Ethiopian Airlines vs Ganesh Narain Saboo

Ethiopian Airlines ...Appellant

Versus

Ganesh Narain Saboo ...Respondent

J U D G M E N T

Dalveer Bhandari, J.

1. This appeal is directed against the judgment and order of

the National Consumer Disputes Redressal Commission, New

Delhi, dated 7.1.2004 passed in First Appeal No. 190 of 1996.

2. A two-Judge bench of this Court by its order dated

10.11.2009 referred this matter to a larger Bench. The said

order reads as under:

"The questions in this case is whether

proceedings before the Consumer Forum are suits.

It appears that there are two conflicting judgments

on this point - E.I.C.M. Exports Ltd. v. South

2

Indian Corporation (Agencies) Ltd. and Another

2009 (10) SCALE 22 and Patel Roadways Limited

v. Birla Yamaha Limited (2000) 4 SCC 91. Hence

we are referring the matter to a larger Bench to

resolve this conflict, to be constituted by Hon'ble the

Chief Justice of India."

BRIEF FACTS:

3. The respondent booked a consignment of Reactive Dyes

with the appellant Ethiopian Airlines to be delivered at the Dar

Es. Salaam, Tanzania on 30.9.1992. The airway bills were

duly issued by the appellant from its office in Bombay at the

Taj Mahal Hotel for the said consignment. According to the

respondent there was gross delay in arrival of the consignment

at the destination, which led to deterioration of the goods.

4. The respondent filed a complaint on 11.5.1993 before the

Maharashtra State Consumer Dispute Redressal Commission

(hereinafter referred to as `the State Commission'). Pursuant

to the notice issued by the State Commission, the appellant

filed a written statement in which the appellant raised a

preliminary objection regarding maintainability of the

complaint.

5. On 17.1.1996, the State Commission held that the

complaint filed by the respondent was not maintainable. The

3

respondent aggrieved by the said order preferred an appeal

before the National Consumer Disputes Redressal Commission

(hereinafter referred to as `the National Commission'). The

National Commission categorically observed in the impugned

judgment that Section 86 of the Code of Civil Procedure (for

short `C.P.C.') was not applicable since the case in dispute is

covered under the provisions of the Consumer Protection Act,

1986 (hereinafter referred to as `the Act').

6. The National Commission further held that Section 13(4)

of the Act makes the CPC applicable only for the limited

purpose. As such, the National Commission took the view

that the judgment of the High Court of Delhi delivered in the

case of Deepak Wadhwa v. Aeroflot 24 (1983) Delhi Law

Times 1 had no bearing and application in deciding the

complaint filed by the respondent.

7. The National Commission set aside the order passed by

the State Commission and remitted it to the State Commission

so that the State Commission could decide it afresh in

accordance with law.

4

8. The appellant, aggrieved by the said order, has preferred

this appeal on the ground that a foreign State or its

instrumentality cannot be proceeded against under the Act

without obtaining prior permission from the Central

Government. The appellant contends that a foreign State or

its instrumentality can legitimately claim sovereign immunity

from being proceeded against under the Act in respect of a

civil claim.

9. It is submitted that, in India, it is clear that there is

presumption that sovereign immunity is absolute, but that a

foreign sovereign can still be sued in India under certain

circumstances with the permission of the Government of

India. The Central Government may give consent for such a

suit if:

(a) the foreign State has instituted a suit in the

Court against the person desiring to sue it; or

(b) the foreign State trades within the legal limits

of the jurisdiction of the Court or;

(c) the foreign State is in possession of immovable

property situated within those limits and is to

be sued with reference to such property or for

money charged thereon or;

(d) the foreign State has expressly or impliedly

waived the privilege of immunity.

5

Relevant case law and submissions

10. Reliance was placed on a judgment of the Constitution

Bench delivered in the case of Mirza Ali Akbar Kashani v.

The United Arab Republic and Another AIR 1966 SC 230.

This Court in para 30 of the said judgment observed as under:

"The effect of the provisions of section 86(1) appears

to be that it makes a statutory provision covering a

field which would otherwise be covered by the

doctrine of immunity under International Law. It is

not disputed that every sovereign State is competent

to make its own laws in relation to the rights and

liabilities of foreign States to be sued within its own

municipal Courts. Just as an independent sovereign

State may statutorily provide for its own rights and

liabilities to sue and be sued, so can it provide for

the rights and liabilities of foreign States to sue and

be sued in its municipal Courts. That being so, it

would be legitimate to hold that the effect of section

86(1) is to modify to a certain extent the doctrine of

immunity recognised by International Law. This

section provides that foreign States can be sued

within the municipal Courts of India with the

consent of the Central Government and when such

consent is granted as required by section 86(1), it

would not be open to a foreign State to rely on the

doctrine of immunity under International Law,

because the municipal Courts in India would be

bound by the statutory provisions, such as those

contained in the Code of Civil Procedure. In

substance, section 86(1) is not merely procedural; it

is in a sense a counter-part of section 84. Whereas

section 84 confers a right on a foreign State to sue,

section 86(1) in substance imposes a liability on

foreign States to be sued, though this liability is

6

circumscribed and safeguarded by the limitations

prescribed by it. ... ... ..."

11. Reliance was also placed on another judgment of this

Court in the case of Veb Deutfracht Seereederei Rostock

(D.S.R. Lines) a Department of the German Democratic

Republic v. New Central Jute Mills Co. Ltd. and Another

(1994) 1 SCC 282. In para 5 of the judgment this Court held

that:

"One of the principles of International Law is that

sovereign State respects the independence of every

other foreign State. This absolute independence and

the international comity underlines the relationship

between sovereign States.

The object of Section 86 of the Code is to give effect

to the principles of International Law. But, in India

it is only a qualified privilege because a suit can be

brought with the consent of the Central Government

in certain circumstances. Just as an independent

sovereign State may statutorily provide for its own

rights and liabilities to sue and be sued so can it

provide rights and liabilities of foreign States to sue

and be sued in its Courts. It can be said that effect

of Section 86 thus is to modify the extent of doctrine

of immunity recognised by the International Law. If

a suit is filed in Indian Courts with the consent of

the Central Government as required by Section 86,

it shall not be open to any foreign State to rely on

the doctrine of immunity. Sub-section (1) of Section

86 says in clear and unambiguous terms that no

foreign State may be sued in any court, except with

the consent of the Central Government certified in

writing by the Secretary to that Government. Sub-

section (2) prescribes that such consent shall not be

7

given unless it appears to the Central Government

that the case falls within any of the clauses (a) to (d)

of sub-section (2) of Section 86. Sub-section (6)

enjoins that where a request is made to the Central

Government for the grant of any consent referred to

in sub-section (1), the Central Government shall

before refusing to accede to the request in whole or

in part, give to the person making the request a

reasonable opportunity of being heard.

