1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION SUIT NO.2885 OF 1992 The Board of Truestees of the Port of Bombay, a body corporate constituted under the provisions of the Major Port Trust Act, 1963 as amended by the provisions of the Major Port Trust (Amendment) Act, 1974, having its principal place of business at Vijay Deep, Shoorji Vallabhadas Marg, Fort, Mumbai – 400 038. . ..... Plaintiffs V/s. M/s.S.V.A. Udyog Viniyog Limited, a company Limited under Indian Companies Act, having their Administrative office at 162-C, Mittal Tower, 16th Floor, Nariman Point, Mumbai – 400 021. .... Defendants Mr.U.J.Makhija i/by Mulla & Mulla & Craigie Blunt & Caroe, for the plaintiffs. None for the defendants. CORAM: R.Y.GANOO , J. DATED: 03 rd FEBRUARY, 2009. ORAL JUDGMENT : 1. The plaintiffs have filed the present suit for recovery of Rs.97,069.35 along with interest @ 18% p.a., on Rs.96,593.00 from the date of the suit till realization and for costs. 2 2. The plaintiff's case in a nutshell, is as under : - The defendants imported 880 bags of seeds of almonds vide Item No.189, Import General Manifest No.2115 of 10-08-1988 (hereinafter referred to as the said Cargo). The cargo came to Mumbai port by Ship “M.V.Vanellus”. The general landing date was 12-08-1988 and the last free date was 18-08-1988. The plaintiffs were concerned with the suit cargo in view of the provisions of Major Port Trust Act (hereinafter referred to as the said Act). 3. According to the plaintiffs, the plaintiffs were constrained to destroy the said cargo on 18-09-1989 as the same was ordered to be destroyed by the Port Health Officer. Prior to the destruction as aforesaid, the plaintiffs had by their letter dated 05-01-1989 called upon the defendants to clear the cargo or to make the payment. However, defendants had denied their liability. According to the plaintiffs, after the destruction of the cargo, plaintiffs by their letter dated 07-09-1992 called upon the defendants to pay Port Trust Charges to the tune of Rs.96,593/- on the ground that the defendants were liable to pay Port Trust Charges. The defendants by their letter dated 08-09-1992 denied the liability. The plaintiffs have prayed for decree as set out in the prayer clauses. 4. The defendants disputed the claim of the plaintiffs by filing written statement. According to the defendants, the suit cargo was in the 3 damaged condition and clearance was not allowed as it was not fit for human consumption and that is how the defendants denied their liability. According to the defendants, the suit is barred by the period of limitation. According to the defendants, as the cargo was declared as unfit for human consumption in November 1988, there has been a delay in destruction of the cargo, particularly when the defendants had given their consent for destruction of the cargo in November 1988. In substance, the defendants contested the suit. 5. The following issues came to be framed on 20-06-2008. I have given my findings against each of the issues for the reasons to follow : - ISSUES FINDINGS (1) Whether the suit is barred by the law of limitation as alleged in Para 1 of the written statement ? In the Negative. (2) Whether the defendants prove that the suit consignment was damaged due to negligence and mishandling of consignment by the plaintiffs and as the consignment was declared unfit for human consumption while in custody of the plaintiffs, defendants are not liable to clear the same as alleged in Para Nos.1 and 4 of the written statement ? In the Negative (3) Whether the defendants prove that plaintiffs are guilty of delay and 4 negligence in disposing the suit consignment as alleged in para No.6 and 7 of the written statement ? In the affirmative. (4) Whether the port trust charges along with destruction charges amounted to Rs.96,593/- as stated in para 8 As per Operative of the plaint ? Part. (5) Whether the defendant is liable to pay to the plaintiff a sum of Rs.96,593/- together with a sum of Rs.476.35 being interest thereon at 18% p.a. from As per operative 07-09-1992 ? part. (6) To what reliefs, if any, are the As per Operative plaintiffs entitled to ? Part. (7) What order ? Suit is decreed. 6. At the trial, the plaintiff's examined Mr.S.V.Prakash (P.W.1), Assistant Docks Manager. No other witness was examined on behalf of the plaintiffs. Defendants remained absent at the time of recording of evidence and no witness was examined on behalf of the defendants. 