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PETITIONER: NIRANJANLALL AGARWALLA

       Vs.

RESPONDENT: UNION OF INDIA

DATE OF JUDGMENT: 07/03/1968

BENCH: MITTER, G.K. BENCH: MITTER, G.K. SHAH, J.C. RAMASWAMI, V.

CITATION:  1969 AIR   23            1968 SCR  (3) 415

ACT: Indian  Railways  Act  (9 of 1890), ss.  3(6),  77  and  140 (before   amendment   by  Act   39   of   1961)--State-owned Railway--Service of s. 77 notice on Chief Commercial Manager (Claims and Refunds)--If sufficient compliance. Indian Limitation Act (9 of 1908), s. 14--Applicability.

HEADNOTE: The  appellant  booked  goods at Sealdah, which  is  on  the border   of   the  territorial  limits   of   the   Original Jurisdiction  of the Calcutta High Court, to be  transported by  the  Bengal and Assam Railway, owned by the,  State  and having  its  head  office  at  Calcutta.   There  was  short delivery  of the goods anti the railway  authorities  issued the necessary certificates of shortage.  The appellant Wrote a  letter  to  the Chief  Commercial  Manager  (Claims  and. Refunds)  of the Railway within six months from the date  of delivery  of goods for carriage as required by s. 77 of  the Act  before  its amendment by Act 39 of 1961, claim  in  the value  of  the goods short delivered.  Failing  to  get  any redress,  he filed a suit on the Original Side of  the  High Court at Calcutta in 1946, within the period of  limitations In 1954, the suit was dismissed on the ground that the Court had  no  jurisdiction to try the suit.  Then  the  appellant filed a second suit in the Subordinate Judge’s Court  having jurisdiction,  and  prayed for exclusion of the  time  taken between  the  dates  of institution  and  dismissal  of  the earlier suit, under s. 14 of the Limitation Act, 1908. The  trial  Court  dismissed the suit.  The  High  Court  in appeal,  held against the appellant on the ground  that  the appellant’s letter addressed to the Chief Commercial Manager (Claims  and  Refunds) could not be treated  as  the  notice required  under  s. 77 of the Railways Act,  1890,  as  that officer  was not the authority to receive the  notice  under the section. In appeal to this Court, HELD  : (1) The requirement of compliance with the terms  of s.  77  should be liberally construed as the object  of  the notice was only to enable the railway administration to make an enquiry and investigate into the cause of the loss of the goods consigned to it.  Section 140, before its amendment by

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Act 39 of 1961 provided that a notice required to be  served on a State-owned Railway Administration may be served on the Manager.   The Bengal and Assam Railway  Administration  did not  have  -in  authority known as the Manager.   It  had  a General Manager in over all charge but its Chief  Commercial Manager  (Claims  and  Refunds) was a  high  ranking  office specially engaged in enquiring into claims by consignors and consignees  against  the  Railway  administration.   He  was therefore an officer competent to deal with such claims  and the requirements -of s. 77 are satisfied by serving a notice on  him; and it does not behove ’he State to contest a  good claim on unsubstantial technical pleas. [418 DE; 419 C-D, F- H; 421 D] Governor-General in Council v. Musaddi Lal, [1961] 3  S.C.R. 647,  651  and Jetmull Bhojraj v. The  Darjeeling  Himalayan Railway Co. Ltd. 2 S.C.R. 832, 845, followed. 416 Governor-General  in  Council v.G.S. Mills Ltd.   I.L.R.  28 Pat. 178 (F.B.) -approved. (2) On the facts, the appellant was entitled to the  benefit of S, 14 of the Limitation Act. because, lie was prosecuting the  earlier  Suit  with due diligence and  the  mistake  in choosing the Original Side of the, High Court for filing the first suit was made bona fide. [421 A]

