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IN THE HIGH COURT AT CALCUTTA
Pinaki Chandra Ghose, J.
Steel Authority of India Ltd. – Petitioner
Versus
Messrs Stanimpex & Ors. – Respondents
G.A. No. 740 of 1998 & Suit No. 185C of 1996
Decided on: 17th December, 1998
MARINE INSURANCE ACT, 1963 - SECTION 47, 48 - INSURANCE CONTRACT - JURISDICTION - CAUSE OF ACTION - LEAVE TO SUE UNDER CLAUSE 12 OF THE LETTERS PATENT - REVOCATION - INSURANCE POLICY ISSUED BY ITALIAN COMPANY TO ITALIAN INSURED FOR CARGO TRANSPORT FROM ITALY TO INDIA - DEVIATION AND TRANSHIPMENT OF CARGO WITHOUT INSURER'S KNOWLEDGE - INSURER'S LIABILITY DISCHARGED - NO CAUSE OF ACTION AGAINST INSURER IN INDIAN COURT - LEAVE TO SUE REVOKED - SUIT DISMISSED AGAINST INSURER.
Fact of the Case:
An Italian insurance company (petitioner) issued an insurance policy to an Italian insured (defendant No. 2) for the transport of cargo from Italy to India. The cargo was shipped on board a vessel and was supposed to be carried directly to India. However, the vessel deviated from its course and sailed to Mumbai, where the cargo was discharged and transhipped onto other vessels for onward carriage to India. The plaintiff, the consignee of the cargo, filed a suit against the shipping company (defendant No. 3), the insured (defendant No. 2), and the insurer (petitioner) in an Indian court, claiming damages for the short landing of cargo and consequential losses. The insurer filed an application to revoke the leave granted to the plaintiff to sue the insurer under Clause 12 of the Letters Patent, arguing that the insurance contract was governed by Italian law and that the Italian courts had exclusive jurisdiction over any claims arising out of the contract. The insurer also argued that the deviation and transhipment of the cargo without its knowledge discharged its liability under the insurance policy.
Finding of the Court:
The court found that no part of the cause of action arose within the jurisdiction of the Indian court against the insurer. The insurance contract was issued and received in Italy, and no significant part of the cause of action occurred within the court's jurisdiction. The court also found that the insurer's liability was discharged under Sections 47 and 48 of the Marine Insurance Act, 1963, due to the deviation and transhipment of the cargo without its knowledge. The court further found that there were no allegations against the insurer within the jurisdiction of the Indian court.
Issues: 1. Whether the Indian court had jurisdiction to entertain the suit against the insurer. 2. Whether the insurer was liable for the short landing of cargo and consequential losses.
Ratio Decidendi: 1. The court held that the Indian court did not have jurisdiction to entertain the suit against the insurer because no part of the cause of action arose within its jurisdiction. The insurance contract was issued and received in Italy, and no significant part of the cause of action occurred in India. The court also found that the insurer's liability was discharged under Sections 47 and 48 of the Marine Insurance Act, 1963, due to the deviation and transhipment of the cargo without its knowledge. 2. The court held that the insurer was not liable for the short landing of cargo and consequential losses because its liability was discharged under Sections 47 and 48 of the Marine Insurance Act, 1963.
Final Decision: The court allowed the insurer's application to revoke the leave granted to the plaintiff to sue the insurer under Clause 12 of the Letters Patent. The name of the insurer was struck out from the Cause Title of the plaint, and the suit against the insurer was dismissed.
This is an application filed by the petitioner inter alia praying for:-
(a) Leave under Clause 12 of the Letters Patent be revoked;
(b) The name of the defendant No. 4 who is the petitioner herein be struck out from the Cause Title of the suit;
(c) The plaint in Suit No. 185C of 1996 be rejected and/or taken off the file;
(d) The suit against the defendant No. 4 be dismissed;
(e) Stay of the suit being Suit No. 185C of 1996 and all proceedings thereunder till the disposal of this application;
(f) The suit being Suit No. 185C of 1996 be not transferred to the list of un-defendant suit till the disposal of this application.
2. On or about 17th December, 1992 the petitioner at the request of Shopping Team S.R.I., Issued an insurance policy bill No. 29 609 in order to guarantee on behalf and on account of the defendant No. 2, the transport of 33 boxes of electrical and mechanical equipments from the Port of Genoa (Italy) to the Port of Calcutta by means of the vessel M.V. "SNAGOV ROMANIA". The total sum insured by the petitioner was $ 675,475. The goods in question were sold by the defendant No. 2 on CIF basis to the plaintiff. The said insurance contract is governed by the laws of Italy.
3. The plaintiff in the suit carries on business as manufacturers of steel including alloy steel at its various plants in India and markets the same both for domestic consumption and/or export. The defendant No. 1 is a concern carrying on business of importing machinery and spare parts particularly those required for steel plants. The defendant No. 2 likewise carries on similar business as associates of the defendant No.1 from Milan, Italy. The defendant No. 3 is a Government of India undertaking carries on business of carriage of goods by sea for reward and for the said purpose owns and manages a number of merchant vessels for carriage of diverse kinds of cargo
4. By a contract of carriage contained in or evidenced by Bill of Lading dated 10th December, 1993 the defendant No. 3 agreed to carry various items of machinery in 33 cases marked 1/33 to 33/33 weighing 163.634 Kgs. of board the vessel M.V. "SNAGOV" from the Port of Genoa, Italy to Calcutta being the destination Port. The said machinery was sold by the defendant No. 2 who was to effect the dispatch of the same for and on behalf of the defendant No. 1 for an agreed consideration of US $ 6,14,052.00 including carriage insurance and freight. The said Bill of Lading indicated the consignee to be the State Bank of India, Rourkella and the plaintiff was a party to be notified under the same.
5. In terms of the contract for sale of the said machinery entered into between the plaintiff and the defendant Nos. 1 & 2 the defendant No. 2 contemporaneously with the loading of the cargo on board the vessel M.V. "SNAGOV ROMANIA" issued an invoice in respect of the said machine and acknowledge payment by the plaintiff of the price of the cargo against L/C. No. 01-050193/95 dated 12th May, 1993.
6. Pursuant to the request made by the defendant No. 2 the petitioner (being the defendant No. 4 herein) in the usual course of its business issued a policy of insurance dated 10th December, 1993 in respect of the said cargo. Initially, the petitioner issued the insurance certificate in respect of the 32 cases under policy No. 29609 dated 10th December, 1993 and thereafter corrected the original certificate on 17th December, 1993 to cover all the 33 cases which were shipped on board the vessel M.V. "SNAGOV ROMANIA".
7. The defendant No. 3 being the Shipping Corporation of India to carry the cargo from the Port of Genoa, Italy to Calcutta, the defendant No. 3 resorted to wrongful deviation and caused the vessel to sail to the Port of Mumbai and there caused the discharge and transhipment of the entire cargo of 33 cases without any intimation thereof to the petitioner. The further case of the petitioner that after the cargo was off-loaded from board the vessel M.V. 'SNAGOV ROMANIA" at the Port of Mumbai 25 packages wer
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