The Union of India (UOI) vs South India Insurance Company and Another

M.M. Ismail, J.—The defendant in O.S. No. 3138 of 1966 on the file of the City Civil Court, Madras, who lost before the trial Judge as

well as before the first appellate Judge, is the appellant herein. The facts lie within a very narrow compass and there is not much controversy about

them. The second respondent herein, who is carrying on business in synthetic stones under the name and style of Jatin Diamond Company, sent a

registered parcel of synthetic diamonds of the value Rs. 1,444 from Madras to Mauritius Commercial Bank Ltd., Mauritius, on 29th August, 1964.

The said parcel was registered at the General Post Office, First Line Beach, Madras, on 29th August, 1964, bearing postal receipt No. 356. The

second respondent had insured the said parcel with the first respondent under an open policy by certificate of the same date for a sum of Rs.

1,444. The parcel"". was not delivered to the addressee and there was correspondence between the postal department and the second respondent

herein. When the parcel was note-delivered, the second respondent herein claimed the value of the parcel from the postal department. The senior

Superintendent of R.M.S., Bombay, Sorting Division, Bombay-1 by a communication dated 1st July, 1965, informed the second respondent that it

had been intimated by the Foreign Administration concerned that the investigation made to trace the -whereabouts of the parcel proved

unsuccessful and the Air Company in Mauritius with whom the parcel despatch under reference was entrusted for conveyance had also declared

the despatch as lost, and in the circumstances the parcel under enquiry was to be treated as lost. The communication informed the second

respondent that the Presidency Postmaster, Madras General Post Office had been addressed to take further necessary action in connection with

the settlement of the second respondent''s claim. The second respondent was requested in that communication to submit the required claim papers

to the Presidency Postmaster, Madras General Post Office direct. This letter has been marked as Exhibit A-6 in these proceedings. The

Postmaster-General, Madras, on 8th December, 1965, directed payment of Rs. 29.25--Rs. 15-50 being compensation and Rs. 13.75 being the

postage due thereon. It is thereafter respondents 1 and 2 herein instituted the suit for recovery of the value of the parcel namely Rs. 1,444. The

appellant herein resisted the suit putting forward the contention that the parcel was lost in transit between Bombay and Port Louis, while it was in

the custody of the Air Carriers and that since the parcel in question was not insured with the appellant, the appellant was not liable under the rules

to pay to the sender the value of the parcel. The learned V Assistant Judge, who tried the suit, overruled the defences of the appellant herein and

decreed the suit as prayed for. On appeal, the learned Principal Judge, City Civil Court, Madras, confirmed this conclusion of the learned V

Assistant Judge. Hence, the present second appeal by the defendant.

Since the facts are not in controversy, the only question that arises for consideration is, whether in the circumstances of the present case, the

appellant is liable to pay to the respondents herein the value of the parcel. Section 6 of the Indian Post Office Act, 1898, hereinafter referred to as

the Act, states:

The Government shall not incur any liability by reason of the loss, misdelivery or delay of or damage to, any postal article in course of transmission

by post, except in so far as such liability may in express terms be undertaken by the Central Government as hereinafter provided; and no officer of

the Post Office shall incur any liability by reason of any such loss, misdelivery, delay or damage, unless he has caused the same fraudulently or by

his wilful act or default.

Section 31 of the Act deals with the power of the Government to require insurance of postal articles and provides:

The Central Government may, by notification in the Official Gazette, declare in what cases insurance shall be required, and direct that any postal

article containing anything required to be insured, which has been posted without being insured, shall be returned to the sender or shall be delivered

to the addressee, subject to the payment of such special fee as may be fixed by the notification:

Provided that the levy of such special fee as aforesaid shall not impose any liability upon the Central Government in respect of the postal article.

Once a postal article is insured as required u/s 31, u/s 33, the Government are liable to pay compensation and the conditions under which the

liability arises and the extent of the liability are provided for in that section (section 33). In exercise of the powers conferred by the Act, the

Government have framed the Indian Post Office Rules, 1,933 and Rule 50 states that the Director-General shall, from time to time, notify in the

Post Office Guide the conditions in force for the transmission of Postal articles by the Foreign Post. Purusant to this rule, the Director-General has

issued a notification and the relevant notification, as far as the present case is concerned, is contained in paragraph 352 (1), of the Post Office

Guide, 1965. That paragraph states:

(1) The Post Office undertakes to pay compensation, subject to the conditions indicated in the subsequent paragraphs of this clause, for the loss of

any parcel or damage to or abstraction of the contents of any parcel destined to or received from any foreign country except in the case of

uninsured parcels for and from the following countries:

British Overseas Territories....

