Haldar Joo Vishnath vs State of Jammu and Kashmir and Others

J.N. Wazir, C.J.—This is a first appeal by the Plaintiffs from a decree passed by the Subordinate Judge, Srinagar, against Defendant No. 2

and dismissing the Plaintiffs suit against Defendant Nos. 1 and 3. In this appeal the Plaintiffs have sought a decree against Defendants Nos. 1 and 3

as well.

The Plaintiffs case was that in Section 2006 they purchased 25 bags of fine Assam tea from Messrs. Nihal Chand Daulat Ram and Co. at

Amritsar. According to the Plaintiffs Messrs. Nihal Chand Daulat Ram handed over 25 bags of tea to the Trade Agent, Jammu and Kashmir

Government, at Amritsar for transmission to Srinagar. S. Amar Singh, the Trade Agent, issued receipt No. 4525 dated 8-1-1949 and entrusted

tea bags to the Universal Transport Co. Ltd., Defendant No. 2, for carriage to Srinagar. The Plaintiffs further alleged that they paid freight charges,

godown rent, coolie charges, commission and customs duty to the Trade Agent at Amritsar.

It is also alleged that after considerable delay and exchange of correspondence between the Plaintiffs and Defendant No. 3 only 16 bags of tea

were delivered to the Plaintiffs' forwarding agents Messrs. Desraj Brothers on 10-5-1949. In regard to the remaining nine bags the Plaintiffs wrote

to the Trade Agent who by his letter dated 13-7-1949 advised them to take delivery of these bags from his Srinagar Office. The Plaintiff's

forwarding agents went to take delivery but were offered inferior type of tea which they refused to accept. On 21st Bhadon 2006 the Plaintiffs

served a notice u/s 80 of the CPC on Defendant No. 1, Jammu and Kashmir Government to deliver the nine bags of tea or to pay compensation

for the same,

The Defendant failed to comply with the terms of the notice and hence this suit for the recovery of Rs. 3,000/- consisting of Rs. 2031/5/- as the

price of 900 lbs of tea, freight charged by the Trade Agent Rs. 59/ -, sur-charge Rs. 6/14/ -, go-down rent Rs. 2/4, commission paid to the Trade

Agent Rs. 21/8/ -, customs duty paid in advance Rs. 169/ -, brokerage paid to Messrs. Nihal Chand Daulat Ram Rs. 32/- and Rs. 450/- being the

profit that would have accrued to the Plaintiffs if the goods had been received by them. Adding interest at the rate of six per cent per annum

amounting to Rs. 290/ - the Plaintiffs claimed Rs. 3,000/- giving up the claim for an amount of Rs. 63/1/6.

Defendant No. 1 resisted the suit on the, ground that they had not authorised their Trade Agent at Amritsar to take delivery of the goods from

the Plaintiffs and to transmit the same to Srinagar and, therefore, they were not liable to pay any compensation for the loss suffered by the Plaintiffs.

Defendant No. 2 did not appear and expert proceedings were taken against them. An application was made by the Plaintiffs on 28th Phagan 2008

for adding S. Amar Singh as one of the Defendants in the suit. An issue was drawn up whether S. Amar Singh, Trade Agent was a necessary

party. That issue was decided in favour of the Plaintiffs on 12th Phagan 2009 and S. Amar Singh was impleaded as one of the Defendants. In his

written statement S. Amar Singh, Defendant No. 3, pleaded that he did not take delivery of the goods, that he was not the carrier of the goods of

the Plaintiffs and that he was not responsible for any loss, or damage for which compensation was claimed by the Plaintiffs and that the suit was

barred by time.

The trial Court on the pleadings of the parties struck the following issues

(1) Whether Defendants Nos. 1 and 2 received 25 bags of tea from Plaintiffs, through Defendant No. 3 for transport to Srinagar and whether only

16 bags were returned to the Plaintiff through Defendant No. 2. O.P.P.

(2) If issue No. 1 is proved in affirmative what has been the quantum of the damages that has occurred to the Plaintiff and to what extent

Defendant are individually responsible for that

(3) Whether the Plaintiff's suit was barred by time.

(4) Relief.

On consideration of the evidence adduced by the parties the trial Court came to the conclusion that Defendants Nos. 1 and 3 were not

responsible for short delivery of 9 bags of tea and, therefore not liable to pay any compensation to the Plaintiffs. Defendant No. 2 was held to be

solely responsible for short delivery of tea bags and was liable to pay compensation to the extent of Rs. 3,000/- to the Plaintiffs. The point of

limitation was decided in favour of the Plaintiffs and the Plaintiff's suit was decreed against Defendant No. 2 alone to the extent of Rs. 3,000/ -.

