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Apl (India) Pvt. Ltd. Vs. Chairman, CochIn Port Trust and Others - Court Judgment

LegalCrystal Citation
CourtKerala High Court
Decided On
Case NumberW.A.No.2549, 2564, 2565, 2567, 2569, 2576, 2611, 2783, 2791 of 2002, O.P.No.21041 of 1999, W.P.(C)No.32191 of 2004
Judge
AppellantApl (India) Pvt. Ltd.
RespondentChairman, CochIn Port Trust and Others
Excerpt:
major port trusts act 1963 - sections 2(o), 3, 29, 30, 35, 37 to 39, 42, 42(3), 47a, 48(1)(d), 48, 49, 59 to 63, 60(1) and (2), customs act - sections 150 and 150(2), indian contract act 1872 - sections 151, 152 and 161 - writ appeal – the question of fact is - whether liability to pay ‘ground rent’ in respect of containers unloaded in the cochin port, lying uncleared by consignees - refused to be destuffed by the port, for inadequate storage space, can be mulcted on owners of vessel agents beyond 75 days - in view of the scheme of the statute (major port trusts act, 1963. p.r. ramachandra menon, j.- whether the liability to pay ‘ground rent’ in respect of the containers unloaded in the cochin port, lying uncleared by the consignees/importers and refused to be destuffed by the port, for inadequate storage space, can be mulcted on the owners of the vessel/steamer agents beyond 75 days, in view of the scheme of the statute (major port trusts act, 1963-in short ‘mpt act’) and the contents of the tamp (tariff authority for major ports) orders dated 10-11-1999, 19-7-2000 and 13-9-2005, is the point. 2. altogether nine writ appeals have been preferred against the common judgment dated 16-9-2002 in o.p. 9730 of 2000 and five other original petitions (total six original petitions). the above original petitions were filed by concerned.....
Judgment:

P.R. Ramachandra Menon, J.-

Whether the liability to pay ‘Ground Rent’ in respect of the containers unloaded in the Cochin Port, lying uncleared by the Consignees/Importers and refused to be destuffed by the Port, for inadequate storage space, can be mulcted on the owners of the Vessel/Steamer Agents beyond 75 days, in view of the Scheme of the Statute (Major Port Trusts Act, 1963-in short ‘MPT Act’) and the contents of the TAMP (Tariff Authority for Major Ports) Orders dated 10-11-1999, 19-7-2000 and 13-9-2005, is the point.

2. Altogether nine Writ Appeals have been preferred against the common judgment dated 16-9-2002 in O.P. 9730 of 2000 and five other original petitions (total six original petitions). The above original petitions were filed by concerned Shipping Agents mainly for destuffing the cargo and to release the containers; to stop appropriation of any amount towards ‘Ground Rent’ from the ‘pre-deposits’ effected by them and also to refund the excess amount appropriated. O.P. 21041 of 1999 is a similar petition (as amended) filed by another Shipping Agent; which however was omitted to be tagged along with the connected cases, when they are heard and decided as per the common judgment dated 16-9-2002.

3. Writ Appeals 2549, 2564, 2565, 2567, 2569 and 2576 of 2002 have been preferred by the Shipping Agents; while Writ Appeals 2783 and 2791 of 2002 have been preferred by the Port Trust challenging the verdict in O.P.Nos.9690 and 9648 of 2000 (in respect of the very same cause of action forming the subject-matter of Writ Appeals 2569 and W.A.2576 of 2002 respectively preferred by the concerned Shipping Agents). W.A. 2611 of 2002 has been preferred by the Consignee in respect of the verdict in O.P.9730 of 2000 (pertaining to the subject-matter involved in W.A. 2549 of 2002 preferred by the Shipping Agent against the very same verdict). W.P.(C) No.32191 of 2004 relates to a subsequent cause of action, involving a different commodity, but similar question of law. W.A. 2549 of 2002 is treated as the lead case.