7. I have heard the learned counsel appearing on behalf of the plaintiffs. With the assistance of the learned counsel for the plaintiffs, I have perused the entire record. The plaintiffs claimed that the cargo was declared as unfit for human consumption and was destroyed on 18-09- 1989. The plaintiffs have placed before the Court Worksheet as Exh.P-2 and the plaintiffs have claimed wharfage charges to the extent of Rs.129/- 5 and have claimed demurrage charges upto 180 days from the last free date and they amount to Rs.96,390/-. The plaintiffs have claimed destruction charges to the tune of Rs.1,910/-. 8. The plaintiffs' witness Mr.S.V.Prakash (P.W.1) has stated in his evidence in Para 4 that by letter dated 02-01-1989, the plaintiffs informed the defendants that the contents of the packages are certified as unfit for human consumption by the Municipal Analyst. The learned counsel for the plaintiffs contended that though the cargo was destroyed on 18-09-1989, (that is practically after a period of one year from the last free date i.e. 18-08-1988), the plaintiffs have claimed port trust charges for a period of six months from the last free date. The learned counsel for the plaintiffs, further submitted that the plaintiffs were required to charge demurrage charges as per the Docks Scale of rate and as the evidence of Mr.S.V.Prakash (P.W.1) has gone unchallenged, the plaintiffs have made out a case for grant of decree as prayed for. 9. The learned counsel for the plaintiffs took me through the evidence and submitted that there is an elaborate procedure to arrive at a final decision as to whether the cargo is fit for human consumption or not and it is only after getting certificate that the cargo is unfit for human consumption, the port trust authorities have proceeded for destruction of the cargo. The learned counsel for the plaintiffs submitted that plaintiffs 6 could calculate port trust charges only after the cargo came to be destroyed i.e. on 18-09-1989 and if that date is taken into account, the institution of the suit on 17-09-1992 will have to be treated as within the period of limitation. In this context, he placed reliance upon a judgment in the case of Trustees of Port of Bombay V/s. M/s.Jayantilal L. Gandhi, AIR 1979, Bom. 12. 10. The learned counsel for the plaintiffs, submitted that the plaintiffs were required to incur destruction charges to destroy the said cargo and that is how the plaintiffs have claimed a sum of Rs.1,910/- and that the same is required to be granted to the plaintiffs. The learned counsel for the plaintiffs submitted that plaintiffs have claimed interest @ 18% p.a. and such a demand was made by a letter dated 07-09-1992 and that averments in such a demand letter are not denied by the defendants and hence, the plaintiffs are entitled to interest as prayed for. 11. I have considered the submissions advanced by the learned counsel for the plaintiffs. The defendants have filed written statement and have admitted that they are the consignees. The defendant's claim that the cargo reached the port of the plaintiffs in the damaged condition and this fact was pointed out to the plaintiffs. It is also the case of the defendants as put in Para No.7 of the written statement that the defendants had given consent for the destruction of the goods in November 1988. It will have to 7 be remembered that in the absence of evidence on behalf of the defendants, the stand put up by the defendants that they had given consent for destruction of the cargo in November 1988, cannot be accepted. The plaintiffs' witness has categorically admitted in para No.4 of the examination-in-chief that by letter dated 02-01-1989, the plaintiffs had informed the defendants that the cargo was not fit for human consumption. This will mean that the plaintiffs were knowing as on 02-01-1989 that the cargo was required to be destroyed. If this be so, in the entire evidence, there is no explanation forthcoming as to why the cargo came to be destroyed as late as 18-09-1989. 12. The provisions of Section 61 and 62 of the said Act, impose the responsibility upon the plaintiffs to wait and allow the consignee or the owner of the cargo to receive the cargo. It is an admitted position that for a period of 60 days, the plaintiffs as a Port Authority, cannot proceed for destruction or for sale of the cargo. If the consignee or the owner does not retire the cargo upto the period of 60 days, the plaintiffs are free to attend to the cargo i.e. to say plaintiffs may destroy the cargo or sale the cargo depending upon the facts and circumstances of the case. 13. In the present case, the mandatory period of 60 days came to an end on 18-10-1988, keeping in view the last free date as 18-08-1988. Hence, it