NEW INSURANCE CO. LTD. DACCA Versus UNITED ORIENTAL STEAMSHIP CO.

1. Z. A. CHANNA, J. ‑This second appeal by the New Jubilee Insurance: Company Ltd., Karachi, calls in question the judgment and decree, dated 28‑4‑1967, of a learned Additional District Judge, Karachi, by which he upheld the judgment and decree of a learned Civil Judge, Karachi, dis missing the suit of the appellants for damages and loss resulting from non delivery of a part of consignment of raw cotton.

2. The case of the appellants is that a consignment of 400 bales of Pakistani raw cotton was shipped from Karachi, on or about the 29‑3‑1963, by Messrs H. Muhammad Ishaque H. Dost Muhammad, to Chittagong, per s. s. "Ilyas Bakhsh" belonging to respondent No. 1. The consignment was to be delivered to the East Pakistan Industrial Development Corporation (hereinafter referred to as the EPIDC and was insured with the appellants. for a sum of Rs. 1,91,600. It appears that on arrival of the aforesaid ship at Chittagong Port on or about 27‑4‑1963, delivery of only 385 bales of' cotton was given out of the above assignment to Messrs S. M. Islam. Choudhry & Company, the clearing agents of EPIDC, and remaining 15 bales could not be delivered. The EPIDC thereupon lodged a claim with the appellants for a sum of Rs. 7,108.45, being the invoice value of the 15 bales of cotton short delivered, and the appellants settled this claim, paid up the amount and obtained a letter of subrogation from the EPIDC. The appellants having failed to recover the said amount of Rs. 7,108.45 from .either respondent No. 1 or its local agents, respondent No. 2, instituted a suit against them in the Court of a Civil Judge at Karachi, on 27‑4‑1964, for .the said amount together with interest and costs.

3. Respondent No. 1, in its written statement, while not disputing the fact that 15 bales of cotton had been short delivered to the EPIDC, raised several pleas and resisted the suit on the ground that the bill of lading being endorsed to Messrs M. S. Islam Choudhry & Company, the appellants had no right to sue; that some of the bales in the consignment in question were not permanently marked and this resulted in the obliteration of the marks, an consequence whereof a number of bales were landed under nil or wrong .arks; that the full consignment of 400 bales of cotton was in fact landed at the Chittagong Port and hence the responsibility of respondent No. 1 came to an end as soon as the bales were free of the ship's tackle and ‑entrusted to the Chittagong Port Authorities; that it had not been established that the appellants or the original consignees suffered any loss and that the suit was barred both under Article 111, Clause 6 of the Rules under the Carriage of Goods by Sea Act, 1925, as well as by limitation. It was also contended that the Chittagong Port Authorities were a necessary party to the suit.

4. Respondent No. 2, while admitting in their written statement that they acted as agents for the owners of s. s. "Ilyas Bakhsh", contended that they had been wrongly impleaded. Further, they adopted the defence ,of respondent No. 1.

5. On the pleadings of the parties, the trial Court framed as many as 10 issues. It is, however, not necessary for the purposes of this appeal to reproduce the same as only limited points were argued before us by the counsel of the parties. The trial Court held that the 15 bales, which were short‑delivered to the EPIDC, were landed by respondent No. 1 at the Chittagong Port under wrong nil marks, as they were not permanently marked ; that these bales of cotton, having been landed at the port and entrusted to the Chittagong Port Authorities, the respondents were not liable for the non‑delivery; that the appellants failed to adduce evidence .as to the value of the contents of the bales in question and therefore had failed to prove any loss or damage to the consignees and that finally the fact of the payment by the appellants to the original consignees had not been .established. On these findings, the trial Court dismissed the suit of the ;appellants with costs.

6. On appeal, the First Appellate Court concurred in the finding of the trial Court that the appellants had failed to establish the value of the short landed goods. It also held that the letter of subrogation executed by the EPIDC in favour of the appellants was defective and incomplete, inas much as it did not mention the amount paid by the subrogee, and hence the said letter cannot be said to furnish a right to the appellants to file the suit. It accordingly dismissed the appeal of appellants. It is against this decision that the appellants have come up in appeal before us.

7. The only points which have been argued before us by the learned counsel for the parties are: (1) Whether the letter of subrogation executed by the EPIDC m favour of the appellants is incomplete or defective and gives no right to the appellants to sue thereon. (2) Whether, the 15 bales of cotton, short‑delivered to the appellants, were landed by the respondents No. 1 at the Chittagong Port and delivered to the Chittagong Port Trust: Authorities. (3) Whether delivery to the Chittagong Port Authorities of the said bales of cotton is delivery to the consignee and absolves the respondents from responsibility. We will deal with these points seriatim.

