JUDGMENT
Ramratna Singh, J.
1. This is an appeal by the Union of India, representing the postal department, who were defendant No. 1 in the suit out of which the appeal arises. The admitted facts are these. Defendants 2 to 5 carry on business of commission agency at Chapra, in the district of Saran, in the firm name of Palak Sah Padarath Ram. The plaintiff, who is resident of Gaya district, kept 182 bags of rice in charge of this firm on the 13th May, 1954 with the request that the price thereof should be sent to him after selling the same. On the 16th December, 1954, these defendants posted an insured cover at the Chapra post office addressed to the plaintiff’s home address. The plaintiff received the insured cover on the 21st December, 1954 at Usri post office, where he had gone on receipt of an intimation from that post office to take delivery of the cover.
2. Then, the case of the plaintiff is that he opened the insured cover in the presence of the post master and two others at Usri post office and found that the cover contained only blank pieces of paper. He then informed the police and the postal authorities about this fact. On the defendants’ refusal to pay him this sum of Rs. 2,500/-, said to be contained in the insured cover, he sent a pleader’s notice by registered post to them on the 7th April, 1955 and ultimately instituted the suit after service of notice under Section 80 of the Code of Civil Procedure on the 6th October, 1955 on the Union of India.
3. The Union of India asserted that the postal department was not responsible for the money, as the insured cover was delivered to the plaintiff with seals intact. Defendants 2 to 5 asserted that they had actually put currency notes worth Rs. 2,500/-in the insured cover and posted the cover at Chapra post office; and they were not responsible for the loss of the money.
4. The learned Munsif, who tried the suit, granted a decree for Rs. 2,500/-, besides interest, against defendants 2 to 5, who were defendants second party, and dismissed the suit against the Union of India. The first appellate Court, that is, the Additional Subordinate Judge of Chapra, in appeal, however, took a different view. He held that the defendants second, party did despatch the currency notes worth Rs. 2,500/- in the insured cover, but the cover had been tampered with by the employees of the postal department and they had substituted blank pieces of paper for the currency notes. Hence, he granted a decree for the plaintiffs claim against the Union of India only. Hence, this appeal.
5. Mr. K.D. Chatterji, learned Government Pleader appearing for the appellant, submitted that the Union of India can on no account be made liable for payment of the insured amount because there was no contract between the plaintiff and the postal authorities for the carriage of the insured cover and no liability was incurred under the relevant provisions of law, that is, the Indian Post
Office Act and the rules framed thereunder. He
further submitted that, on the evidence on record,
the decision of the lower appellate Court is perverse,
as there is no legal evidence to support it.
6. Learned Counsel for the parties took us through the different provisions of the Post Office Act and the rules framed thereunder. A large number of decisions, both English and Indian, were cited on the question whether there was a contractual liability or not, or whether the post office was an agent of the sender or the addressee or of both. But, in view of the decision of the Supreme Court in Commr. of Income-tax, Bombay South v. Ogale Glass Works Ltd., AIR 1954 SC 429, it is not necessary to discuss the said provisions of law or any of these authorities. In the above case decided “by the Supreme Court, the question raised, for the purposes of assessment of Income-tax, was whether a certain sum of money paid through a cheque sent by post could be deemed to have been paid in the then British India. The views of their Lordships are correctly summarised in the placitum, which reads as under:
“Under the Indian Post Office Act, 1898, the right of the sender to reclaim the letter until it is delivered to the addressee is by ho means an absolute right, for it is left entirely to the authorities to decide whether a letter once posted should be returned to the sender. This very narrow and qualified right can hardly be regarded as bringing about a position so different from that prevailing in England as to make the English decisions laying down the effect of sending cheques by post, wholly inapplicable. On the other hand, the principles underlying the English decisions are clearly consonant with the provisions of Indian law………
There can be no doubt that as between the sender and the addressee it is the request of the addressee that the cheque be sent by post that makes the post office the agent of the addressee. After such request the addressee cannot be heard to say that the post office was not his agent and therefore the loss of the cheque in transit must fall on the sender on the specious plea that the sender having the very limited right to reclaim the cheque under the Post Office Act, 1898, the Post Office was his agent, when in fact there was no such reclamation. Of course, if there be no such request, express or implied, then the delivery of the letter or the cheque to the post office is delivery to the agent of the sender himself. Apart from this principle of agency there is another principle which makes the delivery of the cheque to the post office at the request of the addressee a delivery to him and that is that by posting the cheque in pursuance of the request of the creditor the debtor performs his obligation in the manner prescribed and sanctioned by the creditor and thereby discharges the contract by such performance.
