The main legal point established in the judgment is the determination of liability under the Carriage by Air Act, 1972, and the application of Rule 22(2) and Rule 25 in cases of loss of goods in transit.

ORDER

Dr. P.D. Shenoy, Member - Appellant - Gujarat Electricity Board (in short the Board ) was the complainant before the State Commission. The Board had placed an order for purchase of 28 units of electrodes from its foreign manufacturer based at England. The value of these goods was 4704 i.e. equivalent to Rs. 2,40,187. The order was placed on 26.9.1994, and they were transferred by Air from London Heathrow Airport to Mumbai (Bombay). The Manufacturer Solartron Transducers Ltd. shipped the goods through Air India for transportation on 9.11.1994. The goods were transported by Air India Flight No. 102/09. The appellant received a telegraphic message to contact Air India Import Cell to collect the goods. When their clearing agent Babaji Shivram - Clearing and Carriers Pvt. Ltd., went to take the delivery of the goods, they were told that they have been mishandled or missing and the clearing agent was advised to lodge a claim. Air India offered a sum of US $ 120 as full and final satisfaction of the goods not delivered, which was refused by the complainant - Board. Subsequently, the complainant purchased these items from Bharat Heavy Electricals Ltd,. (BHEL) for Rs. 6,26,463.

2. Accordingly, the Board filed complaint before the State Commission to pay:

(a) Rs. 7,58,680 to the complainant Board as compensation for the monetary loss, it has suffered on account of deficiency of service

(b) To pay further interest of Rs. 6,32,213 @ 18% per annum since 10.11.1996 till payment (a) + (c) + (d) + (e) of paragraph No. 13)

(c) To pay Rs. 20,000, as compensation for the expenditure incurred in travelling and lodging and boarding.

(d) To pay Rs. 10,000, as compensation for future expenditure for travelling and lodging and boarding.

(e) To pay Rs. 10,000 as compensation for mental and physical harassment and agony.

3. The Air India raised defence of limited liability in respect of loss of cargo under provisions of Rule 22(2) of Schedule II of the Carriage by Air Act, 1972.

4. The complainant in this case had initially stated that the goods were lost by Air India. Subsequently they filed an amended complaint stating that goods were later on found and auctioned and were purchased by World Trade Corporation in August, 1998. The State Commission proceeded on the assumption that the goods were lost in transit. The State Commission relied upon Rule 22(2) of Schedule II to the Carriage by Air Act, 1972 and observed that in view of the well settled legal position, liability of Air India is limited to the extent specified under Rule 22(2) of Schedule II to the Carriage by Air Act, 1972. Admittedly the weight was 6 kgs. Therefore, the liability of Air India in any case cannot be beyond the sum of U.S. $ 120.

5. The State Commission further observed that the Airway Bill has not disclosed the value of the subject goods in the column of declared value of cargo and declared value for customs was also written "NVD". Therefore, the complainant cannot claim the value of the goods. Accordingly, Air India is entitled to invoke Rule of limited liability.

6. The State Commission further held that there was no conclusive evidence brought on record to show that goods were not lost in transit and were subsequently found. The State Commission discarded the request of the learned Counsel for Nigam to invoke Rule 25 of the Carriage Act, 1972 holding that in the absence of conclusive proof with regard to reckless negligence in handling of goods, this Rule cannot be invoked. Therefore, the complaint filed by the complainant was partly allowed and Air India was directed to pay $ 120 to the complainant together with interest at the rate of 6% from 14.12.1994 within a period of 30 days from the date of receipt of the order along with Rs. 1,000, as cost.

7. Aggrieved and dis-satisfied by the order of the State Commission, the Board/ Nigam has filed this appeal before us.

Submissions of the learned Counsel for the Appellant

8. The learned Counsel for the appellant, Mr. R.K. Mehta submitt