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeal No. 577 of 1965. Appeal  from the judgment and decree dated June 9,  1961  of the  Calcutta High Court in Appeal from Original Decree  No. 133 of 1956. B. C. Misra and S. S. Shukla for the appellant. V.  A. Seyid Muhammad, K. L. Hathi and R. N.  Sachthey,  for the respondent. The Judgment of the Court was delivered by Mitter,  J.  This-is  an appeal by  certificate  under  Art. 133(1)(c)  of the Constitution of India from a judgment  and decree of the High Court of Calcutta confirming a decree  of dismissal of the suit of the appellant herein instituted  in the  court of the Subordinate Judge, 8th Court  at  Alipore, District 24 Parganas, West Bengal. The  only two points canvassed in the appeal to  this  Court are:  (1)  whether notices under section 77  of  the  Indian Railways   Act   were  properly  served   on   the   Railway Administration  in this case, and (2) whether the  suit  was barred by limitation ? The  relevant  facts  are as  follows.   The  appellant  was entitled to delivery of two lots of goods booked at Sealdah, Calcutta   on   June  9,  1945  and   September   24,   1945 respectively.   The goods were for delivery at Cooch  Behar. They  were  to be transported by Bengal  and  Assam  Railway owned  by  the  State  and having its  Head  Office  at  the relevant  time  at  No. 3 Koilaghat  Street,  Calcutta.   In respect of the first lot, there was a short delivery of  104 umbrellas  and a certificate of shortage was issued  to  the plaintiff on July 20, 1945.  The appellant wrote a letter to the Chief Commercial  Manager (Claims and Refunds) of the  Bengal  and Assam  Railway at No. 3 Koilaghat Street on August 11,  1945 claiming  the  value of the goods short delivered  i.e.  Rs. 1,284/as   per   bill  enclosed  and  the   short   delivery certificate  issued  to  him.   On  November  12,  1945  the plaintiff  sent a letter to the Governor-General in  Council representing  the  Bengal  and  Assam  Railway  through  the

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Secretary,  Government  of  India,  New  Delhi  giving  full particulars of the claim and stating that the Chief  Commer- cial Manager had already been approached for payment.  This’ letter  was  replied to by the Secretary, Railway  Board  on November 27, 1945 to the effect that the plaintiff’s  letter had been for- 417 warded for disposal to the General Manager, Bengal and Assam Railway.   In  respect  of  the second  lot  of  goods,  the plaintiff  made  a  similar claim to  the  Chief  Conmercial Manager  of  Rs.  12,742-7-4  as  per  the  short   delivery certificate of October 10, 1945.  The plaintiff also wrote a letter  to the Governor-General in Council on  February  14, 1946 giving full particulars about the two invoices and  the railway  receipts  covering the consignments  despatched  on September 24, 1945 and mentioning further that a claim  had. been preferred on October 24, 1945 enclosing the  plaintiffs bill.  It was stated expressly in this letter that notice to the  Chief Commercial Manager had been given under s. 77  of the  Railways Act.  It does not appear that this  particular claim of the plaintiff was referred to the General  Manager, Bengal  and  Assam Railway by the Secretary to  the  Railway Board as in the previous case. Failing  to  get any redress the plaintiff served  a  notice under  s. 80 of the Code of Civil Procedure on February  14, 1946   on  the  Governor-General  in  Council  through   the Secretary  to the Railway Board and on the 14th August  1946 filed  a  suit  on the Original Side of the  High  Court  at Calcutta  for  recovery of the two sums of  money  for  non- delivery  of  the goods and alternatively  for  damages  for wrongful conversion or detention of the said goods.  It  was defended  by the Governor-General in Council and one of  the pleas  ,taken  was  that the Court had  no  jurisdiction  to entertain the suit as no part of the cause of action for the suit  had arisen within the said jurisdiction.  On July  16, 1954,  the suit was dismissed on the ground that  the  Court had  no  jurisdiction  to  try  the  same.   Thereupon   the appellant  filed  a  suit out of which  the  present  appeal arises on August 5, 1954.  In the plaint of the second suit, it  was stated that the earlier suit had been filed  on  the Original  Side of the High Court on a bona fide  mistake  on the part of the plaintiffs solicitor and prosecuted with due diligence by the plaintiff till it was dismissed on July 16, 1954.  The plaintiff prayed for exclusion of the time  taken between the date of the institution of the earlier suit  and the dismissal thereof under s. 14 of the Limitation Act.   A defence similar to that taken in the High Court suit was put up by the Union of India, the defendant in the later suit. The  Subordinate Judge who tried the suit dismissed.  it  on various grounds, inter alia that the notice served upon  the Chief  Commercial Manager was not in terms of  the  Railways Act  and that the first suit had not been pursued bona  fide and with diligence on the Original Side of the Calcutta High Court. In  appeal  to  the High Court, it was argued  that  (a)  no notice under s. 77 was necessary in the case of non-delivery of  (goods  (b) alternatively, notice in terms of  the  said section  had  been  served  by the  appellant  and  (c)  the plaintiff was entitled to 418 the  benefit  of s. 14 of the Limitation Act.   The  greater part  of the judgment of the High Court was devoted  to  the first  question  which was answered against  the  appellant. The  second  contention  was summarily turned  down  by  the observation  that  there was nothing on the record  to  show

