F.A.O No.4995 of 2006 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. F.A.O No.4995 of 2006 Date of Decision: 25.08.2009 New India Assurance Co. Ltd.and another ....Appellants Versus Union of India and another ...Respondents F.A.O No.2310 of 2007 New India Assurance Co. Ltd. ....Appellants Versus Union of India and another ...Respondents F.A.O No.1806 of 2008 New India Assurance Co. Ltd. ....Appellants Versus Union of India and another ...Respondents F.A.O No.4995 of 2006 2 F.A.O No.1807 of 2008 New India Assurance Co. Ltd. ....Appellants Versus Union of India and another ...Respondents F.A.O No.1808 of 2008 New India Assurance Co. Ltd. ....Appellants Versus Union of India and another ...Respondents F.A.O No.3727 of 2008 New India Assurance Co. Ltd. ....Appellants Versus Union of India ...Respondent CORAM : Hon'ble Ms. Justice Nirmaljit Kaur Present:- Mr. Paul S. Saini, Advocate for the appellant. Mr. Jagdish Marwaha, Sr. Standing Counsel for Railways. Mr. Nitin Kumar, Advocate for the respondents in FAO No.2310 of 2007. ***** F.A.O No.4995 of 2006 3 1. Whether Reporters of Local Newspapers may be allowed to see the judgment ? 2. To be referred to the Reporters or not ? 3. Whether the judgment should be reported in the Digest ? ** NIRMALJIT KAUR, J. This order shall dispose of FAO Nos.4995 of 2006, 2310 of 2007, 1806 of 2008, 1807 of 2008, 1808 of 2008 and 3727 of 2008 as common question of law arise in all these appeals. The facts are being taken from FAO No.4995 of 2006. This is an appeal against order dated 02-08-2006 passed by Railway Claims Tribunal, Chandigarh Bench, Chandigarh, vide which an amount of Rs.3000/- was awarded to appellant No.1, despite the non-delivery of the entire consignment worth Rs.42,946/-. The appellants, herein, is the New India Assurance Co. Ltd. as well as M/s Kohinoor Textile Industries. The appellant No.2 entrusted a consignment comprising of one cartoon of knitted fabrics to the Railway Administration at Amritsar for carriage from Amritsar to Howrah at railway's risk for delivery to M/s Kewal Krishan Kapoor, Calcutta. The said consignment was never delivered by the railway authorities to the aforesaid party. Consequently, the consignment remained undelivered. The non-delivery was confirmed. On account of the aforesaid non-delivery, the appellant No.2 served a notice to the Railways under Section 78-B of the Indian Railway Act (now Section 106 of the Railway Act). The said consignment was insured with appellant No.1, i.e. the New India Assurance Company Limited and in terms of the said policy, the appellant No.2 preferred a claim with appellant No.1. The claim of the appellant No.2 was settled by appellant No.1 for Rs.42,946/- being the actual value of the entire consignment plus the incidental expenses. Accordingly, the appellant No.1 filed a claim for Rs.42,946/- from the respondents Railway Administration. While challenging the said order, learned counsel for the appellants argued that the Tribunal fell in error in awarding the compensation on the basis of the weight of the consignment under the provisions of Section 103 of the F.A.O No.4995 of 2006 4 Railways Act, 1989. It was further submitted that even if the value of the consignment is not declared, the Railway Administration under the garb of Section 103 of the Railways Act, 1989, cannot be permitted to keep the whole consignment and pay only a paltry amount to the consigner/consignee. It was further submitted that the Railway Administration cannot be absolved of its responsibility as a carrier and custodian of the goods in transit without any cogent reasons. In the present case, there is nothing on record to show as to what happened with the consignment during transaction. Consequently, the Railway Administration deserves no protection, whatsoever, under any law. It was, therefore, pleaded that the Railway Administration should be directed to pay entire claim of Rs.42,946/-, instead of Rs.3,000/- only. Learned counsel for the respondents, in response to the arguments, submitted that while booking the consignment, the appellant No.2 had not disclosed the value nor disclosed the nature of the consignment. Only the weight of the parcel i.e. 60 Kgs. was disclosed. The charges for the delivery were on the basis of the weight and not as per the value of the consignment. As such, their liability was only to the extent of the provisions of Section 103 of the Railways Act, 1989. In view of the above, it would be relevant to peruse Section 103(2) of the Railways Act, 1989, which is as under :- “103 Extent of monetary liability in respect of any consignment :- (1) XXX XXX XXX (2) Notwithstanding anything contained in sub- section (1), where the consignor declares the value of any consignment at the time of its entrustment to a railway administration for carriage by railway and pays such percentage charges as may be prescribed on so much of the value of such consignment as is in excess of the liability of the railway administration as calculated or specified, as the case may be, under sub-section (1), the liability of the railway administration for the loss, destruction, damage, deterioration or non-delivery of such consignment shall not exceed the value so declared.” The above Section 103(2) of the Railways Act, 1989 is