1. This is an application under Article 227 of the Constitution of India for setting aside an order passed by Sri S. P. Chatterjee Chief Presidency Magistrate, Calcutta, directing recovery of a sum of Rs. 98.54 p. as wages together with a further sum of Rs. 138 as double pay for non-payment, under Section 145(1) of me Merchant Shipping Act, 1958 at the instance of Narain Singh, Engine Room, 2nd Tindal, holding C. D. Book No. 19421. The opposite parry No. 1, Narain Singh worked on board the ship S. S. Indian Splendour owned by the petitioner from June 22nd, 1964 to 1st December, 1964 when he was discharged at the port of Calcutta. Narain Singh claimed a sum of Rs. 1105 as wages for 5 months 9 days besides leave pay for a sum of Rs. 34.50 and Rs. 138 for 10 days' double pay for non-payment, total claim being laid at Rs. 1277.50 p. He also prayed for return of his C. D. C. The claim was contested on behalf of petitioner Messrs India Steamship Company Ltd. They admitted that a sum of Rs. 98.54 was due after deduction of money taken by him from time to time during the voyage and then claimed that this was deposited with the shipping master, Calcutta under the provisions of the Merchants Shipping Act pending final decision regarding a fine imposed on the crew members by the customs authorities at Bombay.
Their case appears to be that S. S. 'Indian Splendour' arrived in Bombay from Continental Ports via Aden on November 3rd, 1964 and anchored in stream. A party of customs officers proceeded in stream shortly after the arrival of the ship to carry out a search of the vessel. As they were in the process of boarding the ship, they noticed a large number of packages, some of which were in card-board packing, being thrown overboard from the vessel through various portholes in the deck and the Engine Crews' quarters on board the vessel. While some of the packages so jettisoned which were still afloat were retrieved by the customs officer, others which had sunk into the sea could not be retrieved. The retrieved packages were taken on board the ship where they were opened. On examination by the customs officers in the presence of the Master and the chief officer of the vessel, these packages were found to contain 152 dozen 'Bonus' playing cards valued at Rs. 4,560 on import and at Rs. 10,944 at the local market rate. These were seized by the customs officers. Later, on search of S. S. 'Indian Splendour' the customs officers received 144 cigarette lighters valued at Rs. 144 on import and at Rs. 576 at the local market rate from various places in the vessel. The owner-chip of the articles could not be established and these were also seized. Legal proceedings were then started by the Customs and by an order dated January 7, 1965, the Additional Collector of Customs confiscated the vessel with an option to pay in lieu of compensation a fine to the extent of Rs. 2,00,000 by the owners of the vessel and also imposed a personal penalty of Rs. 1,000 on the crew members under Section 112 of the Customs Act, 1962.
2. The petitioner, Messrs India Steamship Company Ltd. was of the view that the Articles of Agreement which govern the terms of service and conditions of employment of the crew including the petitioner Narain Singh contain a clause by which any fine imposed by the customs authority can be recovered by the Master from the crew. The shipping company therefore addressed to the Shipping Master, Calcutta while depositing the balance of wages of the entire crew amounting to Rs. 12,000 and odd, that the sum should be forfeited in part satisfaction of the financial loss incurred by the company as a result of wilful negligence and unlawful conduct on the part of the crew members. It claimed that it was entitled to deduct or retain the entire sum of wages under the terms of the agreement between the parties as also under the provisions of law.
3. The Shipping Master, Calcutta was also made a party and he filed a separate written statement supporting the above stand taken by the shipping company. He stated that a sum of Rs. 19.23 was the proportionate share of the personal penalty imposed by the Customs on the crew members and that a sum of Rs. 79.31 was due to the opposite party but the payment of this amount was withheld pending final decision of the matter by the Director General of Shipping, Bombay to whom the whole matter was referred.
4. The relevant clause of the agreement upon which the company claimed its right to recover the fine imposed by the customs authorities reads as follows :--
'And the said crew jointly and severally agree that in case any contraband goods be found on board, and a fine be imposed by the Customs authorities in respect of the same, the amount of such fine shall be recoverable from the wages of the owners or owner of the goods; but if the Master be not satisfied as to whom the goods belong, such fine shall, at the discretion of the Master be recoverable rateably according to the rates of their wages, either from that portion of the crew belonging to the department in which the contraband goods shall have been discovered, or from the whole crew.'
