A Shipper (exporter/supplier) of the goods normally hires a freight forwarder (forwarding agent) or Non-Vessel Operating Common Carrier (NVOCC) in order to arrange transportation of his goods to a foreign destination. Once receiving cargo from shipper freight forwarder inspects the cargo to verify that the consignment received by them is without damages. The freight forwarder after inspection of goods and necessary completion of customs formalities in respect of goods received from shipper releases House Bill of Lading (HBL) to the shipper. Thus, the House Bill of Lading (HBL) is issued by freight forwarder/NVOCC is an assurance to the shipper that the consignment received is damage-free and is ready to be shipped to the consignee. However, if the HBL specifies that the consignment was damaged at the time of receiving, it becomes the liability of the shipper.
The freight forwarder then books cargo space with to main carriers who are vessel owners. With the House Bill of lading, the carrier can warrant that he is carrying the goods legally. House Bill is non-negotiable unless there are already conditions incorporated. The holding or receiving authority shall be as per the conditions that are incorporated.
The main carriers, once cargo received, issues the Bill of Lading to whom the cargo booked with him. This is called the Master Bill of Lading (MBL). In a master bill of lading, the shipper will be the freight forwarder who delivers the cargo to the main carrier and the consignee. HBL is normally issued as per the terms and conditions of the Multi-model Transport Document Act 1993. Multimodal transportation means carriage of goods, by at least two different modes of transport under a multimodal transport contract, from the place of acceptance of the goods in India to a place of delivery of the goods outside India. The “multimodal transport contract” means a contract under which a multimodal transport operator undertakes to perform or procure the performance of multimodal transportation against payment of freight. “Multimodal transport document” means a negotiable or non-negotiable document evidencing a multimodal transport contract and which can be replaced by electronic data interchange messages permitted by applicable law. The Multimodal Transportation of Goods Act, 1993 (amended in 2000), also defines a carrier as a person who performs or undertakes to perform for hire, the carriage or part thereof, of goods by road, rail, inland waterways, sea, or air.
The delivery of the consignment to the consignee by the multimodal transport operator shall be treated as prima facie evidence of delivery of the goods as described in the multimodal transport document unless notice of the general nature of loss of, or damage to, the goods is given, in writing, by the consignee to the multimodal transport operator at the time of handing over of the goods to the consignee.
Where the loss or damage is not apparent, the provisions of sub-section (1) shall apply unless notice in writing is given by the consignee of the loss of, or damage to, the goods within six consecutive days after the day when the goods were handed over to the consignee. The responsibility of the multimodal transport operator for the goods under this Act shall cover the period from the time he has taken the goods in his charge to the time of their delivery.
Under the above act, “delivery” means,—
(i) in the case of a negotiable multimodal transport document, delivering of the consignment to, or placing the consignment at the disposal of, the consignee or any other person entitled to receive it;
(ii) in the case of a non-negotiable multimodal transport document, delivering of the consignment to, or placing the consignment at the disposal of, the consignee or any person authorised by the consignee to accept delivery of the consignment on his behalf;
(g) “Endorsee” means the person in whose favour an endorsement is made, and in the case of successive endorsements, the person in whose favour the last endorsement is made;
(h) “endorsement” means the signing by the consignee or the endorsee after adding a direction on a negotiable multimodal transport document to pass the property in the goods mentioned in such document to a specified person;
In summary, the bill of lading issued by the freight forwarder to the shipper is called the house bill of lading, and the bill of lading issued by the Carrier to the forwarder is called the Master Bill of Lading when they take control of the goods. The freight forwarder or the NVOCC acts only as of the Ocean Transport Intermediary. A bill of lading is a legal document that serves three vital purposes in the shipping process: as a receipt for shipping, as a title of goods, and as a contract of carriage. A house bill of lading is always a receipt for a shipment from one exporter, while a master bill of lading is a receipt that could potentially cover the shipments of many exporters, as they are consolidated by the carrier into a larger shipment.