# NIRANJANLALL AGARWALLA v. UNION OF INDIA

- **Citation:** [1968] 3 S.C.R. 415
- **Court:** Supreme Court of India
- **Decided:** 1968-03-07
- **Bench:** J.C. Shah, V. Ramaswami, G. K. Mitter
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/niranjanlall-agarwalla-v-union-of-india-4409
- **Pages:** 7

## Headnote

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Indian Rai11rays Act (9 o/ 1890), ss. 3(6), 77 and 14Q (before a111e1i~l111t•111 by Act 39 of 1961)-StatC-olvned Railway-Service of s. 77 notice
<'111 Cilil'f Co1111nercial Managt•r (Claiin.v aud Refunds)-!/ sufficient co111p/iauce.
Indian Li111italio11 Act (9 of l 908), s. 14-Appliccbility.
The appellant booke<l goods at Scaldah, which is on the border of the
1crritoria1 limits of the Original Jurisdiction of the Calcutta High Court,
to be tr:tnsported by the Bengal and Assam Railway, owned by the State
and having its head office at Calcutta. There was ·short de1ivcry of the
goo<ls and ti1c n1ihvay authorities issued the ncccssarv c..:rt:fk:atcs uf ~hort
agc.
The appellant \Vrote a letter to the Chief
Commercial
~tanager
(Clain1s and Rcfun<ls) of the R.aihvay within six months from th.? <late
of delivery of goods fOr carriage as required by s. 77 of the Act before
ils amendment by Act 39 of 1961, claiming the value of the goods short
deliv-cred.
Failing to get any rcdrcs.~. lie filed a suit on the Original Side
of the High Court at Cnlcutta in 1946. within the period of limitation.
In 1954. the sui1 \Vas disn1issed on the ground that the Court had no
iu'risdiction to try the suit. lbcn the appellant filed a second suit in the
Subordinate Judge's Court havinl! jurisdiction, and prayed for exclusion
of the time tnkcn between the i.latcs of institution and dismissal of th"c
earlier suit. under s. J 4 of the Limitation Act, 1908.
The trial Court dismissed the suit.
The High Court in appeal, held
against the appellant on the ground that the appc11ant's letter addre~sed
to the Chief Commercial Man:.tgcr (Claims and Refunds) could not
he
t'ri:atcd as th-.:: notice required under s. 77 of the Railways Act, 1890. as
that officer \vas not the authority to receive the notice -un<lcr the si:ction.
ln appeal to this Court,
HELD: (1) The rcquircn1ent of compliance \\-'ith the tcrn1s of s. 77
should be liberally construed as the object of the notice ,vas only to enable the railway n<lministration to n1ak~ an enquiry and investigate into
lhc cause of the loss of the goods consigned to it. S:ction 140, bcfor\! its
.imendment by Act 39 of 1961 provided that a notice required to
he
served on a State-owned Raily.·ay Adn1inistration may he served on the
Mannger.
The Bc11gal and Assam Railway Administration did not have
an authority known as the Mnnagcr. It hall a General M'anagcr in •JVer
all charge hut its Chief Commercial ~Ianagcr (Claims and Kefunds) \l.1as
a high ranking officer specially engaged in enquiring into claims hY consignors and consignees against the Rnilway administration . .He was therefore an officer con1pctcnt to deal \\•ith such claims and the requirements
of s. 77 arc satisfied hy serving a notice on him: and it docs not behove
the S!nte to contest a good claim on unsubstantial technical picas. [418 DE; 419 C-D, F·H; 421 DJ
Gol'ernor-.General i11 Council v . .lf11satldi Lal. [_1961] 3 S.C.R. 647,
651 an<l Je11111tl/ Bhojraj v. The Darjt•c/ing Hi111ala~'<111 Railn·ay Co. LttT.
11963] 2 S.C.R. 83~. 845, followed.
416
SUPREME COURT REPORTS
(1968) 3 S.C.R.
Governor-General in Co1111cil v. G .. S. Mills Ltd, 1.L.R. 28 Pat. 178
A
(F.B.) approved,
(2) On the facts, tho appellant was entitled to the benefit of s. 14
of the Limitation Act, because, he was prosecuting the earlier suit v.·ith
due diligence and the mistake in choosing the Original Side of tl>o High
Court for filing the first suit was made bona fide. [421 Al

## Text

A
NIRANJANLALL AGARWALLA
v.