4. Goods involved in all the cases, imported as ‘FCL’ (Full Container Loads) mainly consist of ‘synthetic woolen rags’, except in W.P.(C) No.32191 of 2004, where it is VCD players. The period of import is during August, 1998 to March, 1999. All the containers now stand returned after destuffing, pursuant to the common judgment in the Original petitions and the interim orders passed in the Appeals.

5. Some of the goods imported earlier in the Cochin Port, titled as “woolen rags” were actually found to be “brand new clothes” on inspection by the Customs Department, which attracted heavy duty, penalty and such other charges. The dispute between the Consignees and the Customs went on for an indefinite period and in the said circumstances, the Consignees did not turn up to clear the goods in respect of the subsequent transactions as well, presumably knowing the probable outcome and the huge liability to be satisfied under different heads including the Port charges and other dues because of the delay. So also, no action was taken by the Port Trust to destuff the goods and they retained the containers for their own reasons.

6. The stand of the Customs Department was that arrangements for inspection had to be made by the Consignee and unless the goods were destuffed by the Port Trust, no inspection/valuation was possible and that they had not prevented the Port Trust from destuffing. Despite the inaction/lapse of those concerned, including the Consignees/Importers, the Port Trust was conveniently appropriating ‘Ground Rent’ in respect of the containers from the ‘pre-deposits’ effected by the Shipping Agents, though the retention of containers was not because of any fault pointed out on the part of the Shipping Agents. This led to various writ petitions filed by the Shipping Agents, as aforesaid, culminating in the common judgment.

7. As per the common judgment, the learned Single Judge turned down the contention of the Shipping Agents that they were not liable to satisfy the ‘Ground Rent’ in respect of the containers, holding that only on issuance of the ‘Delivery Order’, would the ownership over the goods stand transferred to the consignee, leaving the dispute between the consignee and the Shipping Agents to be decided by way of Civil Suit/Arbitration (however, ordering destuffing in a phased manner); which led to the appeals preferred by the Shipping Agents. In two cases (O.P. Nos.9648 and 9690 of 2000), some wider relief was given, referring to the letters given by the Shipping Agents to cause destuffing and confining the liability till such date, which led to the appeals filed by both the concerned Shipping Agents and also by the Port Trust, to the extent they were aggrieved. The observation made by the learned Judge, that the dispute between the Consignee and the Shipping Agents had to be resolved by approaching the Civil Court or by invoking the remedy by way of Arbitration, based on the terms of the agreement in between, forms the subject-matter of challenge in W.A. 2611 of 2002 filed by the Consignees.

8. In W.P.(C) 32191 of 2004, though Delivery Order was issued to the Consignee, the Customs Department confiscated the cargo of VCD players for mis-declaration. Lien notice was issued by the petitioner/Shipping Agent to the Port Trust for Ground Rent and other charges appropriated from their account. Interim order was passed in the Writ Petition directing to earmark a sum of ` 3.6 lakhs from the sale proceeds, if the cargo was ‘sold in auction’. Later, the confiscation order was set aside by the CESTAT, Bangalore in the Appeal preferred by the Importer/Consignee and the goods were released to the Consignee, however without retaining the aforesaid ` 3.6 lakhs. Alleging violation of the interim order, Contempt Case No.515 of 2005 was filed, which however was closed, holding that, releasing the goods ‘to the Consignee’ would not amount to the violation of the interim order dated 18-11-2004 (since the cargo was “not auctioned”, but released to the Consignee). The issue that survives relates to return/refund of the Ground Rent charges appropriated from the account of the Shipping Agent.