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that  the Chief Commercial Manager had been held out as  the authority  competent  to receive notice under S. 77  of  the Act.  The question of limitation was not decided in view  of the above although the learned Judges felt inclined to allow the appellant the benefit of S. 14 of the Limitation Act. The relevant portion of s. 77 of the Indian Railways Act (IX of 1890) provided that               "  a  person  shall not be  entitled  to  ....               compensation  for  the  loss,  destruction  or               deterioration of animals or goods delivered to               be .... carried unless his claim to the refund               or compensation has been preferred in  writing               by  him  or  on  his  behalf  to  the  railway               administration within six months from the date               of  the delivery of the animals or  goods  for               carriage by railway" Section  140 of the Act provided that "any notice  or  other document required or authorised by the Act to be served on a railway  administration  may  be served, in the  case  of  a railway administered by Government .... on the  Manager..... by   delivering  the  notice  or  other  documents  to   the Manager...  or by leaving it at his office or by  forwarding it by post in a pre-paid letter addressed to the Manager.... at his office." Under S. 3 cl. (6) of the Act, unless  there is  something repugnant in the subject or  context  "railway administration or "administration" in the case of a  railway administered  by  the Government means "the manager  of  the railway and includes the Government. . . ." In this case, there can be no dispute that if notices to the Chief Commercial Manager (Claims and Refunds) complied  with the terms of section 77 of the Act the most serious obstacle to  -the  appellant’s  success  in  this  appeal  would   be overcome.   It therefore becomes necessary to  consider  the ambit and effect of the said section. The  scope  of section 77 has come up for  consideration  by various  High  Courts  at  different  times.   It  -is   not necessary  to  refer  to the same; but we  may  refer  to  a decision  of  this Court in Governor General in  Council  v. Musaddi Lal(1).  It was there observed that :               "Section  77  of the Railways Act  is  enacted               with   a   view   to   enable   the    railway               administration to make en- (1) [1951] S.C.R. 647,651. 419 .lm15 quiries and if possible to recover the goods and to  deliver them  to  the  consignee and to prevent  stale  claims.   It imposes  a  restriction  on  the  enforcement  of  liability declared  by s. 72.  The liability declared by s. 72 is  for loss,  destruction or deterioration.  Failure to deliver  is the consequence of loss or destruction of goods; it does not furnish  a cause of action on which a suit may  lie  against the railway administration, distinct from a cause of  action for loss or destruction." This  aspect  of  s. 77 was again  referred  to  in  Jetmull Bhojraj  v.  The Darjeeling Himalayan Railway  Co.  Ltd.(’). There  it was observed that the object of service of  notice under  s.  77  being  essentially  to  enable  the   railway administration  to make an enquiry and investigation  as  to whether   the   loss,  destruction  etc.  was   due-to   the consignor’s  laches or to the wilful neglect of the  railway administration  and  its servants, the notice  under  s.  77 should  be liberally construed.  To quote the words  of  the judgment of the majority Judges               "In enacting the section the intention of  the

