CENTURY LEATHERS Vs. KOREAN AIR

JUDGEMENT

(1.) The complainant Century Leathers, sent through the opposite party M/s. Korean Air, cow hide grain leather under 7 different air way bills. It was agreed that the goods shall be air-shipped to Korea by 30.6.93. According to the complainant even after 20 days after the air-shipment they found that their Bank in India through which they had negotiated the documents had not received the sale price. On enquiry, it was found that the consignee Bank at Seoul had received payments from the complainant's purchaser in respect of the consignment under only one air way bill which was Rs.2,62,093.75 and no amount was received in respect of the consignment under the other six air way bills. The purchaser had not taken delivery of the goods under the six air way bills because of the late arrival of the cargo at Korea. The opposite party had not sought for fresh instructions from the complainants for redirecting the goods. This lapse on the part of the opposite party amounts to grave deficiency in service. The complainant by their letter dated 23.7.93 wrote to the opposite party enquiring about the whereabouts of the shipment. The opposite party by their reply dated 29.7.93 informed the complainant that the consignments were delivered to the complainants-consignee on various dates. On receipt of this communication the complainant was totally confused. The complainant's representative Mr. Appa Rao left for Seoul and reached there on 5.8.93 to locate the cargo there and with difficulty he found the undelivered cargos in six consignments in 3 different customs warehouses. In the mean while the complainant tried to find fresh purchasers. One Kum Chon Corporation (KCC), a Company in Seoul, was interested in purchasing the cargo. But since entry with the warehouses was restricted only to the consignee or the exporters and not for prospective purchasers, Kum Chon Corporation were not able to assess the condition of the goods nor could they examine the cargo by direct inspection. The demurrages kept mounting up. KCC agreed to settle the demurrages and take delivery of the goods. But they offered only 75 cents per sq. ft. which works out to 25 to 30% less than the price of the cargo. The complainant had no option but to accept this offer. The complainant then procured RBI's approval for reduced price on the basis of revised pro forma, invoice and packing list and these were faxed to me prospective purchasers, mentioning the terms of the payments as CAD (Cash Against Documents ). But the air way bills could not be amended as they were still with the Bankers. Subsequently in December, 1993 the complainant came to know that the goods were cleared by KCC without making any payments to the Bank. When the complainant contacted them and pressed for payment they sent the complainant the said purchase price pertaining to air way bill No.1803123-2143. Subsequently in March, 1993 KCC sent US $ 5,000 and US Pound Sterling's 3631. The opposite parties were once again guilty of deficiency in service and negligence in handing over the goods to the new purchasers without receiving the properly endorsed air way bills. Even though the goods were in the customs ware house the opposite parties still retained control over them. The complainant had not received the entire payments till the date of filing of the complaint. Because of these reasons the complainant had to totally suspend his export activities for nearly a year. They had also suffered many other losses. On these grounds the complainants have claimed compensation on different grounds.

(2.) The opposite parties in their written version denied that they agreed to shift the cargo by courier on 30.6.93. They contended that the air way bills prepared by the complainants did not contain any special instructions regarding the time within which the cargo should be taken to the place of destination. All the seven consignments have been handed over to them by M/s. Sky lift Cargo Private Ltd. the cargo agents of the complainants, only after 30.6.93 and, therefore, there is no basis for the allegations that specific instruction was given to the opposite party that goods should be shipped to Korea by 30.6.93. On the part of the opposite party there was no delay in airlifting the consignments. The opposite party denied that the purchasers refused to deliver the goods because of late arrival as alleged. Even as per the air way bill the opposite party was obliged to notify the buyer alone and not the consignee Bank. The opposite party had notified the buyer M/s. Shangyong Corporation and handed over the air way bills and with that their responsibility was over, and thereafter it was for the consignee Bank for clearing the goods. In these circumstances there was no need for the opposite party to inform about anything to the complainant or seek fresh instructions regarding clearance of the goods. The carrier, on reaching the destination, upon notifying the purchaser, lodges the cargo with the customs bonded warehouse and they cease to have any control or responsibility over the same. Moreover the freight have not been prepaid. The carrier have no further interest in the goods, and unless the air way bill itself was not cleared they have no duty to the consignor. It is true that the complainants themselves in their letter dated 27.3.1993 after coming to know that the consignee will not take delivery of six out of seven consignments, informed the opposite party that they were trying to locate an alternative buyer and requested the opposite party to keep the cargo in the customs bonded warehouse and also for seeking the permission for inspection of the cargo with the customs bonded warehouse by the prospective buyers if any. The opposite parties in their letter dated 29.7.1993 informed the complainant about the position of the consignments but by inadvertence instead of stating that the air way bills have been cleared from them, stated that the consignments were cleared, and this was only an error which was also within the knowledge of the complainant. The, complainants had entered into a direct transaction with the subsequent purchaser and it is because the subsequent purchaser had committed default, as an after-thought the complainant has filed this complaint with a view to fasten the liability on the opposite parties. There was no obligation on the part of the opposite parties to hand over the goods to any new purchasers. Therefore, the complaint is liable to be dismissed.

(3.) The points that arise for consideration are : 1. Whether there was any delay on the part of the opposite party in the shipment of the cargo? 2. Whether there was deficiency on the part of the opposite party in failing to inform the complainant that the consignee had failed to take delivery of the goods or in failing to issue an irregularity certificate as pleaded by the complainant? 3. Whether the opposite party had given false information about the fate of the consignments at the destination