ECONOMIC TRANSPORT ORGANIZATION v. M/S. CHARAN SPINNING MILLS (P) LTD. AND ANR

A subrogation, the document, if read as a simple assignment would fall foul of section 6(e) of Transfer of Property Act and thus would be unenforceable. But the ultimate decision in Oberai may be correct as the complaint was filed by the insurer, in its own name and on its own behalf making a claim B for the entire value of the goods, in excess of what was paid to the assured. Though the assured was belatedly impleaded as a co-complainant, the nature and contents of the-complaint was not apparently changed, and continued to be one by the insurer as assignee. On those peculiar facts, the finding that the c complaint under the Act by the insurer (who was not a consumer) was not maintainable, was justified.

(23.2) We may also refer to the frequent misconstruction of para 23 of the decision in Oberai by some carriers. The said para does not mean that when the consignment is received by D the carrier from the consignor and put it in the course of transportation, the carrier has provided the service and thereafter either ceases to be a service provider or ceases to be responsible for delivery of the goods, and that consequently, the consignor ceases to be a 'consumer'. All that para 23 of E Oberai meant was that in a contract for carriage of goods between the consignor (assured) and the carrier, if the consignor assigns the right to claim damages to an assignee, after the goods are lost or damaged, the assignee cannot claim to be a "consumer'' under the Act. It impliedly meant that if the F assignment had b~en done before the loss or damage to the goods, then the assignment would have been in regard to 'property' and not a mere right to sue, and the assignee as consignee would be entitled to sue the carrier. Be that as it may.

24Copy pinpoint24. We therefore answer the questions raised as follows: G (a) The insurer, as subrogee, can file a complaint under the Act either in the name of the assured (as his attorney holder) or in the joint names of the assured and the insurer for recovery of the amount due from the service provider. H

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SPINNING MILLS (P) LTD. [R.V. RAVEENDRAN, J.]

The insurer may also request the assured to sue the wrong doer (service provider).

(b) Even if the letter of subrogation executed by the assured in favour of the insurer contains in addition to the words of subrogation, any words of assignment, the complaint would be maintainable so long as the complaint is in the name of the assured and insurer figures in the complaint only a~ an attorney holder or subrogee of the assured.

(c) The insurer cannot in its own name maintain a c complaint before a consumer forum under the Act, even if its right is traced to the terms of a Letter of subrogation- cum-assignment executed by the assured.

(d) Oberai is not good law insofar as it construes a Letter D of subrogation-cum-assignment, as a pure and simple assignment. But to the extent it holds that an insurer alone cannot file a complaint under the Act, the decision is / correct.

25Copy pinpoint25. We may also notice that section 2(d) of Act was amended by Amendment Act 62 of 2002 with effect from 15.3.2003, by adding the words "but does not include a person who avails of such services for any commercial purpose" in the definition of 'consumer'. After the said amendment, if the service of the carrier had been availed for any commercial purpose, then the person availing the service will not be a 'consumer' and consequently, complaints will not be maintainable in such cases. But the said amendment will not apply to complaints filed before the amendment. G Re : Question (d)

26Copy pinpoint26. Section 14(1)(d) of the Act provides that the Forum under the Act can direct payment of compensation awarded by it to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party. This, according to H

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A the appellant, makes it mandatory for the complainant to establish negligence on the part of the opposite party, i.e. the carrier. It is further contended that presumption of negligence under Section 9 of the Carriers Act, 1865 (which provides that in any suit brought against a common carrier for the loss, s damage or non-delivery of the goods entrusted to him for carriage, it shall not be necessary for the plaintiff to prove that such loss, damage or non-delivery of goods was owing to the negligence or criminal act of the carrier, his servants and agents) is applicable only to a civil suit, and not to a complaint c under the Act which specifically contemplates establishment of negligence by evidence. It is submitted that in this case the compensation has been awarded even though no evidence ,was led by the complainants about negligence of the driver of appellant.

