Partly allowed

The Shipping Corporation of India v. Cochin Spice Private Ltd.

Kerala HC14 Mar 2024RFA/625/2004

Case brief

AI extract

What is this about?

Suit for recovery of consignment value where cargo was delivered against a fabricated bill of lading lacking the banker's payment stamp. The High Court affirmed the finding of negligence against the carrier but reduced interest to 6% per annum from the date of suit.

What did the court decide?

Interest reduced to 6% per annum from date of suit till realisation; rest of trial court decree affirmed; parties to bear costs in appeal.

The Shipping Corporation of India Vs Cochin… — Contract and Commercial Disputes | Kerala HC (2024)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE SATHISH NINAN

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THURSDAY, THE 14^TH DAY OF MARCH 2024 / 24TH PHALGUNA, 1945

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RFA NO. 625 OF 2004

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AGAINST THE JUDGMENT DATED 31.03.2004 IN OS NO.166 OF 2002 OF ADDITIONAL SUB COURT, KOCHI

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APPELLANTS/DEFENDANT NO.1 & 2 IN OS 166 OF 2002:

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1 THE SHIPPING CORPORATION OF INDIA LTD. SHIPPING HOUSE, 245 MADAME CAMA ROAD, MUMBAI 400 021.

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2 MS.JAIRAM & SONS, AGENTS, SCI LINE, 45/364, G.V.AYYAR ROAD, WILLINGDON ISLAND, KOCHI-3.

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BY ADVS. SRI.K.P.VIJAYAN SMT.KRIPA ELIZABETH MATHEWS SMT.P.F.ROSY SMT.C.B.SUMA DEVI SRI.SURESH SAMUEL SRI.V.M.SYAM KUMAR SRI.JOY THATTIL ITTOOP, SC, SHIPPING CORPORATION OF INDIA

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RESPONDENT/PLAINTIFF IN OS NO.166 OF 2002:

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COCHIN SPICE PRIVATE LTD. PLOT NO.24, COCHIN SPECIAL ECONOMIC ZONE, KAKKANAD, COCHIN 682 037 REPRESENTED BY ITS MANAGING DIRECTOR, THOMAS PHILIP.

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BY ADVS. SRI.JOSEPH MARKOSE SR. SRI.MATHEWS K.UTHUPPACHAN

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THIS REGULAR FIRST APPEAL HAVING COME UP FOR HEARING ON 14.03.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: `

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SATHISH NINAN, J.

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= = = = = = = = = = = = = = = = = = R.F.A. No.625 of 2004

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= = = = = = = = = = = = = = = = = = Dated this the 14^th day of March, 2024

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J U D G M E N T

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The decree in a suit for money is under challenge by the defendants.

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The plaintiff company is engaged in the business

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of export of produces like black pepper. The first

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defendant is a carrier and the second defendant is its agent.

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As per bill of lading dated 13.02.2002, the plaintiff entrusted a consignment of black pepper to the first defendant for delivery at Rotterdam, Netherlands.

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The bill of lading was entrusted with the plaintiff's Bank. Subsequently it was understood that, on 26.03.2002 the consignee took delivery of the consignment without making payment, on the strength of a fabricated bill of lading. There had been negligence on the part of the defendant in verifying the bill of lading. Accordingly

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R.F.A. No.625 of 2004

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-: 2 :-

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the suit was filed for recovery of the value of the consignment.

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The defendants contended that they had taken all

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reasonable precautions at their end and that they are not liable for damages.

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The trial court found that there was negligence

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on the part of the defendants and accordingly decreed the suit.

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I have heard Sri.Joy Thattil Ittoop, learned

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Standing Counsel for the appellants-defendants and

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Sri.Joseph Markose, the learned Counsel on behalf of the respondent-plaintiff.

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The points that arise for determination are :-

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(i) Is the finding of the trial court with regard to the

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negligence of the defendant based on evidence?

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(ii) Does the decree and judgment of the trial court

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warrant any interference?

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R.F.A. No.625 of 2004

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-: 3 :-

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That the consignment was taken delivery of by

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the consignee on 26.03.2002, is not in dispute. The fact that the consignee had not made payment into the consignee's Bank, neither had obtained the bill of lading from the Bank, is not in dispute. A fabricated bill of lading was produced by the consignee, and the cargo was taken delivery of. Exts.A1 and A2 respectively, are the original and fabricated bill of lading. On a perusal of Exts.A1 and A2, it appears that they are similar. However, Ext.A2 did not contain the stamp of the Bank evidencing payment of the value. It is without verifying the same that the cargo was released.

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There had been omission on the part of the defendants to confirm the genuineness of the bill of lading produced before them. They should have definitely looked for the Banker’s stamp of payment. The same not being there on Ext.A2, the delivery of cargo should have been refused. They should have taken steps to ascertain the

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R.F.A. No.625 of 2004

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-: 4 :-

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genuineness of the bill of lading and with regard to payment. The failure to do so resulted in the release of goods based on a fake document. It is in the above circumstances that the trial court found negligence on the part of the defendants. The trial court was right in having held so.

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It is seen that the trial court has awarded

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interest at the rate of 8.5% from 13.02.2002, i.e. from the date of the bill of lading till realisation. The plaintiff would have got the payment only at the time of its delivery. The goods were taken delivery of on 26.03.2002, but the suit is filed only on 30.11.2002. It

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would be sufficient if interest is awarded from the date of suit. So also considering the present rate of interest in the banking transactions, interest at the rate of 6% is considered as just and reasonable.

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In the result, the appeal is allowed in part. The plaintiff will be entitled to interest only at the

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R.F.A. No.625 of 2004

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-: 5 :-

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rate of 6% per annum and that too, only from the date of suit till realisation. The decree and judgment of the trial court will stand modified to the above extent. In all other respects the decree and judgment of the trial court will stand affirmed. Parties to suffer their

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respective costs in the appeal.

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Sd/- SATHISH NINAN JUDGE

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kns/-

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//True Copy//

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P.S. to Judge

The Shipping Corporation of India v. Cochin Spice Private Ltd.

Case brief

What is this about?

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The Shipping Corporation of India v. Cochin Spice Private Ltd.

Case brief

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