The Plaintiff has now come up in appeal praying that a decree may be passed against the other two Defendants.

In order to show that Defendant No. 1 was responsible for the loss caused to the Plaintiffs, the Plaintiffs had to prove that Defendant No. 1 had

authorised Defendant No. 3 to take delivery of the goods on behalf of the Plaintiffs and to send the same to the Plaintiffs at Srinagar. The Plaintiffs

have examined Daulat Ram, Lassa Joo of Ali Kadal and L. Girdhari Lal of Messrs. Desrai Brothers, Commission and Forwarding Agents.

According to Daulat Ram, a partner of Messrs. Nihal Chand Daulat Ram the goods were delivered to S. Amar Singh, Defendant No. 3 on the

responsibility of Kashmir Government for their transport to Srinagar and delivery to the consignee.

But in his cross-examination he has admitted that he had no personal knowledge whether the Government had authorised the Trade Agent to

receive or transport the goods for the benefit of the consignee. To the same effect is the statement of L. Girdhari Lal and Lassa Joo of Ali Kadal.

They have definitely stated that they did not know whether S. Amar Singh used to arrange for transport on his own behalf or on the authority of the

Government of Jammu and Kashmir.

In view of the fact that the Plaintiffs have not been able to show that Defendant No. 3 was authorised by Defendant No. 1 to take delivery of the

goods and transport the same to Srinagar for the benefit of the Plaintiffs, Defendant No. 1 can in no case be held liable for any loss or damage

caused to the goods of the Plaintiffs. In order to fix liability on Defendant No. 1 it was necessary for the Plaintiffs to prove that Defendant No. 3

had instructions and was acting within the scope of his authority in receiving goods on behalf of the Plaintiffs and sending the same to them at

Srinagar. In the absence of any proof that Defendant No. 1 had authorised Defendant No. 3 to accept the goods and transport then to Srinagar

Defendant No. l has been rightly absolve from liability to pay any compensation to the Plaintiffs.

It has been argued that there is ample evidence to show that S. Amar Singh took delivery of the goods on behalf of the Plaintiffs and sent them to

Srinagar through the Universal Transport Co. Ltd.

It is, therefore, submitted that in case Defendant No. 1 was not held liable for the loss of goods, Defendant No. 3 could not escape liability for the

same and a decree for the amount claimed ought to have been made against him as as well. Our attention has been drawn to the receipt, Ex.

CPWD/1 dated 8-1-1949, which bears the seal of the Trade Agent and is signed by S. Amar Singh This receipt is on the printed form of

Universal Transport Company Ltd. and S. Amar Singh has admitted his signatures thereon.

There is evidence of Daulat Ram of Messrs Nihal Chand Daulat Ram to the effect that 25 bags of tea were delivered to S. Amar Singh, Trade

Agent at Amritsar for being sent to the Plaintiffs at Srinagar. L. Girdhari Lal of Messrs Desraj Brothers Commission and Forwarding Agents stated

that in the year 1948-49, 25 bags of tea were handed over by him to S. Amar Singh at Amritsar who after realising all the charges in advance

forwarded the goods to Kashmir. In August 1947 the witness received delivery of 16 bags of tea from Universal Transport Co. Ltd. and there was

a shortage of 9 bags which remained undelivered to the Plaintiffs. Our attention has further been drawn to the letters written by the Plaintiffs to

Defendant No. 3 and the replies sent by Defendant No. 3 to those letters. In one of the letters dated 12-5-1949 Defendant No. 3 has stated as

under:

...the goods from Jammu are being cleared with great speed and you should expect your goods shortly.

In another letter dated 18-7-1949 Defendant No. 3 stated:

Please send your goods receipts together with a non-delivery receipt from the office of the, Universal Transport Co. Srinagar to enable this office

to claim the amount of loss from the said Transport Company.

On the basis of these letters and the oral evidence adduced by the Plaintiffs it is argued that Defendant No. 3 took delivery of the goods at

Amritsar on behalf of the Plaintiffs from Messrs Nihal Chand Daulat Ram and arranged with the Transport Company on his own responsibility for

the carriage of these goods to Srinagar. From the letters it is clear that Defendant No. 3 took, upon himself to deliver the goods or to recover

compensation from the Universal Transport Co. through whom the goods were sent. Defendant No. 3 has appeared as his own witness and he has

explained the situation under which he had affixed his seal and put down his signatures on the receipt form of the Transport Company.