9. Port Trust filed a counter-affidavit in O.P.9690 of 2000. As revealed from paragraphs 8 and 9, the crux of the contentions is that, from the date of destuffing, till the date of clearance, Ground Rent charges are levied and collected from the Importer/Consignee and that the Port is not legally obliged under any Act, Rule or Regulation to effect an expeditious destuffing of containers immediately on their arrival at the Port premises. Due to compelling reasons, such as shortage of storage space, the Port will not be in a position to destuff the containers, on which situation, it is the Consignee/Importer, who, after obtaining the delivery orders from the Steamer Agents and permission from the Customs authorities usually removes the containers to bonded warehouses, to be destuffed there and release the containers to the Vessel Owners/Agents. If the Consignee does not turn up, Ground Rent Charges is payable in respect of the containers, treating the Vessel Owners/Agents as the ‘owner’ of the goods entrusted to the Port till delivery order is presented in favour of the Consignee (with liberty to seek reimbursement from the Consignee/Importer). The Port had denied permission to destuff the containers within the Port premises, solely because they were facing acute storage space and it was impossible to store destuffed cargo in the premises. It is also stated that the Port is empowered under the ‘MPT Act’ to prescribe the scale of rates for the services provided by it to the persons concerned. The Port filed an additional affidavit dated 12-11-2001 stating that, it was open for the Consignee or the Steamer Agents to destuff the cargo in bonded warehouses to minimize payment of Ground Rent Charges; however conceding that the Port was aware of the identity of the importers, through the information furnished by the Clearing Agents. The Port filed an additional counter-affidavit dated 17-6-2002 as well, producing letters written by the Shipping Agents to retain the cargo till their consent was obtained/produced.

10. The Customs has filed statement/counter-affidavit in different cases, contending that destuffing of the goods is a matter which comes absolutely within the purview of the Port as stated by the petitioner; that the Customs had not prevented destuffing of the goods; that it is the responsibility of the Importer to arrange destuffing and present the goods for examination by the Customers; that the Customs actually wanted an earlier destuffing of the goods; that Exts.P-5 and P-6 Circulars issued by CBEC pertain to a situation where the cargo is detained by the Customs Department, which is not the position in the instant case, (as the goods have not been detained by the Customs); that no examination could be done as the goods were not destuffed for examination by the Port authorities and that the Customs have no objection in destuffing the cargo, which however is not the responsibility of the Customs.

11. It is contended by the Shipping Agents that without the consent of the Consignee, the containers cannot be shifted, nor can it be destuffed in the Warehouse at ‘Pettah’, as made clear by the Customs in Ext.P-3 letter dated 26-7-1999 and further that bonding of the cargo is being permitted by the Customs House only at the instance of the Consignee. As mentioned above, since the goods were not destuffed and containers were not returned even after months of discharge, Ext.P-1 letter dated 2-3-1999 was written by petitioner/Shipping agent to the Port, to auction the cargo. The relevant portion reads as follows:

“In this matter, we would request you to arrange to take custody of the cargo since these containers/cargo has been delinquent inside the Port for over 60 days and arrange to auction the cargo as per the Port’s Rules and Regulation.”

The Port sent Ext.P-4 reply dated 16-4-1999 stating that, in view of the nature of the cargo, the Customs will not allow the Port Trust to dispose of the cargo after destuffing and hence requested the petitioner to ‘pressurise the Customs’, to get in examined and auctioned. On receipt of the said reply, the petitioner sent Ext.P-19 letter dated 20-5-1999 to the Customs for immediate auction. The relevant portion reads as follows:

“In this matter, we would request you to arrange to take custody of the cargo since these containers/cargo has been delinquent inside the Port for over 60 days and arrange to auction the cargo as per the Port’s Rules and Regulation.”

This was followed by Ext.P-10 letter dated 9-6-1999 addressed to Customs. The relevant portion reads as follows:

“Even if you feel that these process is going to take a longer time, we would as an alternative, request you to permit us to move these containers to Pettah CWC-CFS and destuff the Cargo there.”

The Customs sent Ext.P-3 reply dated 26-7-1999 declining the request. The relevant portion reads as follows:

“On verification of records it is noticed that Bills of Entry have been filed by importer in all these cases and hence your submission that the cargo is delinquent is not correct.