On a plain reading of different sub-sections of

Section 86, it is apparent that no foreign State may

be sued in any court in India, except with the

consent of the Central Government which has to be

certified in writing by the Secretary to that

Government. In view of the provisions aforesaid,

before any action is launched or a suit is filed

against a foreign State, person concerned has to

make a request to the Central Government for grant

of the necessary consent as required by sub-section

(1) of Section 86 and the Central Government has to

accede to the said request or refuse the same after

taking into consideration all the facts and

circumstances of the case. ... ... ..."

12. It was submitted by the learned counsel for the

appellant, Mr. K.G. Presswala, that when interpreting Section

86 of the CPC, it should always be kept in view that the said

Section gives effect to the principles of international law.

13. The learned counsel for the appellant placed reliance on

the judgment of this court delivered in the case of H.H. The

Maharana Sahib Shri Bhagwat Singh Bahadur of

Udaipur v. State of Rajasthan and Others AIR 1964 SC

8

444, where an ex-ruler contended that under section 86 of the

CPC, a reference made by the Government under the

Industrial Disputes Act in respect of employees' wages was not

maintainable without the prior consent of the Central

Government. This Court in para 5 of the said judgment held:

"The appellant is recognised under Article 363(22) of

the Constitution as a Ruler of an Indian State, but

Section 86 in terms protects a Ruler from being

"sued" and not against the institution of any other

proceeding which is not in the nature of a suit. A

proceeding which does not commence with a plaint

or petition in the nature of plaint, or where the

claim is not in respect of a dispute ordinarily triable

in a civil court, would prima facie not be regarded

as falling within Section 86 Code of Civil Procedure.

... ... ..."

14. The learned counsel for the appellant submitted that the

Act specifically states in Section 3 that "the provisions of this

Act shall be in addition to and not in derogation to any other

law for the time being in force." The learned counsel for the

appellant also submitted that this Court in the case of State

of Karnataka v. Vishwabharathi House Building Co-

operative Society and Others (2003) 2 SCC 412 in

paragraphs 46 and 47 observed as under:

"46. By reason of the provisions of Section 3 of the

Act, it is evident that remedies provided thereunder

are not in derogation of those provided under other

9

laws. The said Act supplements and not supplants

the jurisdiction of the civil courts or other statutory

authorities.

47. The said Act provides for a further safeguard to

the effect that in the event a complaint involves

complicated issues requiring recording of evidence

of experts, the complainant would be at liberty to

approach the civil court for appropriate relief. The

right of the consumer to approach the civil court for

necessary relief has, therefore, been provided under

the Act itself."

15. The learned counsel for the appellant further submitted

that a claim which is ordinarily triable in a Civil Court can

also be tried in the Consumer Court if:

(i) an Unfair Trade Practice or a restrictive trade

practice has been adopted by any trader or

service provider;

(ii) the goods bought by a person or agreed to be

bought by him suffer from one or more defects;

(iii) the services hired or availed of or agreed to be

hired or availed of by him suffer from

deficiency in any respect;

(iv) a Trader or a Service Provider as the case may

be has charged for the goods or the services a

price in excess of the price:

(a) fixed by or under any law for the time

being in force;

(b) displayed on the goods or any package

containing such goods;

10

(c) displayed on the price list exhibited by

him or under any law for the time being

in force;

(d) agreed between the parties

(v) goods which would be hazardous to life and

safety when used are being offered for sale to

the public

(a) in contravention of any standards

relating to safety of such goods as

required to be complied with by or under

any law for the time being in force;

(b) if the trader could have known with due

diligence that the goods so offered are

unsafe to the public.

(vi) services which are hazardous or likely to be

hazardous to the life and safety of the public

when used are being offered by the Service

Provider could have known with due diligence

injurious to life and safety.

16. Mr. Presswala also submitted that a Complaint and a

Plaint is one and the same thing and a proceeding in the

Consumer Court, though not a suit under the Civil Procedure

Code, is still a proceeding which is in the nature of a suit and

is commenced by a proceeding in the nature of a Plaint (i.e. a

Complaint and is in respect of a claim which is ordinarily

triable by a Civil Court). It is submitted by Mr. Presswala that

11 Section 86 of the CPC would be squarely applicable to the

proceedings under the Act.

17. The learned counsel for the appellant further submitted

that the provisions of the CPC are not applicable to the

proceedings under the Act. Mr. Presswala also submitted that

the District Forums, the State Commission and the National

Commission have all the trappings of a Civil Court.

Consequently, the proceedings before these fora are legal

proceedings.

18. According to the appellant, the interpretation given by

the National Commission is totally untenable and cannot be

sustained.

19. Mr. Rakesh Kumar Khanna, the learned senior counsel

for the respondent submitted that this appeal not only

involves the applicability of section 86 of the CPC and the Act,

but also raises the following questions:

(a) Whether the Consumer Protection Act being a

later and a Special Statute will have overriding

effect over the provisions of general and

previous Statute (i.e. the Civil Procedure Code,

1908?)

12

(b) Whether in view of the provisions of the

Carriage by Air Act, 1972, specially, Section 7

read with Rules 1, 2, 18, 19 & 28 of First

Schedule framed under Section 3 of the Act

thereof, the Appellant Ethiopian Airlines will

be deemed to have submitted to the

jurisdiction of the Indian Courts for the

purpose of Code of Civil Procedure, 1908?

(c) Whether the provisions of Carriage by Air Act,

1972 will be read into the provisions of the

Consumer Protection Act, 1986?

20. Learned senior advocate for the respondent also

submitted that the Act is a complete code in itself. It sets

forth the procedure to be followed in dealing with complaints

filed before the fora provided for in the Act as well as with the

Appeals arising from the orders of those fora. Section 13 of

this Act provides for the procedure to be followed by the fora

on receipt of the complaint. Sub-sections 4, 5 and 6 of section

13, which are relevant for the purpose of the present case,

read as under:

"13. Procedure on admission of complaint: (1) The

District Forum shall, on admission of a

complaint, if it relates to any goods,

xx xx xx

xx xx xx

13

(4) For the purposes of this section, the

District Forum shall have the same

powers as are vested in a Civil Court

under Code of Civil Procedure, 1908 (5 of

1908) while trying a suit in respect of the

following matters, namely:

(i) the summoning and enforcing the

attendance of any defendant or

witness and examining the witness

on oath;

(ii) the discovery and production of any

document or other material object

producible as evidence;

(iii) the reception of evidence on

affidavits;

(iv) the requisitioning of the report of

the concerned analysis or test from

the appropriate laboratory or from

any other relevant source;

(v) issuing of any commission for the

examination of any witness; and

(vi) any other matter which may be

prescribed.