According to Defendant No. 3 in the year 1948-49, soon after the raids, considerable difficulty was experienced by the traders to import their

goods from Amritsar to Srinagar and the Government of Jammu and Kashmir had asked the Trade Agent at Amritsar to offer assistance to the

traders in making arrangements for the transport of their goods from Amritsar to Srinagar on reasonable rates. He was offering transport facilities

to the traders and looking after their interests. He was, therefore given authority to issue permits to transport companies who were plying between

Amritsar and

The main object of his endorsing the receipt was to preclude transporters from giving undue preference to any trader by lifting his goods out of turn

and charging him more than the usual freight. The witness has completely denied having taken delivery of the goods on behalf of the Plaintiffs. It is

true that there is evidence to show that the goods were handed over to S. Amar Singh and godown rent was charged by him and there is no

independent evidence except the statement of Defendant No. 3 to rebut that evidence. But we find that the explanation offered by Defendant No.

3 for having appended his signatures on the receipt form of the Transport Company is very plausible.

It is supported by the evidence of Lassa Joo, Plaintiffs' witness. According to Lassa Job there was shortage of transport facilities in those days and

transporters used to charge exorbitant rates for import of goods from Amritsar to Srinagar and, therefore, the Trade Agent was making

arrangements for the transport of the goods of traders from Amritsar to Srinagar. That being so, it cannot be said that S. Amar Singh acted as a

bailee and there was a relationship of bailor and bailee between the Plaintiffs and Defendant No. 3. It is well settled that obligation of a bailee is

contractual obligation and springs from a contract of bailment. The law usually implies upon a bailment a contract to re-deliver when there is not an

express promise to do so. In the present case we do not find that there was a contractual relationship of a bailor and bailee between the Plaintiffs

and Defendant No. 3.

Even assuming that Defendant No. 3 by taking delivery of the goods and by signing the receipt form of the transport company and by arranging

transport from Amritsar to Srinagar and by his replies to the letters written to him by the Plaintiffs undertook as a bailee to redeliver the goods, the

question for consideration is whether or not the suit filed against him for the recovery of compensation for the loss of goods is within time. The suit

was originally filed by the Plaintiffs against Defendants Nos. 1 and 2 on 5.1.2007.

In paragraph 9 of the plaint the Plaintiffs stated that when they did not get nine bags of tea or the price thereof, they served a notice on Defendant

No. 1 u/s 80 of the CPC on 21st Bhadon 2006. From the plaint it is, therefore, clear that on the date when the suit was filed the Defendant had

failed to pay compensation in spite of the notice issued to them on 21st Bhadon 2006. An application for impleading S. Amar Singh as Defendant

was made on 28th Phagan 2008 more than a year after the suit was actually brought against Defendants Nos. 1 and 2. Learned Counsel for S.

Amar Singh has argued that Article 31 of the Limitation Act is applicable to the present case and the suit against S. Amar Singh having been

brought after the lapse of one year from the date when the goods ought to have been delivered, is clearly barred by time.

Counsel for the Appellants urged that it was Article 49 and not Article 31 of the Limitation Act that was applicable to the present case. In support

of this contention reliance is placed on a ruling of the Madras High Court reported in M. Kuppuswami Mudaliar Vs. S. Pannlal Sowcar, . In this

case it has been held that where the Plaintiff entrusts specific moveable property to the Defendant on the understanding that the same would be

returned to the Plaintiff limitation for a suit for the return of the property or its value starts when the Defendant's possession becomes unlawful.

Article 49, Limitation Act, is held to be applicable to such a case.

This ruling is of no assistance to the Appellants. Article 49 is a general Article and where a case falls within a specific article then according to the

general principles that specific Article would be applicable and not the general Article of the Limitation Act. The present case specifically falls

under Article 31 and, therefore, the general Article 49 has no application.

There are a number of authorities of different High Courts which are on all fours with the facts of the present case, and it has been held in them

that Article 31 of the Limitation Act is applicable to such cases. Reference may be made to some of these rulings:

Palanichami Nadar v. Governor-General of India AIR 1946 Mad 133. In this, it has been held that where a part of the consignment has been

delivered on an earlier date and a part remained to be delivered in respect of which the railway company after making inquiries for a long time

finally informed the consignee that the undelivered articles were not traceable time to institute a suit for compensation of lost articles began to run

under Article 31 from after a definite refusal or declaration of inability to deliver the lost goods. Raigarh Jute Mills Ltd. Vs. Commissioners for the

Port of Calcutta, . It has been held in this ruling that to a suit for damages for non-delivery of part of consignment Article 31 of the Limitation Act

applies.