There is no basic difference in the Indian Post Office Act of 1866 and the Act of 1898 in this respect The Act of 1898 did not enlarge the right of the sender to reclaim the postal article to such an extent as to nullify illustration (d) to Section 50, Contract Act, or otherwise to affect the well known general principle that a contractual obligation is discharged by the performance of the engagement or promise in the manner prescribed or sanctioned by the promisee.”
In that case, the assessee company, having its business in Aundh, a native State, had supplied certain goods to the Government of India at Delhi and, as desired by the company, payments were to be made by cheques. Cheques were drawn in Delhi and received by the assessee in Aundh by post. Their Lordships observed that, according to the course of business usage in general, the parties must have intended that the cheques should be sent by post which is the usual and normal agency for transmission of such articles. Their Lordships added that, apart from the implication of an agreement arising from such business usage, the assessee expressly requested the Government to “remit” the amounts of the bills by cheques, and, therefore, “on the authorities cited above” it clearly amounted, in effect, to an express request by the assessee to send the cheques by post. The authorities referred” to by their Lordships are some English decisions.
7. In view of this decision of the Supreme Court, the post office becomes an agent of the addressee also in the case of remittance of money in an insured cover, provided the addressee has, expressly or impliedly, asked the sender to send the money by post. It is true that the word “remit” was not used in the present case as the plaintiff has said in the plaint that, after depositing the rice with the defendants second party at Chapra, he asked them to sell the same and ‘send” the price fetched to him. But there is no difference in the context between the words “send” and “remit”, and it is reasonable to infer that there was an implied request by the plaintiff to the defendants second party to send the money by post. This question is, however, not material, because we have come to the conclusion that the insured cover was not tampered with during transit through the post-office.
8. Section 33 of the Post Office Act reads: “Subject to such conditions and restrictions as the Central Government may, by rule, prescribe, the Central Government shall be liable to pay compensation, not exceeding the amount for which a postal article has been insured to the sender thereof for the loss of the postal article or its contents or for any damage caused to it in course of transmission by post:
Provided that the compensation so payable shall in no case exceed the value of the article lost or the amount of the damage caused.”
Relevant part of Rule 81 made under the Act, which corresponds to paragraph 175 of the Post Office Guide, Part I, corrected up to the 30th June, 1960, lays down as under:
“175. Responsibility of the Post Office –There will be payable to the sender of an insured postal article compensation not exceeding the amount for which the article has been insured, for the loss of the postal article, or any of its contents, or for any damage caused to it in course of transmission by post; provided that the compensation in no case exceeds the value of the article or any of its contents lost or the amount of the damage caused, and provided, that, in the case of loss, the sender furnishes full particulars of the contents of the postal article and their values; provided, also that no compensation will be payable:
* * * * (b) where there has been fraud on the part of the sender or addressee; (c) where the insured article has been delivered to the addressee, and he has signed and returned the receipt therefor; * * * * (d) where the loss or damage was due to improper or insecure packing; (f) where there is no visible damage to the cover or seals, it being understood that the sender must so pack the letter or parcel that its contents cannot be touched without visible damage as aforesaid being caused; * * * *" It will be seen, therefore, that no compensation is payable where the insured article has been delivered to the addressee and he has signed and returned the receipt therefor, or where there is no visible damage to the cover or the seals.
9. In the present case, it is admitted by the plaintiff Lallan Prasad Singh (P. W. 4), that, at the time he took delivery of the insured cover at Usri post office, he found the seals of the cover intact and the postmaster obtained in writing from him that the insured cover was received by him in proper condition and, after obtaining these writings, the postmaster delivered the insured cover to him. He then opened it by cutting the thread and also the mouth of the cover with a pair of scissors. But only pieces of blank paper of the size of ten-rupee notes and hundred-rupee notes came out of the cover when it was thus cut open by him, and the cover did not contain any currency notes. All this took place in presence of the postmaster and the postman. At the suggestion of the postmaster the plaintiff, accompanied by the two, went to the Postal Inspector at Niranjanpur for lodging a complaint. The postmaster (P. W. 1) and the postman (P. W. 2) corroborated this version. Jairam Singh (P. W. 3), a co-villager of the plaintiff, who happened to be present at the time, also supported these witnesses. Some postal employees of Arwal post office, through which the insured cover was sent to Usri post office, stated that they found the cover and the seals intact at the time it passed through their hands. The trial Court accepted the statements of all these witnesses and came to the conclusion that the insured cover had not been tampered with during transit. The learned Judge in the Court below referred to the evidence of the postal employees of Arwal post office and said that the insured cover had not been tampered with till it reached Arwal post office; but he held that the “insured cover was opened and damaged during its transit, most probably at Usri post office.” There is no legal evidence, however, to support this conclusion. I shall now discuss the so-called circumstantial (evidence on which the learned Subordinate Judge relied in coming to this conclusion.
