IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. SATHISH KUMAR, J.
Freight Bridge Logistics Pvt. Ltd. - Petitioner
Versus
A1 - Arsath Enterprises, Rep. by its Partner Mr. K.M. Humayun Kabeer - Respondent
O.P. No. 208 of 2018
Decided On : 26-10-2021
Sale of Goods Act – Section 26 - Arbitration Act – Section 34 - Missing of goods - Compensate damages for missing goods - Claimant is doing business of exporting textiles and fancy items - They exported 283 packages containing textile and fancy items through respondents - Respondents issued Model Transport Document/Bill of Lading - Goods were consolidated by respondents and stuffed in a container - Goods were entrusted after customs clearance - Goods reached to destination port - Agent at that port informed claimant that there were only 108 packages as against 283 packages - Immediately, claimant informed respondents about their shipment - First respondent also lodged FIR before the Sub Inspector of Police, B5 Harbour Police Station for missing of goods - Claimant issued a legal notice calling to compensate damages for missing goods - Hence, according to the claimant, as per model transport document if there are loss or damage during period from taking charge of the goods and delivery, Multi Transport operator is liable to pay compensation - Whether claimant entrusted 283 packages of Textiles and Fancy items to respondents for shipment, and they short shipped 175 packages as alleged by the claimant – Held, it is very clear that Bill of Lading is an evidence of a contract between shipper and owner of the ship by which owner of ship agrees to transport goods delivered by the consignor to a specified destination and deliver it to the consignee. In fact, such a contract itself create bailment between consignor and operator - Therefore, at any angle, once the Bill of Lading has been executed between parties herein, petitioner cannot avoid the liability - As the same has created a contract of bailment also when the consignment has been lost during transit - It is the liability on transport to make the loss good - Admittedly, the learned Arbitrator factually found that 283 bales were entrusted for shipping and delivery was given only the lessor quantity - Therefore, operator cannot avoid liability - Accordingly, this Court do not find any perversity or any violation in the award passed by Sole Arbitrator or otherwise any of grounds contemplated under Section 34 of Arbitration Act has been made out to interfere with the award passed by Sole Arbitrator - Accordingly, this Original Petition stands dismissed.
ORDER :
Challenge has been made against the award passed by the Sole Arbitrator directing the respondent, namely the petitioner herein to pay a sum of Rs.8,73,182/- as damages for the loss of 175 bales of textile and fancy items from their possession to the claimant with interest at 3% per annum from 19.05.2014 i.e. the date of Bill of Lading till the date of filing the claim on 22.06.2016 and thereafter at the rate of 6% till the date of payment.
2. Brief facts leading to filing of this petition is as follows :
The claimant is doing the business of exporting textiles and fancy items. They exported 283 packages containing textile and fancy items valued at Rs.28,075.5 USD, through the respondents on 19.05.2014 to Kualalampur, Malasia. The respondents issued Model Transport Document/Bill of Lading dated 19.05.2014. The goods were consolidated by the respondents and stuffed in a container. The goods were entrusted after customs clearance. The goods reached to the destination port on 25.05.2014. The agent at that port informed the claimant that there were only 108 packages as against 283 packages. Immediately, the claimant informed the respondents about their shipment. The first respondent also lodged FIR on 03.06.2014 before the Sub Inspector of Police, B5 Harbour Police Station for missing of goods. The claimant issued a legal notice on 21.06.2014 calling to compensate damages for missing goods. Hence, according to the claimant, as per the model transport document if there are loss or damage during the period from taking charge of the goods and delivery, the Multi Transport operator is liable to pay compensation. Hence, they claimed a sum of Rs.8,73,182/- being the value of missing goods with interest at 24% per annum.
3. The respondent filed a counter stating that the right and title of the goods vested with the consignee. Therefore the claimant cannot maintain the claim under Section 26 of Sale of Goods Act. Similarly, it is also their contention that the claimant approached the respondent for shipment of certain cargo stated to be 283 bales of textiles and fancy items from Chennai Port to Port Kelang in Malaysia. It was stuffed into the container No.KKP0773956-Z. The respondent is not aware of the nature, weight, quality and value of the cargo. Only on the basis of declaration of the claimant, Bill of Lading dated 10.05.2014 was issued. The respondent has not accepted or guaranteed that the container has 283 bales. Hence, it is their contention that it is only short shipping, not a short delivery. The claimant had stuffed less cargo, than what was declared by him, therefore he cannot fasten the liability upon the respondent. It is also stated that the claimant being an unregistered partnership firm cannot maintain the claim and the claimant has also not produced any document to show that the consignee has not made any payment. Therefore, he disputed the claim.
4. The learned Arbitrator has framed the following issues:
(1) Whether the claimant entrusted 283 packages of Textiles and Fancy items to the respondents for shipment, and they short shipped 175 packages as alleged by the claimant?
(2) Is it correct to allege that the respondents entrusted the transport of cargo to 3rd party transporters?
(3) Whether the loss of 175 packages occurred in the custody of the respondent and the claimant is entitled to claim damages from the respondents based on the Bill of Lading?
(4) Is it correct to claim by the respondent that the 175 packages not occurred in their custody and they are liable to pay damages?
(5) Whether the claimant received the value of 283 cargo packages from the consignee?
(6) Is it correct to say that, the claimant lost right, title and interest over the cargo since he endorsed the Bill of Lading in favour of the consignee?
(7) Is it correct to say that the holder of Bill of Lading alone is entitled to claim the cargo or the loss or sue for damages?
(8) Whether the claim is maintainable in the absence of clear statement whether t
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