As regards permission to move these containers to CWC-CFS, Pettah and to destuff the cargo there, same requires the concurrence of the importer.”

Based on the above proceedings, it is contended that all necessary steps were taken by the Shipping Agents, moving the Port and the Customs, to have the cargo destuffed, either in the Port premises or by taking out which was not agreed upon and that there was no fault or lapse on their part. Further, the Central Board of Excise and Customs, as per Circular 50/97/CUS dated 17-10-1997, had issued guidelines for disposal of unclaimed/uncleared cargo and for sharing the sale proceeds on the basis 50:50 between the Port and Customs in respect of the cargo landed prior to 31-12-1996. In view of severe congestion felt at all Ports, the same course was followed in respect of all the cargo landed till 31-12-1998 as well, as per Ext.P-7 Circular, holding that no charge would be levied on the Shipping Companies. It was issued as an interim administrative arrangement, also alerting the course to be pursued with reference to Section 150(2) of the Customs Act.

12. Sri Venkiteshwaran, the learned Senior Counsel, who led the arguments on behalf of the Shipping Agents, explaining the various provisions in different enactments connected with the issue and the binding judicial precedents on the point, asserted that the Port Trust was not justified in not destuffing the goods from the containers pursuing further steps within the stipulated time as provided under Section 61 and 62 of the Major Port Trusts Act (as enhanced to 75 days as per the relevant TAMP Orders) while continuing to collect the Ground Rent Charges on the containers from the running accounts maintained by the Steamer Agents beyond the above period. The learned Senior Counsel asserted that there was no much difference between the liability to satisfy ‘demurrage’ for the delay in clearing the goods which admittedly stands on the consignee and the liability sought to be satisfied in respect of the very same goods when it is kept in the containers lying in the Port premises, branding the same in a different name as ‘Ground Rent’. The learned Senior Counsel however submits that the concerned Appellants/Shipping Agents do not propose to press the contention as to the liability of the Steamer Agents in satisfying the Ground Rent; except the question that how long, can it be realized by the Port. With reference to Sections 61 and 62 and the contents of the relevant TAMP orders issued by the Tariff Authority for Major Ports, which is a statutory Body constituted under Section 47A of the Major Port Trusts Act, it is contended that the said liability can never exceed beyond 75 days and therefore there is no justification in raising further demand by the Port Trust and that the amount already collected in excess is liable to be refunded to the Steamer Agents.

13. Mr. Prasanth S. Prathap, the learned counsel appearing for the appellant in W.A. No.2567 of 2002 sought to supplement the arguments made by the learned Senior Counsel Mr. Venkiteshwaran and submitted that ‘container’ is only a device for storing and transporting the goods, which cannot by itself change the nature or obligation as to the liability to satisfy the rates payable in respect of the services rendered by the Port or in respect of the use of the premises/infrastructure made available by the Port. It was pointed out that the appellant, by their letter dated 12-2-2000 called upon the Port to sell the cargo as per the provisions of the Major Port Trusts Act, 1963, but no action was taken by the Port to destuff the containers and sell the cargo, which is contrary to the statutory duty on the Port to sell the goods by public auction which remained uncleared for a period exceeding 30 days. The learned counsel submitted that the provisions pertaining to cargo demurrage are clearly applicable here as well, since the services provided by the Port are in respect of the ‘goods’ kept in the containers, for which the Port is entitled to charge demurrage on the uncleared cargo as provided under Section 48(1)(d) of the Major Port Trusts Act; but not any Ground Rent charges, the container being only a device for the purpose of storage of cargo and the retention is only due to failure to clear the cargo and not due to failure to remove the container. The learned counsel further submits that it is the Bill of Lading in favour of the consignee or the endorsement thereon, that is relevant for deciding the ownership and not the delivery order; because the latter does not transfer any property in the goods.