10. The first circumstance is that there was lei (paste) mark on the uncut flap of the cover. It may be stated that the flap which remains pasted at the time of the sale of the cover by the post
office was the flap cut by the plaintiff with the help of scissors after he took delivery of the insured cover, and this paste mark is on the opposite semi-circular flap which is pasted by the sender after putting in the contents in the cover and before handing it over to the postal employee for registration. I fail to understand how the paste position can be evidence of tampering. Such paste mark is bound to be there when the flap is pasted a, bit carelessly and the excess lei is bound to spread beyond the flap. There are three seals on this flap, two at the two ends and one in the middle. What, however, the Court below entirely missed was the fact that the seals on the cover were all intact. I think the intactness of the seals is conclusive on the question of tampering by postal authorities. In view of the admission of the plaintiff that the seals had not been tampered with at all, it would be rather difficult to draw an inference, from the mere fact that the paste had spread, that the currency notes were replaced by the postal employees during the transit. The presence of the seals in the same position as before is sufficient to destroy the theory of tampering by postal authorities. The spreading of paste can at best raise some suspicion but cannot displace the conclusion afforded by the seals.
The learned Subordinate Judge has, in support of his inference, relied on the evidence of the postal employees of Arwal, who have said that they did not notice) any lei or paste mark on this flap on the 18th December, 1954, when the insured cover passed through their hands. The witnesses were examined in this case in September-October, 1956; and it is improbable that these employees would remember such details as the absence or presence of lei mark on one particular insured cover out of many covers which must have passed through their hands during the long period. This remark would not, however, apply to the postal employees of Usri, because an unusual thing had happened, namely, the plaintiff had found in their presence that pieces of blank paper came out of the insured cover, and this significant fact must have been stamped on their memories. Thus, the spreading of paste has no significance at all.
11. Another circumstance mentioned by the learned Subordinate Judge is that the upper portions of some of the blank papers were besmeared with lei and there was no evidence that the pieces of blank paper were so besmeared after they were taken out of the cover by the plaintiff. But, when the excess lei or paste spreads over the flap, the greater probability is that they must have spread over to some extent on those ends of the blank pieces of paper which were inside towards the flap which was pasted by the sender. This circumstance would rather indicate that these pieces of paper had been put inside the cover before the flap was pasted by the senders or their men.
The third circumstance is that there was no hole in any of the pieces of paper, though the insured cover had been sewn with thread in the middle before the seal was put there. In this connection, the learned Judge has referred to the evidence of D. W. 9, one of the defendants second party. He has said that he had closed the flap of the insured cover by pasting it with water only and that the pasting was neatly done in one attempt. He then stitched the cover, after piercing a thread through the currency notes and then affixed the seals on it. But this testimony is apparently interested and it is difficult to believe that he would remember such details in respect of this insured cover after a laps of two years, particularly when admittedly the firm of the defendants second party is a big firm and, in their capacity as commission agents, they must be dealing with a large number of customers and remitting moneys to them. Under the rules of the Post Office, of course, an insured cover has to he sewn with thread; but the mere fact that the insured cover in question was sewn with thread does not necessarily lead to the conclusion that the thread must have pierced through the contents. It is possible that the contents were kept on one side of the point in the middle where the cover was sewn with thread.
The plaintiff has stated that the thread had not passed through the blank pieces of paper contained inside the cover, but it pierced through the cover at the centre on one side and had been taken out to the other side by taking it round by the side of the pieces of paper. There is no reason why the plaintiff would tell lies in order to shield the postal employees of Usri, when he had nothing to gain but only to lose, by inventing a story to cover their alleged misdeed. The learned subordinate judge has rejected this evidence of the plaintiff on the ground that the length of the thread would be a bit larger, if it was made to reach from the hole on one side to the hole on the other side of the cover. We do not know, however, whether the thread was short or long, as the thread was not produced. The learned subordinate judge has also commented on the non-production of the thread found at the time the cover was opened by the plaintiff, and also on the fact that the written complaint (Ext. 5) of the plaintiff to the postal Inspector did not contain any thing about the thread. The learned Subordinate Judge has drawn an inference that the thread had been removed before the cover was delivered to and opened by the plaintiff; but in that case, the seals on the two sides over the thread must have been broken before delivery of the insured cover to the plaintiff. The plaintiff has, however, said that he found all the seals intact when he took delivery. Hence, it is unfair to draw an adverse inference on that account, as the plaintiff or the postal employees of Usri Post office could not have anticipated that the preservation of the thread would be of any significance.
