Supreme Court Upholds NCDRC Order Directing Kuwait Airways To Pay Compensation For Delay In Delivery Of Consignment

The Supreme Court upheld an NCDRC order directing Kuwait Airways to compensate for delay in delivery of consignment.

The Court has held that once its agent had issued a time schedule for delivery of consignment, it cannot be argued that there is no material confirming an agreement for delivery on time.

The Court was deciding appeals preferred against the order of the National Consumer Disputes Redressal Commission (NCDRC) in which the complaint filed by the appellant M/s. Rajasthan Art Emporium was disposed of. The Commission had directed the respondent i.e., Kuwait Airways to pay US$ 500750/- or Rs. 20 lakhs (whichever is less) with 9% per annum compensation.

The two-Judge Bench comprising Justice A.S. Bopanna and Justice Prashant Kumar Mishra observed, “Once the agent has issued a time schedule for delivery of consignment, it cannot be said that there is no material indicating that there was no agreement for delivery of the consignment in time. respondent no.1 – Kuwait Airways has never taken the stand in any of the communication arising from its office that the respondent No.2 is not its agents or that there was no agreement or promise by its agent that the consignment will be delivered in 07 days.”

The Bench was satisfied with the fact that the NCDRC did not commit any illegality or perversity in recording the finding that there was delay in delivery of consignment.

Advocate Madhurima Tatia represented the appellant while Advocate S.C. Birla represented the respondents.

Brief Facts -

The appellant was an exporter of all kinds of handicrafts goods to several countries including USA and it had received an order from M/s. Williams Sonoma Inc. USA for supply of handicraft goods. Accordingly, the appellant had to send three shipments of 1538 packages to the consignee on an urgent basis, which was specifically informed to the respondents. The goods were tendered to Kuwait Airways/respondent no.1 after getting an assurance that the shipments will reach destination at Memphis within 7 days and delivery schedule was handed over to the appellant. As per the schedule, the entire consignment was supposed to reach at Memphis by July 31, 1996 but the same did not reach the destination. On enquiry, respondent no. 1 expressed its inability to deliver the consignments and a revised delivery schedule was given, which mentioned the date of delivery on August 6, 1996.

However, the consignment did not reach at the destination even as per the revised delivery schedule. On non-receiving the goods, the consignee expressed its anguish by sending a letter. Thereafter, the appellant made a modest claim against the respondents for refund of full freight in response to which, respondent no. 2 confirmed having short delivered 104 cartons out of 288 cartons but did not state whether other cartons arrived at the destination. The appellant served the legal notice on the respondents, which evoked no response. Ultimately, it lodged a complaint before the NCDRC with the prayer that respondent no. 1 be directed to refund a sum of Rs. 24,48,345/- being the fair charges for the consignments.

The Supreme Court in view of the above facts noted, “As a matter of fact, it is an admitted position that the consignment which was booked on 24.07.1996, was delivered after one and a half month i.e. from 03.09.1996 to 12.09.1996. … the delay in delivery of consignment has necessarily inflicted damage to the appellant which is liable to be satisfied by the respondent No.1 as provided under Section 19 and 13(3) of the Carriage by Air Act 1972.”

The Court also noted that Section 186 of the Contract Act, 1872 provides that the authority of an agent may be expressed or implied and similarly, Section 188 prescribes that an agent, having an authority to do an act, has authority to do every lawful thing which is necessary in order to do such act.

“In the case at hand, in the absence of a plea by the respondent No.1, that the respondent no. 2 was not its agent or that he had no authority to give schedule of delivery of consignment, the onus has not been discharged. Therefore, the respondent No.1 is bound by the promise held by its agent - respondent No.2, that the goods shall be delivered within one week and when the time schedule expired and the goods were, in fact, delivered after one and a half month, there was negligent delay in delivery of consignment”, further observed the Court.

Accordingly, the Apex Court dismissed the appeals and refused to interfere with the order passed by NCDRC.

Cause Title- M/s. Rajasthan Art Emporium v. Kuwait Airways & Anr. (Neutral Citation: 2023 INSC 996)

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