14. Mr. Jayasankar Nambiar, the learned Standing Counsel appearing for the Port reiterated the submissions as given in the counter-affidavit, that the liability to pay Ground Rent was upon the Steamer Agents, till the goods were destuffed; that the Port was not in a position to permit destuffing for want of sufficient storage space; that it was open for the Shipping Agents to have moved the Customs for taking the containers to bonded warehouses or elsewhere, as prescribed, to minimize the amount payable to the Port; that there was no duty or obligation on the Port to effect destuffing of the cargo immediately on landing of the containers in the premises of the Port and that the Port was not in a position to proceed with sale of the goods for want of proper abandonment letters issued in this regard. It is also stated that the various TAMP Orders referred to and relied on by the Writ Petitioners/Shipping Agents prescribing/limiting the extent of liability pay Ground Rent charges to ‘60/75 days’, deal with a situation on abandonment of containers, which is not applicable to the case in hand.

15. Sri Venkiteshwaran, the learned Senior Counsel submitted that, the questions whether the Steamer Agent can be construed as ‘Owner’ of the goods carried in the vessel of their principal, coming within the purview of term ‘owner’ defined under Section 2(o) of the MPT Act and whether a ‘Steamer Agent’ can be made liable for payment of storage charges/demurrage in respect of the goods which are uncleared by the consignee, have already been referred by the Apex Court to be considered by a Larger Bench, as per the ruling rendered in Forbes Forbes Campbell and Co., Ltd. ((2008) 4 S.C.C. 87). The learned Senior Counsel submits that, the issue now pressed before this Court is not whether the appellants/Shipping Agents are bound to effect payment of any ‘Ground Rent’ charges for the failure on the part of the Consignee/Importer to clear the goods, but to what extent the liability can be mulcted on the shoulders of the Shipping Agents, in the light of the relevant TAMP Orders.

16. It is seen that the above case [(2008) 4 S.C.C. 87] originated from non-payment of `4752 which was still to be satisfied to the Port of Bombay (now Mumbai) in respect of the default in clearing the goods imported on 5-2-1972. Since the goods were not cleared, the Port issued letters to the Shipping agent to furnish the name and address of the Consignee and since it was not responded, the Shipping Agent was informed of the proposed sale, requesting the same to be communicated to the Consignee. Since no further steps were taken by the Shipping Agent, in spite of further notice asking to clear the goods within 10 days, satisfying the charges payable to the Port, the goods were sold in public auction on 2-9-1976, realizing a sum of `62,000, which was appropriated against the Port charges, Customs duty etc.; followed by filing a Civil Suit before the Court of Small Causes for realizing the balance amount of `4572 wherein the Shipping Agent was arrayed as the second defendant.

17. The Trial Court exonerated the Shipping Agent (second defendant) which however was reversed in appeal, finally leading to the appeal before the Supreme Court. Though the amount involved was trivial, the Apex Court observed that, having regard to the question of law of public importance involved in the appeal, the matter required to be considered at depth. The questions of law of public importance framed by the Apex Court were given in paragraph 9, which is extracted below:

(1) Whether a steamer agent can be construed as owner of the goods carried in his principal’s vessel within the definition of “owner” in relation to goods under Section 2(o) of the Major Port Trusts Act, 1963?

(2) Whether a steamer agent at all can be made liable for payment of storage charges/demurrage, which are uncleared by the consignee, even where steamer agent has not issued delivery order?

(3) In the event a steamer agent is held liable, to what extent he is liable and whether it absolves the respondent from acting promptly under Sections 61 or 62 of the Act?

Mr. Venkiteshwaran, the learned Single Counsel, who led the arguments in these cases on behalf of the Shipping Agents himself had addressed the Apex Court in the above case and sought to place much reliance on the decision rendered by the Apex Court in Trustees of the Port of Madras v. K.P.. Sheikj Mohd. Rowther and Co. Pvt. Ltd. and another ((1997) 10 S.C.C. 285), whereby it was held that the demurrage charges had to be collected by the Port Trust only from the Consignee and not from the Steamer Agent. The Apex Court doubted the correctness of the said judgment and accordingly referred the above questions of law to be considered by the Larger Bench.