8. We have already referred, in an earlier part of this judgment, to the views of the First Appellate Court that the letter of subrogation, which appears at pages 73 and 74 of the paper‑book, is incomplete and gives no right to the appellants to sue, by reason of the fact that it does not specify the value of the goods in respect of which the letter was issued or the appellants had become the subrogees. The learned First Appellate Court, however, has cited no authority in support of this view. Section 135 A of the Transfer of Property Act, 1882, deals with assignment of rights, under a policy of marine insurance. Subsection (1) of the said section, entitles the assignee of a policy of marine insurance to sue thereon in his own name. Subsections (2) and (3) of the said section deal with subroga tion and provide that on the insurer paying for loss or damage to the goods insured under a marine insurance policy, he is subrogated to all rights and remedies of the insured person and is entitled to take over interest of the insured person in respect of whatever may remain of the subject‑matter so paid for. While subsection (2) deals with cases where there has been either a total loss of the whole of the goods or consignment, or of a part or an apportionable part of the goods, subsection (3) is limited to cases where there is a partial loss of the insured goods or consignment. In the instant case, since the claim of the appellants is that 15 bales of cotton were short‑delivered, there is a total loss in respect of those goods. The case would thus appear to attract the application of subsection (2) of section 135‑A of the Transfer of Property Act, for there was a total loss of a part of the consignment or an apportionable part of the goods.

9. Mr. Salim Akhtar, who appeared for the respondents, contended that this was not a case of total loss covered by subsection (2) but is a case of partial loss, attracting the application of subsection (3) of the: aforesaid section, and in support of his contention he referred us to the observations made by Cornelius, C. J. and S. A. Rehman, J. (as he then was) in the case reported as East 8c West Steamship Company v. Queensland Insurance Company (P L D 1963 S C 663). In that case, 25 packages were booked on a ship from Karachi to Chittagong, but at the port of destination, two of the packages were found to be completely empty. According to the observations made by Cornelius, C. J. at page 675 of the report and of S. A. Rehman, J. (as he then was) at page 667 of the report, this was a case of partial loss, governed by subsection (3) of section 135‑A of the Transfer of Property Act. We are inclined to the view that their Lordships of the Supreme Court were persuaded to this view by reason of the fact that the packages were not altogether missing but only their contents were missing, and hence it could not be said that there was either a total loss. of the subject‑mater insured or any apportionable part thereof. It is, however, immaterial whether the instant case is governed by subsection (2) or sub section (3) of section 135‑A of the Transfer of Property Act, for whether the case be treated as one of partial loss or of total loss, the respondents.. would be liable for damages, if it is proved that they failed to deliver or to land the bales of cotton in question in accordance with the bill of lading and further the value of the missing bales has been satisfactorily proved.

10. Mr. Salim Akhtar very candidly conceded that he is unable to cite any authority, whether Pakistani, English or even from the Indian jurisdiction, in support of the learned First Appellate Court's view that a letter of sub rogation is effective or complete only if it mentions the value of the goods in respect of which the claim is made. Section 135‑A of the Transfer of Property Act lays down no such condition. Indeed, Cornelius. C. J. in the above reported case was of the view, based on a close examination of the provisions of section 135‑A of the Transfer of Property Act, that an assignment in writing is not necessary, since on fulfilment of the conditions provided therein, the subrogation or assignment takes place by operation of law.

11. Although the letter of subrogation in the instant case appears to be quite valid and effective, and does not suffer from any legal defect or lacuna, nevertheless, the appellants cannot recover any damages, nor their quantum be fixed, unless it is established what amount they. have paid under the insurance policy to the original consignees for the damage sustained by the latter or that they have paid for a total loss. In other words, the view that we take is that in order that an insurer should be entitled under subsection (2) of the Transfer of Property Act to the interest of the insured person in the subject‑matter insured or under subsection (3) of the said section to the rights or remedies of the insured person, the insurer must establish what was the value of the goods which have been lost or damaged, either wholly or partially, and further it must be established, in cases falling under subsection (2) that he has paid for the total loss of the goods or other subject‑matter in respect of which he seeks to enforce such interest, and in cases falling under sub section (3) that the amount which he claims as a subrogee, is the amount which he actually paid to the original consignee.

12. So far as the value of the lost goods is concerned, there would appear to be no great difficulty. It is true that the value of the missing 15 bales of cotton has not been shown in the bill of lading, and we understand that it is not the practice to show the value in such bills, but the value of these bills can clearly be determined from the invoice, which appears at page 57 the Paper‑book and which was produced by P. W. Munawar, whose evidence appears at page 77 of the Paper‑book. This witness, who is a Treasurer of Messrs Haji Ishaque Haji Dost Muhammad, the firm which booked the consignment of cotton, bas stated that the price of the 400 bales of cotton is shown in the invoice and is correct. The invoice shows the value of the full consignment, that is, 400 bales of cotton, as 1,74,199.29. Since there is nothing to suggest that different bales of cotton contained different quality or quantity of cotton. or that the value of cotton in each bale was different, the value of the missing 15 bales of cotton would be worked out at Rs. 7,108.45, which is the amount claimed by the appellants. Mr. Salim Akhtar tried to contend that since the witness, Munawwar, admittedly did not sign the invoice, his evidence as well as the invoice are not admissible in evidence. We are unable to find any substance in his contention. As already pointed out the witness Munawwar is a Treasurer of the Company which shipped the consignment and issued the invoice. He was therefore a proper person to produce the invoice, which was issued in the usual and normal course of business.

