Input:
Civil Appeals No.1472 77 of 1987.
From the Judgment and Order dated 4.12.1986 of the Delhi High Court in Civil Writ Petition Nos.
2148 of 1986, 2417, 2173, 2174, 2175 and 2166 of 1986.
1017 S.C. Mohanta, Ravinder Bana and Mahabir Singh for the Appellant.
A.K. Sen, P.P. Rao, Rajinder Sachhar, K.B. Rohatgi, S.K. Dhingra, Praveen Jain, Shashank Shekhar, C.M. Nayar, P.N. Duda and Randhir Jain for the Respondents.
The Judgment of the Court was delivered by SHARMA, J.
The present appeals by the State of Haryana and the Haryana Minerals Limited are directed against the common judgment of the Delhi High Court disposing of 6 writ applications filed by different petitioners impleaded as respondent No. 1 herein.
Separate mining leases were executed on behalf of the State of Haryana with respect to Silica sand and ordinary sand in favour of the writ petitioners for a period of 10 years, in accordance with the provisions of the Mines & Minerals (Regulation & Development) Act, 1957, hereinafter referred to as the Act.
The State of Haryana, in purported exercise of powers under Section 4A of the Act prematurely terminated the leases by its order dated 1st October, 1986 which is quoted in the judgment of the High Court, stating that it was proper to do so as the Haryana Minerals Limited, respondent No. 4 (appellant No. 2 herein) a public sector undertaking had informed that it had fully equipped itself to undertake the mining operation and that necessary permission in terms of the Section had been obtained from the Central Government to prematurely terminate the leases.
Admittedly no prior notice to the writ petitioners or any opportunity to them to place their case was given.
The lessees contended before the High Court that essential conditions for exercises of the powers under Section 4A are not satisfied in the present cases and further, the impugned decision is violative of the principles of natural justice.
It was also urged that so far as the lease in respect of ordinary sand which is a minor mineral under the Act, is concerned, Section 4A being excluded by the provisions of Section 14 is not applicable.
It was also averred that forcible possession of the mining areas was taken even before communicating the impugned order.
The High Court agreed with these contentions and allowed the writ petitions.
The State of Haryana and the Haryana Minerals Limited, respondents No. 2 and 4, respectively, in the writ cases were allowed special leave to appeal under Article 136.
Hence these appeals.
1018 4.
Section 4A as it stood at the relevant time read as follows: "4A.(1) Where the Central Government, after consultation with the State Government, is of opinion that it is expedient in the interest of regulation of mines and mineral development so to do, it may request the State Government to make a premature termination of a mining lease in respect of any mineral, other than minor mineral, and, on receipt of such request, the State Government shall make an order making a premature termination of such mining lease and granting a fresh mining lease in favour of such Government company or corporation owned or controlled by Government as it may think fit.
(2) Where the State Government, after consultation with the Central Government, is of opinion that it is expedient in the interest of regulation of mines and mineral development so to do, it may, by an order, make premature termination of a mining lease in respect of any minor mineral and grant a fresh lease in respect of such mineral in favour of such Government company or corporation owned or controlled by Government as it may think fit.
Silica sand being a major mineral is governed by Sub section (1) of Section 4A and ordinary sand by Sub section (2).
According to the appellant, full and necessary consultation between the two Governments i.e. the Central Government and the State Government was held and it was considered expedient in the interest of regulation of mines and mineral development to take the impugned decision.
Reference in this regard was made by the learned counsel to the report of the Indian Bureau of Mines referred to in the letters of the Director, Department of Mines, Central Government to the Chief Secretary, Government of Haryana, dated 20th April, 1985, 8th July, 1985 and 10th July, 1985 and the State 's letters dated 14th July, 1986, 17th September, 1986 and 29th September, 1986.
It has been contended that since a decision was jointly taken by the two Governments to grant mining lease of the entire area to the Haryana Minerals Limited, this by itself fulfilled the necessary conditions under Section 4A and as the writ petitioners lessees had no locus standi to place their point of view with respect to this aspect, it was not necessary to give them a notice.
The argument is that in the circumstances there is no question of violation of principles of natural justice.
It was also claimed that the State was the final authority to take a decision under Section 4A with respect to both major and minor minerals.
1019 6.
Mr. B. Datta, Additional Solicitor General, stated on behalf of the Union of India, respondent No. 2 that the respondent is ready to reconsider the matter after hearing the parties concerned.
He refuted the claim of the appellant that the State is the ultimate authority to take a decision under Section 4A with respect to major minerals and he appears to be right.
Sub section (1) which deals with major minerals empowers the Central Government to consider the matter and, after having consultation with the State Government, to take a decision in this regard and once it does so and makes a request to the State Government for prematurely terminating a lease, the State Government shall be under an obligation to act.
The use of "shall" in this context indicates the binding nature of the request.
The language of Section 4A clearly indicates that the Section by itself does not prematurely terminate any mining lease.
A decision in this regard has to be taken by the Central Government after considering the circumstances of each case separately.
For exercise of power it is necessary that the essential condition mentioned therein is fulfilled, namely, that the proposed action would be in the interest of regulation of mines and mineral development.
The question of the State Government granting a fresh mining lease in favour of a Government Company or a Corporation arises only after a decision to terminate the existing mining lease is arrived at and given effect to.
The Section does not direct termination of all mining leases, merely for the reason that a Government Company or Corporation has equipped itself for the purpose.
The Section was enacted with a view to improve the efficiency in this regard and with this view directs consulation between the Central Government and the State Government to be held.
The two Governments have to consider whether premature termination of a particulare mining lease shall advance the object or not, and must, therefore, take into account all considerations relevant to the issue, with reference to the lease in question.
It is not correct to say that an existing mining lease can be terminated merely for the reason that a Government Company or Corporation is ready to undertake the work.
Considered in this light, the Section must be interpreted to imply that the person who may be affected by such a decision should be afforded an opportunity to prove that the proposed step would not advance the interest of mines and mineral development.
Not to do so will be violative of the principles of natural justice.
Since there is no suggestion in the Section to deny the right of the affected persons to be heard, the provisions have to be interpreted as implying to preserve such a right.
Reference may be made to the observations of this Court 1020 in Baldev Singh and others vs State of Himachal Pradesh and others, , that where exercise of a power results in civil consequences to citizens, unless the statute specifically out the application of natural justice, such rules would apply.
The cases, Union of India and another vs Cynamide India Ltd. and another, AIR 1987 SC 1802; D.C. Saxena vs State of Haryana, AIR 1987 1463 and State of Tamil Nadu vs Hind Stone etc.
; , , relied upon by Mr. Mohanta do not help the appellant.
The learned counsel placed reliance on the observations in paragraphs 5 to 7 of the judgment in Union of India vs Cynamide Ltd. which were made in connection with legislative activity which is not subject to the rule of audi alteram partem.
The principles of natural justice have no application to legislative activities, but that is not the position here.
It has already been pointed out earlier that the existing mining leases were not brought to their and directly by Section 4A itself.
They had to be terminated by the exercise of the executive authority of the State Government.
Somewhat similar was the situation with regard to Section 4A of Haryana Board of School Education Act, 1969 which was under Consideration in D. C. Saxena vs State of Haryana, AIR 1987 SC 1463.
A matter of policy was adopted and included by the legislature in the impugned section.
Besides, the validity of the Section was not under challenge there, as was expressly stated in paragraph 6 of the judgment.
So far as the case, State of Tamil Nadu vs Hind Stone is concerned, the learned counsel for the appellant cited it only with a view to emphasise the importance of the mineral wealth of the nation which nobody denies.
We, therefore, held that a final decision to prematurely terminate a lease can be taken only after notice to the leassee.
Coming to the facts of the present case it will be observed that the question of terminating the mining leases in question before us was introduced for the first time under the letter dated 14.7.1986 (page 80) of the State of Haryana.
The earlier letter dated 20.4.1985 and 8.7.1985, of the Department of Mines, Union of India sent to the State Government discussed the general question about the desired improvement in the mining field and referred to the report of the Indian Bureau of Mines on silica sand mining in Haryana.
The report had highlighted various aspects of silica sand mining in the State and made several positive suggestions.
It was stated in the letter dated 20th April, 1985 that if the lessees did not comply with the requirements mentioned therein, their leases "deserve to be terminated in accordance with the procedure established under law.
" In the letter dated 8th July, 1985, further emphasis was laid on ensuring scientific mining of optimum utilisation of natural resources, ensuring safety in operation 1021 and ensuring payment of fair wages to the mine workers.
In this letter the desirability of entrusting mining operations to the public sector was mentioned but it was also stated that the representatives of the Government of Haryana had in the earlier meetings expressed their inability to entrust the Haryana Minerals Ltd. (appellant No. 2 before us) with the mining operations in the entire State immediately.
Additional terms and conditions were also suggested to be imposed in the future mining leases to be granted in favour of private parties.
