SOLIDAIRE INDIA LTD vs International Airports Authority of India

THIS is a complaint under Section 17 read with Section 12 of the Consumer Protection Act.

THE Complainant is a leading manufacturer of television sets and other electronic goods for which it used to import components from abroad by air. From the moment of landing from the aircraft the Opposite Party takes possession Of the consignment and becomes the custodian of the goods till they are handed over to the consignees. Section 30 of the International Airports Authority Act, 1971 imposes on the Opposite Party, the obligation of securing safe custody of goods. THE Opposite Party on receipt of goods from the Airlines keeps them in its warehouses till the consignee takes delivery after the payment of customs duty and rental to the Opposite: Party. THE Complainant imported 12 items of electronic goods from abroad and they were landed in Madras International Airport on various dates. THEy were taken custody of by the Opposite Party. While clearing these consignments after payment of customs duty, it was found that the packages were in tampered condition and on open examination in the presence of Customs Authorities and officials of the Opposite Party the Complainant found the goods were short delivered. It lodged claim with the Opposite Party in respect of each consignment According to the Complainant, the total value of the missing goods is worth about Rs.9,85,430/-. THE Opposite Party has not performed its service of keeping the consignments safely. THEre was deficiency of service and negligence and the Complainant has come forward with this claim for the value of the missing items with interest thereon, demurrage charges in all totaling Rs. 19,86,998/-. The Opposite Party has filed its version and also an additional reply. The contentions raised by the Opposite Party are as follows: The Complainant has imported these goods for commercial purpose and it is not therefore a consumer within the meaning of the Consumer Protection Act. The Complainant has failed to implead the Airlines, the Customs Authority and Break Bulk Agent and, hence the complaint is bad for non-joinder. It is further alleged that the 12 claims are independent and the complaint is therefore bad for misjoinder of causes of action. The complaint in respect of claim No. 11 is also barred by time. It is further contended that the matter involves disputed and complicated facts requiring recording a lot of evidence and going through numerous documents, and hence the proper Forum is the Civil Court. It is incorrect to state that the Opposite Party becomes the custodian of the goods the moment the goods are unloaded from the aircraft. The Opposite Party becomes the custodian when the goods are handed over after the complete customs formality. The Opposite Party had taken upon consignment only on "said to contain" basis and it is not liable for the missing items. The Opposite Party collects only handling charges and applicable demurrage on goods not cleared within the period of 7 days. If the goods are not cleared within 45 days, ''the Opposite Party issues a final notice to the importer and disposes all the goods in accordance with Section 48 of the Customs Act of 1962. It is further contended that the Opposite Party is not responsible for loss or damage due to multiple handling. According to the Opposite Party all the consignments were safely kept in their respective locations under lock and key. As the goods were not cleared within 45 days a final notice was sent to the Complainant in respect of the consignments. The responsibility of the Opposite Party docs not exceed the care as expected of a man of ordinary prudence. It is alleged that in respect of Claim Nos. 4,5,6,7 and 8 the Customs Authorities have already initiated disposal action. In respect of Claims Nos. 10, 11 & 12 the goods were received by the Opposite Party in damaged condition from the Airlines, as evidenced by the import manifests. The Complainant is not therefore entitled to the value of the missing items with interest thereon, nor is the Complainant entitled to refund of the demurrage charges. The complaint must fail.

Exhs. A 1 to A60 and B1 to B11 are marked by consent. Proof affidavit has been filed by the Director of the Complainant Company Mr. A.S. Ravi Prakash and by the Assistant Law Manager of the Opposite Party Mr. Sekar Babu. No oral evidence has been let in.

THE points that arise for determination are: (1) Whether the complaint is maintainable? (2) Whether there has been any deficiency of service or negligence on the part of the Opposite Party? (3) To what relief, if any, is the Complainant entitled?