UNION OF INDIA
March 7, 1968
B
[J.C. SHAH, V. RAMASWAMI AND G. K. MITTER, JJ.]
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Indian Rai11rays Act (9 o/ 1890), ss. 3(6), 77 and 14Q (before a111e1i~l111t•111 by Act 39 of 1961)-StatC-olvned Railway-Service of s. 77 notice
<'111 Cilil'f Co1111nercial Managt•r (Claiin.v aud Refunds)-!/ sufficient co111p/iauce.
Indian Li111italio11 Act (9 of l 908), s. 14-Appliccbility.
The appellant booke<l goods at Scaldah, which is on the border of the
1crritoria1 limits of the Original Jurisdiction of the Calcutta High Court,
to be tr:tnsported by the Bengal and Assam Railway, owned by the State
and having its head office at Calcutta. There was ·short de1ivcry of the
goo<ls and ti1c n1ihvay authorities issued the ncccssarv c..:rt:fk:atcs uf ~hort
agc.
The appellant \Vrote a letter to the Chief
Commercial
~tanager
(Clain1s and Rcfun<ls) of the R.aihvay within six months from th.? <late
of delivery of goods fOr carriage as required by s. 77 of the Act before
ils amendment by Act 39 of 1961, claiming the value of the goods short
deliv-cred.
Failing to get any rcdrcs.~. lie filed a suit on the Original Side
of the High Court at Cnlcutta in 1946. within the period of limitation.
In 1954. the sui1 \Vas disn1issed on the ground that the Court had no
iu'risdiction to try the suit. lbcn the appellant filed a second suit in the
Subordinate Judge's Court havinl! jurisdiction, and prayed for exclusion
of the time tnkcn between the i.latcs of institution and dismissal of th"c
earlier suit. under s. J 4 of the Limitation Act, 1908.
The trial Court dismissed the suit.
The High Court in appeal, held
against the appellant on the ground that the appc11ant's letter addre~sed
to the Chief Commercial Man:.tgcr (Claims and Refunds) could not
he
t'ri:atcd as th-.:: notice required under s. 77 of the Railways Act, 1890. as
that officer \vas not the authority to receive the notice -un<lcr the si:ction.
ln appeal to this Court,
HELD: (1) The rcquircn1ent of compliance \\-'ith the tcrn1s of s. 77
should be liberally construed as the object of the notice ,vas only to enable the railway n<lministration to n1ak~ an enquiry and investigate into
lhc cause of the loss of the goods consigned to it. S:ction 140, bcfor\! its
.imendment by Act 39 of 1961 provided that a notice required to
he
served on a State-owned Raily.·ay Adn1inistration may he served on the
Mannger.
The Bc11gal and Assam Railway Administration did not have
an authority known as the Mnnagcr. It hall a General M'anagcr in •JVer
all charge hut its Chief Commercial ~Ianagcr (Claims and Kefunds) \l.1as
a high ranking officer specially engaged in enquiring into claims hY consignors and consignees against the Rnilway administration . .He was therefore an officer con1pctcnt to deal \\•ith such claims and the requirements
of s. 77 arc satisfied hy serving a notice on him: and it docs not behove
the S!nte to contest a good claim on unsubstantial technical picas. [418 DE; 419 C-D, F·H; 421 DJ
Gol'ernor-.General i11 Council v . .lf11satldi Lal. [_1961] 3 S.C.R. 647,
651 an<l Je11111tl/ Bhojraj v. The Darjt•c/ing Hi111ala~'<111 Railn·ay Co. LttT.
11963] 2 S.C.R. 83~. 845, followed.
416
SUPREME COURT REPORTS
(1968) 3 S.C.R.
Governor-General in Co1111cil v. G .. S. Mills Ltd, 1.L.R. 28 Pat. 178
A
(F.B.) approved,
(2) On the facts, tho appellant was entitled to the benefit of s. 14
of the Limitation Act, because, he was prosecuting the earlier suit v.·ith
due diligence and the mistake in choosing the Original Side of tl>o High
Court for filing the first suit was made bona fide. [421 Al
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 577 of
B·
1965.