Later on, it appears that the Haryana Minerals Ltd. became ready to take over the mining operations and intimated its preparedness by letter dated 10.7.1986 and thereupon the State of Haryana wrote on 14.7.1986 to the Union of India that it was appropriate to prematurely terminate the 6 leases mentioned in the letter of the date.
It will be significant to note that the State Government did not take a decision to terminate all the mining leases; on the countrary, fresh mining leases in favour of private individuals were in contemplation of the State authorities, as indicated by the aforementioned letters and by Annexure P 5 (page 273) to the Writ Petition of Ram Kishan in the High Court.
The State 's letter dated the 14th July, 1986 was followed by another letter dated 5.9.1986 and in reply to it, the Central Government asked for a report on several specific points mentioned in their letter which is at page 85 of the paper book.
In place of sending the required information, the State Government, in its letter dated 17.9.1986, took the erroneous stand that the information sought for was not relevant.
Instead of pointing out that the information demanded was very pertinent in the context of the proposed termination of the mining lease, the Central Government by its letter dated 26th November, 1986 agreed to the proposal, but took care to advice that while taking any action for premature termination of the leases the authority should "ensure that the provisions of Section 4A of the Act are complied with".
As has been mentioned earlier, the Union of India does not deny the right of hearing to the affected lessees and is ready, even now, to give an opportunity to them.
Admittedly, the writ petitioners who are respondents before us were never given any such opportunity and according to their assertion if such an opportunity had been afforded, they would have shown that the standard of their mining operation was very high and favourably measured against the expected standard suggested in the report of the Indian Bureau of Mines and mentioned in the letter of the Mines Department of the Central Government and that it was definitely superior to that of Haryana Minerals Limited.
On a consideration of the facts and circumstances of the 1022 present case, we are of the opinion that there was no effective consultation between the Union of India and the State Government, and the Central Government did not form any opinion as required under Section 4A of the Act.
We are further of the view that the lessees, the respondents before us, were entitled to be heard before a decision to prematurely terminate their leases was taken but they were not given any opportunity to place their case.
Mr. Sen, the learned counsel for the respondents, very fairly stated that he could not support the plea that leases in respect of minor minerals are saved from the application of Section 4A altogether by reason of Section 14.
This Court in State of Tamil Nadu vs Hind Stone, ; (at pages 746H and 747A) pointed out that perhaps since Section 4A(1) is inapplicable to minor minerals because of the provisions of Section 14, Section 4A(2) has been specially enacted making somewhat similar provision.
It must, therefore, be held that leases in respect of minor minerals also can be prematurely terminated in appropriate cases.
However, in view of our earlier finding the respondents must succeed.
We accordingly dismiss these appeals with costs.
S.L. Appeals dismissed.

Output:
These appeals were directed against the common judgment of the High Court in Writ applications filed by different petitioners, challenging the termination of the mining leases granted to them.
The State of Haryana which had executed the mining leases in favour of the writ petitioners for ten years under the provisions of the Mines & Minerals (Regulation & Development) Act (the Act), terminated the said leases prematurely in the purported exercise of powers under Section 4A of the Act without prior notice to the writ petitioners or any opportunity to them to defend their cases.
The leases were so terminated on the ground that the Haryana Minerals limited a public sector undertaking had fully equipped itself to undertake the mining operations.
The High Court allowed the writ petitions.
The State of Haryana and Haryana Minerals Limited appealed to this Court by Special leave against the decision of the High Court.
According to the appellant, the necessary consultation between the Central Government and the State Government was held, fulfilling the conditions under Section 4A of the Act and the decision impugned was taken.
The appellant contended that the writ petitioners lessees had no locus standi to place their view point and it was not necessary to give them notice, and that there was no violation of the principles of natural justice.
Dismissing the appeals, the Court, ^ HELD: The language of Section 4A indicates that the Section by itself does not permaturely terminate any mining lease.
A decision in this regard has to be taken by the Central Government.
The question of the State Government granting a fresh mining lease in favour of a 1016 Government Company or a Corporation arises only after the existing mining lease is terminated, the section does not direct termination of all mining leases merely for the reason that a Government Company or a Corporation has equipped itself for the purpose.
It is not correct to say that an existing mining lease can be terminated for the reason that a Government Company or a Corporation is ready to undertake the work.
Viewed thus, the section must be interpreted to imply that a person who may be affected by such a decision should be afforded an opportunity to prove that the proposed step would not advance the interest of mines and mineral development.
Not to do so will be violative of the principles of natural justice.
Since there is no suggestion in the section to deny the right of the affected persons to be heard, the provisions have to be interpreted as implying to preserve such a right.
A final decision to prematurely terminate a lease can be taken only after notice to the lessee.[1019C H;1020E] The Writ Petitioners respondents before the Court were never given an opportunity to be heard.
If such an opportunity had been afforded, they would have shown that their standard of mining operations was very high and favourably measured against the expected standard and was superior to that of the Haryana Minerals Limited.
[1021G] There was no effective consultation between the Union of India and the State Government, and the Central Government did not form any opinion as required under Section 4A of the Act.
The respondents before the Court were entitled to be heard before a decision to prematurely terminate their leases was taken but they were not given any opportunity to place their cases.
The respondents must succeed.
[1022A B] Baldev Singh and others vs State of Himachal Pradesh and others, ; Union of India and another vs Cynamide India Ltd. and another, AIR 1987 SC 1802; D. C. Saxena vs State of Haryana, AIR 1987 SC 1463 and State of Tamil Nadu vs Hind Stone, etc.
; , , referred to.


Input:
itions Nos.
147, 320 69, 459, 4335 4434/85 etc.
(Under Article 32 of the Constitution).
For the Appearing Parties: B. Datta RishiKesh M.K. Rama murti MA.
Krishnamurty.
Anis Suhrawardy M section Gujaral S.C.
Maheshwari PP Singh C.
V. Subba Rao R.N. Poddar C.P. Pardey V.R Verma R P. Singh Indira Sawhney S.C. Patel Harbans Singh G.N. Chowdhary Narinder R D. Uradhyay PK.
Jain K.R. Nagaraja Shakil Ahmed Syed NS.
Das Bahl K R.P. Pillai D.Goburdhan C. Malhotra SN.
Chowdhary V.K. Pandit Manoj Saxena Madan, Sharma G.S.
Narayan Ms. Halida Khatoon K K Gupta C. Agarwala h. Satish Ms. A. Subhashini Sambandam and Pillai P.N. Gupta Mrs. Jayashree Wad and Raju Ramachandran.
The Judgment of the Court was delivered by DESAI,J.
Articles 41 and 42 of the Constitution notwithstanding, there are certain grey areas where the rule of hire and fire, a legacy of laissez faire even in Government employment still rules the roost.
Casual labour employed on projects also known as 'projects casual labour ' is one such segment of employment where one may serve for years and remain a daily rated worker without a weekly off, without any security of service, without the protection of equal pay for equal work.
In short at the sweet will and mercy of the local 839 satraps.
Even the formidable railwaymen 's unions least cared for these helpless and hapless workmen.
Suddenly a torrent of writ petitions and petitions for special leave awakened this Court to the plight of these workmen.
In quick succession, 48 writ petitions and 32 petitions for special leave flooded this Court.
In each writ petition / S.L.P., the grievance was that even though the workmen styled as 'project casual labour ' had put in continuous service for years on end to wit ranging from 1974 till 1983, yet their services were terminated with impunity under the specious plea that the project on which they were employed has been wound np on its completion and their services were no more needed.
No one is unaware of the fact that Railway Ministry has a perspective plan spreading over years say decades and projects are waiting in queue for execution and year these workmen were shunted out (to use a cliche from the railway vocabulary) without any chance of being re employed.
Some of them rushed to the court and obtained interim relief.
Some were not so fortunate.
At one stage some of these petitions were set down for final hearing and the judgment was reserved.
When some other similar matters came up, Mr. K.G. Bhagat, the then learned Additional Solicitor General, requested the Court not to render the judgment because he would take up the matter with the Railway Ministry to find a just and humane solution affecting the livelihood of these unfortunate workmen.
As the future of lakhs of workmen going under the label of casual project labour was likely to be affected, we repeatedly adjourned these matters to enable the Railway Ministry to work out a scientific scheme.
Railway Ministry framed a Scheme and circulated the same amongst others to all the General Managers of Indian Railways including production units as per its circular No. E(NG)II/84/CL/41 dated June 1, 1984.
In the Scheme it was stated that all the General Managers were directed to implement the decision of the Railway Ministry by the target dates It was further stated that a detailed letter regarding group 5 1(ii) would follow.
Such a letter was issued on June 25, 1984.
Thereafter, these matters were set out for examining the fairness and justness of the Scheme and whether the Court would be in a position to dispose of these petitions in view of the Scheme.
That is how these matters came up before us.