Point No. 1: The Complainant is a company incorporated under the Indian Companies Act and has imported 12 consignments of Electronic goods by Air from abroad. The Opposite Party is the International Airports Authority of India, a Statutory Corporation created by the International Airports Authority Act, 1971. Under Section 16 of the said Act it shall be the duty of the Opposite Party to provide at Airports such services and facilities as are necessary or desirable for the efficient operation of Air Transport Services. Specific provision has also been made enabling the Opposite Party to establish warehouses at the Airport for the storage or processing of goods. Goods landed at the Airport are entrusted to the custody of the Opposite Party which stores them in its warehouse till they are delivered to the consignee after custom clearance and payment of the warehouse charges known as the handling charges and in case of delay in delivery demurrage also. According to the Complainant all the 12 consignments imported by it were taken custody of by the Opposite Party, but at the time of the delivery, it was found that the packages were opened and several items were missing. The Complainant has therefore filed this complaint claiming the value of the missing items with interest and for recovery of the demurrage charges.

THE first contention of the Opposite Party is that these goods have been imported by Complainant for commercial purpose and the Complainant is not therefore a consumer. This contention has to be mentioned only to be rejected. Under Section 2(1)(d)(i) of the Consumer Protection Act a person who buys goods for consideration is not a consumer if the goods are purchased for resale or for any commercial purpose. But under Section 2 (1)(d)(ii) of the Act a person is a consumer who hires or avails of any services rendered by the Opposite Party for consideration and the question whether the services availed of are for commercial purpose or not of no consequence. THE Complainant claims to be a consumer under Section 2(l)(d)(ii) of the Act as one availing of the services of the Opposite Party and hence the question of commercial purpose does not arise for consideration. THE Complainant is therefore a consumer who has availed of the services of the Opposite Party for consideration namely payment of handling charges and demurrage for safe custody. It is then urged that the complaint is bad for non-joinder of the concerned airlines, the consolidator, the Insurance Company and the Break bulk agent who are all involved in the import of the goods. It is the definite case of the Complainant that the goods were in sound condition when they were landed at the Madras Airport and taken custody of by the Opposite Party and that the damage and pilferage have occurred only when the goods were in the custody of the Opposite Party. The Complainant can succeed only if it establishes the above facts. In view of this contention of the Complainant, there is no necessity to implead the Airlines or the Consolidator or the Break bulk agent. The Complainant cannot therefore be said to be bad for misjoinder. The next contention of the Opposite Party is that the complaint is bad for misjoinder of causes of action. In that these 12 consignments in respect of which this complaint has been filed are independent transactions and they ought not to have been clubbed together in one complaint. According to the Opposite Parry, the Complainant ought to file 12 separate complaints, one in respect of each consignment. This contention cannot also be accepted. Even under the Code of Civil Procedure (Order 2 Rule III) a plaintiff may unite in the same suit several causes of action against the same defendant. The Consumer Protection Act has provided for a simple procedure and has done away with such legal technicalities. We hold therefore that the Complaint is not bad for misjoinder of cause of action.

IT is contended by the Opposite Party that the matter involves complicated questions of fact and law that lot of evidence has to be gone through and hence the proper Forum is the Civil Court. The Complainant has filed Exh. Al to A60 which are all invoices, bills of entries, survey reports etc. The Opposite Party has filed Exhs. Bl to Bl 1 which are some manifests, Airway bills, etc. Neither party has offered to let in any oral evidence and they have been contended with filing affidavits. In our view there is no complicated question of law or fact involved in the matter so as to necessitable the depriving of the Complainant of the benefit of this Act. Further in S.K. Abdul Sukur v. State of Orissa & Others, II (1991) CPJ 202 (NC) the National Commission has held that if jurisdiction is 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 application of its jurisdiction by the Forums. This view has been reitreated by the National Commission in the subsequent decision in Prem Singh & Others v. United India Insurance Co. Ltd., I (1992) CPJ 138 (NC). We are therefore unable to accept the contention of the Opposite Party that this matter has to be adjudicated only in a Court of competent civil jurisdiction. We hold that the com: plaint is maintainable and answer point No. 1 against the Opposite Party.

POINTS Nos. 2 & 3: The Complainant has imported by Air 12 consignments of electronic goods from abroad and they have entrusted to the custody of the Opposite Party and kept in its warehouse. According to the Complainant, when we went to take delivery, he found the packages tampered with and several items pilfered. We shall deal with each items separately. Before we do so, it is necessary to deal with the liability of the Opposite Party for the goods which it takes custody of and keeps in its warehouse. 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 same 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 recovery 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 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 care 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 & 152, the loss or damage of goods entrusted to a bailee is prima facie evidence of negligence, and the burden of proof, therefore, to disporsvenegligence lies on the bailee."