13. Coming next to the question as to the amount of the insurance claim which the appellants had paid, we may refer to paras. 7 and 9 of the plaint.

14. Para. 7 specifically asserts that by reason of the non‑delivery of 15 bales of cotton, the consignees suffered a loss of Rs. 7, (08.45, being the invoice value of the goods and their handling and insurance charges. In paragraph 9 of the plaint, averment is made that the appellants, on being approached by the EPIDC to settle their claim on account of non‑delivery of the 15 bales of cotton, satisfied their claim on the basis of the contract of insurance. The contract of insurance, which appears at pages 49 to 56 of the Paper book, shows that the consignment had been insured for Rs. 1,74,199.29 and that in all an amount of Rs. 1,157.52 was paid as insurance premium. These averments in the plaint have not been specifically denied by either of the respondents. However, in order to avoid any possible doubts on this point, we recorded the evidence of witness Rafatullah Siddiqui, Chief Manager of Messrs New Jubilee Insurance Company, who stated that the claim of the EPIDC on account of the short delivery of 15 bales of cotton had been settled at Rs. 7,108.45 by the appellants, and a receipt (H. C. Exh. 1/1) was issued by the EPIDC for the said amount. In view of this evidence it ii quite clear that the loss sustained by the EPIDC, and which the appellants have satisfied, and thereby have become subrogated to the rights of the consignees, is the sum of Rs. 7,108.45, which amount was actually paid by the appellants to the EPIDC.

15. Mr. I. A. Lari, who appeared on behalf of the appellants then contended that respondent No. 1 had failed to deliver or land 15 bales of cotton out of the consignment of 400 bales which was booked in favour of the EPIDC. In support of his contention be relied upon the short‑landing certificate, which appears at page 30 of the Paper‑book, issued by the Chittagoag Port Trust Authorities. This certificate shows that 15 bales of cotton, bearing the marks stated in the certificate, were short‑landed out of the consignment of 400 bales of cotton meant for EPIDC. In addition, there is the oral testimony, which was taken on commission, of the Superintendent of Jetties, Chittagong Port Trust, and of Muhammad Ibrahim Choudhry of the firm of Messrs M. S. Islam Choudhry & Company, the Clearing Agents of EPIDC, that 15 bales of cotton meant for EPIDC were short‑landed and not delivered to the‑consignees or their Clearing Agents.

16. Mr. Salim Akhtar, while admitting the short delivery, contended that the respondents were exempted from liability for non‑delivery of the missing 15 bales of cotton by reason of the provisions of section 50 of the Chittagong Port Trust Act. The said section reads as follows :‑

17. "50.‑(1) Whenever any goods are landed by the Trustees from any vessel, the Trustees shall, if so required, give to the master of such vessel a receipt in the form or to the effect set forth in the Second Schedule to this Act, and may in any such receipt include all goods landed from such vessel during one day.

(2) No master or owner of a vessel from which the goods, in respect of which a receipt is given under subsection (1), may have been landed shall be liable for any loss or damage to such goods which may occur after they have been so landed."

