience is also in his favor. The principles of law for the grant of interlocutory order have been enunciated by the Supreme Court when it is stated that if the prima facie case in favor of the plaintiff is made out and so is the balance of convenience then in such an eventuality in order to safeguard the interest of the plaintiff and to save him from the losses he may suffer if ultimately decree is passed and the defendants by then have already left the country, he will be deprived of the fruits of his decree. In this view of the matter I think it would meet the end of justice if directions are given to defendant No.1 to at least always keep with him so much of the containers in India which are worth Rs. 16,00,000.00 (Rupees Sixteen Lakhs only).