The relevant portions of the Scheme read as under: 840 "5.1.
As a result of such deliberations, the Ministry of Railways have now decided in principle that casual labour employed on project (also known as 'project casual labour ') may be treated as temporary on completion of 360 days of continuous employment.
The Ministry have decided further as under: (a) These orders will cover: (i) Casual labour on projects who are in service as on 1.1.84; and (ii) Casual labour on projects who, though not In service on 1.1.84, had been in service on Railways earlier and had already completed the above prescribed period (360 days) of continuous employment or will complete the said prescribed period of continuous employment on re engagement in future.
(A detailed letter regarding this group follows).
(b) The decision should be implemented in phases according to the schedule given below: Length of service Date from which Date by which (i.e. (i.e.continuous may be treated decision should employment).
as temporary be implemented (i) Those who have 1.1.1984 31.12.1984 completed five yearsof service as on 1.1.84 (ii) Those who have 1.1.1985 31.12.1985 completed three years but less than five years of service as on 1.1.1984 (iii) Those who have 1.1.1986 31.12.1986 ted 360 days but less than three years of service on 1.1.1984 841 (iv) Those who complete 1.1.1987 or 31.3.1987 360 days after the date on which 1.1.1984 360 days are completed which ever is later.
The Ministry would like to clarify here that casual labour on projects who have completed 180 days of continuous employment would continue to be entitled to the benefits now admissible to them (so long as they fulfil the conditions in this regard) till they become due for the benefits mentioned in the preceding sub paragraph.
" By and large the scheme certainly is an improvement on the present situation though not wholly satisfactory.
However, the railway being the biggest employer and having regard to the nature of its work, it would have to engage casual labour and therefore, as a preliminary step towards realisation of the ideal enshrined in Articles 41 and 42, we propose to put our stamp of approval on the scheme with one major variation which we proceed to herein set out.
The Scheme envisages that it would be applicable to casual labour on projects who were in service as on January 1, 1984.
The choice of this date does not commend to us, for it is likely to introduce an invidious distinction between similarly situated persons and expose some workmen to arbitrary discrimination flowing from fortuitous court 's order.
To illustrate, in some matters, the court granted interim stay before the workmen could be retrenched while some other were not so fortunate.
Those in respect of whom the court granted interim relief be stay/suspension of the order of retrenchment, they would be treated in service on 1.1.1984 while others who fail to obtain interim relief though similarly situated would be pushed down in the implementation of the Scheme.
There is another area where discrimination is likely to rear its ugly head.
These workmen come from the lowest grade of railway service.
They can ill afford to rush to court.
Their Federations have hardly been of any assistance.
They had individually to collect money and rush to court which in case of some may be beyond their reach.
Therefore, some of the retrenched workmen failed to knock 842 at the doors of the court of justice because these doors do not open unless huge expenses are incurred.
Choice in such a situation, even without crystal gazing is between incurring expenses for a litigation with uncertain outcome and hunger from day to day.
It is a Hobson 's choice.
Therefore, those who could not come to the court need not be at a comparative disadvantage to those who rushed in here.
If they are otherwise similarly situated, they are entitled to similar treatment if not by anyone else at the hands of this Court.
Burdened by all these relevant considerations and keeping in view all the aspects of the matter, we would modify part 5.1 (a) (i) by modifying the date from 1.1.1984 to 1.1.1981.
With this modification and consequent rescheduling in absorption from that date onward, the Scheme framed by Railway Ministry is accepted and a direction is given that it must be implemented by re casting the stages consistent with the change in the date as herein directed.
To avoid violation of article 14, the scientific and equitable way if implementing the scheme is for the Railway administration to prepare, a list of project casual labour with reference to each division of each railway and then start absorbing those with the longest service.
If in the process any adjustments are necessary, the same must be done.
In giving this direction, we are considerably influenced by the statutory recognition of a principle well known in industrial jurisprudence that the men with longest service shall have priority over those who have joined later on.
In other words, the principle of last come first go or to reverse it first come last go as enunciated in Sec.
25G of the has been accepted.
We direct accordingly.
All these writ petitions and special leave petitions shall stand disposed of consistent with the scheme as modified by this judgment and the directions herein given.
The scheme as would stand modified by the directions here in given forms part of this judgment and a copy of it shall be annexed to this judgment.
Learned counsel Shri Anis Suhrawardy has put in the maximum labour in making a very useful compilation.
He must have spent days and months! The compilation helped us the most 843 in dealing with the writ petitions and the special leave petitions and in ascertaining the proper principle.
Such a compilation ought to have been prepared by the Railway administration.
Therefore, we direct the Union of India to pay Rs. 5,000 as and by way of costs to Shri Anis Suhrawardy, advocate, Supreme Court.
M.L.A. Petitions dismissed.

Output:
The petitioner workmen styled as 'Project Casual Labour ' in these writ petitions and special leave petitions contended that even though they had put in continuous service for years, their services were terminated on the ground that the project on which they were employed has been wound up on its completion and their services were no more needed.
After the conclusion of the hearing in some of the matters, the Railway Ministry framed a scheme to find a just and humane solution affecting the livelihood of the petitioner It provided that casual labour employed on projects may be treated as temporary on completion of 360 days of continuous employment.
Disposing of the petitions, ^ HELD: 1.
(i) By and large the scheme certainly is an improvement on the present situation though not wholly satisfactory.
However the Railway being the biggest employer and having regard to the nature of its work, it would have to engage casual labour and therefore, as a preliminary step towards realisation of the ideal enshrined in Articles 41 and 42, this Court proposes to put its stamp of approval on the scheme with one major variation which is herein set out.
[841D] 1.
(ii) The scheme envisages that it would be applicable to casual labour on projects who were In service as on January 1, 1984.
The choice of this date does not commend, for it is likely to introduce an invidious distinction between similarly situated persons and expose some workmen to arbitrary discrimination flowing from fortuitous court 's order, since, in some matters, the court granted interim stay before the workmen could be retrenched while some other were not so fortunate.
Those in respect of when the Court granted interim relief by stay suspension of the order of retrenchment, they would be treated in service on l. l. 1981 while others who fail to obtain interim rel if though similarly situated 838 would be pushed down in the implementation of the scheme.
Therefore, those who could not come to the Court need not be at a comparative disadvantage to those who rushed in here.
If they are otherwise similarly situated, they are entitled to similar treatment.
Keeping in view all the aspects of the matter, the Court modifies part 5.1 (a) (i) of the scheme by modifying the date from 1.1.1984 to 1.1.
With this modification and consequent rescheduling in absorption from that date onward, the scheme framed by Railway Ministry is accepted and a direction is given that it must be implemented by re casting the stages consistent with the change in the date as herein directed.
[841E G; 842B C] (2) To avoid violation of article 14, the scientific and equitable way of implementing the scheme is for the Railway administration to prepare, a list of project casual labour with reference to each division OF each railway and then start absorbing those with the longest service.
If in the process any adjustments are necessary, the same must be done.
In giving this direction, the court is considerably influenced by the statutory recognition of the principle of last come first go or to reverse it first come last go as enunciated in s.25G of the .
[842D F]


Input:
Appeal No. 88 of 1956.
Appeal by special leave from the judgment and decree dated February 11, 1954, of the Madras High Court in Civil Revision Petition No. 921 of 1952, arising out of the judgment and decree dated November 2, 1951, of the Court of Small Causes, Madras, in Suit No. 4076 of 1950 (N. T. A. No. 113 of 1951).
With Civil Appeals Nos. 91 and 92 of 1958.
Appeals by special leave from the judgment and decree dated March 10, 1955, of the Bombay High Court in Appeals Nos.
66/X and 67/X of 1954, arising out of the judgment and decree dated February 15, 1954, of the said High Court in Suits Nos.
1693 of 1949 and 105 of 1950, respectively.
B. Sen, section N. Mukherjee and B. N. Ghosh, for the appellant (in C. A. No. 88 of 1956).
C. B. Pattabhiraman and Ganapathy Iyer, for respondent (in C. A. No. 88 of 1956).
C. K. Daphtary, Solicitor General of India, section N. Andley, J. B. Dadachanji and Rameshwar Nath, for the appellants (In C. As.
Nos. 91 and 92 of 1958).
G. Gopalakrishnan, for the respondent (In C. A. No. 91/58).
A. V. Viswanatha Sastri and G. Gopalakrishnan, for the respondent (In C. A. No. 92 of 58).
May 3.
The Judgment of the Court was delivered by 107 822 DAS GUPTA, J.
These three appeals Civil Appeal No. 88 of 1956, Civil Appeal No. 91 of 1958 and Civil Appeal No. 92 of 1958, of which one is from a decision of the High Court of Madras and the other two from decisions of the High Court of Bombay raise some common questions of general importance to carriers of goods by sea and of shippers as regards the 3rd clause of paragraph 6 of article III in the Schedule of the Carriage of Goods by Sea Act (hereinafter called " the Act ").