(5) Every proceeding before the District

Forum shall be deemed to be a judicial

proceeding within the meaning of

sections 193 and 228 of the Indian Penal

Code (45 of 1860), and the District Forum

shall be deemed to be a civil court for the

purposes of Section 195 and chapter

XXVI of the Code of Criminal Procedure,

1973 (2 of 1974).

(6) Where the complainant is a consumer

referred to in sub-clause (iv) of clause (b)

14

of sub-section (1) of Section 2, the

provisions of rule 8 of Order 1 of the first

Schedule to the Code of Civil Procedure,

1908 (5 of 1908) shall apply subject to

the modification that every reference

therein to a suit or decree shall be

construed as a reference to a complaint

or the order of the District Forum

thereon."

21. This Court in Savita Garg v. Director, National Heart

Institute (2004) 8 SCC 56 para 7 has observed that:

"... ... ...Therefore, as far as the Commission is

concerned, the provisions of the Code of Civil

Procedure are applicable to a limited extent and not

all the provisions of the Code of Civil Procedure are

made applicable to the proceedings of the National

Forum.... ... ..."

22. In para 10 of the said judgment the Court further

observed as under:

"The Consumer Forum is primarily meant to

provide better protection in the interest of the

consumers and not to short-circuit the matter or to

defeat the claim on technical grounds. ... ... ..."

23. The respondent contends that a bare perusal of Section

13(4), (5) and (6) clearly demonstrate that as far as the fora

created under the Consumer Protection Act, 1986 for deciding

consumer disputes are concerned, the provisions of the CPC 15

are applicable to a limited extent only and not all provisions of

CPC are made applicable thereto.

24. In exercise of powers conferred by Section 30A of the

Consumer Protection Act, 1986, the Consumer Protection

Regulations, 2005 have been framed. Regulation 26 of these

Regulations specifically provides that in all the proceedings

before the consumer forum endeavour shall be made by the

parties and their counsel to avoid the use of provisions of CPC.

Regulation 26 of these Regulations reads as under:

"26. Miscellaneous: (1) In all proceedings before the

Consumer Forum, endeavour shall be made by the

parties and their counsel to avoid the use of

provisions of Code of Civil Procedure, 1908 (5 of

1908).

Provided that the provisions of the Code of Civil

Procedure, 1908 may be applied which have been

referred to in the Act or in the rules made

thereunder."

25. The aforesaid view of the specific provisions of Section

13(4) of the Consumer Protection Act read with Regulation 26,

makes it clear that the provisions of the CPC in general are not

applicable in the proceedings under the Consumer Protection

Act, except to the extent provided for under Section 13 of the

Act.

16 26. Mr. Khanna also submitted that the controversy involved

in this case is no longer res integra, as evidenced by Savita

Garg (supra).

27. Mr. Khanna further submitted that the provisions of the

CPC are not applicable to the proceedings under the

Consumer Protection Act, 1986 and consequently, the bar

under Section 86 of the CPC likewise does not apply to the

proceedings initiated under the Consumer Protection Act,

1986.

28. Mr. Khanna contended that the impugned order passed

by the National Commission is in consonance with the legal

position crystallized in a series of judgments of this Court and

calls for no interference.

29. Mr. Khanna gave the historical background of the

enactment of the Consumer Protection Act, 1986. He

submitted that the interests of consumers around the world

had drawn the attention of the United Nations for a long time

and that after long deliberations and continued consultations,

the United Nations in its General Assembly adopted

17

guidelines for consumer protection. The relevant portion of

the guidelines is given as under:

"1. Taking into account the interests and needs of

consumers in all countries, particularly in

developing countries, recognize that

consumers often face imbalances in economic

terms, educational levels, and bargaining

power; and bearing in mind that consumers

should have the right of access to non-

hazardous products, as well as the right to

promote just, equitable and sustainable

economic and social development. These

guidelines for consumer protection have the

following objectives:

(a) To assist countries in achieving or

maintaining adequate protection for their

population as consumers;

(b) To facilitate production and distribution

patterns responsive to the needs and

desires of consumers;

(c) To encourage high levels of ethical

conduct for those engaged in the

production and distribution of goods and

services to consumers;

(d) To assist countries in curbing abusive

business practices by all enterprises at

the national and international levels

which adversely affect consumers;

(e) To facilitate the development of

independent consumer groups;

(f) To further international cooperation in

the field of consumer protection;

(g) To encourage the development of market

conditions which provide consumers with

greater choices at lower prices.

18

5. All enterprises should obey the relevant laws

and regulations of the countries in which they

do business. They should also conform to the

appropriate provisions of international

standards for consumer protection to which

the competent authorities of the country in

question have agreed. (hereinafter references

to international standards in the guidelines

should be viewed in the context of this

paragraph).

28. Governments should establish or maintain

legal and/or administrative measures to

enable consumers or, as appropriate, relevant

organizations to obtain redress through formal

or informal procedures that are expeditious,

fair, inexpensive and accessible. Such

procedures should take particular account of

the needs of low income consumers."

30. Mr. Khanna submitted that these guidelines were

considered by this Court in the case of Vishwabharti House

Building Cooperative Society and others (supra).

31. Mr. Khanna also submitted that the framework for the

Consumer Protection Act, 1986 was provided by a resolution

dated 9.4.1985 of (the General Assembly of the United Nations

Organisation) which is commonly known as "Consumer

Protection Resolution No. 39/248". India is a signatory to the

said resolution. The Act was enacted in view of the

aforementioned resolution of General Assembly of the United

Nations.

19 32. The learned counsel for the respondent contended that

the Act was enacted to provide better protection for the

consumers and their interests. By this Act, the legislature

sought to constitute quasi judicial Tribunals/Commissions as

an alternative system of adjudicating consumer disputes via

summary proceedings. That is the whole purpose of providing

for a separate three tiered system comprised of a District

Forum, State Commission and the National Commission

which would provide inexpensive and speedy remedies to

consumers. In creating those fora, the legislature required the

fora to arrive at conclusions based on reasons following the

rules of natural justice. He also submitted that while enacting

the Consumer Protection Act, Parliament was fully aware that

the provisions of the CPC were available for the trial of a claim

of a consumer dispute, yet, in its wisdom, Parliament decided

not to apply the procedure provided in the CPC to the

proceedings under the Act. Instead, Parliament chose to apply

only limited provisions of the Code of Civil Procedure to the

complaints to be entertained under the Act. Specifically, in

Sections 13 (4), (5) and (6), the Act explicitly provided for

20

limited applicability of the provisions of Code of Civil

Procedure.