12. It appears that at one point, where the two ends of the other two flaps meet on the front side of the cover at the time of preparing, the cover is now loose. These flaps are pasted at that point lengthwise before a new envelope is issued by the Post Office. But in the present case the pasting was found loose there at the time the insured cover was produced in Court, that is, about two years after the delivery, and the plaintiff had not opened this portion of the cover and he could not say when it had been opened or loosened. The pasting at that particular point would naturally become loose on account of frequent handling in the course of the enquiries made after the complaint of the plaintiff.
13. Another inference has been drawn by the learned Judge from the statement of P. W. 2 that he had not seen the complaint petition (Ext. 5) of the plaintiff on the 21st December, 1954, either at Niranjanpur or at Usri. The inference drawn is that the plaintiff did not lodge any complaint before the Postal Inspector on the 21st. December, 1954. But the statement of P. W. 2 could not be considered literally. The relevant statement of P. W. 2 is this:
“The Postal Inspector did not take any written statement from Lallan Singh at Niranjanpur. I cannot say if he obtained any written statement from the plaintiff at Usri. I accompanied the Postal Inspector from Niranjanpur to Ushri Post office and then I left that place.”
It is, therefore, not fair to draw the above inference from these statements.
14. In some of the pieces of blank paper the date noted by the Postal Inspector, as stated by the learned Subordinate Judge, is the 22nd December, 1954, though they are said to have been produced by the plaintiff before him on the 21st December, 1954 at Niranjanpur. P. W. 3 has said that these pieces of paper were initialled by the Inspector at Ushri Post office the next day when he came there. The learned Subordinate judge has then observed that no reason has been assigned for the Inspector not signing them at Niranjanpur, and stated the argument of the learned Lawyer for the defendants second party that the postal authorities were all in conspiracy and took some time to deliberate as to how to move in the matter and so they did not take steps in due course of business. The learned Judge does not say whether he accepted this argument or not; but by implication he probably accepted the same. As pointed out by the trial Court, this suggestion regarding conspiracy between the plaintiff and the postal employees of Usri was not made to the plaintiff or any of the witnesses examined for the Union of India; and there is absolutely no evidence in support of such a conspiracy.
15. Another circumstance mentioned by the learned Subordinate Judge is that the postmaster of Usri has not produced the register called the Error Book, which is maintained in every post office for noting the irregularities and discrepancies noticed. He says that this register would show whether the postmaster noted the fact that that blank pieces of paper were found in the insured cover in question. But this Error Book is meant to note irregularities or discrepancies noticed by the Postal employees in the course of their official duties, and not for noting any thing found after delivery of a cover by the addresses as in the present case. The non-production of this register is, therefore, of little significance. Further, neither the plaintiff nor the defendants second party called for this register and the Union of India could not have anticipated that the production of this register was necessary.
16. The last circumstance relied on by the learned Judge is that, according to the plaintiff, the postal Inspector weighed the blank pieces of paper and found their weight to he 114 rates, while the weight noted on the insured cover was 112 rates. He, therefore, observed that, if the blank pieces of paper were really kept inside the cover by the sender before making over the same to the Chapra Post Office, the weight noted on the cover should have been much more than 114 rates because of the additional weight of the cover. But he has misread the evidence of the plaintiff, who said that the paper pieces were weighed, at Usri post office by the Postal Inspector himself in his presence and the Inspector told him that the same weighed 114 rates “including the cover and its broken seals”. Thus, 114 rates included the weight of the cover; and the difference of two rates, which works out at less than two per cent, is not very material. The suggestion on behalf of the defendants second party before the Court below that the Postal employees of Usri and the plaintiff were in collusion with one another is absolutely untenable, particularly in view of the fact the plaintiff alone was to lose in such a collusion.
17. From the foregoing discussions, it will appear that the learned Subordinate judge has ignored the important and unassailable evidence and has based his conclusion against the employees of the Union of India only on surmises and conjectures I which cannot take the place of legal evidence; and, therefore, his conclusion must be rejected.