18. It will be seen that the twin requirements of the aforesaid section and before the ship‑owner can be exempted from liability thereunder are that the( goods must be landed by and delivered into the custody of the Port Trust c Authorities and that the Port Trust Authorities should issue a receipt therefor in the prescribed form. In the instant case neither of these conditions or requirements have been fulfill. There is neither tangible evidence to show that the goods were landed by or delivered into the custody of the Chittagong Port Trust Authorities nor has the requisite receipt been produced by the respondents or anyone else. Mr. Salim Akhthar placed reliance on the joint checking report, which is at page 29 of the Paper‑book, and contended that this not only should be considered as the prescribed receipt but also the said report goes to establish that the goods in fact were delivered by the respondents into the care and custody of the Chittagong Port Trust Authorities. We are unable to find any substance in these con tentions. For the purpose of showing that the full consignment of 400 bales of cotton, including the 15 missing bales, were delivered to the Chittagong Port Trust Authorities, Mr. Salim Akhtar also relied upon the oral testimony of D. W. 1, Gurga Charan Choudhry, an employee of respondent No. 1, and Mr. S. M. Yusuf of the Universal Shipping Agency, which agency was employed by respondent No. 1 as tally contractors for the discharge of cargo from their ship, "Ilyas Bakhsh". Both these witnesses were examined on commission. According to witness, Gurga Charan Choudhry, the vessel "Ilyas Bakhsh" arrived at Chittagong Port on 27‑4‑1963 with 8597 bales of cotton, of which about 189 bales were discharged under nil marks. He has further deposed that a joint checking was held at Jetty Shed No. 13 in respect of the nil mark cargo discharged from the above vessel and it was found that 10 bales of cotton were not available in that shed for delivery to the consignees. He has also testified that when marks on packages are obliterated during transit by the stress of voyage, such packages are discharged and received under the caption "packages landed under wrong/nil marks", and that it is possible for steamer agents to connect such packages with the packages short‑landed by marks. The evidence of this witness is not of much assistance to the respondents on this point as, firstly, the witness admittedly has not stated when the 400 bales in question were actually discharged from the vessel, and secondly, he was not present when the said bales were discharged nor does he appear to have seen them subsequently. As respondent No. 1 had employed Messrs Universal Shipping Agency as their tally contractors, it was not necessary for any officer of respondent No. 1 to be present throughout the period of discharge of cargo from the ship "Ilyas Bakhsh". The evidence of D. W. S. M. Yousuf, an employee of Messrs Universal Shipping Agency, does not advance the case of the respondents much further. He has no doubt stated that the vessel "Ilyas Bakhsh" discharged her cargo in the custody of Chittagong Port Trust Authorities under his supervision at Jetty Shed No. 13, that the vessel landed about 189 bales into the custody of the Chittagong Port Trust Authorities under nil marks, and that it is possible for steamer agents to connect the wrong or nil‑marked packages with packages short‑landed by marks, but he has admitted that neither he nor the respondents informed the consignees or their agents that their missing bales had been discharged under nil or wrong marks nor did they apply to the customs authorities and the Port Trust to connect the bales lying under nil or wrong marks with the consignee's consignment. It may further be pointed out that the respon dents have neither produced the ship's manifest nor the tally sheets to show how many bales of cotton were actually landed from the ship "Ilyas Bakhsh". It is common ground that the ship carried a total of 8597 bales of cotton but there is no satisfactory evidence that all these bales were in fact landed at the Chittagong Port. Had this been the case, it might perhaps have been possible for the respondents to contend that all that hag happened is that some of the goods which they had landed were landed under nil marks and that since it was possible to connect the goods landed under nil marks with the goods of the consignees, neither any loss has actually been caused to the consignees nor could they (respondents) be held liable for obliteration of marks during the voyage, because of the weather conditions or the stress of the sea. On the other hand, the short‑landing certificate, at page 30 of the Paper‑book, to which we have already adverted, clearly shows that 15 bales of cotton, out of the consignment meant for the EPIDC, were short landed. Mr. Salim Akhtar tried to contend that this certificate was superseded by the joint checking report, which appears at page 29 of the Paper book, and which has been signed both by the steamer agents as well as the officials of the Chittagong Port, including the Jetty Superintendent. We confess that we have not been able to wholly understand this joint checking report. It no doubt states that items of cargoes shown or specified in the said report will be shown in the final O. T. R. and that among the items so specified in the report are 15 bales of cotton, but there is nothing in the report to indicate that these 15 bales of cotton are the same which were consigned to the EPIDC. Furthermore, not only the O. T. R., which has been referred to in the said checking report, has not been produced and brought on record, but furthermore, the report contains a note to the effect that 19 bales of cotton short‑landed by marks were not found available in the shed as per landing for which unmanifested missing report is issued. This joint checking report, however, should be read in the light of the evidence of the Jetty Superintendent, M. Ashfaque Alt Khan, whose evidence appears at pages 24 to 28 of the Paper‑book. He has stated that the manifest of the ship Ship that 409 bales of cotton marked to the EPIDC, was carried by the slip "Ilyas Bakhsh", but he has categorically denied that 15 bales out of the said consignment were delivered to the Port Authorities by the ship's agents. He has further stated that because these bales were not delivered to the Port Authorities, the short‑landing certificate at page 30 of the Paper‑book was issued. He has denied that any bales out of this consignment were received by the Port Trust Authorities under wrong or nil marks. He has also denied that the joint checking report at page 29 of the Paper‑book indicates that 15 bales of raw cotton were lying at Jetty Shed No. 13 for delivery to the consignees or that the Jetty authorities in fact had received from the ship, "Ilyas Bakhsh", 15 bales of raw cotton but the Jetty authorities failed to deliver the same to the consignees. In view of this evidence of the Jetty Superintendent, which we have no reason to doubt, we are satisfied that the 15 bales of cotton, which were short‑delivered to the consignees, were not landed nor entrusted to the custody of the Chittagong Port Authorities. Furthermore, we are satisfied that the joint checking report at page 29 of the Paper‑book is not the prescribed receipt required under section 50 of the Chittagong Port Trust Act, firstly, because it is not a receipt but a report, and secondly, it does not state that the missing bales of cotton. which were consigned to the EPIDC, were in fact entrusted to the care of Chittagong Port Authorities.