Appeal from the judgment and decree dated June 9, 1961 of
the Calcutta High Court in Appeal from Original Decree No. 133
of 1956.
B. C. Misra and S. S. Shukla for the appellant.
V. A. Seyid Muhammad, K. L. Hathi and R. N. Sachthey, for
the respondent.
The Judgment of the Court was delivered by
Mitter, J. This is an appeal by certificate under Art. 133(l)(c)
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0f the Constitution of India from a judgment and decree of the
High Court of Calcutta confirming a decree of dismissal of the
I>
suit of the appellant herein instituted in the court of the Subordinate Judge, 8th Court at Alipore, District 24 Parganas, West
Bengal.
The only two points .canvassed in the appeal to this Court are:
(I) whether notices under section 77 of the Indian Railways Act
were properly served on the Railway Administration in this case,
and (2) whether the suit was barred by limitation ?
The relevant facts are as follows. The appellant was entitled
to delivery of two lots of goods booked at Sealdah, Calcutta on
June 9, 1945 and September 24, 1945 respectively. The goods
were for delivery at Cooch Behar. They were to be transported
by Bengal and Assam Railway owned by the State and having its
Head Office at the relevant time at No. 3 Koilaghat Street, Calcutta. In respect of the first lot, there was a short delivery of 104
umbrellas and a certificate of shortage was issued to the plaintiff
on July 20, 1945.
The appellant wrote a letter to the Chief
Commercial Manager (Claims and Refunds) of the Bengal and
Assam Railway at No. 3 Koilaghat Street on August 11, 1945
claiming the value _of the goods short delivered i.e. Rs. 1,284/-
as per bill enclosed and the short delivery certificate issued to him.
On November 12, 1945 the plaintiff sent a letter to the GovernorGeneral in Council representing the Bengal and Assam Railway
through the Secretary,
Gov~rnment of India, New Delhi giving
full particulars of the claim and stating that the Chief Commercial Manager had already been approached for payment.
This
letter was replied to by the Secretary, Railway Board on November 27, 1945 to the effect that the plaintiff's Jetter had been forE
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NIRANJAN LALL v. UNION (Mitter, /.)
417
warded for disposal to the General Manager, Bengal and Assam
Railway. In respect of the second lot of goods, the plaintiff made
a similar claim to the Chief Commercial Manager of
Rs. 12,742'7-4 as per the short delivery certificate of October 10,
1945. The plaintiff also wrote a letter to the Governor-General
in Council on February 14, 1946 giving full particulars about
the two invoices and the railway receipts covering the consignments despatched on September 24, 1945 and mentioning further that a claim had been preferred on October 24, 1945 enclosing the plaintiff's bill. It was stated expressly in this letter
that notice to the Chief Commercial Man!lger had been given
under s. 77 of the Railways Act. It does nQt appear that this
particular claim of the plaintiff was referred to the General Manager, Bengal and Assam Railway by the Secretary to the Railway
Board .as in the previous case .
....
Failing to get any redress the plaintiff served a notice under
s. 80 of the Code of Civil Procedure on·February 14, 1946 on the
Governor-General .in Council through the Secretary to the Railway
Board and on the 14th August 1946 filed a suit on the Original
Side of the High Court at Calcutta for recovery of the two sums of
money for non-delivery of the goods and alternatively for damages
for wrongful conversion or detention of the said goods. It was
defended by the Governor-General in Council and one of the pleas
taken was that the Court had no jurisdiction to entertain the suit
as no -part of the cause of action for the suit had arisen within
the said jurisdiction. On July 16, 1954, the suit was dismissed
on the ground that the Court had no jurisdiction to try the same.
Thereupon the appellant filed a suit out of which the present
appeal arises on August 5, 1954. In the plaint of the second
suit, it was stated that the earlier suit had been filed on the
Original Side of the High Court on a bona fide mistake on the
part of the plaintiff's solicitor and prosecuted with due diligence
by the plaintiff till it was dismissed on July 16, 1954. The plaintiff
prayed for exclusion of the time taken between the date of the
institution of the earlier suit and the dismissal thereof under s. 14
of the Limitation Act.