self F.A.O No.4995 of 2006 5 explanatory. There is no ambiguity in the said Section. It is clear that as per this Section, the liability is restricted to Rs.50/- per kilogram in case of non-delivery of the consignment. Learned counsel for the appellants has not been able to deny this. Obviously, no dispute can be found with the order of the Tribunal, granting Rs.50/- per kilogram i.e. a total of Rs.3,000/- for the non-delivery of the consignment, weighing 60 kilograms with interest @ 6% per annum from the date of filing the claim application i.e. 26.01.2006 till the payment is made by the respondent-railways. Learned counsel for the appellants further relied on the judgment of Bombay High Court, reported in the case of Babubhai Cloth Stores v. Union of India and another 1988 ACJ 1105, wherein, it was held that the declaration of the value is not necessary, if the compensation is claimed on the ground of non-delivery of goods. The said judgment is not applicable herein, as in that case, no compensation at all, was granted. It was in those circumstances that the Court held on the basis of interpretation of Section 77-B of the Indian Railways Act, 1989, as follows :- “ Section 77-B, relevant portion of which is extracted above, read with the excepted eventualities is an exception grafted on the general rule. From the nature of things therefore, if the exceptions do not hold good in certain cases the main provisions contained in Section 73 of the Railways Act must prevail. Under Section 73 the railway administration becomes responsible for payment of compensation not only for loss, destruction, damage or deterioration of the goods but it is responsible for compensation even in the case of mere non-delivery of the goods. Section 73, therefore, is a very wide section. One of the exceptions grafted upon it by section 77-B is, on the other hand, narrow in certain respects. The exception says that for recovering compensation on the ground of loss, destruction, damage or deterioration of the goods, the declaration of the value of the same is necessary. The declaration is not necessary if the compensation is claimed on the ground of non-delivery of the goods. Section 73 specifies and enumerates five categories in respect of which compensation is required to F.A.O No.4995 of 2006 6 be paid by the Railways. Section 77-B takes out four categories out of that enumeration but does not take out the last category viz. non-delivery of goods from the enumeration. This means that if the plaintiff's grievance is about non-delivery of the goods, he has every right to file a suit for compensation, even though he has not made declaration as regards the value of the goods as required by said section 77-B of the Act.” The above judgment was, therefore, passed keeping in view Section 77-B of the Railways Act, which reads as under :- “77-B (1) Notwithstanding, anything contained in the provisions of this chapter, when any articles mentioned in the Second Schedule are contained in any parcel or package delivered to a railway administration to be carried by railway and the value of such articles in the parcel or package exceeds five hundred rupees, the railway administration shall not be responsible for the loss, destruction, damage or deterioration of the parcel or package unless the person sending or delivering the parcel or package to the administration caused its value and contents to be declared in writing or declared them in writing at the time of the delivery of the parcel or package for carriage by railway, ad if so required by the administration, paid or engaged to pay in writing a percentage on the value so declared by way of compensation for the increased risk.” The Act has since been amended and the present claim has been filed under the amended Act i.e. The Railways Act, 1989. Even otherwise, in the present case, compensation has been duly granted as per the declaration. In the case, in hand, the claim petition was held maintainable and the compensation was awarded, in accordance with the provisions of amended Act, under which the claim was filed. Whereas, in the case cited by the learned counsel, the very maintainability of the claim was under consideration. In the present case, the consignor insured the goods on the basis of the weight. He took the risk of not insuring the goods as per the value. He thus saved the additional charges. In case, he had insured the goods as per the value, the Insurance Company would have got the earlier amount. F.A.O No.4995 of 2006 7 The evidence, the ground, the claim or policy on the basis of which, the appellant No.1, the Insurance Company gave Rs.42,946/- as compensation together with interest to the appellant No.2 is not before this Court and as such, the same is between the appellant No.1 and appellant No.2. The Railway Administration-respondent No.2 is not a party to the same and therefore cannot be made liable for a declaration which was never made before it. Thus, the liability of the Railway is to the extent of the declaration made before it. In the present case, declaration was in terms of weight and thus, the liability is in the same terms as specified under Section 103(1) of the Railways Act, 1989. The appeal is, accordingly, dismissed. (NIRMALJIT KAUR) 25.08.2009 JUDGE gurpreet