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2006 Supreme(Cal) 208

High Court Of Calcutta
Before: Kalyan Jyoti Sengupta, J.
JAYTEE EXPORTS - Appellant
Versus
NATVAR PAREKH INDUSTRIES LIMITED - Respondent
C. S. 481 Of 2000
Decided On : 04/05/2006

Section 230 of the Indian Contract Act, 1872 does not bar a suit against an agent for a contract entered into on behalf of a disclosed principal, but only grants immunity from personal liability.

Headnote:

CONTRACT - Agent - Liability - Suit maintainability - Whether a suit against an agent for a contract entered into on behalf of a disclosed principal is barred under section 230 of the Indian Contract Act, 1872 - Held, no - Section 230 does not bar the suit against the agent, but only grants immunity from personal liability.

Fact of the Case:

The plaintiff, a consignor, filed a suit against the defendant, an agent of a foreign principal, for the loss of goods carried by sea under a Bill of Lading issued by the defendant. The defendant contended that the suit was barred under section 230 of the Indian Contract Act, 1872, as the principal was disclosed and the agent was not personally liable.

Finding of the Court:

The Court held that section 230 of the Indian Contract Act, 1872 does not bar a suit against an agent for a contract entered into on behalf of a disclosed principal. The section only grants immunity from personal liability to the agent, but the suit is not barred.

Issues: 1. Whether the suit against the agent is barred under section 230 of the Indian Contract Act, 1872? 2. Whether the one-year limitation period under the Carriage of Goods by Sea Act, 1925 applies to the suit?

Ratio Decidendi: 1. Section 230 of the Indian Contract Act, 1872 does not bar a suit against an agent for a contract entered into on behalf of a disclosed principal. 2. The one-year limitation period under the Carriage of Goods by Sea Act, 1925 does not apply to the suit as it is based on negligence and tort, which is governed by Article 108 of the Limitation Act, 1963.

Final Decision: The Court dismissed the defendant's demurrer application and the plaintiff's application for judgment on admission.

( 1 ) THE Court: The aforesaid applications were heard together for convenience sake. The first mentioned application is demurer action taken out by the defendant No. l for revoking leave obtained by the plaintiff under clause 12 of the Letters Patent for instituting the aforesaid suit in this Hon'ble Court or in any event the order may be made for revoking leave obtained by the plaintiff as against the aforesaid defendant: and rejection of the plaint, filed now, and dismissing the same and in any event rejecting the plaint dismissing the above suit as against the petitioner. The second mentioned application has been taken out by the plaintiff for Judgment on admission for a sum of Rs. 27. 12. 000/- against the defendant No. 1 with interest at the rate of 15% per annum from 22nd August, 1998 till date of the payment.

( 2 ) I thought the demurer action should be considered and decided first as the result thereof would obviously have inevitable legal implication on the application for Judgment on admission.

( 3 ) IT is contended that the suit is barred by law for getting the plaint rejected. No part of the cause of action arose within the jurisdiction and the suit is also barred by laws of limitation. Learned counsel for the first defendant contends that the suit is barred under section 230 of the Contract Act as going by the statements and averments of the plaint it will appear that the defendant No. l is described as agent of the disclosed principal, defendant No. 4, in the suit. The first defendant issued and signed Bill of Lading dated 15th January, 1998, acting as agent of the defendant No. 4 who is the carrier of the goods covered by the Bill of Lading, that were received by it. As such, when the principal, being defendant No. 4, is disclosed, the defendant No. 1 could not be sued. In support of this contention the learned counsel has sought reliance on a decision of this Court reported in AIR 2002 Cal 211.

( 4 ) HIS next contention is that the suit is founded on the Bill of Lading and the transaction originated from its issuance and the consignment was carried by ship from Cochin to Dubai. Thus, the carriage of goods by sea under the aforesaid Bill of Lading is governed by the Indian carriage of Goods by Sea Act. 1925 (hereinafter referred to as the said act ). The Bill of Lading was of dated 15th January, 1998. The plaintiff came to know of refusal of overseas buyer to accept the documents and make payment and return of the documents including Bill of Lading from Allahabad Bank on 1st September, 1998 on receipt of its letter. The suit was filed on 29th November, 2000. Therefore, starting point of limitation for filing of the suit is to be reckoned from 1st September, 1998. Therefore, obviously the suit has been filed beyond the period of the limitation of one year as prescribed by the said Act. 1925. There is no separate contract between the plaintiff and the defendant No. 1 to get out of the statutory period of limitation of one year under the said act, 1925 as per Rule 6 of Article III of Schedule thereof. The said Act is a special statute and has since stood the test of time and the same does neither, in any way, affect the provision of Contract Act nor it debars any party to initiate legal proceedings. Filing of suit is essential for recovery of value of goods by the consignor from carrier for the alleged loss of goods carried on under Bill of Lading. The provision of Sea Act, 1925 alone is applicable and the Limitation Act, 1963 has no manner of application, as it is suit for recovery of value of goods by the consignor from carrier.

( 5 ) SRI S. Roy Chowdhury, senior advocate, appearing for the plaintiff, submits that while deciding the question of demurer action the plaint has to be read as a whole. It would appear therefrom that the plaintiff has several causes of action in the suit which includes inter alia, misrepresentation, breach of contract of carriage, breach of duty of care owed to the plaintiff, conve



























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