5. The learned Magistrate found on a reference to the wage bill itself that a sum of Rs. 98.54 was due plus such other sum as the court might award on ground of non-payment so far. The learned Magistrate also recorded that the learned Advocate for the petitioner Narain Singh, at the time of the argument, did not press for recovery of any balance beyond this sum.
6. The question that arose before the learned Magistrate was whether the sum of Rs. 98.54 was liable to further deduction on account of any fine imposed by the Customs in the circumstances stated above and whether this amount or any part of it could be withheld pending a departmental decision. The learned Magistrate also repelled the argument that the particular clause in the agreement was repugnant to the statute itself and I entirely agree with the view expressed by the learned Magistrate. Section 195 of the Merchants Shipping Act 1958 relates to conviction of a seaman for an offence of smuggling whereby loss or damage caused is to the master or owner of the ship and provides that the seaman would be liable to pay that master or owner a sum sufficient to reimburse the loss or damage and the whole or a part of his wages may be retained in satisfaction on account of that liability without prejudice to any other remedy. This has reference to a court of law as distinguished from adjudication and imposition of penalty and confiscation by customs authority. This section contemplates the existence of other remedies and therefore does not prohibit incorporation of analogous penal provision by agreement between the parties. The next Section 196 of the Act speaks of any act of misconduct for which offender's agreement imposes a fine and of entries to be made of the offence in the Log Book while Section 201 of the Act indicates that the question arising out of such a provision can be determined otherwise than by a criminal proceeding. The learned Magistrate was therefore right in holding in the circumstances of the case that the particular clause in the Articles of Agreement earlier quoted is not repugnant to the statute.
7. The learned Magistrate however found that the procedure to be followed for enforcement of a fine arising out of such a clause has been indicated in Section 196 of the Act. He then found that the Log Book was not properly kept and that the entries produced in this case bore signatures of the master and the mate only hut not of any member of the crew. He, there fore, held that the requirements of law were not fully complied with and the possibility that the petitioner was not given a reasonable opportunity to defend himself could not be altogether ruled out and further deduction could not be permitted. He also held that there was no provision in the Act itself or the rules by which payment could be withheld pending a decision by the Director General of Shipping. Eventually he held that the opposite parties failed to make the payment to the petitioner according to Section 129(a) of the Act without reasonable cause and he therefore allowed double payment of wages for 10 days. He however rejected the prayer for return of the C. D. C. as he had no power to give such a direction under the law.
8. The principal argument advanced by Mr. Ajit Kumar Dutta, learned Advocate for the petitioner is firstly that the provisions of Section 196 applied when the fine was imposed by the master of the ship and not in the present case where the fine was imposed by the customs authorities and secondly that in any case, Section 196 was merely procedural and for failure to observe it punctiliously, the bar under Clause (d) of Section 196 would apply The relevant portion of Section 196 reads as follows:
If any offence within the meaning of this Act of desertion or absence without leave or against discipline is committed, or If any act of misconduct is committed for which the offender's agreement imposes a fine and it is intended to enforce the fine,--
(a) an entry of the offence or act shall bemade in the official log book and signed by themaster, the mate and one of the crew; ... .'The provisions of Section 196 relate to a casewhere it is intended to enforce a fine imposedby the master for offences, enumerated in thesection or any act of misconduct for which anoffender's agreement imposed the fine. Thisobviously is necessary to see how far the imposition of fine is justified and whether anyopportunity was given to the members of thecrew concerned for explaining the offencescharged with. In the present case however thefine or penalty was imposed by the customsauthority for jettisoning goods from board theship and the customs authorities acted under theprovisions of the Customs Act and imposed thefine. The application before the learned Magistrate was under Section 145(1) which is a summary proceeding for wages. The section provides that a seaman may, as soon as any wages due to him become payable, apply to any magistrate exercising jurisdiction at or near the place at which he has been discharged and the magistrate shall try the case in a summary way ma the order made by the magistrate in the matter shall be final. There is no scope for adjudication in regard to the penalty imposed by the customs authorities; there is also no dispute that the balance of wages was due to the seaman and the only question is whether the penalty imposed including the personal penalty could be distributed to the seaman concerned under the agreement subsisting between the master and the seamen. The provisions of Section 196 relate to imposition of fine by the master for breach of the terms of agreement also and a look at the terms of agreement shows that the master may impose fine for various offences which are enumerated under the agreement under the heading 'Regulations for maintaining discipline sanctioned by Govt. in pursuance of Section 28(2)(g) of the Indian Merchant Shipping Act, 1923 (21 of 1923)'. The clause 'if any act of misconduct is committed for which the offender's agreement imposes a fine' in Section 196 relates to such fines imposed by