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1958 Supreme(Pat) 167

PATNA HIGH COURT
Raj Kishore Prasad, J.
Union Of India
Versus
Jethabhai Jesinbhai Patel And Co.
Appeal from Original Decree No. 376 of 1953 ;
Decided On : OCTOBER 09, 1958

The doctrine of estoppel under Section 115 of the Evidence Act does not apply where both parties are aware of the true position.

Headnote:

ESTOPPEL - PAYMENT OF COMPENSATION - FULL AND FINAL SETTLEMENT - ESTOPPEL NOT APPLICABLE WHERE TRUE POSITION KNOWN TO BOTH PARTIES - EVIDENCE ACT, SEC. 115.

Fact of the Case:

Plaintiff booked 229 bags of biri tobacco from Desar Road to Chakradharpur under Risk Note A. On arrival, 159 bags were found wet and damaged. Plaintiff claimed damages for the damaged tobacco after deducting the amount paid by the railway. The railway defended, claiming that the payment of Rs. 4,310.00 was in full and final settlement of the claim, and the plaintiff was estopped from claiming more.

Finding of the Court:

The court found that the railway deliberately took the lower figure of Rs. 100.00 per Gujerati maund instead of the standard rate of Rs. 200.00 per standard maund to calculate the compensation, and the plaintiff, knowing this, accepted the payment and later claimed the balance. The court held that the plea of estoppel was not applicable in this case as both parties were aware of the true position.

Issues: Whether the plaintiff was estopped from claiming more than what it had already been paid by the defendant in full and final settlement of the plaintiffs claim.

Ratio Decidendi: The court held that the doctrine of estoppel under Section 115 of the Evidence Act did not apply in this case as both parties were aware of the true position. The railway deliberately took the lower figure to calculate the compensation, and the plaintiff, knowing this, accepted the payment and later claimed the balance. The court also referred to precedents where it was held that mere retention and encashment of a cheque did not conclusively prove acceptance of the amount in full satisfaction of the claim.

Final Decision: The court dismissed the appeal and upheld the decree in favor of the plaintiff.

Judgment

Raj Kishore Prasad, J.

1. This appeal is by the defendant railway against a decree far money passed in favour of the plaintiff-respondent.

2. Two hundred twenty-nine bags of biri tobacco were booked from Desar Road on the G. B. S. Railway for Chakradharpur on the then B. N. Railway under Risk Note A. On arrival at Chakradhnrpur, 159 baps, out of 229 bags consigned, were found wet, and the total weight of these wet bags of tobacco was found to be 43 maunds 4 seers. The plaintiff, therefore, claimed damages for this amount of damaged tobacco after deducting what the plaintiff company had been paid by the railway.

3. The suit was contested by the railway, and the main defence, with which we are concerned in the present appeal, is to be found in paragraph 7 of the written statement. It was stated by the defendant that Rs. 4,310.00 was paid to the plaintiff after due certification of the rates and strictly with- out any prejudice to Railway rights; and moreover, the offer was made in full and final settlement of the plaintiffs claim, and the plaintiff, having cashed the cheque in acceptance thereof, was estopped from claiming any more, and, therefore, the plaintiffs suit was liable to be dismissed on this score alone.

4. Mr. M. M. Sulaiman. learned Subordinate Judge of Singhbhum, Chaibassa, by his judgment, dated 30-6-1953, negatived the defence, and decreed the plaintiffs suit for the balance. Hence, the present appeal by the defendant Railway.

5. The only point pressed in support of the appeal by Mr. P.K. Bose is that the plaintiff was estopped from claiming more than what it had already been paid by the defendant in full and final settlement of the plaintiffs claim, which was unreservedly accepted by it without any protest.

6. The plea of estoppel is based on paragraphs 10 and 11 of the printed letter written by the railway to the plaintiff on 5-3-1951 (Exhibit 1) in reply to the plaintiffs letter dated 27-8-1949, where the railway referred the plaintiff to paragraphs 10 and 11 of this printed letter. Para. 10 of exhibit 1 says that the Financial Adviser and Chief Accounts Officer of the Railway was being advised to remit to the plaintiff a sum of Rs. 4,310/-, being the compensation in full and final satisfaction of the plaintiffs claim in connection with the consignment in question, and that the plaintiff might expect payment shortly by cheque. In paragraph 11 of exhibit 1, it was further mentioned that a receipt was being enclosed which might be filled in and signed by the plaintiff & tent to the Cashier, B. N. Railway, Kidderpore to expedite payment. It is, however, mentioned in exhibit 1 at the bottom that this amount of Rs. 4,310.00 was the cost of 43 maunds 4 seers of biri tobacco at the rate of Rs. 100.00 per maund as per senders bijak, the copy of which is exhibit 4.

7. The defendants case is that the plaintiff signed the receipt for Rs. 4,310.00 and received the, cheque and encashed it, and, thereafter, sent the letter dated 19-3-1951, exhibit 1(a), to the defendant saying that the payment of Rs. 4,310.00 by the railway was only a part payment of the plaintiffs claim for Rs. 9,670/5/-, and, therefore, the balance might be sent to the plaintiff.

8. The argument of Mr. Bose is that, when it was definitely stated in paragraph 10 of exhibit 1 by the defendant that Rupees 4,310/-was the compensation in full and final satisfaction of the plaintiffs claim and the plaintiff accepted it without any protest, it was not open to the plaintiff to write the letter exhibit 1(a), after encashment of the cheque, informing the railway that that was only a part of its whole claim. Further, it was submitted that this letter, exhibit 1(a) will not at all make the defendant liable and it will not enable the plaintiff to get over estoppel, in view of the letter of the defendant, exhibit 1.

9. . He further submitted that the learned Subordinate Judge is wrong in saying that exhibit 1 does not show that the amount was in full and final














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