1958 Supreme(Cal) 222

HIGH COURT OF CALCUTTA
P. B. Mukharji, R. S. Bachawat
ASIATIC STEAM NAVIGATION CO. LTD. - Appellant
Versus
JETHALAL DHARAMSHI AND CO. - Respondent
A. F. O. D.  29  Of  1954
Decided On : AUGUST 13, 1958

The carrier is liable for the loss and damage to the goods caused by the grossly careless and negligent stowage of the consignment of tobacco by the carrier.

Headnote:

CARRIAGE OF GOODS BY SEA ACT, 1925 - STOWAGE OF GOODS - NEGLIGENCE - BURDEN OF PROOF - ONUS OF PROOF - INHERENT VICE - DAMAGES - MARKET VALUE - EXCISE DUTY - BILL OF LADING - OWNERSHIP OF GOODS - CONTRACT OF CARRIAGE - INDIAN CONTRACT ACT, 1872, SECTION 230 - WITHHOLDING OF DOCUMENTS - PRESUMPTION.

Fact of the Case:

Plaintiffs brought a suit against the defendant shipping company for the recovery of damages for non-delivery of 1472 bags of Indian biri tobacco entrusted to the defendant for carriage by sea from Bombay to Calcutta. The defendant denied liability and relied on two clauses of the bill of lading, Clause 5 and Clause 8. The defendant also took the defence of inherent defect or vice of those goods and pleaded that the goods suffered from latent defects not discoverable by due diligence of the carriers.

Finding of the Court:

The court held that the defendant was liable for the loss and damage to the goods as it was caused by the grossly careless and negligent stowage of the consignment of tobacco by the carrier. The court also held that the defendant could not escape liability by relying on the two clauses of the bill of lading as they were either not applicable or were void and of no effect under the Carriage of Goods by Sea Act, 1925. The court further held that the plaintiffs were entitled to recover the market value of the goods, including the excise duty paid or payable thereon, as the ultimate liability to pay excise duty was on the first plaintiff.

Issues: 1. Whether the defendant was liable for the loss and damage to the goods? 2. Whether the defendant could escape liability by relying on the two clauses of the bill of lading? 3. Whether the plaintiffs were entitled to recover the market value of the goods, including the excise duty paid or payable thereon?

Ratio Decidendi: 1. The court held that the defendant was liable for the loss and damage to the goods as it was caused by the grossly careless and negligent stowage of the consignment of tobacco by the carrier. The court relied on the evidence which showed that the tobacco was stowed in a deep hold, placed against the engine room and the bulk-head, improperly and faultily dunnaged, kept near the tunnel, kept the dry and wet bags together, and that there was complete lack of supervision of this tobacco during the entire voyage. 2. The court held that the defendant could not escape liability by relying on the two clauses of the bill of lading as they were either not applicable or were void and of no effect under the Carriage of Goods by Sea Act, 1925. The court held that Clause 5 of the bill of lading was not applicable as there was no evidence that the goods offered were "unclaimed goods" or "of like kind and quality." The court also held that Clause 8 of the bill of lading was not applicable as there was no landing receipt granted by the Port of Calcutta and that the goods were not landed as they were a "charred mass." 3. The court held that the plaintiffs were entitled to recover the market value of the goods, including the excise duty paid or payable thereon, as the ultimate liability to pay excise duty was on the first plaintiff. The court relied on the evidence which showed that the first plaintiff had purchased the goods from various parties and had accepted liability for payment of the price of the goods. The court also held that the inclusion of excise duty not paid but payable in claiming damages was justified as the market value of the goods reflected the actual damage suffered by the person who puts this merchandise on the market and that market value itself proceeds ex hypothesi on the basis that the goods had gone through all necessary legal incidents including payment of duty before they entered the market and acquired a market value.

Final Decision: The court upheld the decree in favor of the plaintiffs respondents for the sum of Rs. 2,40,811/8/- with interest and costs. as allowed by the learned trial Judge and dismissed this appeal with costs.