27Copy pinpoint27. It is no doubt true that Section 14( 1)(d) of the Act contemplates award of compensation to the consumer for any loss suffered by consumer due to the negligence of the opposite party (Carrier). Section 9 of Carriers Act does not lay down a preposition that a carrier will be liable even if there was no negligence on its part. On the other hand, it merely raises a presumption that when there is loss or damage or non-delivery of goods entrusted to a carrier, such loss, damage or non- delivery was due to the negligence of the carrier, its servant and agents. Thus wliere the consignor establishes loss or damage or non-delivery of goods, it is deemed that negligence on the part of the carrier is established. The carrier may avoid liability if it establishes that the loss, damage or non-delivery was due to an act of God or circumstances beyond its control. Section 14(1)(d) of the Act does not operate to relieve the carrier against the presumption of negligence created under Section 9 of the Carriers Act.

28Copy pinpoint28. The contention of appellant that the presumption under section 9 of the Carriers Act is available only in suits filed before civil courts and not in other civil proceedings under other H

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SPINNING MILLS (P) LTD. [R.V. RAVEENDRAN, J.]

Acts, is not tenable. This Court in Patel Roadways Ltd. v. Bir/a A Yamaha Ltd. [2000 (4) SCC 91] has observed:

"The principle regarding the liability of a carrier contained in S.9 of Carriers Act namely, that the liability of a carrier is that of an insurer and that in a case of loss or damage 8 to goods entrusted to the carrier the plaintiff need not prove negligence, are applicable in a proceeding before the Consumer Forum. The term "suit" has not been defined in Carriers Act nor it is provided in the said Act that the term 'suit' will have the same meaning as in Civil PC. Therefore; C the term 'suit' has to be understood in its ordinary dictionary meaning. In that sense, term 'suit' is a generic term taking within its sweep all proceedings initiated by a party for valuation of a right vested in him under law. It is true that a proceeding before Consumer Forum is ordinarily a summary proceeding and in an appropriate D . case where the commission feels that the issues raised are too contentious to be decided in summary proceedings it may refer parties to Civil Court. That, however, does not mean that proceedings before the Consumer Forum is to be decided by ignoring the express E statutory provision of Carriers Act in a proceeding in which a claim is made against a common carrier. A proceeding before the Consumer Forum comes within the sweep of term 'suit." F

29Copy pinpoint29. Again in Economic Transport Organization vs. Dharward District Khadi Gramodyog Sangh - 2000 (5) SCC 78, this Court reiterated the principle stated in Patel Roadways and added the. following :

"Even assuming that section 9 of the Carriers Act, 1865 G does not apply to the cases before the Consumer Fora under Consumer Protection Act, the principle of common law above-mentioned gets attracted to all these cases coming up before the Consumer Fora. Section 14(1 )(d) of the Consumer Protection Act has to be understood in that H

942 SUPREME COURT REPORTS [2010] 2- S.C.R.

.. . A light and the burden of proof gets shifted to the carriers. . by the application of the legal presumption ~nder the common law. Section 14(1)(d) has to be understood in that manner. The complainant can discharge the iditial onus, . even if it is laid on him under section 14(1}(d)··of the 8 Consumer Protection Act, by. re·lying on section 9'of the Carrier Act. It will, therefore; be for the caffier to· prove· ·absence. of negligence." · · ·

· We reiterate the said settled position and reject the contention. of the appellant that the presumption under section 9 of Carriers C Act is not available in a proceeding under the Consumer Protection Act and that therefore, in the absence of.proof of negligence, it is not liable to compensate the respondents for the loss. · ·

D Conclusion

30Copy pinpoint30. The loss of consignment by the assured and settlement of claim by the insurer by paying Rs.4,47,436/- is established by evidence. Having regard to the presumption E regarding negligence under section 9 of Carriers Act, it was not necessary for the complainants to prove further that the loss/ damage was due to the negligence of the appellant or its driver. The presumption regarding negligence was not rebutted. Therefor.e, the District Forum was justified in allowing the complaint brought by the assured (first respondent) F represented by the insurer and the insurer for recovery of Rs.447,436. The said order was affirmed by the State Forum and the National Forum. We find no reason to interfere with the same. The appeal is, therefore, dismissed.

G N.J. Appeal dismissed.