19. Mr. Salim Akhtar then contended that both under the provisions of the Sea Customs Act, 1925 (hereinafter referred to a9 the said Act) and under the terms and conditions of the bill of lading, which was issued to cover the consignment of cotton in question, the liability of the respondents was only in respect of the period between the loading of the goods into the ship up to the time when they were landed and ceased the moment the goods were discharged at the Chittagong Port. The said Act, which came into force on 21‑9‑1925, incorporates and gives effect to the rules and conventions adopted at the International Con ference on Maritime Law held at Brussels in October 1922, and as further amended at the meeting held at that place in October 1923. Section 2 of the said Act provides that the rules set out in the Schedule to the Act "shall have effect in relation to and in connection with the carriage of goods by sea in ships carrying goods from any port in Pakistan to any other port whether in or outside Pakistan". Article 1(e) of the Rules set out in the ‑said Act defines "Carriage of goods" to cover only "the period from the time when the goods are loaded on to the time when they are discharged ;from the ship." Article 7 of the said Rules states that nothing in the Rules ‑shall prevent a carrier or a shipper from entering into an agreement, reser vation or exemption "as to the responsibility and liability of the carrier ,or the ship for the loss or damage to or in connection with the custody :and care and handling of goods prior to the loading on and subsequent .to the discharge from the ship on which the goods are carried by sea". Mr. Salim Akhtar contended that under the latter Article, it was permissible ‑for a ship‑owner to enter into an agreement with a shipper providing for the .ceasing of his liability the moment the shipped goods were discharged from ,his ship. According to Mr. Salim Akhtar the bill of lading in respect of the consignment in question is such an agreement and he invited our attention to the clause in the said bill of lading appearing at page 62 of the Paper took, which recites that: "In all cases and in all circumstances the Company's liability shall absolutely cease when the goods are free of the ship's tackle and thereupon the goods shall be at the risk for all purposes and in .every respect of the shipper or consignee". Mr. Salim Akhtar further .contended that as soon as the goods were discharged from the respon dent's ship at the Chittagong Port, the Chittagong Port Authorities became the agents of the consignees and held the goods as bailees on their behalf.

20. The question whether the Prot Trust Authorities act as agents for the consignees or the ship‑owners in respect of the goods discharged at their jetties was examined by the Sind Judicial Commissioner's Court in the case of Bombay Company Limited v. Karachi Port Trust (11 S L R 29 ), where it was :held that the Karachi Port Trust Act as agents of the ship‑owners. The .aforesaid view was somewhat modified by a later Division Bench of that Court is the case reported as Haji Shakoor v. Volkart Brothers (A I R 1937 Sind 13), where the view expressed was that while it may well be that the Port Trust are the agents of the ship‑owners in cases where there is a mixture of cargo and .confusion of marks and the instructions of the ship‑owners are necessary before the different bales of the consignments could be identified and ascertained and delivered to the consignees, the Port Trust cannot be ‑considered to be "the agents of the ship‑owners to hold identified and ascertained consignments indefinitely at the will of the consignee and that in the circumstances of the particular case when the ship left Karachi on the 2nd May. she had delivered her cargo to the consignees within the meaning of para. 6, Article 111", of the Rules to the said Act. In the Karachi .Steam Navigation Company Limited v. Ibrahim Ghani (P L D 1957 Kar. 315) the proposition was laid down that the Karachi Port Trust is a statutory bailee and that .delivery to such a statutory bailee amounts to delivery of the goods to the consignee. This proposition was sought to be based on the provisions of section 47 of the Karachi Port Trust Act. This proposition came up for .consideration before their Lordships of the Supreme Court in the case reported as Abdul Jalil v. Muhammad! Steamship Company (P L D 1961 S C 340) where its validity was considered to be doubtful and it was observed that the provision of section 47 of the Act are not by themselves sufficient to make the Port Trust the agent of the consignee.

21. Mr. Salim Akhtar also invited our attention to a case from the Indian, jurisdiction, reported as G. B. Shipping Company v. S. M. S. Sahib &: ‑Company (A I R 1959 Mad. 367), where it was held, following an earlier Madras case, reported as. Great Eastern Shipping Company Limited v. Govandas Bhawani ((1957) 2 Mad. 897) that when the master of ship lands the goods and releases them in the charge of Porb Trust, the legal effect is, as if the Master of the shipping company bad delivered the goods to the consignee and the Port Trust must be deemed to be the consignee's agent. This decision, however, is in respect of goods discharged at the Madras Port, and we are not aware whether the provisions of the Act governing the Port Trust of the said posit are similar to those of the Chittagong Port. Furthermore, in view of the above decision of our own Supreme Court, the Madras decision, which suggests a contrary view, has to be ignored. The effect and implication of the observations of our Supreme Court in Abdul Jaleel's case were considered by our learned brother, Dorab Patel, J., in the case‑ of Tar Muhammad JantE & Company v. Maldivian National Corporation (Ceylon) Ltd. (P L D 1969 Kar. 495), wherein. he held, on the basis of the said observations that the Karachi Port Trust was the statutory bailee of the Shipping Company, and not of the consignee.

22. We would now proceed to examine the authorities in regard to the extent and nature of liability of the carrier in respect of the goods carried: by him by sea and which are short‑delivered to the consignee, including then question whether a provision in the bill of lading to the effect that the liability of the carrier shall cease when the goods carried by the carrier in: a ship are free from the ship's tackle is in accord with the provisions of the Carriage of Goods By Sea Act, 1925 and the rules thereunder.

