Supreme Court: Section 16 Carriage By Road Act Applicable To Suit Or Legal Proceedings In Connection With Loss/Damage To Consignment Alone

The Supreme Court in the case ESSEMM Logistics vs DARCL Logistics Limited observed and has stated that Section 16 of Carriage by Road Act, 2007 is only being applicable where the claim is in connection with the loss or damage to the consignment and it is not in respect of any other claim of loss or damage.
The bench comprising of Justice V. Ramasubramanian and Justice Pankaj Mithal in the case observed that as per the provision stated under Section 16 of the new Act does not come into play vis-à-vis the condition of giving a notice in respect of claims for the damages and for the loss of reputation, the business opportunity etc. therefore, the court stated that kind of claims are not in connection with the damage or the loss of the consignment.
In the present case, the ESSEMM Logistics, who being the first defendant in the suit, has preferred the said appeal against the rejection of its counter-claim. Therefore, the said rejection made was on the ground that the counter claim was being preferred without the mandatory notice was issued as contemplated mistakenly under Section 10 of the Carriers Act, 1865.
It has also been stated by the court that Section 16 of the New Act, the 2007 Act is only being applicable in respect of institution of a suit or through the legal proceeding which being against a common carrier for any loss of, or damage to, the consignment.
The court in the case observed and has issued notice under Section 16 of the new Act as it being necessary for the instituting any suit or legal proceedings much less counter-claim against the common carrier for recovering the loss other than the loss of or through damage to the consignment.
Therefore, the court in the case manifestly erred in rejecting of the counter-claim under Order VII Rule 11 Code of Criminal Procedure as the same is barred under by Section 16 of the new Act.
Accordingly, the court allowed the appeal.