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1950 Supreme(Pat) 123

PATNA HIGH COURT
Jha and Reuben JJ.
Union Of India
Versus
Baijnath Madan Lall
Appeal from Original Decree No. 423 of 1946 ;
Decided On : AUGUST 21, 1950

A plaintiff is not entitled to damages for late delivery without proof that he has suffered loss.

Headnote:

RAILWAYS ACT - SECTIONS 77, 80 - DAMAGES FOR SHORT DELIVERY AND LOSS DUE TO DELAY - NOTICE UNDER SECTION 77 - SUIT AGAINST RAILWAY ADMINISTRATION - LIABILITY OF RAILWAY ADMINISTRATION FOR LATE DELIVERY - ADMISSION OF LIABILITY BY ADVOCATE - EFFECT.

Fact of the Case:

The appellant, the owner of the O.T. Railway, was sued for damages for short delivery and loss due to delay in the delivery of two consignments of cotton piece goods. The plaintiffs claimed damages based on the difference between the market prices of the goods on the date they should have been delivered and the date they were actually delivered. The appellant contended that the plaintiffs were not entitled to a decree against him without proof that the O.T. Railway Administration was responsible for the delay and that the plaintiffs had not proved that they had suffered loss due to the delay.

Finding of the Court:

The court held that the plaintiffs were not entitled to damages for late delivery because they had failed to prove that they had suffered loss. The court also held that the appellant was liable for the late delivery because his advocate had admitted that there was late and short delivery of the goods.

Issues: 1. Whether the plaintiffs were entitled to damages for late delivery without proof that the O.T. Railway Administration was responsible for the delay? 2. Whether the plaintiffs had proved that they had suffered loss due to the delay? 3. Whether the appellant was liable for the late delivery.

Ratio Decidendi: 1. Under Section 73, Contract Act, a party who suffers loss due to a breach of contract is entitled to compensation for any loss or damage caused to him thereby. However, the plaintiff must prove loss or damage. 2. The plaintiffs had not proved that they had suffered loss due to the delay because they had not produced their account books showing the entries relating to the sale of the cotton piece goods in question. 3. The appellant was liable for the late delivery because his advocate had admitted that there was late and short delivery of the goods.

Final Decision: The appeals were allowed to the extent that the decrees were set aside so far as they related to damages for late delivery. The principal amount of the decrees was reduced to Rs. 696 in Money Suit No. 11 and Rs. 227 in Money Suit No. 1. The appellant was awarded costs proportional to his success.

Judgment

Reuben, J.

1. These two appeals are directed against a decision of the Subordinate Judge, Patna, in Money Suite Nos.1 land 11 of 1944, which were tried analogously by him. The appellant was the defendant in both the suits.

2. The suits were for the recovery of damages for short delivery and for loss due to delay in the delivery of two consignments of Indian cotton piece goods made over to the B. B. and C. I. Railway at Ahmedabad on 10-4-1948 for transport to and delivery at Bigha Ghat on the O. T. Railway. In the ordinary course, these consignments should have arrived at Digha Ghat in the first week of May. Actually they arrived on 8-11-1943. The consignee finding them to be in a damaged condition, took open delivery on 23-11-1943. Shortages were found in both the consignments, Rs. 696 in Money Suit No. 11 of 1944 and Rs. 227 in Money Suit No. 1. The plaintiffs claim these amounts on account of the short delivery, and, on account of loss due to late delivery. They base their claim on the difference between the market prices of cotton piece goods on She data when the consignments should have been delivered and on the date when they were, in fact, delivered. The Subordinate Judge has held that, during this period, there was a depreciation in the price of 25 per cent, of the value on the date when the goods should have been delivered. He has decreed the suits accordingly.p-

3. The appellant does not challenge the decrees so far as they relate to short delivery. As regards delay in delivery, two points are urged on his behalf:

(1) that the appellant was sued as the owner of the O. T. Railway and, under the provisions of Section 80, Railways Act, the plaintiffs are not entitled to ft decree against him without proof that the O. T. Railway Administration was responsible for the delay, and

(2) that the plaintiffs have not proved that they have suffered loss by reason of the delay in delivery and, in any case, the evidence given by them is insufficient to prove the amount of damages they should get.

On behalf of the plaintiffs a third point is pressed, that the decrees appealed from are decrees against the Governor General in Council as owner of the B. B. and C. I., the E. I. and the O. T. Railways, that the appeals have been filed by him only in the capacity of the owner of: the O. T. Railway, and that, therefore, the decrees are final so far as the other two Railways are concerned,

4. It will be convenient to take up the second point first. The other two points can be dealt with together afterwards.

5. The provision for compensation when there is a breach of contract is made by Section 73, Contract Act. I reproduce the relevant portion:

"When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation, for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it.

* * * * * *

Explanation.--In estimating the loss or damage arising from a breach of contract, the means which, existed of remedying the inconvenience caused by the non-performance of the contract must be taken into account."

There follow a number of illustrations. Illustration (e) exactly covers the present case, According to it, the test adopted by the Subordinate Judge namely, the difference between, the market prices on the due day of delivery and on the day of actual delivery, is correct; this-is subject however, to the main provision of the section which I have reproduced above. From the portion of the citation which I have placed in italic, it is clear that the plaintiff must prove loss or damage. Ordinarily the mere difference in price on the two relevant dates is sufficient to establish this fact. In the present case, it is urged that it is not sufficient because it is admitted by the Munim of the plaintiffs (P. W. 1) th
























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