18. In the above background, particularly, in the light of the submissions made by the learned Senior Counsel as to the issue involved, this Court finds it not necessary or proper to consider the above specific issues which are referred for consideration by the Larger Bench of the Apex Court. But, we find that the scope and power of the Tariff Authority for Major Ports constituted under Section 47A of the MPT Act brought into force w.e.f. 9-1-1997, to prescribe the scale of rates and conditions as specified under Sections 48 and 49 of the MPT Act and the effect of the various TAMP orders issued in this regard limiting the eligibility of the Port Trust to realize the Ground Rent (initially for the period of two months) in tune with the mandate under Section 61/62 of the Act, as per the TAMP Order dated 10-11-1999 and thereafter extending the same to ’75 days’ as per TAMP Order dated 19-7-2000; followed by the subsequent TAMP Order dated 13-9-2005 clarifying the position was not the subject-matter or the point highlighted. As such, the scope of consideration in these appeals/original petition/writ petition stands restricted to the scheme of the Statute and the effect of the TAMP Orders with regard to fixation/extent of liability on the Steamer Agents to pay the Ground Rent.

19. The sequence of events that led to the stalemate refers to the incidents which happened in 1998 when there were imports of synthetic woolen rags (in containers) in the Cochin Port Trust premises. The said containers were destuffed to facilitate Customs examination and to return the empty containers to the Steamer Agents. The destuffed cargo occupied much larger space and was not promptly cleared by the consignees in view of the hurdles placed by the Customs stating that the cargo actually did not constitute old woolen rags as declared, but mostly were brand new cloths which could not have been cleared. The ‘modus operandi’ of the consignees/importers attracted wide attention of all concerned and taking note of the probable extent of liability to be imposed by the Customs Department, and the liability to be satisfied to the Port and others concerned, the consignees did not turn up to clear the goods and they were lying idle in the Port premises for quite long. It was in the said circumstance, that the Port Trust denied permission to destuff any further containers, thus causing much loss and hardship to the owners of the containers/Steamer Agents for no fault on their side; more so, when the Port was conveniently appropriating the ‘Ground Rent’ from the running accounts maintained by the Steamer Agents with the Port.

20. The term ‘Ground Rent’ is not defined in the MPT Act and the source of authority to levy the same is stated as referable to Section 49(1)(d) of the said Act. Earlier, the right to prescribe the scale of rates for the services performed by the Board or other persons and to prescribe the statement of conditions under which the property/premises of the Board could be used, was vested with the Board of Trustees of the Port. Later, ‘Tariff Authority for Major Ports’ (‘TAMP’ in short) was constituted under Section 47A (incorporated w.e.f. 9-1-1997, bringing in a new Chapter as Chapter VA). It is by virtue of the said power conferred on the Tariff Authority for Major Ports that various ‘TAMP Orders’ have been issued on 10-11-1999 and 19-7-2000 respectively, which are heavily relied on by the concerned Appellants/Shipping Agents.

21. As per the first TAMP Order dated 10-11-1999, the time limit of ‘two months’ for levy of storage charge on abandoned FCL containers/shipper owned containers was prescribed. Based on the request from some of the Major Ports to review the said order, TAMP passed the order dated 19-7-2000 extending the time limit for levy of storage charge on abandoned containers to ’75 days’. The relevant provisions were made applicable uniformly at all Major Ports. It is stated that the provisions as above, also appear in clause 5.8.3 of the Tariff Guidelines announced by the Government, notified in the Gazette of India on 31-3-2005 and it has the status of a policy decision.