23. The first authority to which we would refer in this behalf is the decision of the Privy Council in the case reported as Chartered Bank of India. Australia & China v. British India Steam Navigation Company Ltd. (1909 A C 369). In that cafe, it was found that certain goods were shipped on board the defendant's ship, Teesta, at Kadanpur and Pondicheri, and were to be carried to Penang and were there to be delivered under bills of lading which contained the condition that "in all cases and in all circumstances the liability shall absolutely cease when the goods are free of the ship's tackle,. and thereupon the goods shall be at the risk for all purposes and in every respect of shipper or consignee." It was found that the goods were delivered to the landing agents appointed by the defendant Steamship Company,. and for that purpose were discharged from the ship's tackle in the lighters sent by the said agents, but by fraud, in which the said landing agents parti cipated, the goods were never delivered to or reached the consignee. It was contended before their Lordships on behalf of the appellant‑Bank that as the landing agents were neither the assignees nor the agents of the shippers or consignees, the goods had never been delivered in accordance with the bills of lading. The Privy Council held that although it may be admitted that bills of lading cannot be said to be spent or exhausted ,until the goods covered by them are placed under the absolute movement and control of the consignees, but that the provision in the bills of lading as to the cesser of defendant's liability directly the goods were "free of the ship's tackle" was perfectly clear, and that it mush be held to be operative and effectual to protect them. It may be pointed out that this decision was given before the rules at the convention at Brussels were adopted or The Hague Rules were enforced.

24. The next decision to which we would like to refer is the decisions of the House of Lords reported as Sandeman & Sons v. Tyzack & Grandfoot Steamship Company (109 Law Times 580). The facts of that case are that a vessel loaded a cargo of jute bales. The bills of lading, which included bales with many different marks, were endorsed to as many as 37 different consignees. All the cargo was discharged at one port, and it was discovered that 33 of the consignees had received their full consignments, while the consignments of the 4 other consignees were incomplete. There were 11 bales which could not be identified by their marks, as these marks appeared to, have been obliterated, and further, there was a deficiency of 14 bales.. The bills of lading inter alia provided that the bales were received "marked and numbered as per margin"; that the number of packages found short. was to be binding on the ship‑owners unless errors or fault was proved, but that the ship was not bound to be liable for "inaccuracies, obliterations, or, absence of marks." On a claim for freight being brought by the ship‑owners against one of the four consignees, to whom the delivery of the consign ment had not been made, he made a counter‑claim for the value of 6 bales which had not been delivered to him. The ship‑owners, while admitting their liability for the value of the missing 14 bales, contended that the four consignees, to whom full delivery of the consignments had not beers made, were bound to allocate among themselves the 11 bales which could not be identified due to obliteration of their marks. The House of Lords repelled this contention of the ship‑owners and upheld the claim of the consignee for set‑off on account of loss of 6 bales which had been short delivered to him. The Lord Chancellor, who wrote the leading judgment in that case, stated as follows :‑

25. "The respondents were suing for freight, and they had to show that they had performed their contract. That contract was to carry and deliver, or tender, at Dundee, the bales put on board at Calcutta. Unless. they fulfilled this contract they were not entitled to freight on any bales in respect of which they had not fulfilled it.

26. The appellants, on the other hand, were entitled to have the bales put on board delivered to them as put on board, unless the special stipulations in the bills of lading protected the respondents . . . . .

27. Fourteen bales have been lost altogether, and there are four consignees to whom the respondents seek to attribute the eleven bales. Why,, then. should the appellants be bound to treat their six bales as include. in the eleven which have arrived rather than in the fourteen which did not arrive."

28. In that case, two of the noble Lords, namely, Earl Loreburn and Lord Shaw,, examined the question as to what would have been the position if the full consignment of bales of jute carried by the ship had been off‑loaded at Dundee. Lord Shaw dealt with this question as follows :‑

29. "The respondents have unfortunately to face the total disappearance of fourteen bales. The defender's six may all be among them. Had the ship‑owners delivered the cargo in full, and had the qualities not been so disconform to those of the goods shipped, they might well have argued with force that all the shippers of goods (and all of them parties to bills of lading in similar terms) stood together to take the risk of confusion by the loss of identifying marks. But the cardinal fact of delivery fails, and with it wanting, the doctrine of distribution goes."

