What is the Indian Bills of Lading Act 1856?

The Indian Bills of Lading Act 1856 is legislation the British colonial Government passed in India during the mid-19th century. It is an essential law regarding most of the international trading activities in India. It outlines all the guidelines regarding informed trade practices.

Curious to know more about the Indian Bills of Lading Act? Keep reading for a comprehensive overview.

The Government passed the Indian Bills of Lading Act of 1856 to establish rules and regulations regarding its governance to issue all essential documents used in international trade. It helped confirm the receipt of goods and establish contractual terms between a shipper and a carrier.

Moreover, this bill’s purpose was to provide a legal framework and clarify the rights and obligations of shippers, carriers, and consignees.

The three different sections of the Indian Bills of Lading Act 1856 are as follows:

Section 1: Rights Under this Bills of Lading Act is to Vest in Endorsee or Consignee

Every goods’ consignee and endorsee, whose name this bill of lading contains or to whom the property in the goods mentioned shall pass upon or because of such endorsement or consignment shall be transferred and consigned to all rights suited to them. On the other hand, such endorsements or consignments can be subject to liabilities regarding goods in this contracted bill of lading as if made with them.

Section 2: Not to Affect any Right of Freight Claims or Transit Stoppage

Nothing can affect any right to claim freight or stoppage in transit against its original shipping owner. Besides, any liability of an endorsee or consignee or their goods’ receipt by reason or in consequence of such endorsement or consignment cannot affect such rights. 

Section 3: Bill of Lading in the Hands of Endorsee or Consignee, etc., Conclusive Evidence on behalf of the Shipment, being an Against Master, etc.

Every bill of lading that a consignee or endorsee consists of for valuable consideration should have this shipment’s conclusive evidence against any person who is signing for the same. However, remember that you cannot ship such goods or their parts unless its bill holder gets an actual notice. Here is a better explanation of this idea:

A holder or any other assigned person in charge may release them as a result of such misrepresentation. For this, they must show that there was no fault on their part. The total fraud came from a shipper or anyone a holder claims to be faulty while conducting certain activities.

The importance and objective of the Indian Bills of Lading Act 1856 are as follows:

1. Helps in determining ownership of the mentioned goods, by supporting it as a legal document to its respective holder.
2. Acts as a contract of carriage by holding specific terms and conditions, involving the transportation of the goods mentioned in the respective bill. 
3. Serves as an evidence, disclosing the shipment details of the goods mentioned in the respective bill.

There are two different types of the Indian Bills of Lading Act 1856, which are as follows:

1. Original Bill of Lading: The Original Bill of Lading is a primary document, mandatory while transporting goods via seaways. While receiving an order or delivery of respective cargo, the buyer or consignee needs to present this bill to its supplier in order to release its shipment. This bill has three main functions: to act as a contract of carriage, a title document affording ownership, and a transport goods receipt. 
2. Seaway Bill: The Seaway Bill is another legal document that is important while transporting cargo via sea route. It is necessary when a shipper or supplier immediately decides to release a cargo or consignment ownership to its buyer or consignee. With this bill, the assigned buyer can pick up their respective cargo or consignment without presenting any document stating ownership. It is also proof of a carriage’s contract and transports a good receipt, although it has no title to give to the goods.Although the Indian Bill of Lading Act of 1856 came out more than 150 years ago, it continues to have relevance in modern international trade. This Act provides specifications regarding the prime evidence of all goods’ receipt for their carrier. It also discusses the status of goods to be transferred by endorsement and delivery. Moreover, it looks into the rights and obligations of consignees, shippers, and carriers with respect to the goods. Additionally, it establishes penalties for all violations and frauds carried out against the Act.