33. Mr. Khanna further submitted that the Act is a special

statute enacted to provide remedies to a special class of

litigants, namely the consumers, by a special procedure

provided for under the statute, instead of the usual procedure

set forth under the Code of Civil Procedure.

34. The learned counsel for the respondent also submitted

that the general legal principle of statutory interpretation of

generalia specialibus non-derogant and generalibus specialia

derogant applied. That is, if a special provision is made on a

certain matter, that matter is excluded from the general

provision. Mr. Khanna also stated that these principles have

been applied by this Court in resolving the disputes between

two Acts as well as in the construction of statutory rules and

statutory orders. Mr. Khanna referred this Court's decision in

the case of Ghaziabad Zila Sahkari Bank Ltd. v. Addl.

Labour Commissioner and Others (2007) 11 SCC 756. In

para 61 of that judgment, this Court held that the Uttar

Pradesh Cooperative Societies Act, which is a complete code in

itself regarding employment in cooperative societies, and its

21

machinery and provisions will have overriding effect on the

general Act, the Uttar Pradesh Industrial Disputes Act, 1947.

Thus, the Industrial Disputes Act was held to have no

applicability and to be excluded after enforcement of the Uttar

Pradesh Cooperative Societies Act, which was a later and a

special Act. Similarly, this Court in the case of Maruti Udyog

Limited v. Ram Lal and Others (2005) 2 SCC 638 in para 42

observed as under:

"42. In Solidaire India Ltd. v. Fairgrowth

Financial Services Ltd. and Others [(2001) 3 SCC

71], it is stated:

9. It is clear that both these Acts are

special Acts. This Court has laid down in

no uncertain terms that in such an event

it is the later Act which must prevail. The

decisions cited in the above context are

as follows: Maharashtra Tubes Ltd. v.

State Industrial & Investment Corpn.

of Maharashtra Ltd., Sarwan Singh v.

Kasturi Lal; Allahabad Bank v.

Canara Bank and Ram Narain v.

Simla Banking & Industrial Co. Ltd.

10. We may notice that the Special Court

had in another case dealt with a similar

contention. In Bhoruka Steel Ltd. v.

Fairgrowth Financial Services Ltd. it

had been contended that recovery

proceedings under the Special Court Act

should be stayed in view of the provisions

of the 1985 Act. Rejecting this

contention, the Special Court had come

to the conclusion that the Special Court

22

Act being a later enactment would

prevail. The headnote which brings out

succinctly the ratio of the said decision is

as follows:

Where there are two special statutes

which contain non obstante clauses

the later statute shall prevail. This

is because at the time of enactment

of the later statute, the Legislature

was aware of the earlier legislation

and its non obstante clause. If the

Legislature still confers the later

enactment with a non obstante

clause it means that the Legislature

wanted that enactment to prevail. If

the Legislature does not want the

later enactment to prevail then it

could and would provide in the later

enactment that the provisions of the

earlier enactment would continue to

apply."

35. Mr. Khanna also submitted that the Act is a special and

a later Act which will prevail over the provisions of the CPC,

which is a general and previous statute. He submitted that

the Act is a complete Code in itself as regards the disputes

covered under it. As such, the general statute i.e. CPC can

have no applicability and stands excluded after the enactment

of the Act.

36. Mr. Khanna further contended that the Carriage by Air

Act, 1972 (hereinafter referred to as `Air Act') again is a special

23

Act regarding international carriage. The Air Act was enacted

to give effect to the Convention for unification of Rules relating

to international carriage by air signed at Warsaw on

12.10.1929, as amended by Hague Protocol dated 28.9.1955

and the Montreal Convention dated 28.9.1999. India enacted

this Act as it is a signatory to the Warsaw Convention of 1929

governing the liabilities of air carrier in respect of international

carriage of passengers, baggage and cargo by air. The

preamble of the Air Act reads as under:

"An Act to give effect to the convention for the

unification of certain rules relating to international

carriage by air signed at Warsaw on the 12th day of

October, 1929 and to the said Convention as

amended by the Hague Protocol on the 28th day of

May, 1999 and to make provision for applying the

rules contained in the said Convention in its

original form and in the amended form (subject to

exceptions, adaptations and modifications) to non-

international carriage by air and for matters

connected therewith."

37. Section 2 (ii) of the Air Act defines "Convention" to mean

Convention for unification of certain rules relating to

international carriage by air signed at Warsaw on 12.10.1929.

Section 2 (ii) reads as under:

"2 (ii) Convention means the Convention for the

unification of certain rules relating to international

carriage by air signed at Warsaw on the 12th day of

October, 1929."

24

38. Section 3 of the Air Act provides that the Rules contained

in the first schedule (the provisions of the Convention relating

to the rights and liability of the carriers, passengers,

consignors and other persons), shall have the force of law in

India with respect to any carriage by air to which these rules

apply, irrespective of the nationality of the air craft performing

the carriage. Sub-Section 2 of section 3 provides that the high

contracting parties to the Convention and date of enforcement

of the said Convention shall be such as are included in Part-I

of the Annexure. Section 3 reads as under:

"3. Application of Convention to India:

(1) The rules contained in the First Schedule,

being the provisions of the Convention

relating to the rights and liabilities of

carriers, passengers, consignors, consignees

and other persons shall, subject to the

provisions of this act, have the force of law in

India in relation to any carriage by air to

which those rules apply, irrespective of the

nationality of the aircraft performing the

carriage.

(2) For the purpose of this Act, the High

Contracting Parties to the Convention and

the date of enforcement of the said

Convention shall be such as are included in

part-I of the Annexure-1.

25

(3) Any reference in the first schedule to the

territory of any High Contracting Party to the

Convention shall be construed as a reference

to all the territories in respect of which he is

a party.

(4) Any reference in the first schedule to agents

of the carrier shall be construed as including

a reference to servants of the carrier.

(5) The Central Government may, having regard

to the objects of this act, and if it considers

necessary or expedient so to do, by

notification in the official gazette, add to, or,

as the case may be, omit from, Part I of the

Annexure, any High Contracting Party and on

such addition, or as the case may be,

omission, such High Contracting Party shall

be or shall cease to be, a High Contracting

Party."

39. Section 7 of the Air Act provides that every high

contracting party to the Convention, shall for the purpose of

any suit brought in a court in India in accordance with the

provisions of rule 28 of the first schedule or of the second

schedule as the case may be to enforce a claim in respect of

the carriage undertaken by him be deemed to have submitted

to the jurisdiction of that Court and to be a person for purpose

of Code of Civil Procedure, 1908. Section 7 reads as under:

"7. Provisions regarding suits against High

Contracting Parties who undertake carriage by

Air: (1) Every High Contracting Party to the

Convention or the amended Convention, as the case

26

may be, who has not availed himself of the

provisions of the Additional Protocol thereto shall,

for the purpose of any suit brought in a Court in

India in accordance with the provisions of rule 28 of

the First Schedule, or of the Second Schedule, as

the case may be, to enforce a claim in respect of

carriage undertaken by him, be deemed to have

submitted to the jurisdiction of that Court and to be

a person for the purpose of the Code of Civil

Procedure, 1908.