What are British Overseas Territories have been enumerated under paragraph 256 and Mauritius is one included in this enumeration. Therefore as

far as paragraph 352 is concerned, it will follow that in the present case the post office has not undertaken to pay compensation, since admittedly

the parcel in question is an uninsured parcel for British Overseas Territories. If paragraph 352 alone is the relevant provision under which the

liability of the appellant has to be decided there can be no doubt whatever that the appellant is not liable, since the case does not come within the

scope of that paragraph. Unfortunately, this notification does not appear to have been brought to the notice of the courts below and they had no

occasion to consider the same. On the other hand, as I have already pointed out, only two defences were taken by the appellant before the Courts

below. One is that the parcel was lost during transit and the second is that the parcel was uninsured and therefore the appellant -was not liable.

With reference to these defences, reliance had been placed on Section 6 of the Act which has been extracted above and the Courts below have

considered that section with reference to a few decisions of certain courts and come to the conclusion that unless it has been established that the

parcel is a loss to the postal department itself, Section 6 will not apply. Though I find it difficult to understand what exactly is meant by ""loss to the

department"", it is unnecessary for me to pursue the matter further for the simple reason that even Mr. Subramaniam, learned Counsel for the

respondents, conceded before me that if there was no negligence on the part of the department and the loss was beyond the control of the

department, Section 6 would apply and exonerate the appellant from its liability. It is in view of this Mr. Subramaniam contended that it was the

duty of the appellant to place evidence before the Court to show as to how it dealt with the parcel in order to establish that there was no

negligence on its part and the appellant has failed to do so.

In my opinion, this argument is misconceived. In paragraph 5 of the plaint, after stating that the appellant informed the second respondent of the

loss of the parcel it is stated:

As the loss of the parcel was due to the negligence of the defendant the second plaintiff claimed the sum of Rs. 1, 444 being the value of the goods

covered by the parcel.

The appellant in its written statement while contending that the parcel was lost in transit between Bombay and Port Louis, while it was in the

custody of the Air Carriers, emphatically denied that the parcel was lost due to the negligence of the postal department. It may be mentioned in this

context that the second respondent neither in the plaint nor in the evidence challenged the correctness of the statement contained in Exhibit A-6, to

which I have already made a reference. Exhibit A-6 clearly and categorically stated that even the Foreign Administration concerned had reported

to the postal department that the investigation made to trace the whereabouts of the parcel proved unsuccessful and that the Air Company in

Mauritius with whom the parcel despatch under reference was entrusted for conveyance had also declared the despatch as lost. As far as the

appellant is concerned, the appellant can give evidence only as to how it dealt with the parcel and certainly it cannot give evidence as to how the

foreign Air Company to whom the parcel entrusted for carriage and delivery dealt With the same. As I have pointed out already, except for the

bald allegation made in paragraph 5 of the plaint that the loss was due to the negligence of the appellant, the respondents herein did not even allege

that the statement contained in Exhibit A-6 was not correct and that the loss was due to the negligence of the officers and servants of the postal

department, before the parcel could be entrusted to the foreign carrier. From the very nature of the case, with regard to a foreign parcel, it will be

impossible for the postal department to place any evidence as to how the parcel Was dealt with from the day it was entrusted to it until the time

when it reached the addressee or ought to have reached the addressee. The postal department can lead evidence as to how it dealt with the parcel

before it, in its turn, entrusted the same to the foreign carrier for carriage abroad. In this case, once the statement contained in Exhibit A-6 remains

uncontradicted, it must necessarily follow that there was no negligence whatever on the part of the postal department and that if there was any

negligence at all, it must have been only on the part of the foreign carrier and no principle whatever was brought to my notice to show that for any

negligence on the part of a foreign air carrier the postal department is liable. Under these circumstances, I am clearly of the opinion that Section 6

of the Act is a complete answer to the claim made by the respondents herein.

In addition to this, there is a decision of a Bench of this Court in Union of India (UOI) Vs. Amjad Miyan, , which had elaborately considered the

source and the scope of the liability of the postal department with reference to the provisions contained in the Act.

The Bench held:

The post office is a branch of the public service; accordingly, the Postmaster-General is not a common carrier, the acceptance by him of letters and

packets for transmission through the post does not give rise to any contractual relationship between him and the owner of the letter or packet.

It further held:

The liability of the Union Government in the case of any mis-delivery, non-delivery or loss of an insured article or V.P. Article is to be found within

the four corners of the Act and the Rules framed thereunder, otherwise there will be no liability.

(Having regard to these principles laid down in the above decision which is binding on me and having regard to the provisions contained in Section

6, 31 and 32 of the Act and the notification of the Director-General referred to above, it must be held that the appellant herein is not liable to pay,

by way of damages to the respondents herein, the value of the parcel which was lost.

Hence, the second appeal succeeds and the same is allowed. However, the respondents will be entitled to recover a sum of Rs. 29.25 which

the Postmaster-General, Madras offered to pay by his communication dated 8th December, 1965 (Exhibit A-16). Therefore, in modification of the

decrees passed by the Courts below there will be a decree in favour of the respondents for the said sum of Rs. 29.25. The parties will bear their

respective costs throughout.

No leave.