30. Mr. Salim Akhtar referred to a recent Singapore case reported as Chelaram & Sons Ltd. v. Nissbo Shipping Company Ltd. ((1967) 2 L R 578). In that case, 5 cases of the plaintiff‑Company were shipped on a ship belonging to the defendant's Shipping Company, under bills of lading, which inter alia provided that " . . . . . . the responsibility of the carrier or the ship shall cease as soon as the goods are lifted from and leave the ship's deck and/or ship's tackle . . . . . . .". The bills of lading further provided that if the goods are delivered to or taken into the custody of the officials of the ‑Customs or the other Government authorities, such action shall constitute the full discharge of the carrier's obligation. When the ship reached Singapore, it discharged its cargo into the possession of the Singapore Port authorities. However, when the plaintiff‑Company presented its delivery orders, the Port authorities failed to deliver three of the cases. On the plaintiff‑firm claiming damages against both the Port authorities and :the Shipping firm for the value of the 3 missing cases, a special case was referred to the High Court. It was expressly stated in the reference, that for the purposes of the special case, it was agreed that the missing goods were to be regarded as having been duly discharged ex‑ship's tackle by the shipping Company into the possession of the Singapore Port authorities ;between the 7th November and 11th November 1964. Buttrose, J., who heard the reference, dismissed the claim of the plaintiff firm both as against the Port authorities as well as ‑the Shipping Company. The claim against ‑the Port authorities was dismissed in view of the provisions of section 88 of the Singapore Authority Ordinance, 1963. which gave immunity to the Port Authorities. The claim against the Shipping Company was dismissed on the basis of the finding that the goods had actually been delivered to the 'Port Authorities. In exempting the Shipping Company from liability for the missing goods, reliance was placed on the Privy Council decision in Chartered Bank of India, Australia and China v. British India Steam Navigation Company Ltd. The further question which was considered in that case was whether the provision in the bills of lading providing for the cesser of the liability of the Shipping Company the moment the goods loaded on the ship had left the ship's tackle could be said to be inconsistent with or repugnant to The Hague Rules. It was held that the said :provision is not repugnant to or inconsistent with the above said rules.

31. We will now proceed to consider the pertinent authorities of our own Courts which were cited before us. The first of these is a decision of the Sind Judicial Commissioner's Court, reported as the Bombay Company Ltd. v. Karachi Port Trust (42 1 C 659). The facts of this case are that s. s. "Ambra" . arrived at Karachi with about 64,000 bags of sugar, of which 16900 were, . according to the bills of lading, consigned to the Bombay Company Ltd. However, 17080 bags were actually discharged bearing the marks B. C. L., which was the mark of the Bombay Company Ltd. Out of these 17089 bags, 16040 bags were sound ones, 772 were cut and torn and 277 were burst bags. The Bombay Company actually took delivery in all of 16775 bags, leaving the balance of 125 bags still due to them out of the total consignment of 16900 bags. The Port Trust Authorities offered the Bombay Company Ltd. 125 burst bags and kept back the other 180 burst bags for delivery to the other consignees, whose consignments by the said ship "s. s. Ambra", were short. It appeared from the outturn report, which was produced in the case, that whereas there was a shortage of bags in 19 different consignments, there was an excess in 12 others, giving a total shortage of 406 bags as against the total excess of 404, there being left very little net difference. The bill of lading under which the consignment of sugar had been shipped to Bombay Company had specified that the goods had been shipped "in good order and condition". Among the questions which arose for consideration of the Court were, firstly, whether the Karachi Port Trust held the 16900 bags of sugar 12 bailees for the Bombay Company Ltd. or the Shipping Company, and secondly, whether the Bombay Company Ltd. were entitled to refuse delivery of the 125 burst bags of sugar, specially in view of the provisions in the bill of lading referred to above. It was held, relying on the authority of Glyn Mills & Company v. East & West India Dock Company ((1882) 7 A C 591) that the Port Trust or the Dock Company is merely an agent for making delivery on behalf of the ship‑owner and thus is in the same position as that of an ordinary bailee to deliver the goods bailed to him by the ship‑owner according to the latter's , direction. On the second question, in accordance with the dictum laid down in Sandeman v. Tyzack & Branfoot Steamship Company, it was held that where a mixing of goods of different owners has taken place by accident or other cause for which none of the owners is responsible, the only equitable solution is to apply the rule of proportion. It may, however, be pointed out that both in the case before the Judicial Commissioner's Court as well as in Sandeman's case, the decision rested on the fact that the ship had discharged the full cargo in accordance with the bills of lading, that there had been no shortage in the goods carried by the ship and covered by the bills of lading, and that there had only been a mixing of the goods, either because the marks had been obliterated or because some of the packages had burst. In the instant case before us, as we have already pointed out, there is no evidence to show that all the bales of cotton which were carried by the ship "Ilyas Bakhsh" were in fact landed at Chittagong Port according to the manifest and the bills of lading, and that there was no shortage.

32. We would next refer to the Dacca case, reported as Karachi Steam Navigation Company v. Abdul Rehman Abdul Ghani (P L D 1967 Dacca 159). One of the points which was mooted before the Full Bench was when the operation of the Carriage of Goods by Sea Act, 1925, commences and when does it end or terminate. It was held by the Full Bench, with reference to the definition of the terms "carriage of goods" in Article 1 (e) of the Rules to the said Act, that the operation of the said Act would commence from the time when the goods were loaded on the ship and would continue till they are discharged from the vessel at the destined port. It was further held that where the carrier could show that the goods suffered damage after they were dis charged from the ship at the port of their destination, the quantum of damages will not be covered by the Carriage of Goods by Sea Act, 1925, and, stipulation, if made between the parties, unless it militated against the other provisions of law, would, govern the case.