(2) The High Court may make rules of procedure

providing for all matters which may be expedient to

enable such suits to be instituted and carried on.

(3) Nothing in this section shall authorize any

Court to attach or sell any property of a High

Contracting Party to the Convention or to the

amended Convention."

40. The First Schedule to the Act vide Rule 1 provides that

the Rules under this Schedule shall apply to all international

carriage of persons, luggage or goods, performed by aircraft for

reward. Sub Rule 2 defines the "High Contracting Party". Sub

Rule 3 defines International Carriage. The provisions of Rule 1

read as under:

"Rule1: (1) These rules apply to all international

carriage of persons, luggage or goods, performed by

aircraft for reward. They apply also to such carriage

when performed gratuitously by an Air Transport

undertaking.

(2) In these rules, "High Contracting Party" means

a High Contracting Party to the Convention.

27

(3) For the purposes of these rules the expression,

"international carriage" means any carriage in

which according to the contract made by the

parties, the place of departure and the place of

destination, whether or not there be a break in the

carriage or a transshipment, are situated either

within the territories of two High Contracting

Parties, or within the territory of a single High

Contracting Party, if there is an agreed stopping

place within a territory subject to the sovereignty,

suzerainty, mandate or authority of another power,

even though that power is not a party to the

Convention. A carriage without such an agreed

stopping place between territories subject to the

sovereignty, suzerainty, mandate or authority of the

same High Contracting Party is not deemed to be

international for the purposes of these Rules."

41. Rule 2 of these Rules, provides that these rules apply to

carriage performed by the State or by legally constituted public

bodies. Rule 2 reads as under:

"2. (1) These rules apply to carriage performed

by the State or by legally constituted public

bodies provided it falls within the conditions

laid down in rule 1.

(2) These rules do not apply to carriage

performed under the terms of any

International Postal Convention."

42. Rule 18 provides for liability of the carrier for damages

and Rule 19 provides for liability of the carrier for damages

occasioned by delay. Rule 18 and 19 read as under:

28 "18. (1) The carrier is liable for damage sustained in

the event of the destruction or loss of, or of

damage to, any registered luggage or any

goods, if the occurrence which caused the

damage so sustained took place during the

carriage by air.

(2) The carriage by air within the meaning of

sub-rule (1) comprises the period during which

the luggage or goods are in charge of the

carrier, whether in any aerodrome or on board

an aircraft, or, in the case of a landing outside

an aerodrome in any place whatsoever.

(3) The period of the carriage by air does not

extend to any carriage by land, by sea or by

river performed outside an aerodrome. If,

however, such a carriage takes place in the

performance of a contract for carriage by air,

for the purpose of loading, delivery or

transshipment, any damage is presumed,

subject to proof to the contract, to have been

the result of an event which took place during

the carriage by air.

19. The carrier is liable for damage occasioned by

delay in the carriage by air of passengers,

luggage or goods."

43. Rule 28 provides for Territorial Jurisdiction for suing for

damages which reads as under:

"28. An action for damages must be brought at the

option of the plaintiff either before the Court

having jurisdiction where the carrier is

ordinarily resident, or has his principal place

of business, or has an establishment by which

the contract has been made or before the

Court having jurisdiction at the place of

destination."

29

44. As per the Annexure to the Air Act under Section 3 sub

Section 2, Part-I, vide entry 47, Ethiopia is a High Contracting

Party to the Convention w.e.f. 12.11.1950.

45. A bare perusal of the aforesaid rules in the First

Schedule, which has the force of law as per Section 3 of the

Air Act, read with Section 7 leaves no room or doubt that a

state carrier or legally constituted public body of the

international carrier is deemed to have submitted to the

jurisdiction of the courts in India, including for the purpose of

the Code of Civil Procedure, 1908.

46. Mr. Khanna also submitted that even otherwise Section

86(2) of the CPC provides that the consent of the Central

Government can be given with respect to a specified suit or to

several specified suits or with respect to all suits of any

specified class or classes. Section 86 of the CPC reads as

under:

"86. Suits against foreign Rules, Ambassadors

and Envoys: (1) No foreign state may be sued

in any Court otherwise competent to try the

suit except with the consent of the Central

Government certified in writing by a Secretary

to that Government:

30

Provided that a person may, as a tenant of

immovable property, sue without such consent

as aforesaid (a foreign State) from whom he

holds or claims to hold the property.

(2) Such consent may be given with respect

to a specified suit or to several specified suits

or with respect to all suits of any specified

class or classes, and may specify, in the case

of any suit or class of suits, the court in which

(the foreign state) may be sued, but it shall not

be given, unless it appears to the Central

Government that (the foreign State) -

(a) has instituted a suit in the Court against

the person desiring to sue (it), or

(b) by (itself) or another, trades within the local

limits of the jurisdiction of the Court, or

(c) is in possession of immovable property

situated within those limits and is to be

sued with reference to such property or for

money charged thereon, or

(d) has expressly or impliedly waived the

privilege accorded to (it) by this section."

47. Thus, the provisions of Section 7 of the Air Act read with

Rules in the first schedule makes it clear that there is a

consent deemed to be granted by the central government

contemplated under Section 86(1) of Code of Civil Procedure

for a specified class of suits under the Air Act.

31 48. Mr. Khanna also referred to Section 3 of the Act and

submitted that the provisions of this Act shall be in addition to

and not in derogation of the provisions of any other laws for

the time being in force.

49. This Court in the case of Patel Roadways Limited

(supra) has considered this question and has laid down that

the Disputes Redressal Agency provided for in the Act will

have jurisdiction to entertain complaints in which the claim

for loss or damage of goods entrusted to a carrier for

transportation is in dispute. This Court also noted that the

term "suit" in Section 9 of the Carriage Act was applicable

both the cases filed in the Civil Court and to proceedings

before the National Commission that decides the complaints

by consumers following summary procedure. Mr. Khanna

further contended that the view taken by this Court in Patel

Roadways Limited (supra) has been affirmed by the

Constitution Bench of this Court in the case of Economic

Transport Organisation, Delhi v. Charan Spinning Mills

Private Limited and Another (2010) 4 SCC 114. In paras 53

to 57 of that case, this Court observed as under:

32 "53. Section 14(1)(d) of the Act provides that the

Forum under the Act can direct payment of

compensation awarded by it to the consumer

for any loss or injury suffered by the consumer

due to the negligence of the opposite party.