A defence similar to that taken in the
High Court suit was put up by the Union of India, the defendant
in the later suit.
The Subordinate Judge who tried the suit dismissed it on
various grounds, inter alia that the notice served upon the Chief
Commercial Manager was not in terms of the Railways Act
and that the first suit had not been pursued bona fide and with
diligence on the Original Side of the Calcutta High Court.
In appe~I to the High Court, it was argued that (a) no
notice under s. 77 was necessary in the case of non-delivery of
goods (b) alternatively, notice in terms of the said section had
been served by the appellant and ( c) the plaintiff was entitled to
418
SUPREME COURT REPORTS
[1968] 3 s.c.R.
the benefit of s. 14 of the Limitation Act. The greater part of
the judgment of the High Court was devoted to the first question which was answered against the appellant.
The second
contention was summarily turned down by the observation that
there was nothing on the record to show that the ·Chief Commercial Manager had been held out as the authority com~tent
to receive notice under s. 77 of the Act. The question of lunitation was not decided in view of the above although the learned
Judges felt inclined to allow the appellant the benefit of s. 14 of
the Limitation Act.
·
The relevant portion of s. 77 of the Indian Railways Act
(IX of 1890) provided that
"a person shall not be entitled to ... .'compensation
for the loss, destruction or deterioration of animals or
goods delivered to be .... carried unless his claim to the
refund or compensation has been preferred in writing
by him or on his behalf to the railway administration
within six months from the date. of the delivery of the
animals or goods for carri~ge by railway."
Section 140 of the Act provided that "any notice or other document required or authorised by the Act to be served on a railway administraiion may be served, in the case of a railway
administered by Government .... on the Manager ..... by delivering the notice or olher documents to the Manager ... or by
leaving it at his office or by forwarding it by post in a pre-paid
Jetter addressed to the Manager .... at his office." Under s. 3
cl. (6) of the Act, unless there is something repugnant in the
subject or context "railway administration" or "administration"
in the case of a railway administered by the Government means
"the manager of the railway and includes the Government. .... "
In this case, there can be no dispute that if notices to the
Chief Commercial Manager (Claims and Refunds) complied with
the terms of section 77 of. the Act 'the most serious obstacle to
the appellant's success in this appeal would be overcome.
It
therefore becomes necessary to consider the ambit and effect of
the said section.
The scope of section 77 has come up for consideration bv
various High Courts at different times.
It is not necessary to
refer to the same; put we may refer to a decision of this Court in
Gol'emor General i11 Co1111cil v. Musaddi Lal('). It was there
observed that :
"Section 77 of the Railways Act is enacted with a
view to enable the railway administration to make en-
(1) (1951) 3 S.C.R. 647, 651.
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!<IRANJAN LALL I'. UNION (Mitter,.].)
quiries and if possible to recover the goods and to deliver them to the consignee and to prevent stale claims.
It imposes a restriction on the enforcement of liability
declared by s. 72. The liability declared by s. 72 is for
loss, destruction or deterioration.
Failure to deliver
is the consequence of loss or destruction of goods; it
does not furnish a cause of action on which a suit may
lie against the railway administration, distinct from a
cause of action for loss or destruction."
419
This aspect of s. 77 was again referred to in Jetmull Bhojraj v.
The Darjeeling Himalayan Railway Co. Ltd.('). There it was
observed that the object of service of notice under s. 77 being
essentially to enable the railway administration to make an enquiry and investigation as to whether the l~s. destruction etc.
was due to the consignor's ]aches or to the wilful neglect of the
railway administration and its servants, the notice under s. 77
should be liberally construed. To quote the words of the judg·
ment of the majority Judges :
"In enacting the section the intention of the legislature must have been, to afford only a protection to
the railway administration against
fraud and not to
provide a means for depriving the consignors of their
legitilnate claims for compensation for the loss or damage caused to their consignments during the course
of transit on the railways."
Jn the light of section 3(6) there would be sufficient compliance
with section 77 if the notice was served on the Manager of the
State owned railway.
