1 fa200 ssp IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELATE JURISDICTION FIRST APPEAL NO.200 OF 1994 Union of India through General Manager, Central Railway, Bombay. ...Appellant vs. M/s.Mulchand and Company,Pune ...Respondent Mr.A.N.Samant for the appellant Ms Jayshree Avhad i/b Mr.G.M.Khambate for the respondent CORAM :A.S.OKA,J. DATE ON WHICH SUBMISSIONS ARE HEARD: 29 th JUNE 2011 DATE ON WHICH JUDGMENT IS PRONOUNCED: 9TH SEPTEMBER 2011 JUDGMENT : 1 By this First Appeal, the appellant-Union of India has taken an exception to the Judgment and Order dated 22 nd October 1991 passed by the Railway Claims Tribunal by which the appellant has been ordered to pay damages of Rs.5335/- together with interest at the rate of 12% per annum from the date of filing of the claim application till realisation. 2 According to the case of the respondent, a consignment was booked with the appellant-Railways. When the consignment arrived at Pune station, the same showed shortage/damage due to pilferage of water on account of gross negligence on the part of the Railways. The consignments were booked under railway receipts dated 1 st July 1981, 20 th August 1981, 21 st September 1981 and 21 st September 1981. On account of damage, Railways paid a sum of Rs.13,608/-. As the balance amount was not paid, a suit was filed by the respondent in the civil court for a decree in the sum of Rs.7250/-. On the constitution of 2 fa200 Railway Claims Tribunal, the suit was transferred to the said Tribunal from the Civil Court. The appellant contested the suit by filing a written statement. It was contended that the Railway was not liable and the suit was barred by limitation. Various other defences were raised on merits. 3 The Tribunal framed issues. The first issue was regarding bar of limitation. The second issue was regarding authority of the person to sign the plaint. The third issue was whether the payment made by the Railways was accepted by the respondent in full and final settlement of their claim. 4 The learned counsel for the appellant submitted that the consignments were booked under the four railway receipts. The first two railway receipts were dated 1 st July 1981 and 20 th August 1981. Other two railway receipts were of 21 st September 1981. He pointed out that the suit was filed on 25th September 1984 in the Civil Court. He submitted that going by the findings recorded on issue no.5, the suit was clearly barred by limitation. He submitted that interest granted at the rate of 12% per annum was clearly excessive and interest could not have been granted at a rate more than 6% per annum. The learned counsel for the respondent submitted that the Railways made part payment of sum of Rs.6804/- in two cases totally amounting to Rs.13,608/-. The learned counsel submitted that the suit was not maintainable without lodging claim and without giving statutory notice and if period for filing the claim is excluded, the suit was within limitation. The learned counsel submitted that interest at the rate of 12% per annum granted by the Tribunal is consistent with section 34 of the Code of Civil Procedure,1908 (hereinafter referred to as the said 3 fa200 Code). 5 I have given careful consideration to the submissions. As stated earlier, dates of railway receipts are 1st July 1981, 20th August 1981, 21st September 1981 and again 21st September 1981. The details such as the date of damage certificate, the date of claim are as under : Sr . No . Date of Railway receipts Quantity in Kg. Date of damage certificate Date of notice u/sec.78-B of the Railways Act,1890 1 1 st July 1981 440 24 th July 1981 3 rd October 1981 2 20 th August 1981 288 14 th September 1981 19 th October 1981 3 21 st September 1981 1750 7 th October 1981 16 th November 1981 4 21 st September 1981 1750 7 th October 1981 16 th November 1981 Under section 78-B of the said Act of 1890, period of six months from the date of delivery is provided for lodging a claim. Under the said provision, no person is entitled to compensation unless a claim is made under section 78- B. Thus, the cause of action for filing a suit is available only after a claim under section 78-B is lodged within the time provided by law. Considering the dates on which the damage certificate was issued and the dates on which claims were lodged, suit filed on 24 th September 1984 cannot be said tao be barred by limitation. A part payment of Rs.13608/- was made on 12 th February 1982. 6 It is an admitted position that the Railways paid a sum of Rs.13,608/- towards damages. In paragraph 8 of the impugned Judgment, a finding has been recorded that 4 fa200 in case of last two consignments, Railways paid a sum of Rs.6804/- each and against remaining two consignments no amount was paid by the Railways. On the basis of the damage certificate issued by the Railways, Tribunal held that in first two cases, compensation claimed was Rs. 9092.50 each. In paragraph 7 of the Judgment, the Tribunal held that a sum of Rs.13,608/- was received by the respondent under protest as reflected from the letter dated 27th February 1982. Therefore, the contention regarding bar of limitation has no merit. 7 The only other challenge is on the rate of interest. The Apex Court has held that the Railway Claims Tribunal can invoke power under section 34 of the said Code for granting interest on the claims made before it. The Apex Court has held that even the Interest Act can be invoked. In the present case, there is no stipulation in the contract between the parties to pay interest. The transaction cannot be said to be a commercial transaction. Therefore, interest could not have exceeded 6% per annum. This is the only modification which will have to be made in the impugned order. 8 Hence, I pass the following order : i) Impugned Judgment and order is modified by holding that interest payable will be at the rate of 6% per annum instead of 12% per annum. Rest of the Judgment and Order is maintained. ii)Appeal is partly allowed on above terms with no order as to costs. JUDGE 5 fa200