This clause provides that " in any event the carrier and the shipper shall be discharged from all liability in respect of loss or damage unless a suit is brought within one year after the delivery of the goods or the date when the goods should have been delivered ".
In all the three appeals before us the carriers ' main defence to claims of compensation by the owners of the goods was based on this clause and the courts had to consider whether this defence was available to the carrier.
The appeal from the Madras High Court was in respect of a consignment of 90 bundles of brass circles which were consigned to the respondent at Madras from Bombay to Madras per section section Fakira, a Steamer belonging to the East and West Steamship Co. The Ship arrived in Madras on August 1, 1948, and 78 out of the 90 bundles were delivered on August 25, 1948, to the appellant through his clearing agent, the second respondent.
Five more bundles were delivered on September 25, 1948.
After some correspondence between the Shipping Company and the first respondent regarding the seven bundles not, delivered the appellant company repudiated finally the respondent 's claim on March 24, 1950.
The first respondent brought the present suit on June 27, 1950, claiming Rs. 1,023 5 0 as compensation Rs.
974 13 0 for the value of the undelivered goods and Rs. 48 8 0 as the profit of which he had been deprived.
The claim for this amount of profit was given up at the Trial.
The appellant 's defence was: (1) that the suit having been filed beyond the period prescribed in cl. 6 of article 3 of the Act; (2) that the suit was also barred as no claim had been made within the period of one month from the date of 823 arrival of the vessel as stipulated in the bill of lading and (3) that the goods were insufficiently packed and therefore carrier was not liable for the alleged loss.
The learned Judge of the Small Causes Court who tried the suit as also the Judge who heard the matter on a new trial application held that the plaintiff 's right to claim compensation was extinguished before the date of the suit.
As regards the second defence based on the stipulation in the bill of lading that notice has to be given within one month the Trial Court held that this term in the bill of lading was void and of no effect.
The learned Judges who heard the new trial application disagreed with this and accepted the defence on this point also.
In the result they dismissed the new trial application and confirmed the order of dismissal made by the learned Trial Judge.
Against this order the High Court of Madras was moved by the plaintiffs under section 115 of the Code of Civil Procedure.
The learned Judge held that the term in the bill of lading as regards one month 's notice was repugnant to Rule 8 to article III of the Schedule to the Act and was void.
He was also of opinion that the date of the final repudiation of liability by the Shipping Company as regards the short delivery or non delivery is the date " when the goods should have been delivered " within the meaning of the 3rd clause of the 6th paragraph of article III and so whether this clause provided for extinction of a right or only prescribed a rule of limitation, the defence based on this clause of the Act could not succeed.
He expressed his own opinion, however, that this clause did not provide for extinction of the right but merely prescribed a rule of limitation.
In view of his conclusions he set aside the decision of the lower courts and remanded the suit for further disposal to the trial court.
After remand the trial court on May 4, 1954, decreed the suit for a sum of Rs. 974 13 0.
Against that decree no steps were taken by the Shipping Company.
It was after that date that the Shipping Company applied for and obtained from this Court special leave to appeal on October 11, 1954.
It has to be noticed that as the decree made in the suit has become final and unassailable, this appeal is really of 824 academic interest.
In view however of the fact that the main question of law raised, viz., as regards the scope and interpretation of the 3rd Clause of para.
6 of article III of the Schedule to the Act is being raised before us in the other two appeals from the Bombay High Court also we have heard the counsel for both sides in this appeal in full.
Of the two appeals from Bombay the one Civil Appeal No. 92 of 1958 is in respect of some consignments at Bombay by section section Tweedsmuir Park, section section Finnamore Hill and section section Ismalia all vessels belonging to the first defendant, the British India Steam Navigation Company Ltd. section section Tweedsmuir and section section Finnamore Hill arrived in the port of Bombay on or about September 10, 1948, and steamer Ismalia arrived in Bombay on September 6,1948.
The vessels discharged their cargoes alongside on to the docks belonging to the Trustees of the Port of Bombay.
The plaintiffs took delivery of the goods packed in bags which bore their distinctive and identifying marks, but were unable to obtain delivery of 164 bags out of the consignment sent by Ismalia, 869 bags out of the consignment sent by Finnamore and 1,657 bags out of the consignment sent by Tweedsmuir Park.
The suit was brought on a claim of Rs. 1,10,323 8 0 as compensation for the bags not delivered.
The Trustees of the Port of Bombay were also made defendants.
We are no longer concerned with them as after the suit was dismissed by the Trial Judge against both the defendants the plaintiffs did not prefer any appeal against the order of dismissal as against the Trustees.
The main defence of the first defendant, the Shipping Company, was that the company was discharged from all liability in respect of the loss or damage alleged in the plaint by reason of the provisions of the Act inasmuch as the suit had not been brought within one year of the date " when the goods should have been delivered".
Another defence was that the company was not liable as no notice within 3 days after discharge and before goods were removed from the quay or ship 's side or place of discharge had been given and so in view of Clause 20 of the bill of lading the company was free from all liability.
The trial judge held that 825 in view of the fact that S.S. Finnamore Hill completed discharging her cargo on 19th September, 1948, S.S. Ismalia completed discharging her cargo on 25th September, 1948, and S.S. Tweedsmuir Park completed discharging her cargo on 27th September, 1948, the suit was clearly not brought " within one year " from the date " when the goods should have been delivered".
He held therefore that the defendants were discharged from all liability by reason of the provisions of the Act.
Accordingly he dismissed the suit.
In appeal from this order of dismissal the plaintiffs contended that article III (6) did not deal with cases of loss or damage arising from non delivery of goods; in the alternative it was contended that the expression " loss or damage " in article III (6) must be limited to the loss or damage to the goods themselves and if the goods have not been lost this clause had no application.
The learned judges of the High Court rejected both these contentions.
They were of opinion that article III (6) deals with all cases of loss or damage whether the loss or damage is caused by the deterioration of the goods or is caused by the non delivery of the goods and further that " the loss or damage" as used was used by the Legislature to include any loss or damage caused to shipper or consignee in respect of which he claims compensation from the shipping company.
The learned judges also held that so far as the shipping company was concerned the delivery of goods is given or ought to be given as soon as the goods are landed and therefore in this case the goods with regard to the three ships having been cleared on September 19, 1948, September 25, 1948, and September 27, 1948, respectively.
These were the dates on which the goods " should have been delivered " for the purposes of the application of the 3rd clause of paragraph 6 of article Ill.
Accordingly agreeing with the Trial Judge that the liability of the shipping company was discharged and the suit was not maintainable they dismissed the appeal.
The other appeal from the Bombay High Court, viz., Civil Appeal No. 91 of 1958 is in respect of a consignment of 6,000 bags of coconut from Cochin and 4,733 bags of copra and coconuts from Badagara 826 consigned to the plaintiffs for carriage to Bombay by the steamer " Bharatjal " belonging to the appellant, the Bharat Lines Ltd. The steamer arrived in Bombay Port some time in the middle of September, 1948.
The plaintiffs however failed to obtain delivery of 596 bags from the Badagara consignment and 470 bags from the Cochin consignment.
They brought the suit on December 5, 1949, against the shipping company, the Bharat Lines Ltd., and also against the Trustees of the Port of Bombay on a claim of Rs. 1,05,726 1 6 on which Rs. 45,725 7 5 appear to have been claimed as compensation in respect of the bags not delivered and the remainder as compensation for damage to the goods in the bags of which delivery was taken.
We are no longer concerned with the second defendant, the Trustees of the Port of Bombay, as after the suit was dismissed by the Trial Court the plaintiffs did not pursue the claim against them.
The main defence of the first defendant, the shipping company, was that the suit was barred " by reason of the Indian Carriage of Goods by Sea Act ".
It was also urged that the suit was not maintainable as under the terms of the bill of lading the plaintiffs were bound to notify to the defendants their claim in writing about the alleged non delivery within one month from the date of the arrival of the vessel which the plaintiffs had failed to do.
It appears to have been conceded before the Trial Judge in the Bombay High Court that the suit had not been filed within one year after the delivery of the goods or the date on which the goods should have been delivered.
The plaintiffs ' counsel also appears to have conceded that cl. 6 of article III applied to the case.
The learned Judge therefore held that the first defendant had been discharged from all liability in respect of the loss or damage alleged in the plaint and dismissed the suit.
It appears however that in the appeal from this order of dismissal the plaintiffs urged that article III (6) of the Act did not apply to the facts of the case and also the date on which the goods should have been delivered should be construed to mean the date " when the loss was finally ascertained " and the shipping company was in a position to finally declare that they were or were not 827 in a position to deliver the goods in question.
In dismissing the appeal the learned judges of the High Court who heard the appeal did not give any separate reasons but stated that the appeal was being dismissed on the same ground as given in their judgment in Appeal No. 66 of 1954.
