The appellant was engaged in imports and exports. The appellant sent cargoes containing fruits and vegetables from Mumbai, India, to Canada by employing the services of the respondent, British Airways, in 2010. However, the cargoes were damaged for various reasons and had to be destroyed. The appellant instituted a lawsuit on 15 September 2012 before the City Civil Court, Mumbai, for recovery. The respondent argued, among other things, that the suit was barred by limitation. The trial Court held in favour of the appellant, applying s 18 of the Limitation Act 1963 (the Limitation Act) to allow for an extension of time. The High Court of Bombay reversed that decision on appeal, holding that the Carriage by Air Act 1972 (the Air Act), being a later and special statute, overrode the Limitation Act.

The appellant appealed to the Supreme Court.

Held: Appeal dismissed. The Air Act does not allow for an extension of time beyond the two-year period provided for in the relevant international Conventions. The Air Act expressly excludes the applicability of the Limitation Act. The appellant's claim is therefore time-barred.

A similar issue as in the present case arose for consideration in East & West Steamship Company v SK Ramalingam Chettiar AIR 1960 SC 1058, where this Court had to consider the third clause of art 3.6 in the Schedule to the Carriage of Goods by Sea Act 1925, wherein, while interpreting the expression 'discharged from all liability', this Court held:

The question we have to decide is whether in saying that the ship or the carrier will be 'discharged from liability', only the remedy of the shipper or the consignee was being barred or the right was also being terminated. It is useful to remember in this connection the international character of these rules, as has been already emphasized above. Rules of limitation are likely to vary from country to country. Provisions for extension of periods prescribed for limitation would similarly vary.

We should be slow therefore to put on the word 'discharged from liability' an interpretation which would produce results varying in different countries and thus keeping the position uncertain for both the shipper and the shipowner.

Quite apart from this consideration, however, we think that the ordinary grammatical sense of 'discharged from liability' does not connote 'free from the remedy as regards liability' but are more apt to mean a total extinction of the liability following upon an extinction of the right. We find it difficult to draw any reasonable distinction between the words 'absolved from liability' and 'discharged from liability' and think that these words 'discharged from liability' were intended to mean and do mean that the liability has totally disappeared and not only that the remedy as regards the liability has disappeared.

We are unable to agree with the learned Judge of the Madras High Court that these words merely mean that 'even though the right may inhere in the person who is entitled to the benefits, still the liability in the opposite party is discharged by the impossibility of enforcement'. The distinction between the extinction of a right and the extinction of a remedy for the enforcement of that right, though fine, is of great importance. The Legislature could not but have been conscious of this distinction when using the words 'discharged from all liability' in an article purporting to prescribe rights and immunities of the shipowners. The words are apt to express an intention of total extinction of the liability and should, specially in view of the international character of the legislation, be construed in that sense. It is hardly necessary to add that once the liability is extinguished under this clause, there is no scope of any acknowledgment of liability thereafter.