Case Note & Summary
The dispute arose from a consignment of silk garments booked by the appellant with the respondent for transport from Noida to Bombay. The goods were intended for export to the UK, and the appellant had entrusted the consignment to the respondent, who issued a consignment note indicating the goods were carried at 'OWNER'S RISK'. The consignment was destroyed by fire while stored in a godown in Bhiwandi. The appellant filed a claim for damages before the National Consumer Disputes Redressal Commission after the respondent denied liability, citing the 'OWNER'S RISK' clause. The National Commission dismissed the claim, leading to the appeal. The appellant contended that the carrier, as defined under the Carriers Act, 1865, was liable for the loss due to negligence, while the respondent argued that they had taken due care and were not liable due to the 'OWNER'S RISK' clause. The court analyzed the provisions of the Carriers Act and the Indian Contract Act, emphasizing that a common carrier's liability is absolute unless limited by a special contract signed by the owner. The court concluded that the carrier could not escape liability merely because the goods were booked at 'OWNER'S RISK', as this did not exempt them from negligence. The court held that the carrier was liable for the loss of the goods due to the fire incident. The appeal was allowed, and the National Commission's decision was set aside.
Headnote
A) Carriers Act - Liability of Common Carriers - Absolute Liability - Carriers Act, 1865, Sections 6, 8, 9 - The carrier is liable for loss or damage to goods entrusted for carriage unless the loss is due to an act of God or the negligence of the consignor. The court held that the carrier's liability is absolute and cannot be limited by the 'OWNER'S RISK' clause unless a special contract is signed by the owner. (Paras 1-16).
Issue of Consideration
Whether the carrier is liable for the loss of goods due to fire when the goods were booked at 'OWNER'S RISK'.
Final Decision
The Supreme Court allowed the appeal, holding that the carrier was liable for the loss of goods despite the 'OWNER'S RISK' clause, as no special contract was signed by the owner limiting liability.
Law Points
- liability of common carriers
- negligence
- bailment
- insurer's liability
- Carriers Act
- 1865
- Indian Contract Act
- 1872