This is the judgment from which Civil Appeal No. 92 of 1958 of this Court has been preferred.
From what has been said above it is clear as we have already indicated that the main questions in this appeal are as regards the interpretation of the 3rd Clause of paragraph 6 of article III in the Schedule to the Act.
The first and the most important of these questions is as regards the meaning of the word " loss " as used in the said clause.
Does it mean only such loss as occurs when one says " the goods have been lost" or does it include also such loss as is sustained by the owners of the goods whether the shipper or the consignee when the carrier fails to deliver the whole or part of the cargo shipped ? The second question that arises for consideration is whether this clause only prescribes a rule of limitation or also provides for the extinction of the right to compensation after a certain period of time.
The next question is as regards the as certainment of the date on which the goods not delivered " should have been delivered " for the purposes of ' this clause.
Apart from these questions as regards the interpretation of the 3rd clause of paragraph 6 of article 111, it will be necessary to consider also whether the requirement in the bill of lading as regards the time within which the notice of claim must be made in order that the carrier may be responsible is void as being against the 8th paragraph of article III.
As has been mentioned in the preamable to the Act it was passed to give effect to the recommendation of the International Conference of Maritime Law at Brussels in October, 1922.
The circumstances which led to the holding of the conference and were responsible for the recommendations have been stated by Scrutton on Charter Parties, 15th Edition, at p. 439, in these words: 828 In recent years, as the terms of bills of lading became more diverse, the need for standardisation became more and more insistent and an increasing demand was made on the part of importers and exporters for the imposition by legislation, on the lines of the American Harter Act or the Australian Sea Carriage of Goods Act, 1904, or the Canadian Water Carriage of Goods Act, 1910, of certain minimum liabilities on sea carriers who issued bills of lading.
" x x x The movement in favour of legislation finally resulted in the decision of the delegates at the Diplomatic Conference on Maritime Law held at Brussels in October, 1922, to recommend to their respective Governments the adoption of the Hague Rules with slight modifications as a basis of legislation.
" It is this recommendation which has been referred to in the preamble to the Indian Act.
It is important to mention that apart from our own country, U. K., Australia, Canada, Ceylon, Newfoundland, New Zealand as well as Belgium, France and U. section A. have given statutory effect wholly or partially to the Hague Rules.
This international character of the provisions of law as incorporated in the articles to the schedule to the Act makes it incumbent upon us to pay more than usual attention to the normal grammatical sense of the words and to guard ourselves against being influenced by similar words in other acts of our Legislature.
it is helpful to remember in this connection the caution uttered by Lord Atkin in State Line Ltd. vs Foscold (1) about the importance of giving words in these rules their plain meaning, and not to colour one 's interpretation by considering whether a meaning otherwise plain should be avoided if it alters the previous law.
After stating that this caution would be well founded if the Act merely purported to codify the law, he went on to observe: " But if this is the canon of construction in regard to a codifying Act, still more does it apply to an Act like the present which is not intended (1) 829 to codify the English law, but is the result (as expressed in the Act) of an international conference intended to unify certain rules relating to bills of lading.
It will be remembered that the Act only applies to contracts of carriage of goods outwards from ports of the United Kingdom; and the rules will often have to be interpreted in the courts of the foreign consignees.
For the purpose of uniformity it is therefore important that the courts should apply themselves to the consideration only of the words used without any predilection for the former law. ".
The House of Lords was in that case interpreting certain provisions of the English Carriage of Goods by Sea Act, 1924.
Our own Act applies to contracts of carriage of goods outwards from the ports of India.
Section 2 states that the rules set out in the Schedule shall have effect in relation to and in connection with the carriage of goods by sea in ships carrying goods from any port in India to any other port whether in or outside India.
Though in the appeals before us we are concerned with only contracts of carriage of goods from one Indian port to another Indian port, it is necessary to remember that these rules will often have to be interpreted in the courts of the foreign consignees.
That is an additional reason why we should be careful not to attach to the words used in the rules set out in the Schedule to the Act anything more or less than their normal meaning consistent with the context in which they appear and consistent with the scheme of the legislation.
article III of the Schedule with which we are specially concerned in the present case purports to mention the responsibilities and liabilities of the carriers.
The first paragraph lays down the responsibilities and liabilities of the carrier in the matter of making ships seaworthy, properly manning, equipping and supplying the ship and making the holds and the different parts of the ship where goods are carried fit and safe for their reception, carriage and preservation.
The second paragraph places on the carrier the duty of properly and carefully loading, handling, stowing, carrying, keeping, caring for and discharging the goods, subject to article IV.
The 3rd paragraph provides for the issue of a bill of lading 830 to the shipper of the goods showing among other things the identifying marks, the number of packages or pieces or the quantity or weight as also the apparent order and condition of the goods.
Paragraph 4 provides that the bill of lading shall be the prima facie evidence of the receipt by the carrier of the goods as described in accordance with paragraph 3.
The fifth paragraph provides that the shipper shall be deemed to have guaranteed to the carrier the accuracy as regards the details of marks, number, 'quantity and weight as furnished by him.
It provides further that the shipper shall indemnify the carrier against all loss, damages and expenses arising or resulting from such inaccuracies.
Then comes paragraph 6, the whole of which it is proper to set out : Unless notice of loss or damage and the general nature of such loss or damage be given in writing to the carrier or his agent at the port of discharge before or at the time of the removal of the goods into the custody of the person entitled to delivery thereof under the contract of carriage, or if the loss or damage be not apparent, within three days, such removal shall be prima facie evidence of the delivery by the carrier of the goods as described in the bill of lading. " " The notice in writing need not be given if the state of the goods has at the time of their receipt been the subject of joint survey or inspection. " " In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after the delivery of the goods or the date when the goods should have been delivered. " " In the case of any actual or apprehended loss or damage.
the carrier and the receiver shall give all reason able facilities to each other for inspecting and tallying the goods.
The seventh paragraph contains provisions as regards issue of a shipped bill of lading.
The eighth paragraph is in these words: " Any clause, covenant or agreement in a contract of carriage relieving the carrier or the ship from liability for loss or damage to or in connection with 831 goods arising from negligence, fault or failure in the duties and obligations provided in this article or lessening such liability otherwise than as provided in these Rules, shall be null and void and of no effect.
A benefit of insurance or similar clause shall be deemed to be a clause relieving the, carrier from liability.
" It has to be noticed that before providing in the 6th paragraph an immunity to the carrier from " all liability in respect of loss or damage " in certain circumstances the Legislature had in the earlier paragraphs laid on the carrier the duty of making the ships seaworthy, properly manning, equipping and supplying the ship, and making the holds and all other parts of the ship fit and safe for the reception, carriage and preservation of the goods; properly and carefully loading, handling, stowing, carrying, keeping and caring for and discharging the goods carried and provided that ordinarily the bill of lading should show the quantity or weight of the goods or the number of packages or pieces.
" Loss or damage " which paragraph 6 speaks of should therefore reasonably be taken to have reference to such loss or damage which may result from the carrier not performing some or all of the duties which had been mentioned earlier.
One of those duties is to discharge the goods carried in accordance with the quantity or weight or the number of packages or pieces as mentioned in the bill of lading.
The shipper and the consignee of goods are more concerned with the duty of the carrier to discharge the goods in proper order and condition and in full than anything else.
Indeed the other duties cast on the carriers so far as the owners of the goods are concerned, are really incidental to this duty of discharging the goods in full and in good order and condition.
When in the context of the previous paragraphs of article III the 6th paragraph seeks to provide an immunity to the carrier "from all liability in respect of loss or damage " after a certain time, it is reasonable to think that it is loss or damage to the owner of the goods, be he shipper or the consignee, which is also meant, in addition to the " loss of the goods ".
When 832 the goods themselves are lost, e.g., by being jettisoned, or by being destroyed by fire or by theft, there will be failure to discharge the goods in full and loss to the owner of the goods will occur.
Even where the goods are not lost the carrier may fail to discharge the goods in full or not in proper order and there also loss will occur to the owner of the goods.
In such a case, even though there may not have been " loss of the goods " the goods are lost to the owner.
The word " loss " as used in paragraph 6 is in our opinion intended to mean and include every kind of loss to the owner of the goods whether it is the whole of the consignment which is not delivered or part of the consignment which is not delivered and whether such non delivery of the whole or part is due to the goods being totally lost or merely lost to the owner by such fact of nondelivery there is in our opinion "loss" within the meaning of the word as used in paragraph 6.
It is worth noting in this connection that while paragraph 5 makes it clear that loss there means loss to the carrier and paragraph 6 speaks of loss or damage to or in connection with the goods, the Legislature has in the 6th paragraph of this Article left the words "loss or damage" unqualified.
The object of the rule however being to give immunity to the carriers and the shippers from claims of compensation made by the owners of the goods in respect of loss sustained by them, it will be unreasonable to read the word " loss " in that paragraph as restricted to only loss of the goods ".