the Master under the agreement sanctioned under the Merchant Shipping Act but it does not cover a case where penalty is imposed under the Customs Act by the customs officials, for their act is not under scrutiny by the magistrate in an application under Section 129 of the Act The agreement however provides for distribution of fines imposed by customs authorities or the members of the crew and the petitioner sought relief under the agreement. The company therefore relies upon the agreement earlier quoted and not on any of the specific provisions of the Merchant Shipping Act and that agreement has already been found to be not repugnant to the statute The learned Magistrate has not relied on the Log Book as the entries bore the signatures of the master and the mate only but not of any member of the crew in terms of the provisions of Clause (a) of Section 196. The agreement however speaks of attestation to be true by the signatures of the master and the mate or one or the crew. In the agreement therefore the provision is for the signatures of the master and the mate or one of the crew and therefore if the entries are signed by the roaster and the mate, then in terms of the agreement the entries are according to the requirements of law and the entries in the log book should not have been thrown out by the learned Magistrate.
9. Mr. Dutta has next argued that in any case Section 196 is not really a mode of recovery but only a rule of evidence and Sub-section (d) provides as follows:
'(d) in any subsequent legal proceedings the entries by this section required shall, if practicable, be produced or proved, and, in default of such production or proof, the court hearing the case may in its discretion, refuse to receive evidence of the offence or act of misconduct.'
Non-compliance with the requirements of Section 196(d) was not a bar to the plea. It al best raises a question of evidentiary value of the Log Book and the Magistrate is required to consider other evidence produced unless he had refused to produce any other evidence. I think, there is some force in the contention. Section 196 provides for entries in the Log Book and also the manner in which such entries have to be made and finally provides for its production in subsequent legal proceedings and lays down that in default of such production or proof, the court may in its discretion refuse to receive evidence of the offence or act of misconduct. All that this default empowers the court is to refuse to receive evidence of the offence or act of misconduct but it raises no presumption that the seamen were not given a reasonable opportunity to defend themselves. The learned Magistrates order refusing to take the Log Book into consideration is not therefore justified and apparently his order has resulted in failure of justice.
10. The next question that arises is in respect of the order directing double payment for 10 days. The company's case is that they have deposited the amount due with the shipping roister and therefore their liability ceased. It is true that they requested the shipping master to make deduction in terms of the agreement and the shipping master referred to the Director General of Snipping, Bombay. The question that arises therefore is whether this involves the company in a charge of non-payment and whether the master of the ship or the owner could be said to have failed without a reasonable cause to make payment at the time of the discharge. On this depends the crew's right to recover double pay upto a limit of 10 days' pay but this aspect does not appear to have been considered by the learned Magistrate. Section 125(2) of the Act provides that a true and full account of wages shall be delivered either to the seaman himself at or before the time of his leaving the ship or to the shipping master not less than twenty-four hours before the discharge or payment off. Section 128 (1) provides that where a seaman is discharged in India before a shipping master, he shall receive his wages through, or in the presence of, the shipping master unless a competent court directs otherwise. Section 128 provides for payment within 4 days after the seaman's discharge and Sub-section (2) of Section 129 further provides for payment of a sum not exceeding the amount of two days' pay for each of the days commencing from the date of discharge during which payment is delayed as the shipping master may in each case decide, but the sum so payable shall not exceed 10 days' double pay. Section 132 provides for decision of the dispute between crew of the ship or the master, owner or agent of the ship and it provides that such a dispute shall be submitted to the Shipping master where the amount in dispute does not exceed Rs. 300 at the instance of either party to the dispute. The dispute does not necessarily relate to wages due but is comprehensive enough to cover a case like this where the wages are affected by distribution of penalty imposed by Customs. The sum admittedly in the present case is below Rs. 300 and while depositing the entire amount with the shipping master a dispute was raised about the right or the company to deduct the penalty imposed by the customs authority under the provisions of the agreement earlier referred to. A deposit with the shipping master at the time of the discharge is therefore valid under the law and the company raised a dispute about the right to deduct a part of the wages in lieu of the fine imposed by the Customs authorities. This apparently is a dispute under the agreement between the crew and the shipping concern and Section 132 (1) therefore entitles the shipping concern to submit it to the shipping master for decision. The deposit with the shipping master at the time the discharge is valid under the law and lawful dispute may be raised under the provisions of Section 132 (1) and the owner or the agent therefore may claim not to have failed without reasonable cause to make payment at the time of the discharge. If the contentions of the company are accepted, the question of double payment does not arise.