In I.L.R. 1957 Madras Page 840 at 844, the High Court of Madras has 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). The proof of loss by private steath committed by a third party is not sufficient to rebut the presumption of negligence of the bailee. (Narsimha Swami v. Muthukrishna, 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 explain how the goods were dealt with while they were in its custody in its warehouse.

It is the definite case of the Opposite Party as set out in its additional reply (para 8) that in respect of claim numbers 10,11 & 12 the goods were received in a damaged condition from the Airlines as evidenced by the imported cargo manifests and those imported cargo manifest are Exhs. B4, B5 and B7. It follows that the other consignments relating to item Nos. 1 to 9 have been received in a sound condition with ''O.K.'' status. Item No. 1: Exh. Al is the invoice and Exh. A2 is the bill of entry in respect of this item. On the reverse of Exh. A2 bill of entry there is an endorsement made and signed by the surveyor and the proper officer of the Customs. It reads as follows: "The packages produced in damaged condition i.e. Side & Top Flops, torned. There is room for missing contents."

The inference is irresistable that the package has been torn only while it was in the custody of the Opposite Party. Exh. A3 is the survey report. Exh. A4 is the handling and demurrage charge receipt and Exh. A5 is the claim preferred by the Complainant. The surveyor has found 4 items missing and the value of the missing items has been assessed at Rs. 89,155.00. The Opposite Party is bound to make good the loss. Item No. 2: Exh. A6 is the bill of entry and on the reverse of Exh. A6 there an endorsement made by the surveyor and the proper officer of the Customs Department. It reads thus: "The package is produced in damaged condition i.e. cover of...torn. There is room for missing contents."

This is also one of the items which have been received in a sound condition from the Airlines and the package has been tampered with only while in the custody of the Opposite Party. Exh. A7 is the survey report. Exh. A8 is the receipt for handling and demurrage charges. Exh. A9 is the claim form. As per Exh. 47 survey report the value of the missing items is worth about Rs. 1,06,570-00 and this value is not disputed. The Complainant is entitled to claim this amount from the Opposite Party. Item No. 3: Exh. All is the bill of entry. On the reverse we find the following endorsement signed by the surveyor and the proper officer of the customs. "The package is produced in damaged : condition i.e. side flap torn. There is room for missing contents."

This, is also a consignment which has been received in good condition from the Airlines and this tampering and pilfering must have occurred only while in the custody of the Opposite Party. Exh. A12 is the survey report. Exh. A13 is the receipt for payment of handling and demurrage. Exh. A 14 is the claim form. According to Exh. A12 survey report, the value of the missing item is worth about Rs. 1,92,097/- which is not disputed. The Opposite Party has to pay this amount to the Complainant. Item No. 4 : Exh. A 16 is the bill of entry. On the reverse we find the following endorsement signed by the surveyor and the proper officer. "The packages are produced in damaged condition i.e. Flaps torn. There is room for shortage."

This is also a consignment which has been received in good condition and the pilferage must have taken place only while in the custody of the Opposite Party. Exh. A17 is the survey report. Exh. A 18 is the receipt for payment of handling charges and demurrage. Exh. A 19 is the claim form. According to the Surveyor under Exh. A17 the value of the missing items is Rs. 95,876/- which is not challenged. The Complainant is entitled to claim this amount from the Opposite Party. Item No. 5: Exh. A 21 is the survey report. On the reverse there is an endorsement that the package is produced in sound condition and there is no room for shortage. The Opposite Party is not therefore liable for any shortage as the consignment has been produced before the surveyor and the Customs Authority at the time of delivery in the same condition in which it has been received from the Airlines. Exh. A 22 is the survey report which shows shortage. But the shortage cannot be due to any negligence on the part of the Opposite Party. It must be a case of short shipment. The Opposite Party is not liable. Item No. 6 : Exh. A 27 is the bill of entry. On the reverse the endorsement is "The package is produced in sound condition. There is no room for shortage."