was necessary for the plaintiffs to explain through their witness as 8 to what steps were taken by the plaintiffs to proceed to dispose of the cargo by sale or destroy the same. The evidence placed by the plaintiffs does not indicate as to the precise date on which the plaintiffs received the orders from the port authorities as regards destruction. The evidence on record also does not go to show as to when plaintiffs after the mandatory period is over, proceeded to look to the cargo for the purposes of destruction or for sale. If this be so, in my view, in order to claim demurrage charges for the period of six months i.e. upto February 1989, it was necessary for the plaintiffs to explain as to why the cargo was not destroyed immediately after January 1989 and why they waited till 18-09- 1989. It was also necessary for the plaintiffs to place on record as to when they took steps to deal with the cargo. In the absence of such a date, the Court is required to consider the question of delay which has been raised by the defendants. It is true that the defendants did not enter the witness box to lead evidence. However, on the basis of the dates and the record produced by the plaintiffs, it is apparent that the plaintiffs have not been able to place before the Court appropriate evidence to show as to when they thought it fit to take steps in respect of the cargo for destruction or for sale. If this be so, the Court is required to decide as to for what period the plaintiffs can claim demurrage charges. The Court cannot grant the port trust charges beyond a date which is found to be just and reasonable. If 9 the goods are not collected for first two months i.e. during the statutory period, the plaintiffs would undoubtedly be entitled to the demurrage charges for the said period of 60 days. Keeping in view this principle, the period of two months turns out upto 18-10-1988. The plaintiffs have claimed demurrage charges for 120 days after 18-10-1988 i.e. upto February 1989. At the first blush the record shows that the plaintiffs are giving concession to the defendants in the matter of charging port trust charges. At the same time, in the evidence of Mr.S.V.Prakash (P.W.1), no explanation is forthcoming as to why port trust charges are claimed upto February 1989 and not upto 18-09-1989 when the cargo came to be physically destroyed as stated by Mr.Prakash (P.W.1). If this is the position, the question before me is as to what extent the plaintiffs are entitled to demurrage charges in excess of 60 days i.e. beyond 18-10- 1988. 14. After having considered the entire record and relevant dates as mentioned aforesaid, I am inclined to observe that when the cargo was lying on the property of the plaintiffs, they should have kept a watch over the said cargo and take steps as expeditiously as possible to proceed to destroy the cargo or put it for sale. In the present case, no explanation is coming forth as to what employees of the plaintiffs did after the mandatory period of 60 days is over and when the plaintiffs moved for destruction of 10 the cargo. 15. If this be so, in the peculiar facts and circumstances of the case, I am inclined to observe that the plaintiffs would be entitled to recover from the defendants port trust charges for one more month in addition to the mandatory period of sixty days. In my view, the claim of the plaintiffs for recovery of port trust charges for a period of 120 days after the mandatory period, cannot be granted as if such a relief is granted to the plaintiffs, it would mean that the Court is assisting a public body which was required to take steps in regard to the cargo which had landed on the port of the plaintiffs. In my view, keeping in view the facts of this case, it would be proper to balance the equities and grant port trust charges for a period of 30 days beyond the statutory period. 16. The plaintiffs have calculated port trust charges for first 60 days at Rs.22,950/-. The same can be granted. The aforesaid sum is upto the mandatory period of 60 days. Then comes the next stage i.e. plaintiffs have charged port trust charges for 120 days. For that, I am inclined to grant to the plaintiffs port trust charges for 30 days. The charges for 120 days are shown at Rs.73,440/. The charges for the third month keeping in view the Docs Scale of rate would be Rs.18,360/-. Hence, the plaintiffs would be entitled to recover from the defendants port trust charges for in all 90 days amounting to Rs.41,310/-. 