11. Mr. Habibulla learned Advocate for the petitioner has referred to Section 201 and has argued that the company can take action under Section 201 and that there was no dispute to be referred to the shipping master under Section 132 (1). Section 201 relates to any question concerning the forfeiture of or deductions from the wages of a seaman or apprentice and provides that it may be determined in any proceeding lawfully instituted with respect to those wages. This relates to deductions and forfeitures under the authority of the master and the section provides that this plea may be raised in any proceeding at the instance of the crew for realisation of wages. That is an entirely different matter and has nothing to do with a case where penalty has been imposed by the customs authority for jettisoning contraband goods smuggled in the ship.
12. In deciding the claim by the O. P., therefore the learned Chief Presidency Magistrate should have taken into consideration the Log Book kept by the master of the ship and the petitioner's plea that they deposited the entire amount with the shipping master as there was a dispute and that there was no default on their part to entitle the opposite party to claim double payment.
13. The learned Chief Presidency Magistrate decided the claim under Section 145(1) of the Merchant Shipping Act and the law provides that the magistrate shall try the case in a summary way and the order made by the magistrate in the matter shall be final. This application is under Article 227 of the Constitution and this Court will not interfere except in cases of grave dereliction of duty and abuse of fundamental principles of law and justice and where grave injustice would be done unless the High Court interferes, This relates to recovery of seaman's wages but the validity of the agreement, the right to distribute the penalty imposed by Customs on the members of the crew, and other questions are involved. Though this claim was made by a single member of the crew, others are also involved and the learned Chief Presidency Magistrate's refusal to take the Log Book into consideration raises important questions and the decision in my view highly prejudices the shipping companies' right against members of crew indulging in smuggling.
14. The High Court should therefore interfere in exercise of its powers under Article 227 of the Constitution and set aside the order of the learned Chief Presidency Magistrate.
15. The learned Magistrate has himself found that acts of smuggling are acts constituting misconduct. The fines have admittedly been imposed -- both personal fines on members of crew as also fines on the shipping company and there are entries in the Log Book regarding jettisoning contraband goods by the crew from the ship, the refusal of the crew to admit being guilty persons, issuing of summons against them individually and statements taken from them and a declaration that the 'foregoing entries which deal with the crew have been read over to them and they have understood the same. The matter to be dealt with (sic) the Calcutta. A 'D. R.' will be given to all the crew living aft and the fine imposed will be recovered'. Then comes the following entry; Their reply -- they understood the foregoing entries . . .'.
16. The entries in the Log Book read with the findings of Customs Authority and the agreement with crew earlier referred to, entitles the shipping company to distribute the penalty Imposed on members of crew concerned and the O. P. Narain Singh was not therefore entitled to any order for recovery of salary, far less double payment and the order of the learned Chief Presidency Magistrate must therefore be set aside.
17. In the result, the learned Chief Presidency Magistrate's order allowing the claim forwages and further allowing double payment isset aside and the Rule is made absolute.