Here again the Opposite Party is not liable for any shortage. Exh. A28 survey report shows shortage which must be due to short shipment. The Opposite Party is not liable. Item No. 7: Exh. A32 is the bill of entry. The endorsement on the reverse is totally illegible. We are therefore unable to hold that there was any damage in the consignment, as the burden is on the Complainant to establish the same. The Opposite Party is not therefore liable for any shortage. Item No. 8: Exh. A 39 is the bill of entry. On the reverse we find the following endorsement signed by the surveyor and proper officer of the customs. "The package is produced in damaged condition. There is room for missing contents."

This item has also been received from the Airlines in sound condition and the damage and pilferage must have occurred only while in the custody of the Opposite Party and it is liable for the loss. Exh. A 40 is the survey report. Exh. A 41 is the receipt for payment of handling and demurrage charges. Exh. A 42 is the claim form. Under Exh. A 40 the surveyor has assessed the loss of missing items at Rs. 2,32,133/- which is not, disputed. The Complainant is entitled to claim this amount from the Opposite Party. Item No. 9: Exh. A43 is the bill of entry. On the reverse we find the endorsement that out of the 3 packages package No. 470392 was not produced by IAAI and this endorsement has been signed by the surveyor and the customs officials. This consignment which consisted of 3 packages bearing No. 470390,470391 and 470392 has been received in a sound condition. But one package is found missing. Exh. A 47 is the claim form in which the value of missing package is claimed at Rs. 18,030/- there is no evidence contra and we accept the same. The Complainant is entitled to claim this amount from the Opposite Party. Item Nos. 10, 11 & 12 : It is the case of the Opposite Party that these 3 consignments were received from the Airlines in a damaged condition and it is not therefore liable for the loss or the components "said to contain" therein. We are afraid this contention has to be accepted. Item No. 10: Exh. A49 is the bill of entry. The writings on the reverse are not legible and we cannot therefore find what was the condition. Exh. A50 is the survey report. Exh.B7 is the manifest of the airlines. This item No. is 61892311796 said to have been unloaded through consolidator. Exh. B 8 is the house airway bill. This item is mentioned therein as ''DI'' which is said to refer to damaged condition at the time of receipt of the consignment from the airlines. We therefore, agree with the Opposite Party that this item has been received from the Airlines in a damaged condition and the Opposite Party is not liable for any loss. Item No. 11: Exh. A53 is the bill of entry and the writings on the reverse are not legible. Exh. A54 is the survey report. Exh. 84 is the cargo manifest. This item No. is 618238447816 and has been received through the consolidator. Exh. B5 is the house airways bill of the consolidator wherein this item is mentioned as ''DR1'' referring to damaged condition at the time of receipt from the Airlines. We hold that this item was also received in a damaged condition from the Airlines and the Opposite Party is not liable for any loss. Item No. 22: The Complainant has not filed any bill of entry for this item. Exh. B1O is the cargo manifest of the Airlines. This item No. is 61822881633 and it has been received through the Consolidator. Exh. B11 is the Concord Express Consolidator''s house airway bill. This item is marked as ''D2'' which said to have referred to the damaged condition at the time of the receipt of the consignment from the Airlines. We hold that this item is also received in a damaged condition and the Opposite Party is not liable for the missing of the contents.

ON a consideration of all the above facts, the Complainant is entitled to claim damages for missing items in respect of item Nos. 1, 2,3,4,8 & 9 totalling Rs. 7,33,861-00. The Complainant is entitled to recover this amount from the Opposite Party with interest at 18% p.a. from the date of the survey report till payment. The Complainant has also claimed refund of the demurrage charged. It is not entitled to this claim as the consignments have been lying with them till the date of clearance and the demurrage charges has been rightly collected from the Complainant. In fact, the learned Counsel for the Complainant did not argue for this claim.

IN the result, we order as follows: (1) The Opposite Party shall pay to the Complainant the sum of Rs. 7,33,861/- with interest at 18% p.a. on each item from the date of survey till payment. (2) The Opposite Party shall also pay costs of Rs. 2,000/- to the Complainant.

Complaint allowed with costs.