18. Mr. Daroga Prasad, learned Advocate for the defendants second party, submitted that this Court had no jurisdiction to question the finding of fact in a second appeal, however erroneous the finding may be, and relied on the decision in Sinha Ramanuja Jeer v. Ranga Ramanuja Jeer, AIR 1961 SC 1720. There can be no dispute regarding this principle, but in the present case the finding of the learned Subordinate Judge is not based on any legal evidence at all. In a recent decision of the Supreme Court in V. Ramachandra Ayyar v. Ramalingam Chettiar, Civil Appeal No. 284 of 1959, disposed of on 10-8-1962 (unreported) (Since reported in AIR 1963 SC 302) their Lordships of the Supreme Court said:
“In hearing a second appeal, if the High Court is satisfied that the decision is contrary to law or some usage having the force of law, or that the decision has failed to determine some material issue of law or usage having the force of law, or if there is a substantial error or defect in the procedure provided by the Code, or by any other law for the time being in force which may have produced error or defect in the decision of the case upon the merits, it can interfere with the conclusions of the lower appellate Court………
It is necessary to remember that Section 100{1) (c) (Code of Civil Procedure) refers to a substantial error or defect in the procedure. The defect or error must be substantial–that is one fact to remember; and the substantial error or defect should be such as may possibly have produced error or defect in the decision of the case upon the merits that is another fact to be borne in mind. The error or defect in the procedure to which the clause refers is, as the clause clearly and unambiguously indicates, an error or defect connected with, or relating to, the procedure; it is not an error or defect in the appreciation of the evidence adduced by the parties on the merits.”
Their Lordships distinguished the decision in Hemanta Kumari Debi v. Brojendra Kishore Roy Chowdry, 17 Ind App 65 (PC) but approved the view of the Privy Council that the High Court can interfere with the conclusion of fact recorded by the lower appellate Court, if the said conclusion is not supported by any evidence. It is obvious that the word “evidence” connotes “legal evidence”, and not surmises and conjectures.
19. There is the unchallenged evidence of the plaintiff and his witnesses that the insured cover was delivered to the plaintiff with the seals intact by the postmaster of Usri and thereafter in their presence the plaintiff discovered that the cover contained only a large number of blank pieces of paper. It is, therefore, impossible to hold that the insured cover had been tampered with during transit, and it must be held that the Union of India is not liable for any amount.
20. The trial Court, after a discussion of the evidence on record, found that, in fact, the defendants second party had not put currency notes in the insured cover when they handed it over to the Chapra Post office. This finding has not been discussed at all by the learned Subordinate Judge. Of the witnesses examined on behalf of defendants second party, D. W. 9 is one of the defendants himself, D. W. 5 is their Munib and D. Ws. 6 and 7 are their customers. The evidence of D. Ws. 5 and 9 is apparently that of interested persons. D. Ws. 6 and 7 had gone to the Gaddi of the defendants second party for some business of their own, and they had nothing to do with the transactions going on at the Gaddi of the defendants like the transaction between the plaintiff and the defendants second party. It is, therefore, impossible to believe that they would remember the details about the putting in of currency notes in the insured cover, sewing thereof and putting seals thereon.
The defendants second party also relied on entries in their account books (Exts. C and D). Exhibits 12 and 12(a) are two Post cards written by defendants second party to Prasidh Narain Singh, (P. W. 5) of village Kubri, where the plaintiff also resides, but, admittedly, no entry in respect of the transactions mentioned in these two post cards finds place in the defendants’ account books. D. W. 9 admits that both the post cards are of his firm and both of them were written by him. The contents of these post cards support the statement of Prasidh Narain Singh that he had sent rice to the arhat of the defendants second party for sale. The absence of any entry in respect of these transactions in the account books of the defendants second party is sufficient to show that these books cannot be relied upon. Further, D. Ws. 5 and 9 have admitted that, though the defendants second party pay sale-tax and Income-tax, these account books were not produced before any Income-tax Officer or Sales-Tax Officer. In the circumstances, the only conclusion is that the defendants second party did not send currency notes in the insured cover in question and they did put blank pieces of paper therein in order to dupe the plaintiff.
21. In the result, the plaintiff is entitled to get a decree for the amount claimed from the defendants second party, and not from the Union of India. The appeal is, accordingly allowed the judgment and decree of the Court below are set aside and those of the trial Court restored. The plaintiff is entitled to his costs throughout from the defendants second party. The Union of India will also recover their costs of this appeal and of the Lower appellate Court from the defendants second party.
Kanhaiya Singh, J.
22. I agree.