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             legislature  must have been to afford  only  a               protection   to  the  railway   administration               against  fraud and not to provide a means  for               depriving  the consignors of their  legitimate               claims for compensation for the loss or damage               caused to their consignments during the course               of transit on the railways." In  the  light  of section 3(6) there  would  be  sufficient compliance  with section 77 if the notice was served on  the Manager  of  the  State owned  railway.   Section  140  only provides  for the manner of service of notice.   The  Bengal and  Assam Railway administration did not have an  authority known  as  the Manager.  It had a General  Manager  as  also another  high  ranking  officer i.e.  the  Chief  Commercial Manager  (Claims and Refunds) working in the head office  of the  company at Calcutta.  As the said statutory  provisions do  not make it obligatory to serve a notice under s. 77  on the  General  Manager  of  a  State-owned  Railway,  it   is difficult to see why a notice served on the Chief Commercial Manager  (Claims and Refunds) would not be a  proper  notice under  the said section.  The General Manager is in  overall charge of many departments of the railway administration and is  not particularly or immediately concerned  with  dealing with  claims against the railway administration.  The  Chief Commercial  Manager  (Claims and Refunds) is  the  authority specially engaged in the enquiry into such claims and  would therefore  prima facie appear to be competent to  deal  with the  claims-by consignors or consignees against the  railway administration envisaged by s. 77 (1) [1963] 2 S.C.R. 832, 845. 420 of the Act.  He is not a person of such inferior status that it  can  be  said that a claim  preferred  as  regards  non- delivery  would not be properly investigated or looked  into for finding out the truth or falsity of the claim preferred. Apart from any authority it seems to us that a notice on the Chief  Commercial Manager (Claims and Refunds) of  a  State- owned railway administration would be in terms of S. 77. The  question came up for consideration before a Full  Bench of   the  Patna High Court in Governor--General  in  Council v.G. S. Mills Ltd.(’). There are learned Judges of the Patna High  Court  examined the various authorities  of  the  High Courts  of Madras, Lahore, Bombay, Allahabad  and  Calcutta. On  a  conspectus of all the authorities  referred  to,  the answer  to the question posed before the Full Bench  was  as follows :                "The requirements of section 77 read with  S.               140,  Railways  Act,  1890  are  satisfied  by               serving a notice within the prescribed time on               the  Chief  Commercial Manager  or  any  other               subordinate officer of a Railway owned by  the               Government  of  India,  provided  it  is   es-               tablished  as a fact that the Railway  Company               by its course of business or the terms of  the               contract  between the parties has held  out  a               particular official as competent to deal  with               the claims on receipt of a notice to him." There  is a current of authority in the Calcutta High  Court which  is in line with the above Patna decision.  We are  in complete agreement with the view expressed by the Full Bench of the Patna High Court.  In our opinion, it is only in  the case of ,in authority subordinate or inferior in rank to the Chief  Commercial Manager that, proof of competence to  deal with  the claims would be called for.  The question has  now become  academic  in  view of the recent  amendment  of  the

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Railways Act. The  second point about limitation is not of any  substance. The appellant had filed a suit in the Calcutta High Court on its Original Side for recovery of compensation within  time. The despatch of the goods had taken place from Sealdah which is   on  the  border  of  the  territorial  limits  of   the jurisdiction  of the Calcutta High Court.  It  would  appear from the plaint that the plaintiff was under the  impression that  the  head  office  of the  Bengal  and  Assam  Railway administration  being situated within the said  limits,  his suit  could properly be instituted in the High  Court.   The Subordinate Judge was not right in holding that the suit had not  been proceeded with bona fide.  The learned  Judges  of the Division Bench of the High Court were disposed to give (1) I.L.R. 28 Patna 178. 421 the plaintiff the benefit of s. 14 of the Limitation Act and nothing  has  been shown to induce us to  take  a  different view. The  judgment  and decree of the High Court  are  therefore- reversed.   The appeal is allowed with costs throughout  and the  plaintiff’s  suit decreed for the  amount  claimed  and interest pendente lite at 6% per annum. Before  parting  with the case, we however wish  to  make  a remark against the conduct of the authorities of the railway administration concerned in the disposal of claims like  the one in the present appeal.  There is no suggestion  anywhere that  the, plaintiff’s claim was not genuine.   The  railway authorities had promptly issued certificates of shortage  in respect of the consignments.  There is nothing to show  that the  Chief  Commercial of Manager found any  defect  in  the plaintiff’s  claim.  If the claim had been settled  in  good time,  the public exchequer would have been spared not  only of  its own costs of litigation which will  be  considerable but  the costs which will have to be paid to the  appellant. It does not behove the State to contest a good claim on  the off-chance of success on some unsubstantial technical plea. V.P.S.                        Appeal allowed- 422