When the object of this particular paragraph and the setting of this paragraph in the Article after the previous paragraphs are considered there remains no doubt whatsoever that the learned judges of the Bombay High Court were right in their conclusion that the loss or damage in this paragraph is a wide expression used by the Legislature to include any loss or damage caused to shipper or consignee in respect of which he makes a grievance and in respect ,of which he claims compensation from the shipping company.
The argument that loss due to failure to deliver the goods is not covered by this clause is merely to be mentioned to deserve rejection.
The very use of the 833 words " the date on which the goods should have been delivered" clearly contemplates a case where the goods have not been delivered.
The clause gives the owner of the goods one year 's time to bring the suit the year to be calculated from the date of the delivery of the goods where the goods have been delivered and from the date when the goods should have been delivered where all or some of the goods have not been delivered.
The fact that the first clause of the 6th paragraph speaks of removal of the goods may be an argument for thinking as the Bombay High Court thought that clause has no application when goods are not delivered.
It may be mentioned that some authorities (See Carver 's Carriage of Goods by Sea, 10th Edition, p. 191) have suggested that the first clause of this paragraph appears to have little meaning.
That is a matter which need not engage our attention.
It is sufficient to mention that the fact that the rule of evidence provided in the first clause of the paragraph may have no application to cases of non delivery is wholly irrelevant in deciding whether the third clause applies to cases of non delivery.
As we have already said the date when the goods should have been delivered necessarily contemplates a case where loss has arisen because goods have not been delivered.
Reliance was sought to be placed on behalf of the appellants in the two Bombay appeals on Spens vs The Union Marine Insurance Co. Ltd. (1).
What had happened in that case was that cotton belonging to different owners was shipped in bales specifically marked, including 43 bales belonging to the plaintiffs.
In the course of the voyage the ship was wrecked; all the cotton was more or less damaged, some of it was lost, some was so damaged that it had to be sold before reaching the port and marks on a very large number of the bales were so obliterated by sea water that none of the cotton that was lost or sold and only a portion of what was carried to the port could be identified as belonging to any particular consignment.
The plaintiffs had insured the goods with the defendant company against the usual risks.
The question (1) 834 arose whether there was a total loss of a part of each owner 's cotton or whether there was a total loss of the plaintiffs ' consignment.
The court held that it could not be said that there was an actual total loss of the plaintiffs ' consignment nor a constructive total loss of these, that the principle of proportion applied in cases of general average or jettison where it is not known whose goods are sacrificed should be properly applied to cases of this nature where because of the bales of different shippers being undistinguishable by reason of the action of the sea and without the fault of the respective owners it becomes impossible to ascertain to whom the goods actually lost belonged.
This case it has to be noticed had to consider in view of the special terms of an insurance policy, whether there was a total or partial loss for the purposes of claims under the policy and the argument that there was a total loss within the meaning of the policy because it was impossible for the ship owner to deliver the plaintiffs ' own bales of cotton to them was rejected.
This case is of no assistance in the interpretation of the word " loss " in the Articles of the Schedule.
In cases of such mixture of cargo of different owners it was pointed out by Lord Moulton in Sandeman & Sons vs Tyzack and Branfoot Steamship Co. Ltd. (1) which was cited by the learned Solicitor General himself : " It may well be that they could assert the position of joint owners in the mixed cargo, and as such take action against any person who sought to get possession of it or convert it to his own use.
But it does not follow that the ship owners would have performed their contract of carriage.
Their duty is to deliver the goods entrusted to them for carriage, and they do not perform that duty if all that the consignee obtains is a right to claim as tenant in common a mixture of those goods with the goods of other people.
No doubt, if such a right is of some value, and the consignee avails himself of it, the shipowners are entitled to credit for whatever value the goods possessed if they were delivered (1) , 697. 835 mixed up with some extraneous substance which lessened their value or compelled the consignee to go to expense in separating it out.
" There is nothing however to justify the conclusion that the consignee is bound to avail himself of the right to claim as tenant in common.
The breach of contract remains and the claim for compensation for such breach is in no way affected.
Neither authority nor principle therefore supports the contention of the learned Solicitor General that where the goods are in existence but cannot be delivered because they have been mixed up with the cargo of other owners there has been no " loss " within the meaning of the third clause of the 6th paragraph of article III.
On the first question, therefore, we have come to the conclusion that the word "loss" in the third clause of the 6th paragraph of article III to the Act means and includes any loss caused to a shipper or a consignee by reason of the inability of the ship or the carrier to deliver part or whole of the goods, to whatever reason such failure may be due.
On the next question whether this clause prescribes only a rule of limitation or provides for the extinction of a right to compensation, it will be observed that the Bombay High Court has not discussed it at all, apparently because on the facts of the case before it would have mattered little whether the provision was one of limitation or of extinction of right.
The question is however of some importance in the facts of the Madras Case.
For if the provision is one of limitation there would be some scope for argument in the facts of that case that the period was extended by acknowledgments of liability within the meaning of article 19 of the Limitation Act.
The question we have to decide is whether.
in saying that the ship or the carrier will be " discharged from liability ", only the remedy of the shipper or the consignee was being barred or the right was also being terminated.
It is useful to remember in this connection the international character of these rules, as has been already emphasised above.
Rules of limitation are likely to vary from country to country.
Provisions for extension of periods prescribes for limitation would similarly vary,.
836 We should be slow therefore to put on the word " discharged from liability " an interpretation which would produce results varying in different countries and thus keeping the position uncertain for both the shipper and the shipowner.
Quite apart from this consideration, however, we think that the ordinary grammatical sense of "discharged from liability" does not connote " freed from the remedy as regards liability " but are more apt to mean a total extinction of the liability following upon an extinction of the right.
We find it difficult to draw any reasonable distinction between the words "absolved from liability" and " discharged from liability " and think that these words " discharged from liability " were intended to mean and do mean that the liability has totally disappeared and not only that the remedy as regards the liability has disappeared.
We are unable to agree with the learned Judge of the Madras High Court that these words merely mean that " that even though the right may inhere in the person who is entitled to the benefits, still the liability in the opposite party is discharged by the impossibility of enforcement.
" The distinction between the extinction of a right and the extinction of a remedy for the enforcement of that right, though fine, is of great importance.
The Legislature could not but have been conscious of this distinction when using the words " discharged from all liability " in an article purporting to prescribe rights and immunities of the shipowners.
The words are apt to express an intention of total extinction of the liability and should, specially in view of the international character of the legislation, be construed in that sense.
It is hardly necessary to add that once the liability is extinguished under this clause, there is no scope of any acknowledgment of liability thereafter.
This brings us to the question as to how the date " when the goods should have been delivered " should be calculated.
References were made at the Bar to some of the numerous decisions in the different courts in India as regards the interpretation of somewhat similar words in article 31 of the Limitation Act in respect of suits for recovery of compensation for 837 non delivery.
Indeed the learned Judge in the Madras High Court himself has based his conclusion on this question on the view of law he had earlier expressed as regards article 31 of the Limitation Act that the starting point of limitation there is the final repudiation of the liability by the company.
With great respect to the learned Judge, we are of opinion that the cases as regards the ascertainment of the date when the goods " ought to be delivered " as used in article 31 of the Limitation Act are of no assistance for our present purpose.
Most, if not all of the cases which have considered the question of the ascertainment of the date when the goods " ought to be delivered " for the purpose of article 31 deal with cases of transport by Railways where no date has been or can be specified in the contract for carriage.
We cannot however ignore the fact that the conditions of carriage of goods by ship are essentially different from contracts of carriage of goods by Railways in one respect, viz., that whereas in contracts of carriage of goods by Railways there is ordinarily no knowledge as to by which particular train the goods will be despatched nor is there any undertaking by the Railways as regards such trains, there is ordinarily in contracts of carriage of goods by sea distinct arrangement that the goods will be shipped by a particular vessel.
Whether the bill of lading in the older form beginning with the words " shipped on board the. . or in the form more recently employed by some shipping companies, beginning with the words " Received for shipment by. . (See Scrutton on Charter Parties, 15th Edition, p. 10) the name of the vessel is ordinarily indicated in the bill of lading itself.
The duty of the carrier under the contract of carriage is to carry the goods by a particular ship and then to deliver the same on the arrival of the ship at the port.
The manner in which the delivery will take place will depend on the particular terms of the bill of lading and on the custom of the port of destination.
But whether the delivery has to be made to the consignee at the ship 's side or is made on the quay side there can be little doubt that the carrier 's duty is to start the delivery of goods as soon as the ship arrives at the 109 838 port of destination and to complete the delivery before the ship leaves the port.
In a particular case the carrier may not do his duty.
That cannot however alter the fact of the existence of his duty to complete the delivery between the arrival of the ship at the port and the departure of the ship from the port.
