GIRISH CHANDER Vs. AMERICAN CONSOLIDATION SERVICES LTD

JUDGEMENT

(1.) This complaint has been filed to seek compensation amounting Rs. 29,17,844.70 ps. for negligently delivering the consignment to wrong person on various counts.

(2.) The complainant is a sole proprietor of M/s. Gallant Exports engaged in the business of manufacturing and exporting ready made garments. On 13.12.1994, the complainant entrusted to opposite party 220 cartons containing "short sleeve men's knit shorts" for carriage from Bombay to Norkfolk, VA USA vide cargo receipts bearing Nos. 34116, 34117 and 34118 dated 13/20.12.1994 through the opposite party American Consolidation Services Ltd. (ACS for short). These cargo receipts are virtually acknowledgement of receipt of cargo to be consigned "for and on behalf of the consignee". The consignee declared in the said cargo receipts was to the order of the Central Fidelity Bank", Richmond, V.A. and the Notified Party was "Zip Code Inc., Portsmouth, V.A. USA. When the consignment did not reach the destination, the complainant addressed notices and letters dated 2.3.1995 and 7.3.1995 to the opposite party to enquire about the status of the shipment. It was not responded to. On 11.4.1995, notice was sent. It was replied by the Counsel for the opposite party stating therein that they had handed over the consignments to the Carrier M/s. Hoegh Lines who had in turn delivered the cargo, consignment to the Coronet Inc. Group. The opposite party was duty bound to deliver the goods only under the orders of the consignee Bank or under its orders to protect the interest of the complainant. The opposite party and its employees and agents had acted in gross negligence. This amounted to deficiency in service. The complainant has lost the consignment, its value and had been made to incur various expenses. Since the respondent denied the claim, the complainant filed complaint accordingly alleging deficiency in service for not delivering the goods in terms of the contract. Complainant seeks compensation of Rs. 15,27,461.76 (equivalent to $ 49,272.96 @ Rs. 31/- per dollar). Rs. 10,00,000/- as damages, Rs. 2,65,383.50 ps. as interest @ 21% on above sums. Rs. 50,000/- as legal expenses along with Rs. 75,000/- for loss of time for pursuing the claim.

(3.) The opposite party contested the claim of the complainant, inter alia on the ground that the questions raised in the complaint were highly complex and disputed questions of fact. Therefore, at the best it would be proper to leave the matter for determination by a Civil Court. The opposite party is only an agent of the consignee, the buyer of the complainant as such there was no contractual relationship with the complainant. The goods were received on behalf of the consignee. No payment was made by the complainant to the opposite party. There was an agency agreement between the opposite party and the consignee viz. Coronet Group Inc., the affiliate of Zip Code Inc. The complaint was barred against them by the statutory provision of 230 of the Contract Act. The claim is based on cargo receipts indicating consignee by the order of Central Fidelity Bank in the cargo receipts. Subsequently, the name of the consignee was changed in the bill of lading dated 19.12.1994 from Central Fidelity Bank to Coronet Casuals Inc. The cargo receipt itself indicated that the bill was prepared at the instruction of Coronet Casuals Inc. The terms and conditions of the cargo receipt made it clear that the opposite party was to employ the Carrier as per instructions of the Cargo owners. This term not only included the shipper but also the consginee and any other person having interest in the goods also. Since bill of lading was executed prior to the cargo receipt Coronet Group was a party having interest in the goods. The letter of credit indicated that the two shipments were to be shipped on 13.12.1994 and 20.12.1994. The bill of lading indicated that the consignment was shipped on 13.12.1994. That bill of lading as well as cargo receipts were prepared after the shipment of the consignment when the complainant handed over the goods to the opposite party the agent of the buyer-Coronet Group Inc. The complainant was entitled to negotiate the letter of credit and receive payment as Central Fidelity Bank as was shown in the cargo receipt. The letter of credit indicated that it expired on 21.12.1994 for the last date of shipment was 30.11.1994 and the letter of credit was not got extended and the consignments were delivered to the complainant's foreign buyer i.e. the Coronet Casuals Inc. The opposite party had the minor role of consolidating the various consignments on behalf of the buyer of the complainant i.e. Coronet Group Inc. The goods were handed over and delivered to the carrier Hoegh Shipping Line. It also involved the liability of the two Banks. The case could not be decided without bringing the aforesaid parties on record they being the necessary and proper parties. The buyer i.e. Coronet Casuals Inc. as well as both the issuing and advising Banks should have been made parties of the proceedings. The present case was not based on any kind of deficiency in service on the part of opposite party.