UNION OF INDIA Vs. MOTILAL KAMALIA

JUDGEMENT

(1.) In both the appeals, the Union of India as representing the East Indian Railway, the Oudh ahd Tirhut Railway and the Assam Railway, is the appellant. They were the defendant No. 1 in two money suits in the Court of the first Additional Subordinate Judge, Gaya, numbered as Money Suit No. 3/2 and 4/1 of 1952/1956. The suits were filed first in the Court of the Subordinate judge 1st Court, Gaya, but during the trial they came before the 1st Additional Subordinate Judge at that place. That explains the two different numbers given to each of the two suits. The plaintiffs in both the suits were Sri Motilal Kamalia and Sri Kashi prasad Kamalia, sons of Sri Rampra^ap Kamalia,, w^d were traders carrying on business in the nams and style of Messrs Sri Rampratap Kamalia Mills at Warsaliganj in the district of Gaya. They impleaded also two insurance companies, Messrs. National Fires and General Insurance Company Limited of Calcutta in the former suit and Messrs Gladstone Lyall and Company Limited of Calcutta in the latter. Two other persons, Sohanlal Saraogi and Jugal Kishore Jain were also common defendants in the two suits. Balchand Saraogi, who was expunged on account of his death, was another defendant in the second suit. The plaintiffs laid both the actions for recovery of money by way of damages for nondelivery of two consignments at Forbesganj, a station on the Assam Railway, which had been booked from Paimar railway station on the East Indian Railway (now known as Eastern Railway) to he carried at railway risk. Their allegations were that the defendants Sohanlal and Jugal-Kishore, who carry on business at Warsaliganj in the name of Sitaram Radha Kishun, booked nine bags of black pepper at Paimar Railway Station on the 25th September, 1950, under invoice No. 3, and railway receipt No. 611192 to be carried to Forbesganj. On the 9th October, 1950, the deceased Balchand Saraogi, another trader at Gaya, booked a consignment of 16 bags of black pepper at Paimar Railway Station for carriage to Forbesganj at railway risk under invoice No. 4 and railway receipt No. 611193. The bags in both the consignments were new double gunny bags securely packed, the stitched portions being painted in green. The first consignment bore on the bags private marks as SRWRS (25) and the second PBBCS. The railway marks of the consignments were respectively 701 and 707. The first consignment was insured with Messrs National Fire and General Insurance Company of Calcutta for the transit. The railway receipt of the second consignment was endorsed by Balchand Saraogi in favour of Sitaram Radha Kishun who got the consignment insured with Messrs Gladstone Lyall and Company of Calcutta. Both the Railway receipts were again endorsed to favour of the plaintiffs for valuable consideration by the firm Sitaram Radha Kishun. On getting the information of arrival of the consignments at Forbesganj the plaintiffs sent their man to take delivery who, however, found that the bags which had really been booked at paimar had not reached there and in their stead 25 other bags without the private marks on any of them, with contents like Chilli seeds and saw dust, were offered to be delivered to the plaintiffs. They had to refuse that and informed their grievance to railway station .master at Forbesganj on the 14th November, 1950 and the 19th December, 1950. They, lodged their claim with the railway administration as well as the insurance companies. As they had no redress, they brought the present suits.

(2.) Three sets of written statements were filed, one on behalf of Sitaram Radha Kishun another by the Insurance companies, and the third and main, on behalf of the Union of India representing the railway administration. Sitaram Radha Kishun laid support to the plaintiffs' case. They only alleged that they had been impleaded unnecessarily. The defence of the insurance companies wag that the plaintiffs were not the endorsees in due course and, as such, not entitled to any benefit under the policies. In Other respects they went on the same line as the railway administration. The main contestants were the railways and their written statement alleged that the plaintiffs were not the endorsees in due course, and that both the consignments were actually of bags containing chillies, chillies dust and other worthless things which the consignor booked as containing black pepper on a false declaration in the forwarding note, with a view to cheating the railway administration in collusion with the railway staff at Paimar. The bags were brought to the railway station at Palmar as completely closed with their mouths tightly secured and sewn up, and it was not possible for the booking clerk to know and verify their contents. They further stated that the railway administration and their servants dealing with the consignments at different stages were not guilty of any fraudulent conduct, and they had taken all possible care and precaution about the consignments, and there was no misconduct or negligence on their part in any way. It was disclosed that a criminal case had been started arising out of that transaction and was pending in court. The case as it was learnt in evidence, was under Sections 420 and 120B of the Indian Penal Code against Bhagirath Kamalla, Jugal Kishore Jain (one of the defendants) and Kailaspathi, the station master at Paimar railway station. That ended in acquittal in appeal.

(3.) Thus, the main defence was that the transaction consisting in the transfer of the railway receipts in favour of the plaintiffs was collusive and not for consideration and the booking of the two consignments describing them to be bags containing black pepper, at railway risk, was fraudulent and in collusion with the station staff for the ulterior purpose of claiming damages against the railways concerned. Another plea, which was seriously contended during the trial as well as before us, was that the booking of the two consignments at Paimar was in spite of and against the positive directions issued by the Railway authorities to stop any booking of goods to the O. T. Railway through Bhagalpur. This fact, however, was not mentioned in the written statement but was alluded to in evidence in proof of the alleged fraud.