This, according to the appellant, makes it

mandatory for the complainant to establish

negligence on the part of the opposite party i.e.

the carrier. It is further contended that

presumption of negligence under Section 9 of

the Carriers Act, 1865 (which provides that in

any suit brought against a common carrier for

the loss, damage or non-delivery of the goods

entrusted to him for carriage, it shall not be

necessary for the plaintiff to prove that such

loss, damage or non-delivery of goods was

owing to the negligence or criminal act of the

carrier, his servants and agents) is applicable

only to a civil suit, and not to a complaint

under the Act which specifically contemplates

establishment of negligence by evidence. It is

submitted that in this case the compensation

has been awarded even though no evidence

was led by the complainants about negligence

of the driver of the appellant.

54. It is no doubt true that Section 14(1)(d) of the

Act contemplates award of compensation to

the consumer for any loss suffered by the

consumer due to the negligence of the opposite

party (the carrier). Section 9 of the Carriers Act

does not lay down a proposition that a carrier

will be liable even if there was no negligence on

its part. On the other hand, it merely raises a

presumption that when there is loss or damage

or non-delivery of goods entrusted to a carrier,

such loss, damage or non-delivery was due to

the negligence of the carrier, its servant and

agents. Thus where the consignor establishes

loss or damage or non-delivery of goods, it is

deemed that negligence on the part of the

33

carrier is established. The carrier may avoid

liability if it establishes that the loss, damage

or non-delivery was due to an act of God or

circumstances beyond its control. Section

14(1)(d) of the Act does not operate to relieve

the carrier against the presumption of

negligence created under Section 9 of the

Carriers Act.

55. The contention of the appellant that the

presumption under Section 9 of the Carriers

Act is available only in suits filed before civil

courts and not in other civil proceedings under

other Acts, is not tenable. This Court in Patel

Roadways Ltd. (supra) has observed: (SCC

pp. 106-07, paras 47, 48 & 49)

The principle regarding the liability

of a carrier contained in Section 9 of the

Carriers Act, namely, that the liability of

a carrier is that of an insurer and that in

a case of loss or damage to goods

entrusted to the carrier the plaintiff need

not prove negligence, are applicable in a

proceeding before the Consumer Forum.

The term "suit" has not been defined in

the Carriers Act nor is it provided in the

said Act that the term "suit" will have the

same meaning as in the Civil Procedure

Code. Therefore, the term "suit" has to be

understood in its ordinary dictionary

meaning. In that sense, term "suit" is a

generic term taking within its sweep all

proceedings initiated by a party for

realisation of a right vested in him under

law. It is true that a proceeding before

Consumer Forum is ordinarily a

summary proceeding and in an

appropriate case where the Commission

feels that the issues raised are too

contentious to be decided in summary

proceedings it may refer parties to a civil

34

court. That, however, does not mean that

proceedings before the Consumer Forum

is to be decided by ignoring the express

statutory provisions of the Carriers Act in

a proceeding in which a claim is made

against a common carrier. A proceeding

before the Consumer Forum comes

within the sweep of term "suit".

56. Again, in Economic Transport Organization

v. Dharwad District Khadi Gramudyog

Sangh (2000) 5 SCC 78 this Court reiterated

the principle stated in Patel Roadways and

added the following: (Economic Transport

case (supra) SCC p. 79, para 2)

"2. ... Even assuming that Section 9

of the Carriers Act, 1865 does not

apply to the cases before the

Consumer Fora under the

Consumer Protection Act, the

principle of common law

abovementioned gets attracted to all

these cases coming up before the

Consumer Fora. Section 14(1)(d) of

the Consumer Protection Act has to

be understood in that light and the

burden of proof gets shifted to the

carriers by the application of the

legal presumption under the

common law. Section 14(1)(d) has to

be understood in that manner. The

complainant can discharge the

initial onus, even if it is laid on him

under Section 14(1)(d) of the

Consumer Protection Act, by relying

on Section 9 of the Carriers Act. It

will, therefore, be for the carrier to

prove absence of negligence."

57. We reiterate the said settled position and reject

the contention of the appellant that the

presumption under Section 9 of the Carriers

35

Act is not available in a proceeding under the

Consumer Protection Act and that therefore, in

the absence of proof of negligence, it is not

liable to compensate the respondents for the

loss."

50. Mr. Khanna further submitted that in the case of

E.I.C.M. Exports Ltd. v. South Indian Corporation

(Agencies) Ltd. and Another 2009 (10) SCALE 22, this Court

has held firstly that the cases filed before the consumer forum

are not suits within the meaning of Section 9 of CPC and

secondly the limitation of two years for filing a case under the

Act as provided vide Section 24 (A) of the Act will be applicable

instead of Article III, Clause 6 of the schedule of the Indian

Carriage of Goods by Sea Act, 1925, which provides for

limitation of one year extendable by three months at the

discretion of the Court. According to learned counsel for the

respondent there is no conflict between the judgments of this

Court in the cases of E.I.C.M. Exports (supra) and Patel

Roadways Limited (supra). According to him the provisions

of Carriage by Air Act, 1972 have to be read into the provisions

of the Act.

51. We have heard learned counsel for the parties and

carefully perused relevant cases cited at the Bar. The Central

36

Question which requires adjudication is whether the appellant

Ethiopian Airlines is entitled to sovereign immunity in this

case?

52. The short question which falls for our adjudication is

whether the proceedings before the Consumer Forum are

suits.

53. The term "suit" has not been defined in the Carriage by

Air Act, 1972 nor is it provided in the said Act that the term

"suit" will have the same meaning as in the Civil Procedure

Code. Therefore, the term "suit" has to be understood in its

ordinary dictionary meaning. In that sense, the term "suit" is a

generic term taking within its sweep all proceedings initiated

by a party for realisation of the right vested in him in law. In

this view of the matter, we have to look to the dictionary

meaning of the word "suit".

54. According to Black's Law Dictionary, the word "suit"

means "any proceeding by a party or parties against another in

a court of law."

55. In common parlance, the term "suit" is taken to include

all proceedings of a judicial or quasi-judicial nature in which

37

the disputes of aggrieved parties are adjudicated before an

impartial forum. Proceedings before the Consumer fora fall

squarely within that definition.

56. It has been held in Patel Roadways Limited (supra) that

proceedings before the Consumer Forums come within the

sweep of the term "suit". This judgment has been approved by

a Constitution Bench of this Court in Economic Transport

Organization (supra). Therefore, the controversy involved in

this case is finally settled and we are bound by the decision of

the Constitution Bench and this case has to be ruled in terms

of what has been decided by the Constitution Bench in

Economic Transport Organisation (supra).