If as regards any particular goods this duty remains unperformed at the time when the ship leaves the port there can be no escape from the conclusion that the point of time when the ship leaves the port is the latest point of time by which the goods should have been delivered.
On the records of both the Bombay appeals we find the bills of lading for these carriages of contract.
Paragraph 10 of the bill of lading in Civil Appeal No. 92 of 1948 contains the terms as regards the discharge of cargo in these words: " 10.
Discharge of goods: The goods may be discharged as soon as the ship is ready to unload and as fast as she is able, continuously day and night.
Sundays and holidays included, and if the consignee fails to take delivery of his goods immediately the ship is ready to discharge then the company shall be at liberty to land the said goods on to the wharf or quay or into warehouse, or discharge into hulk, lazaretto or craft or any other suitable place without notice and the goods may be stored. . . .
The company shall have the option of making delivery of goods either over the ship 's side or from lighter or store ship of hulk or custom house or warehouse or dock or wharf or quay at consignee 's risk.
In all cases the company 's liability is to cease as soon as the goods are lifted from and leave the ship 's desk".
In the Civil Appeal No. 91 of 1958 the terms of delivery are in paragraph 15 and is in these words: " 15.
The company is to have the option of delivering these goods or any part thereof, into receiving ship or board or craft or landing them at the risk and expense of the shipper or consignee as per scale of charges to be seen at the Agents Offices. . " In these appeals we are not concerned with the facts of these terms of delivery of contract except that they 839 show that it is clearly understood between the parties to the contract that delivery is to commence as soon as possible after the arrival of ship at port and completed before the ship leaves the port.
Indeed even if there were not definite terms in the bill of lading as regards the delivery it would follow necessarily from the very nature of the carriage of goods by ship that the delivery of the cargo carried by the ship should be made between the date of the arrival at the port and its departure from the port.
For our present purpose it is unnecessary to consider whether delivery to the dock authority in any of there cases was or would have been equivalent to the delivery to the consignee.
That would depend upon the custom of the port of discharge or on statutory provisions or express stipulations in the bill of lading.
But whether the delivery is to be made to the consignee or to anybody else on his behalf the duty of the ship 's master is to start the delivery as soon as possible after the ship 's arrival at the port and to complete it before the date of departure from the port.
Before the ship has actually left, the port it is not possible to say that the time when delivery should be made has expired.
Once however the vessel has left the port it cannot but be common ground between the carrier and the consignee that the time when delivery should have been made is over.
It is this point of time, viz., the time when the ship leaves the port, which in our opinion should be taken as the time when the delivery should have been made.
The fact that after this point of time correspondence started between the carrier and the consignee as regards the failure to deliver and at a later point of time the carrier communicates his inability to deliver cannot affect this question.
Nor can the ultimate repudiation of any claim that may be made by the shipper or the consignee affect the ascertainment of the date when the goods should have been delivered.
The arrival at port of the vessel by which the goods have been contracted to be carried being known and the departure being equally an ascertainable thing and the duty of the carrier being necessarily to complete the delivery before leaving the port, the date 'by which the delivery should have been made is 840 already a fixed point of time and later correspondence, claims or repudiation thereof can in no way change it.
We have therefore come to the conclusion that whatever be the proper mode of ascertaining the date when delivery " ought to be made" under article 31 of the Limitation Act whether that be the reasonable time for delivery in the circumstances of the case or the date when after correspondence the carrier intimates its inability to deliver or the date of the final repudiation of the claim on a claim for compensation having been made or in the case of part delivery the date when the bulk of the consignment was delivered the date when the goods should have been delivered for the purpose of the third clause of the 6th paragraph of article III of the Act is the date when the ship by which the goods were contracted to be carried has left the port at which delivery was to be made.
Applying the above clause to the facts of the cases before us it is obvious that these suits for compensation were not maintainable.
It is hardly necessary therefore to consider the additional defence raised in all the three suits by the shipping companies, viz., that the claim for compensation not having been made within thirty days from the date of arrival of the vessel in accordance with the terms of the bill of lading no compensation is payable.
The learned Judges of the Bombay High Court did not think it necessary to consider this additional defence as they accepted ,the defence based on the third clause of the 6th para.graph of article III which has been discussed above.
The learned Judge in the Madras High Court had however to consider this additional defence in view of his conclusions against the shipping company on the other defence.
He held that the stipulation in the bill of lading that if no claim for compensation is made within thirty days from the date of arrival of the ship the shipping company will not be liable for compensation is void as it offends against para.
8 of article 111.
The relevant portion of this paragraph is in these words: 8.
Any clause, covenant or agreement in a contract of carriage relieving the carrier or the ship from liability for loss or damage to or in connection 841 with goods arising from negligence, fault or failure in the duties and obligations provided in this article or lessening such liability otherwise than as provided in these Rules, shall be null and void and of no effect.
" It cannot be seriously disputed that the stipulation under consideration does directly offend against the provisions of the 8th paragraph.
For it seeks at least to " lessen ", otherwise than provided in the rules in the Schedule the liability of the ship or carrier for loss or damage to goods or in connection with goods caused by the failure to deliver.
This stipulation requiring claim for compensation being made within one month from the date of arrival of the ship is therefore null and void.
Though the additional defence raised by the shipping companies must therefore fail, the main defence, as we have already found, succeeds.
None of the suits were brought within a year from the date when the ship carrying the goods left the port of discharge.
We therefore dismiss with costs the Civil Appeals Nos. 91 and 92 of 1958 and confirm the order of dismissal made by the Bombay High Court.
One set of hearing costs will have to be paid.
Civil Appeal No. 88 of 1956 is infructuous because of the fact, as already indicated, that after the order of remand now appealed from was made by the Madras High Court the suit was heard in the Small Causes Court and a decree was passed and that decree has become final.
We therefore dismiss Civil Appeal No. 88 of 1956, as already ordered by this Court when giving leave to appeal; the appellant will pay the costs of the appeal to the respondent.
Appeals dismissed.

Output:
The appellant in the first case (C. A. No. 88/56) and the respondents in the other two cases (C. As.
Nos. 91 & 92 of 1958) were shipping companies carrying goods by sea from one port to another.
They carried goods of the opposite parties by ships to their places of destination but failed to deliver the whole of the goods consigned.
In the suits brought by the owners of the goods for compensation the main question related to the interpretation of the 3rd clause of para.
6 of article III in the Schedule to the Indian Carriage of Goods by Sea Act, 1925 (XXVI Of 1925) which runs thus: " In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after the delivery of the goods or the date when the goods should have been delivered ".
In the first case the Madras High Court expressed the opinion that the above clause did not provide for the extinction of the consignor 's right to claim compensation but merely prescribed a rule of limitation.
It also held that the term in the bill of lading requiring that the claim for compensation should be made within one month from the date of arrival of the vessel was repugnant to Rule 8 to article III of the Schedule and was void.
The Bombay High Court held that article 111(6) dealt with all cases of loss or damage whether the loss or damage was caused by the deterioration of the goods or by their non delivery and further that the words " the loss or damage " included any loss or damage caused to the consignee in respect of his claim for compensation from the shipping company.
If also held that the goods should have been delivered as soon as they were landed.
On appeal by special leave: Held, that the word " loss " in cl. 3, para.
6 of article III in the schedule to the Indian Carriage of Goods Act, 1925, meant and included any loss caused to a shipper or consignee by reason of the inability of the ship or the carrier to deliver part or whole of the goods, to whatever reason such failure might be due.
Spens and another vs The Union Mayine Insurance Co. Ltd., 3 Common Pleas 427, distinguished, 821 Sandeman & Sons vs Tyzack and Branfoot Steamship Co. Ltd., , referred to.
The words "discharged from liability" were intended to mean and did mean that the liability had totally disappeared and not only that the remedy as regards the liability had disappeared.
The date when the goods should have been delivered for the purpose Of cl. 3, para.
6 of article III of the Act was the date when the ship by which the goods were carried left the port of delivery.
The stipulation in the bill of lading requiring claim for compensation being made within one month from the date of arrival of the ship was null and void.


Input:
Appeal No. 1658 of 1966.
Appeal by special leave from the judgment and order.
dated November 19, 1965 of the Calcutta High Court in Matter No. 213 of 1964.
D.N. Mukherjee, for the appellant.
A.N. Sinha and B.P. Jha, for the respondent.
The Judgment of the Court was delivered by Grover, J.
This is an appeal by special leave from a judgment of the Calcutta High Court dismissing a petition filed under section 33 of the Indian , hereinafter called the Act.
A contract was entered into between appellant and the respondent on January 28, 1964 for sale of 200 bags of Cone yarn.
The contract inter alia contained the following terms and conditions: "(a) In case of any dispute arising out of this contract the matter in dispute shall be referred to the arbitration of the Indian Chamber of Commerce whose decision shall be binding on both the parties.