To the same effect is a Division Bench case of the Patna High Court reported in Gajanand Rajgoria and Another Vs. Union of India (UOI), , It

was held therein that Article 31 applies to a suit for compensation for damages on account of short delivery. The Governor-General in Council Vs.

Khadi Mandali, . It has been held in this ruling that where a suit is brought against a railway company for compensation for nondelivery of goods

consigned for transit, Article 31 is applicable. Time begins to run from therefore, of definite refusal or declaration of inability to deliver by the

railway.

In the present case, therefore, Article 31 is applicable and the limitation will start from the date when there was a refusal on the part of the

Defendants to pay compensation to the Plaintiffs. Learned Counsel for the Appellants argued that there has been no refusal on the part of the

Defendant and, therefore, starting point of limitation cannot be taken from the date of the notice or from the date of the suit filed by the Plaintiffs.

This contention is devoid of force. If the Defendants had not refused to make up the deficiency in goods or to pay compensation for non-delivery

of goods the Plaintiffs had no cause of action to, file a suit against the Defendants. When the Plaintiffs were satisfied that the Defendants would not

pay compensation even though a notice was served, by them, they brought the present suit. It is therefore, clear that there was a refusal to deliver

the goods or to pay the compensation before the Plaintiffs filed the suit, as is clear from the averment in paragraph 9 of the plaint.

The starting point of limitation on the Plaintiffs own showing would be 5-1-2007 when the suit was originally brought. The application for adding S.

Amar Singh as a Defendant was made on 28th Phagan 2008 which was clearly beyond one year of the filing of the suit. According to counsel

appearing on behalf of S. Amar Singh u/s 22 of the Limitation Act the suit should be deemed to have been instituted on the date when he was

made a party to the suit and not on the date when the application for impleading him as a party was made. Section 22(1) of the Limitation Act

reads as under:

Where, after the institution of a suit, a new Plaintiff or Defendant is substituted or added, the suit shall, as regards him be deemed to have been

instituted when he was made a party.

In the present case though it is not necessary to go into the question whether the suit should be considered to have been instituted on the date when

the application to implead S. Amar Singh as a Defendant was made or on the date when the order impleading him as a party was made, as even

the application for impleading Defendant No. 3 was made after the period of limitation had expired.

In Ammaya Pillai v. Narayana Chetti AIR 1925 Mad 487, Devadoss J. held that in the case of a person already on record, on the date on

which the suit is filed, limitation ceases to run; but in the case of a person newly added as a party to a pending suit, the suit shall as regards him be

deemed to have been instituted, only when he is so added and not when an application to bring him on record is made. This view has been

dissented from by a Division Bench of the same High Court in the case reported in The South India Industrials, Ltd. Vs. Mothey Narasimha Rao,

in which it laid down that when a party is added on application, the addition, must be deemed to have effect from the date of the application.

We respectfully agree with the view taken by the Division Bench of the Madras High Court that the suit will be deemed to have been instituted

from the date of the application and not from the data when the order impleading a person as party is made by the Court. If the date of the

application is not taken to be the date of institution of the suit it may be hard on the applicant who may have made an application within time for

impleading a new Defendant as a party to the suit but due to the delay on the part of the Court in passing the order it may become time barred.

Under these circumstances the suit against S. Amar Singh, Defendant No. 8, would be deemed to have been instituted on the date when the

Plaintiffs made an application for impleading him as a Defendant, i.e., the 28th of Phagan, 2008. As Defendant No. 1 had refused to make good

the loss or to pay compensation to the Plaintiffs before the 5th of Baisakh 2007 when the suit was instituted by the Plaintiffs limitation would start

to run against Defendant No. 3 from that date. Defendant No. 3 having been impleaded as a party on 28th Phagan 2008 and the suit being

deemed to have been instituted against him on that date after the expiry of one year of non-delivery or refusal to pay compensation for the lost

goods, it would be clearly barred by limitation under Article 31 of the Limitation Act.

In the result the Plaintiffs have failed to show that the Defendant No. l had authorised Defendant No. 8 to take delivery of the goods and to

send the same to the Plaintiffs at Srinagar. Defendant No. 3 no doubt arranged transport for the goods of the Plaintiffs and there is some evidence,

though not sufficient, to establish bailment yet even if it is held that Defendant No. 8 was a bailee and had to redeliver the goods to the Plaintiff

bailor at Srinagar the suit for delivery of goods or payment of compensation for lost goods having been brought after the lapse of the period of

limitation is clearly barred against Defendant No. 3. We, therefore, find no force in this appeal which is dismissed but in the circumstances of the

case we leave the parties to bear their own costs.

S. Murtaza Fazl Ali, J.

I agree.