Section 140 only provides for the man·
ncr of service of notice. The Bengal and Ass~m Railway administration did not have an authority known as the Manager. It
had a General Manager as also another high ranking officer i.e.
the Chief Commercial Manager (Claims and Refunds) working
in the head office of the company at Calcutta. As the said statu·
tory Qrovisions do not make it obligatory to serve a notice under
s. 77. on the General Manager of a State-owned Railway, it is
difficult to see why a notice served on the Chief Commercial
Manager (Claims and Refunds) would not be a proper notice under the said section. The General Manager is in overall charge
of many departments of the railway administration and is not
particularly or immediately concerned with dealing with claims
against the ranway administration. The Chief Commercial Manager (Claims and Refunds) is the authority specially engaged in
the _ enquiry into such claims and would therefore prlma facfe
appe_ar to be competent to deal with the claims by consignors or
consignees against the railway administration envisaged by s. 77
ro [196312 s.c.R. sn, R4~.
420
SUPRBME COURT RBPORTS
[1968] 3 S.C.R.
of the Act.
He is not a person of such inferior status that it
can be said that a claim preferred as regards non-delivery would
not be properly investigated or looked into for finding out the
truth or falsity of the claim preferred. Apart from any authority
it seems to us that a notice on the Chief Commercial Manager
(Claims and Refunds) of a State-owned railway administration
would be in terms of s. 77.
The question came up for consideration before a Full Bench
of the Patna High Court in Governor-General in Council v.
G. S. MilLf Ltd.('). There are learned Judges of the Patna
High Court examined the various aut.horities of the High. Courts
of Madras, Lahore, Bombay, Allahabad and Calcutta.
On a
conspectus of all the authorities referred to, the answer to the
question posed before the Full Bench was as follows :
"The requirements of section 77 read with s. 140,
Railways Act, 1890 are satisfied by serving a notice
within the prescribed time on the Chief Commercial
Manager or any other subordinate officer of a Railway
owned by the Government of India, provided it is established as a fact that the Railway Company by its
course
of
business
or
the
terms
of
the
contract between the parties has hel.d out a particular
official as competent to deal with the claims on receipt
of a notice to him."
There is a current of authority in the Calcutta High Court
which is in line with the above Patna decision. We are in complete agreement with the view expressed by the Full Bench of
the Patna High Court. In our opinion, it is only in the case of
an authority subordinate or inferior in rank to the Chief Commercial Manager that proof of competence to ·deal with the
claims would be called for.
The question has now become academic in view of the recent amendment of the Railways Act.
The second point about limitation is not of any substance.
The appellant had filed a suit in the Calcutta High Court on
its Original Side for recovery of compensation within time. The
despatch of the goods had taken place from Sealdah which is on
the border of the territorial limits of the jurisdiction of the Calcutta High Court.
It would appear from the plaint that the
plaintiff was under the impression that the head office of the
Bengal and Assam Railway administration being situated within
the said limits. his suit could properly be instituted in the High
Court. The Subordinate Judge was not right in holding that the
suit had not been proceeded with bona fide. The learned Jud~es
of the Division Bench of the High Court were disposed to give
(I) 1.L.R. 28 Patna 17S.
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NIRANJAN LALL v. UNION (Mitter, J.)
42r
the plaintiff the benefit of s. 14 of the Limitation Act and nothing has been shown to induce us to take a different view.
The judgment and decree of the High Court are therefore
reversed.
The appeal is allowed with costs throughout and the
plaintiff's suit decreed for the amount claimed and interest pendellle lite at 6% per annum.
Before parting with the case, we however wish to make a
remark against the conduct of the authorities of the railway
administration concerned in the disposal of claims like the one
in the present appeal. There is no suggestion anywhere that the
plaintiff's claim was not genuine.
The railway authorities had
promptly issued certificates of shortage in respect of the consignments.
There is nothing to show that the Chief Commercial
Manager found any defect in the plaintiff's claim. If the claim
had been settled in good time, the public exchequer would have
been spared not only of its own costs of litigation which will be
considerable but the costs which will have to be paid to the
appellant. It does not behove the State to contest a good claim
on the off-chance of success on some unsubstantial technical
plea.
V.P.S.
Appeal allowed;.