57. In the same vein, the U.S. Supreme Court has read the

term "suit" broadly, finding that a "suit" is "any proceeding in

a court of justice by which a person pursues therein that

remedy which the law affords him," Upshur County v. Rich,

135 US 467 (1890). Likewise, "the modes of proceeding may

be various, but if a right is litigated between parties in a court

of justice, the proceeding by which the decision of the court is

sought is a suit." Id. The Michigan Supreme Court similarly

38

found that "the word ["suit"], as applied to legal controversies,

both by the legal profession and others, is now used and

recognized as a generic term of broad significance, often

understood and used, even by legislatures and courts, to

designate almost any proceeding." Patterson v. Standard

Accident Insurance Co., 178 Mich. 288. The proceedings

held before the consumer redressal fora easily fall within the

aforementioned definitions : these are proceedings in which

consumers may pursue the remedies afforded to them by the

Consumer Protection Act and other laws and where the rights

of the parties are fully litigated by an organ of justice.

58. However, notwithstanding the fact that proceedings of

the National Commission are "suits" under the Carriers Act,

vide the expressio unius principle, The Consumer Protection

Act, 1986 clearly enumerates those provisions of the CPC that

are applicable to proceedings before the consumer fora. Such

provisions include 13(4), in which the Consumer Protection

Act, 1986 vests those powers vested in a civil court under the

CPC to the District Forum. However, according to the principle

of expressio unius, because the legislature expressly made the

aforementioned provisions of the CPC applicable to the

39

consumer proceedings, the legislature is, therefore, deemed to

have intentionally excluded all other provisions of the CPC

from applying to the said proceedings. This is particularly true

since, as explained above, the Consumer Protection Act, 1986

sets forth an exhaustive list of procedures, distinguishable

from those required under the CPC, that the consumer

redressal fora must follow. Therefore, since the Consumer

Protection Act does not state that Section 86 applies to the

consumer fora's proceedings, that Section of the CPC should

be held to be not applicable.

59. Likewise, the CPC itself does not claim to make Section

86 applicable to proceedings before the consumer fora.

Instead, the CPC includes a saving clause, providing that "in

the absence of any specific provision to the contrary, nothing

in [the CPC] shall be deemed to limit or otherwise affect any

special.... law ... or any special form of procedure prescribed,

by or under any other law..." In addition, Section 86 only

applies to a "suit in any Court". This term should be

understood differently than the term "court" discussed above

because the CPC refers exclusively to Civil Courts. In

particular, the CPC specifically refers to the District Courts,

40

the High Courts, and the Supreme Court and makes little if

any reference to other, quasi-judicial fora like the consumer

redressal bodies at issue here. This interpretation has been

approved by the Supreme Court, in H.H. The Maharana

Sahib Shri Bhagwat Singh Bahadur of Udaipur (supra). In

that case, the Apex Court found that the phrase "sued in any

Court" must be strictly construed and confined to "suits

proper" and thus held that Section 86 did not bar

adjudication of an industrial dispute in an industrial

Tribunal. Similarly, in Nawab Usmanali Khan v.

Sagarmal, AIR 1965 SC 1798, this Court found that Section

87(B) does not apply to proceedings under the Arbitration Act.

Similarly, Section 86 and 87 should be found inapplicable to

the consumer redressal fora's proceedings at issue here.

60. Moreover, Section 86 of the CPC is inapplicable because

the legislative intent is deem to exclude older and more

general statute by more recent and special statutes : the

Consumer Protection Act, 1986 and the Carriage by Air Act,

1972. And, under these Acts, Ethiopian Airlines is not entitled

to sovereign immunity in a suit like that at issue here. Thus,

consent of the Central Government is not required to subject

41

Ethiopian Airline to suit in an Indian court, let alone in a

consumer redressal forum.

61. In Ratan Lal Adukia and Another v. Union of India,

AIR 1990 SC 104, the Apex Court found that Section 80 of the

Railways Act, 1890, substituted 1961, was a special provision

and self-contained code and that it impliedly repealed in

respect of suits covered by it the general provisions of the

CPC. The Railways Act provides for a forum in which a suit for

compensation for loss of life of, or personal injury to, a

passenger for loss, destruction, damage, deterioration or non-

delivery of animals or goods against a railway administration

may be brought. This is very much akin to the fora created by

the Consumer Protection Act. Thus, a similar finding should

be made here : the Consumer Protection and Carriers Acts

must be deemed special Acts bypassing Section 86 of the CPC,

with respect to suits covered by those special Acts.

62. That is, the Consumer and Carriage Acts, which came

long after the CPC, are more focused and specific statutes,

and therefore should be held to exclude Section 86. The

Supreme Court has previously found as such, holding that in

42

the fora created by the Consumer Act, "the provisions of the

Code of Civil Procedure are applicable to a limited extent and

not all the provisions of the Code of Civil Procedure are made

applicable to the proceedings of the National Forum." Rather,

rules created pursuant to the Consumer Act itself govern the

procedure to be followed in the consumer fora. Similarly, a

Constitutional Bench of this Court, in Economic Transport

Organisation (supra) found that even though the consumer

redressal fora utilized summary proceedings, that "does not

mean that proceedings before the Consumer Forum [are] to be

decided by ignoring the express statutory provisions of the

Carriers Act in a proceeding in which a claim is made against

a common carrier."

63. In view of the Constitution Bench judgment in Economic

Transport Organisation (supra) the view which has been

taken by the two-Judge Bench of this Court in E.I.C.M.

Exports (supra) is wholly untenable and unsustainable in law.

64. Section 86 of the Code of Civil Procedure is inapplicable

to the present case because the older and more general statute

has been excluded by more recent special statute, namely,

43 Consumer Protection Act, 1986 and the Carriage by Air Act,

1972. Ethiopian Airlines is not entitled to sovereign immunity

in the suit at issue in the present case. Therefore, any other

consent of the Central Government is not required to subject

the appellant, Ethiopian Airlines, to a suit in an Indian Court.

65. It is settled principle of statutory interpretation that

specific statutes that come later in time trump prior general

statutes. Both the Consumer Protection Act, 1986 and the

Carriage by Air Act, 1972, which came long after the Code of

Civil Procedure, 1908, are more focused and specific statutes

and therefore should be held to supersede Section 86 of the

Code. This Court in Savita Garg (supra) has clearly laid down

that the principle that in fora created by the Consumer Act,

the provisions of the Code of Civil Procedure are applicable

only to a limited extent, therefore, the provisions of the Code of

Civil Procedure have not been made applicable to the

proceedings of the National Consumer Forum.