11 17. The plaintiffs have claimed wharfage charges being one time charges at Rs.129/-. I see no difficulty in granting the same. The plaintiffs have claimed destruction charges to the tune of Rs.1,910/-. The plaintiffs have not placed on record any material as to under what provisions of law destruction charges can be claimed. Hence, I am not inclined to grant destruction charges to the plaintiffs. To that extent, plaintiffs claim will have to be rejected. 18. Keeping in view the aforesaid discussion, the plaintiffs would be entitled to recover wharfage to the tune of Rs.129/- and demurrage charges for 90 days to the tune of Rs.41,310/-, making it together Rs.41,439/-. The plaintiffs have claimed interest @ 18% p.a. on the port trust charges from 07-01-1992 upto the date of the filing of the suit. Interest was claimed with effect from 07-01-1992 as the demand notice was issued on 07-01-1992. In my view, the claim for the interest with effect from 07-01-1992 can be granted of course, not at the rate of 18% p.a. for reasons to follow. 19. The claim of the plaintiffs for interest @ 18% p.a. is based on the contents of the demand notice. Such a stand cannot be accepted in the absence of appropriate evidence. In my view, rate of interest can be considered on the basis of the relevant dates namely last free date as 18- 08-1988, the date of destruction of the cargo i.e. 18-09-1989. Keeping in 12 view these dates, I am inclined to grant interest @ 12% p.a. with effect from 07-01-1992 till the filing of the suit. 20. In so far as interest after the filing of the suit, keeping in view the provisions of Section 34 of C.P.C., if interest @ 6% p.a. is granted, it would meet the ends of justice. The plaintiffs would of course, be entitled to receive costs of the suit. 21. The plaintiffs have destroyed the goods on 18-09-1989 and the suit is filed on 17-09-1992. In view of these date, the cause of action is arose on 18-09-1989. In view of the judgment in the case of Trustees of Port of Bombay V/s. M/s.Jayantilal L. Gandhi, AIR 1979, Bom. 12, the plaintiffs suit is within the period of limitation. The issue No.1 is answered in the negative. 22. Issue No.2 : - It has been a stand of the defendants that the consignment came to the port in the damaged condition on account of negligence and mishandling by the plaintiffs and that is how the cargo became unfit for human consumption. It is required to be mentioned that no evidence is placed by the defendants before the Court to support the said stand and therefore, it would not be proper for this Court to record findings against the plaintiffs. Keeping in view the aforesaid discussion, issue No.2 is answered in the negative. 13 23. Issue No.3 : This relates to the delay on the part of the plaintiffs in disposing of the goods. It is true that evidence in this regard has not been placed by the defendants to show that there was delay on the part of the plaintiffs. However, in my view, in the facts and circumstances of the case, even if the defendants have not placed evidence on record, the evidence led by the plaintiffs and the relevant dates appearing in the said evidence would clearly show that the plaintiffs did not attend the matter as regards destruction of the cargo or as regards placing it for sale as expeditiously as possible and no evidence is placed before the Court by plaintiffs as to what steps were taken by the plaintiffs to attend to the case after the mandatory period was over. Under these circumstances, I am inclined to observe that issue No.3 is required to be answered in the affirmative and on account of the issue being answered in the affirmative, I have declined to grant relief to the plaintiffs in the nature of port trust charges for a period of six months as prayed for, and port trust charges for a period of three months are being granted. Accordingly, Issue No.3 is answered in the affirmative. 24. Issue Nos.4 & 5 : For the reasons mentioned earlier, port trust charges are granted for 90 days. These issues are decided as per operative part. 25. Issue No.6 : 14 Plaintiffs claim to a limited extent has been granted and the issue has been decided as per operative part. 26. Issue No.7 is being decided as per the operative part. 27. Taking into consideration the above discussion, I pass the following decree. : D E C R E E : 1. The defendants do pay to the plaintiffs Rs.41,439.00. 2. The defendants do pay to the plaintiffs interest @ 12% p.a. from 07-01-1992 till filing of the suit on Rs.41,439.00. 3. The defendants do pay to the plaintiffs interest @ 6% p.a. from the date of the filing of the suit till realization on Rs.41,439.00. 4. The defendants do pay to the plaintiffs costs of the suit. ( R.Y.GANOO, J. )