(b) The Court at Calcutta alone and no other court whatsoever shall have jurisdiction to entertain and try suits in respect of any claim or disputes arising out of or under this contract or in any way relating to the same".
Certain disputes arose between the parties relating to the supply of goods and the respondent demanded a payment of Rs. 25,658.90 as price of the goods alleged to have been supplied.
The appellant maintained that the said goods were not according to the contract and had been rightly rejected.
431 The appellant did not happen to be a member of the Indian Chamber of Commerce, Calcutta, whereas the respondent was a member.
The dispute having been referred to the Chamber the appellant wrote to the Registrar of the Tribunal of Arbitration of the Chamber of Commerce to intimate the names of the persons constituting the court to enable the appellant to ascertain whether they were independent and disinterested persons.
The Registrar sent a reply saying that the names of the arbitrators constituting the court could not be disclosed to the appellant as it was a nonmember.
Later on a list of the office bearers and committee members was sent but according to the appellant the names of the arbitrators were not disclosed.
In September 1964 the Registrar intimated that the meeting of the court of the arbitrators would be held on September 24, 1964.
There was further correspondence.
The appellant 'section attorney again sought information regarding the names and particulars of the arbitrators but without success.
Ultimately the appellant filed an application under section 33 of the Act.
The case of the appellant was that the arbitration agreement contained in the contract was void and ineffective as clauses (a) and (b) reproduced above were in conflict with each other and that the Rules of the Tribunal of Arbitration of the Indian Chamber of Commerce were illegal and void.
The High Court repelled all the contentions raised before it and dismissed the application.
The main emphasis before us has been laid by learned counsel for the appellant on R. III of the Rules of Arbitration of the Indian Chamber of Commerce which, according to him, comes into conflict with the provisions of the Act.
That Rule provides that the Tribunal shall consist of such persons as may be selected by the Committee of the Chamber from time to time.
Sub Rule ( 3 ) reads: "The Committee may, at any time if they think proper so to do, add to the said list the names of other persons qualified as aforesaid.
A list of the members of the Tribunal complete for the time: being shall be kept by the Registrar, and shall always be open for inspection by members on application and at the discretion of the Registrar, also by persons other than members".
It is urged that the non disclosure of the names of the arbitrators by the Registrar is violative not only of the rules of natural justice but also infringes the provisions of the Act.
Before the High Court and before us reliance has been placed on an unreported judgment of the Calcutta High Court in Matter No. 95 of 1963 (Suraj Ratan Binany vs Hindustan Motors Ltd.)(1).
In that Decided on C 4 964.
432 case a similar contention had been raised and it was held that if the names of the arbitrators were not known to the parties until the award was filed the parties would not be in a position to know whether the arbitrators had misconducted themselves entailing removal under section 11 of the Act or a case had ' arisen for moving the court under section 5 of the Act for leave to revoke the ,authority of an appointed arbitrator.
In the judgment under appeal, however, that view was not followed and it has been held that the Arbitration Rules of the Chamber of Commerce did not offend any of the sections of the Act as the powers of the court under sections 5 and 11 remained unaffected by the aforesaid Rules.
In our judgment there is no merit in the challenge to the validity of the arbitration agreement on the ground that the Rules of the Indian Chamber of Commerce which is to be the arbitrator, enable the Registrar of that Chamber to withhold disclosure of the names of the Arbitration Court to a party which does not happen to be a member of the Chamber.
The power given to the Registrar is discretionary and he is not bound in every case to refuse to disclose the names.
At any rate, as soon as proceedings before the arbitrators commence both parties are in a position to know the names and particulars of the arbitrators and if there is any objection on well known grounds to their conducting the arbitration the same can be taken at that stage.
Under section 5 it is not essential that the authority of an appointed arbitrator should be got revoked before the commencement of the arbitration proceedings.
Section 11 contemplates a stage subsequent to the arbitrators entering on the reference.
We can see no conflict between Rule III (3 ) of the Rules of Arbitration of Chamber of Commerce and sections 5 and 11 or section 30 of the Act.
These Rules do not interfere with or take away the powers and the jurisdiction of the court under the aforesaid provisions.
It must be remembered that the appellant agreed to submit to the arbitration of Indian Chamber of Commerce which meant that it was bound by all the Rules of Arbitration of the said body.
No illegality or invalidity can be projected into the agreement by the presence of Rule III(3).
Our attention has been drawn to a statement in Russell on Arbitration, 17th Edn., at page 207 that the appointment of an arbitrator by a party is not complete without communication thereof to the other party.
This Rule can be of no avail to the appellant because in the; present case the arbitrator was known, the arbitrator being the Chamber of Commerce.
Under its Rules the Chamber is authorised to delegate its power to a smaller body.
As the Rules were expressly or by necessary implication incorporated into the contract the Chamber would have the power to appoint a court, by its Registrar, to decide the dispute.
The appointment of the arbitrator was thus complete in every sense in 433 the present case.
It could not be said that it would become complete only when the names of persons constituting the court of arbitration were communicated.
Those persons only discharge the duty which lay on the Chamber in the matter of arbitration.
It is noteworthy that the Rules of Chamber of Commerce in various parts of the country contain provisions similar to the one the validity of which has been impugned.
For instance Rule V(4) of the Rules of Bengal Chamber of Commerce provides that the names or name of the persons or person constituting the court shall not ordinarily be disclosed to the parties nor shall the parties be entitled to such in,formation as of right.
A similar rule is to be found in bye law 8 of the Bombay Chamber of Commerce and Rule V(5) of Arbitration Rules of Madras Chamber of Commerce.
It appears that the aforesaid Rule which has been framed by all these bodies of long standing and experience in the field of business is based on the elimination of all possibility or chance of a party trying to influence the members of the Arbitration Court before they enter upon or proceed with the reference.
It is axiomatic that as soon as a party appears before them or the arbitration proceedings commence the names of the arbitrators can no longer remain a secret and it is always open to a party to initiate: proceedings on the ground of bias or prejudicial interest even at that stage or after the award is made.
The appeal fails and it is dismissed.
There will be no order as to costs.
G.C. Appeal dismissed.

Output:
A contract was entered into between the appellant and the respondent in 1964 for sale of 200 bags of Cone yarn.
The contract inter alia conrained the condition that in case of any dispute arising out of the contract "the matter in dispute shall be referred to the arbitration of the Indian Chamber of Commerce whose decision shall be binding on both the parties".
The appellant was not a member of the said Chamber of Commerce; the respondent was On dispute arising between the parties and being referred to the Chamber for arbitration the appellant wrote to the Registrar of the Tribunal of Arbitration of the Chamber to intimate to it the names of the persons constituting the court to enable the appellant to ascertain whether they were independent and disinterested persons.
The Registrar refused to disclose the names on the ground that under the rules of the Chamber they could not be disclosed to a non member.
On persistent refusal to disclose the names the appellant filed an application under section 33 of the Indian before the Calcutta High Court the application was dismissed, whereupon appeal by special leave was filed in this Court.
It was urged that the non disclosure of the names of the arbitrators by the Registrar was violatire not only of the rules of natural justice but also infringed the provisions of the .
It was contended that there was a conflict between r. III(3) of the Rules of Arbitration of the Chamber of Commerce and sections 5 and 11 or section 30 ' of the Act.
HELD: The appeal must be dismissed.
( i) The power given to the Registrar not to disclose names of the members of the arbitration court to non members is discretionary 'and he is not bound in every case to refuse to disclose the names.
At any rate as soon as the proceedings commence the parties will know the names of the.
arbitrators and objection can be taken at that stage.
Under section 5 of the it is not essential that the authority of an appointed arbitrator should be got revoked before the commencement of the arbitration proceedings.
Section 11 contemplates a stage subsequent to the arbitrator entering on the reference.
There is thus no conflict between r. 111(3) of the Rules of Arbitration of the Chamber and sections 5 and 11 and 30 of the Act.
These Rules do not interfere with or take away the powers and jurisdiction of the court under the aforesaid provisions.
The appellant itself had agreed to submit to the arbitration of the Chamber which meant that it was bound by all the Rules of Arbitration of the said body.
No illegality or invalidity could be projected into the agreement by the presence of r. III(3).
[434 C F].
430 (ii) The statement in Russel on Arbitration (17th Edn.
p. 207) that the appointment of an arbitrator by a party is not complete without communication hereof to the other party could be of no avail to the appellant since in the present case the appointment of the arbitrator, namely, the Chamber of Commerce, was in every sense complete.
[434 G H] (iii) The rule objected to by the appellant is part of the long standing practice of Chambers of Commerce in this country its justification being the elimination of all possibility or chance of a party trying to influence the members of the Arbitration court before they enter upon or proceed with the reference.
[435 C D] Unreported judgment of Calcutta High Court in Suraj Ratan Birany vs Hindustan Motors Ltd. decided onApril 10, 1964, disapproved.