66. This court in Vishwabharathi House Building Coop.

Society and Others (supra) dealt with the object of the

Consumer Protection Act, 1986 : to provide expeditious

44

adjudication of consumers' complaints by adopting summary

procedure. The Consumer Protection Act, 1986 is a

comprehensive and self-contained piece of legislation, and its

object is to decide consumers' complaints expeditiously, via

summary procedure. The Consumer Protection Act, 1986 also

permits authorized agents to appear on behalf of the

complainants in order to ensure that they are not burdened

with the heavy professional fees of lawyers.

67. Similarly, the Carriage by Air Act, 1972 explicitly

provides that its rules apply to carriage performed by the State

or by legally constituted public bodies under Chapter 1,

Section 2, Sub-section 1. Thus, it is clear that according to

the Indian Law, Ethiopian Airlines can be subjected to suit

under the Carriage Act, 1972. It may be pertinent to mention

that the Carriage by Air Act, 1972 (69 of 1972) is an Act to

give effect to the Convention for the unification of certain rules

relating to international carriage by air signed at Warsaw on

the 12th day of October, 1929 and to the said Convention as

amended by the Hague Protocol on the 28th day of September,

1955 and to make provision for applying the rules contained

in the said Convention in its original form and in the

45

amended form (subject to exceptions, adaptations and

modification) to non-international carriage by air and for

matters connected therewith.

68. In effect, by signing onto the Warsaw Convention,

Ethiopia had expressly waived its Airlines' right to immunity

in cases such as that sub judice. Therefore, the Central

Governments of both India and Ethiopia have waived that

right by passing the Carriage by Air Act, 1972 and by signing

onto the Warsaw Convention.

69. In accordance with the interpretation set forth above, the

Bombay High Court has noted that Section 86 is of only

limited applicability and can be overcome in cases of even

implied waiver. For example, in The German Democratic

Republic v. The Dynamic Industrial Undertaking Ltd., AIR

1972 Bombay 27, the Bombay High Court found that Section

86 does not supplant the relevant doctrine under International

Law. Rather, Section 86 "creates another exception" to

immunity (emphasis added), in addition to those exceptions

recognized under International Law. Likewise, in Kenya

Airways v. Jinibai B. Kheshwala, AIR 1998 Bombay 287,

46

the Bombay High Court found that, while Kenya Airways was

a state entity prima facie entitled to immunity under Section

86, it had nevertheless waived that immunity by, in its written

statements, failing to raise a plea of sovereign immunity under

Section 86 of the CPC. Therefore, in that case, the Bombay

High Court found that Kenya Airways was not entitled to

sovereign immunity and could be subjected to suit in an

Indian court.

70. Ethiopian Airlines is not entitled to sovereign immunity

with respect to a commercial transaction is also consonant

with the holdings of other countries' courts and with the

growing International Law principle of restrictive immunity.

For instance, in England, in Rahimtoola v. H.E.H. The

Nizam of Hyderabad and Others (1957) 3 All E.R. 441, Lord

Denning found that "there was no reason why [a country]

should grant to the departments or agencies of foreign

governments an immunity which [the country does] not grant

[its] own, provided always that the matter in dispute arises

within the jurisdiction of [the country's] courts and is properly

cognizable by them." Lord Denning also held that "if the

dispute concerns... the commercial transactions of a foreign

47

government... and it arises properly within the territorial

jurisdiction of [a country's] courts, there is no ground for

granting immunity," finding implicitly that it would not "offend

the dignity of a foreign sovereign to have the merits of such a

dispute canvassed in the domestic courts of another country."

71. Likewise, in Trendtex Trading Corporation Ltd. v.

Central Bank of Nigeria (1977) 1 All E.R. 881, the Court held

that the Central Bank of Nigeria was not entitled to plead

sovereign immunity because, according to International Law

Principle of restrictive immunity, a state-owned entity is not

entitled to immunity for acts of a commercial nature, jure

gestionis. The Court noted that "if a government department

goes into the market places of the world and buys boots or

cement - as a commercial transaction - that government

department should be subject to all the rules of the market

place." The Court also noted an "important practical

consideration." stating that foreign sovereign immunity, "in

protecting sovereign bodies from the indignities and

disadvantages of that process, operates to deprive other

persons of the benefits and advantages of [the judicial] process

in relation to rights which they posses and which would

48

otherwise be susceptible to enforcement." As the court stated,

the principle of restrictive immunity is "manifestly better in

accord with practical good sense and with justice."

72. On careful analysis of the American, English and Indian

cases, it is abundantly clear that the appellant Ethiopian

Airlines must be held accountable for the contractual and

commercial activities and obligations that it undertakes in

India.

73. It may be pertinent to mention that the Parliament has

recognized this fact while passing the Consumer Protection

Act, 1986 and the Carriage by Air Act, 1972. Section 86 was

itself, a modification and restriction of the principle of foreign

sovereign immunity and thus, by limiting Section 86's

applicability, the Parliament through these acts, further

narrowed a party's ability to successfully plead foreign

sovereign immunity. In the modern era, where there is close

interconnection between different countries as far as trade,

commerce and business are concerned, the principle of

sovereign immunity can no longer be absolute in the way that

it much earlier was. Countries who participate in trade,

49

commerce and business with different countries ought to be

subjected to normal rules of the market. If State owned

entities would be able to operate with impunity, the rule of law

would be degraded and international trade, commerce and

business will come to a grinding halt. Therefore, we have no

hesitation in coming to the conclusion that the appellant

cannot claim sovereign immunity. The preliminary objection

raised by the appellant before the court is devoid of any merit

and must be rejected.

74. The controversy involved in this case is no longer res-

integra. This Court in Patel Roadways Limited (supra)

clearly observed that a proceeding before the Consumer Forum

comes within the sweep of term "suit". Again this Court in

Economic Transport Organization (supra) reiterated the

principle stated in Patel Roadways Limited (supra). Both

these judgments have been specifically approved by the

Constitution Bench of this Court in Economic Transport

Organization (supra). The view which has been taken in

E.I.C.M. Exports (supra) is clearly contrary to the view taken

by the Constitution Bench judgment in Economic Transport

Organization (supra) and the same cannot be sustained.

50 75. We are of the considered view that the impugned order

passed by the National Commission is untenable so far it held

that the proceeding before the Consumer Forum does not

come within the sweep of term "suit" because it is contrary to

the judgment of the Constitution Bench of this court in

Economic Transport Organization (supra). The finding of

the National Commission is accordingly set aside to that

extent. However, we agree with the findings of the National

Commission so far as it has remitted the matter to the State

Commission for adjudication. In the facts and circumstance of

this case, we direct the State Commission to dispose of the

case as expeditiously as possible.

76. This appeal is accordingly disposed of, leaving the parties

to bear their own costs.

.......................................J.

(Dalveer Bhandari)

.......................................J.

(Dr. Mukundakam

Sharma)

.......................................J.

51

(Anil R. Dave)

New Delhi;

August 9, 2011

*****