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High Court Of Calcutta
SABYASACHI MUKHERJI
UNION OF INDIA - Appellant
Versus
CHINOY CHABLANI - Respondent
Suit 14 Of 1975
Decided On : 03/15/1976
CHINNOY CHABLANI & CO. V. UNION OF INDIA - JURISDICTION - ORDER 7 RULE 11 CPC - SECTION 230 INDIAN CONTRACT ACT - SECTION 86 CPC - ADMIRALTY COURT ACT 1861 - LETTERS PATENT CLAUSE 12 - BILL OF LADING CLAUSES 25, 26, 27 - SUMMARY: The plaint was rejected as it did not disclose any cause of action against the defendant. The court held that the principal could be sued in the Soviet Union or before any other appropriate forum, and therefore, the conditions required under Sub-section (3), 2nd paragraph, of Section 230 were not fulfilled. The court also held that the suit was incompetent in the Original Side of the Court and should have been instituted on the Admiralty jurisdiction of the Court.
Fact of the Case:
The plaintiffs, Union of India and Food Corporation of India, filed a suit against the defendant, Chinnoy Chablani & Co., claiming damages for short-landing of Urea and empty spare bags shipped from Odessa in the U.S.S.R. to any port in India. The plaintiffs alleged that the short-landing occurred due to the negligence and/or wrongful acts of the shippers and/or its employees and/or its agents. The defendant was an agent of the Black Sea Steamship Company, the owner of the vessel that carried the goods.
Finding of the Court:
The court held that the plaint did not disclose any cause of action against the defendant. The court found that there was no contract entered into by the defendant as agent on behalf of the principal, and therefore, the question of making the defendant personally liable for that contract did not arise. The court also found that the principal, Black Sea Steamship Co., could be sued in the Soviet Union or before any other appropriate forum, and therefore, the conditions required under Sub-section (3), 2nd paragraph, of Section 230 were not fulfilled. The court further held that the suit was incompetent in the Original Side of the Court and should have been instituted on the Admiralty jurisdiction of the Court.
Issues: 1. Whether the plaint should be taken off the file because it does not disclose any cause of action? 2. Whether the suit was incompetent in the Original Side of the Court and should have been instituted on the Admiralty jurisdiction of the Court? 3. Whether the suit should be stayed because the choice of forum as indicated in the bill of lading was the U.S.S.R. and the proper law of contract was also the law of the Soviet Union?
Ratio Decidendi: 1. The court held that the plaint did not disclose any cause of action against the defendant because there was no contract entered into by the defendant as agent on behalf of the principal, and the principal could be sued in the Soviet Union or before any other appropriate forum. 2. The court held that the suit was incompetent in the Original Side of the Court and should have been instituted on the Admiralty jurisdiction of the Court because the claim arose out of a bill of lading for breach of contract of carriage or breach of duty in relation to the carriage. 3. The court held that it was premature to decide the issue of stay of the suit because the ship owner had not taken the terms of the bill of lading as defence of the action.
Final Decision: The court ordered that the plaint be taken off the file. The court also held that the decision would not prejudice the rights of the plaintiffs to institute proceedings against appropriate parties including the defendant on proper cause of action in the appropriate forum.
( 1 ) THIS is an application by Chinoy Chablani and Co. , a firm carrying on business in Calcutta. The petitioner is the defendant in Suit No. 14 of 1975. The said suit was instituted by the Union of India as the first plaintiff and the Food Corporation of India as the second plaintiff against the petitioner. The said suit was instituted on or about the 14th of January, 1975, claiming a decree for Rs. 73,285/ -. The case of the plaintiffs in the plaint is as follows: (a) 81,986 bags of Urea and 820 empty spare bags were shipped from Odessa in the U. S. S. R. to any port in India on a vessel "s. S. SUDGA" under a bill of lading issued by one Black Sea Steamship Co. , the owner of the said vessel, (b) The said Black Sea Steamship Co. . appears to be a concern of U. S. S. R. (c) With regard to the said shipment there was a total short-landing of Urea of 94. 785 m. t. which occurred due to the negligence and/or wrongful acts of the shippers and/or its employees and/or its agents. (d) The petitioner is an agent of the said Black Sea Steamship Company. (e) By reason of such short-landing the plaintiffs have suffered damages to the extent of Rs. 73,285. 00. The particulars have been mentioned in the plaint. It is alleged in paragraph 10 of the plaint as follows:--"the said Black Sea Steamship Company appears to be the concern of U. S. S. R. and as such cannot be sued in India. In the circumstances the defendant or its agent is liable and is sued as such. "
( 2 ) IT has been alleged that the plaintiff No. 2 was acting on behalf of the Ministry of Agriculture, Government of India, in respect of importation of fertilisers and food-stuff and on the 31st October, 1973, one Mineral and Metal Trading Corporation of India Ltd. , had shipped on behalf of the Ministry of Agriculture, Union of India, on board the said vessel "s. S. Sudga" in an apparently good order and condition 81,986 bags of Urea of the total gross weight of 4181286 kg. and net weight of 4099300 kg. and further 820 empty spare bags from the port of Odessa in U. S. S. R. to be properly and safely carried to any port in India. A bill of lading was issued by the said Black Sea Steamship Company duly acknowledging the receipt of the said goods on board the vessel- "s. S. Sudga" and agreeing to carry the same in accordance with the terms and conditions mentioned in the said bill of lading. The said vessel had discharged at Visakhapatnam 51933 bags of Urea of which 2242 were cut and torn bags and further 276 bags containing sweepings only. It is further alleged that the said vessel completed discharge of the goods on or about the 15th/ 16th January, 1974. The said vessel had discharged at the port of Calcutta 28747 bags of Urea of which 3201 were cut and torn bags and further 50 bags containing sweepings only. It is the case of the plaintiffs that the said loss occurred due to negligence and wrongful acts of the shippers and/or its employees and/or its agents. The plaintiffs in the premises had instituted the suit. This application is by the defendant in the suit for taking the plaint off the file and alternatively for dismissing the suit as this Court has no jurisdiction to entertain this suit and alternatively for stay of the suit.
( 3 ) THE first question is, whether the plaint should be taken off the file because it does not disclose any cause of action. Under Order 7, Rule 11 of the Code of Civil Procedure the plaint should he rejected where the plaint does not disclose any cause of action. The grievance of the plaintiffs is against the Black Sea Steamship Company for their negligence. The cause of action against the defendant was sought to be justified in this case on behalf of the respondents to this application by virtue of sub-clause (3) of Section 230 of the Indian Contract Act. The said section provides as follows:--"230. In the absence of any contract to that effect, an agent cannot personally enforce contracts entered into by him on behalf of
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