33. We would finally advert to the case of Tar Muhammad Janu & Company v. Maldiyian National Corporation (Ceylon) Ltd., to which we have already referred while considering the question whether the Chittagong Port Authorities could be considered to be bailees or the agents of the Shipping Company or the consignee. In that case, Tar Muhammad Jana & Company were the consignees of 200 ‑bags of copra shipped on a ship of the Maldivian National Corporation, under a bill of lading which specified that the copra was bagged in strong seaworthy jute bags. On the ship's arrival at Karachi, the applicant firm went to the port to clear their con signment from the Karachi Port Trust, but found that 5 bags of copra were damaged and part of the contents thereof were missing. The consignees filed a suit against the Shipping Company for the loss of the copra and the damage to the bags, as according to them the Shipping Company had undertaken the safe carriage of the consignment and the damage to the bags was caused while they were in the custody of the Shipping Company. The plea of the Shipping Company was that the goods had been delivered into the custody of the Karachi Port Trust Autho rities and that the bags were damaged and the loss had occurred while the bags were in the custody of the Karachi Port Trust. It was held that the Shipping Company is bound to deliver the consignee the goods in accordance with the weight and the terms contained in the bill of lading, which specifically stated the number and the weight of each bag, since according to rule 4 of Article 111 of the Rules under the said Act a bill of lading is prima facie evidence of the receipt by the carrier of the goods as specified therein. It was further held, as stated in the judgment, on the basis of the decision of their Lordships of the Supreme Court in Abdul Jalil v. Muhammadi Steamship Company and another that the Karachi Port Trust was a statutory bailee of the Shipping Company and not of the consignee, and the Shipping Company was accordingly liable to the consignee for the loss claimed even though it may have occurred while the applicant's cargo was in the custody of the Karachi Port Trust. It appears to us, however, and we say so with great respect to the learned Judge, that their Lordships of the Supreme Court in the above case do not appear to have decided or fully considered the question whether the K. P. T. holds on behalf of the consignee or of the ship‑owner, and their Lordships limited their observation to the fact that section 47 of the Karachi Port Trust Act, which provides that goods are kept in the Warehouse of the Karachi Port Trust at the risk of the owner, is not by itself sufficient to make the Port Trust the agent of the consignee. Their Lordships in fact were careful to add that they had "not found it necessary to go into the various provisions of the Karachi Port Trust Act to see how far the Port Trust Authorities can be said to hold the goods on behalf of the consignee, for it is sufficient to point out that at least in the present case the Port authorities who could not have delivered the goods without a delivery order from the respondent No. 1 were not agents of the consignees. Furthermore, in the case which was decided by the learned Single Judge of this Court, the question whether a provision in the bill of lading providing for the cesser of the liability of the ship‑owner in respect of the goods shipped, as soon as the goods were free from the ship's tackle, was not considered, which in fact is the major point urged by Mr. Salim Akhtar on behalf of the Shipping Company.

34. The preponderant view, as we read the authorities, appears to be that the liability of a carrier for carriage of goods under the said Act is for period from the time when the goods are loaded on to the ship up to the time when they are discharged from the ship and that a provision in the bill of lading providing for the cesser of liability of the carrier in respect of goods carried in his ship as soon as the goods have been discharged from the ship or are free from the ship's tackle, is not inconsistent with or repugnent to the pro visions of the said Act or the rules framed thereunder. This however, does not materially help the respondents, for the view that we have already taken is that the respondents have failed to establish, nor is there any material on record, on the basis of which it could be held that they had landed the missing bales of cotton at Chittagong Port. The respondents have even failed to establish that 8597 bales of cotton, which was the total amount ,of cotton carried by the ship, were discharged at the Chhittagong Port. Had they been able to establish this fact, it could have been presumed that the 15 bales of cotton, which were short‑delivered to the EPIDC, were among the bales which were discharged from the ship, but either due to the negligence of the Chittagong Port Authorities or some other persons, these bales were not delivered to the consignees, and since the responsibility of the ship‑owner ‑vas only to land and discharge the cargo at the port of destination, which it had in fact done, the carrier was absolved from all further responsibility under the terms of the bill of lading. The respondents having failed to discharge the burden of establishing that the missing bales of cotton were landed from the ship at the Chittagong Port, would clearly, in our opinion, be liable for the value of the bales, which has been satisfactorily proved to be Rs. 7,108.45.

35. In the result, we would set aside the judgments of the two Courts below and award a decree to the appellants in the sum of Rs. 7,108.45 with interest thereon at 6 % per annum from 4‑5‑1964, the date of suit, up to the date of payment. Since the appellants were unsuccessful in the two Courts below and further the case involved important and difficult legal issues, we would .award the appellants only the costs of the court‑fees.

36. S. A. H. Appeal allowed