P L D 2004 Karachi 705 (PLP)

(3) Re-processing/re-cleaning loss may be considered at 0.5 of the stocks which are mill processed. (4) Total losses on account of all the above mentioned factors can be placed at 3 % at maximum.

16. In the same context the other report annexure E is also relevant which reads as under:-- Item No.2: Loss in weight of Rice in RECP Godowns during prolonged storage, Multiple Handling process and Transportation before shipment. The Board after going through the Working Paper and detailed deliberations greed in principle to allow 3% loss in handling & Storage etc. with the additions a & b of para 21, page 8 of Working Paper. The Board however, directed that internationally reputed firms like SGS etc., may be approached in writing and International Standards on the subject if available with them may be obtained. The full facts of the case taking into account the recommendations of Committee appointed for the purpose may be sent to the Ministry for their consideration and approval.

17. The defendant has also placed on record copy of letter dated 30th May 1995 of SGS (Pvt) Ltd which is addressed to the Manager (M&M) of the plaintiff Corporation as annexure F wherein the said company has informed the plaintiff as under:- "In a controlled warehousing system these losses add up 3.5% to about 6% Consideration for shortage by moisture loss is estimated per annum around 2% specially under tropical conditions unless due care is given for dunnaging and proper ventilation. This includes loss of moisture in jute bags. Apart from above, difference of weight plus/minus occurs also from co-efficient of variation between two co-efficient of variation between two devices of scale weighing. Based on data gathered to different parts of the world the co-efficient of variation of 0.01 % applies at each weighing operation. We trust the foregoing will be found of assistance and with best regards. Yours truly.

18. The case of the defendant regarding natural causes for shortfall in the quantity of food grains is further supported from the report annexure "G" to the affidavit of defendant's witness which reveals as under:- "The rice, after receiving at Karachi is stored in three godowns of, the RECP which are QRG, Landhi and TPX. Year-wise storage losses at these godowns during the period 1990-1996 is given as under:-- 1990-91 1.7 % - 9.4 % 1991-92 4 .4 % 6.7 % 4. 3% 1992-93 3.5 % 2. 3 % - 1993-94 3.6 % - 3 .5% 1994-95 - - - 1995-96 - - - (Annual Average Loss) 3.3 % 4.5 % 5.7 % The above tab a shows that the storage losses are higher than that indicated by the Committee appointed in 1983 which is 2.5%. 19: It is pertinent to mention here that authenticity of none of the above referred reports/documents has been disputed by the plaintiff.

20. In view of the above discussed evidence it is clear that the shortfall in the handling of rice in the present case, which seems to be about 0.69% of the total quantity of rice handled by the defendant is much below the well recognized standard and it is due to natural causes which were beyond the control of defendant and not due to any negligence or act or omission of the defendant. When the plaintiff being specialized in dealing with such transactions, was aware of all these eventualities bat still it did not bother to incorporate any specific clause in the agreement to meet such situation, it cannot claim benefit of its own unfair, rather dishonest attitude. In another case of the plaintiff M/s. Rice Export Corporation v. A.H. Corporation and three others (2002 CLC 607) when same controversy came up for consideration before the learned Single Judge of this Court he examined the relevant provisions of Contract Act, various clauses of agreement executed between .the parties and same set of documents which have been placed on record in the present suit by the defendant and on that basis came to the conclusion that even shortage of stock to the extent of 1.6% of the total quantity is natural incident of contract therefore the defendant was not saddled with the responsibility to meet such loss. Mr. Samiuddin Sami, learned counsel for plaintiff did not dispute that in the said case contract- executed by the plaintiff was on the same terms as in the instant case and the documents taken into consideration by the learned Single Judge to record his conclusion in favour of defendant were also same. However, he attempted to make distinction on the grounds that in the present case as per the terms of the contract process of transportation was not involved and that case referred by him at the bar were not considered in that case. To rebut these submissions, suffice it to observe that no doubt process of transportation was not involved in the contract with the defendant but undisputedly transportation of rice (sic) the time of loading/unloading and storage of rice in the godown (may be through some other contractor), which must have resulted in usual loss of quantity.

21. There is no cavil to the principles of law discussed in various cases referred by Mr. Samiuddin Sami but in the facts and circumstances discussed above. Ratio of these cases goes in favour of defendant and not in favour of plaintiff's case. Further the ratio of judgment in the case of M/s. Rice Export Corporation v. M/s. A.H. Corporation (2002 CLC 607) is attracted to the present case with all force.

22. In the light of above discussion, issues Nos. 2 to 7 are separately answered as under:-- Issue No.2: It was contractual obligation of the defendant to have exercised all care in respect of stocks including its by products entrusted to it. However, in the instant case there was no breach of such obligation by the defendant and the shortfail of 1278.95 metric tons of rice has occurred due to natural causes, which were beyond the control of defendant. The defendant is therefore, not liable to make good any such loss or damages. Issue No.

3. This issue is answered in negative. Issue No.4. After entrustment of rice stocks and Bardana to the defendant, defendant was the custodian of the same as bailee, and not the plaintiff. Issue No.5. As discussed above natural losses occurred during the contract of handling of rice but for such losses defendant cannot be held responsible. Issue is answered accordingly. Issue No.6: Percentage of loss in the quantity of rice during the handling period was approximately 0.69 %. Issue No.7. This issue is answered in the affirmative. Issue No.

8. In view of my findings on issues Nos. 1 to 7 suit of the plaintiff is dismissed with no order as to costs. M.B.A./R-18/K Order accordingly.