22. Meanwhile, complaints were received to TAMP from Steamer Agents’ Association as to the charging of Ground Rent by Cochin Port even beyond 75 days. On seeking clarification, the Cochin Port requested that the Port must not be insisted to destuff the cargo within the stipulated time in view of the practical difficulties. The main points raised by the Cochin Port Trust in the joint hearing stands summarized in paragraph 7.3 of the TAMP Order dated 13-9-2005, which includes the charging of Ground Rent beyond 75 days and non-issuance of delivery orders of Synthetic Rags by the Shipping Lines to the Consignees for non-satisfaction of the payments demanded from them (Sub-clause ‘vi’ and elsewhere). As observed in sub-clause ‘ix’ of paragraph 7.3, the Cochin Port requested the TAMP to amend its order by incorporating the following provisions:

“(a) the cargo items such as hazardous waste, perishable food items, etc., which cannot be destuffed in the port premises due to the very nature of the cargo, especially being FCL, the port trust shall not be insisted upon to destuff the containers till such time they are disposed of or removed by the shipping line or the consignee from the port premises.

(b) The cargo items brought into the country in contravention of the law of the land subjected to investigation by DRI, Customs, Environmental Agencies and restricted by PHO and Plant Quarantine officials, shall also not be insisted upon to be destuffed till such time they are cleared or disposed of from the port’s premises.”

After detailed deliberations, specific observations have been made in paragraph 11 of the said TAMP Order, wherein ‘lack of space’ pointed out by the Cochin Port as a reason to refuse destuffing the cargo from the containers is also referred to (Sub clauses vi, vii and ix). As per the said TAMP Order, the request of the Cochin Port was turned down, holding that there will be no change in the corresponding conditions/scale of rates of the Cochin Port; however clarifying that the TAMP has not passed any order making it mandatory for the Cochin Port to effect destuffing within 75 days, but has only stipulated that if it is not destuffed within 75 days, no Ground Rent will continue to run after 75 days and that’s all.

23. The contention of the Port is that the above TAMP Orders are not applicable, as they are only in respect of ‘abandoned containers’ and no letter of abandonment has been given to the Port, which however is vehemently rebutted by the petitioners/Shipping Agents pointing out that since the Consignees had not turned up, their conduct itself amounted to abandonment of the cargo. Further, it is pointed out by the Petitioners/Shipping Agents that the TAMP Order visualizes two circumstances in respect of Storage Rent collection; either ‘till the date of abandonment letter’ or ‘till the expiry of 75 days from the date of landing’, whichever is earlier. The petitioners/appellants also state that the word ’may’ as it appears under sections 61 and 62 of MPT Act has necessarily to be read and understood as ‘shall’ in view of the obligation of the Port to offer the service, subject to the rates/conditions as aforesaid. It is also contended by the petitioners/appellants that the liability to pay ‘demurrage’ is admittedly on the Importer/Consignee and keeping of the goods in the container, by itself, cannot till the balance.

24. Coming to the scheme of the Major Port Trusts Act, 1963, it was a statute brought in, for the constitution of Port authorities for certain major Ports in India including the Cochin Port and to vest the administration, control and management of such Ports in such authorities and for matters connected therewith. Constitution of the Board of Trustees is provided under Section 3 and the powers of the Board are prescribed under various provisions so as to give effect to the Act. Section 29 deals with the transfer of assets and liabilities of the Central Government and by virtue of sub-section (1)(a), all property, assets and funds and all rights to levy rates, vested in the Central Government or, as the case may be, any other authority for the purposes of the Port immediately before such day, shall vest in the Board.

25. However, by virtue of introduction of Chapter VA providing for constitution and incorporation of Tariff Authority for Major Ports under Section 47A with such other incidental provisions, the power vested with the Board especially, with regard to the right to prescribe the scales of rates for the services performed by the Board and also in respect of such other matters/conditions, came to be vested exclusively with the TAMP. This necessitated introduction of sub-section (3) as well as to Section 29 whereby, it was stipulated that notwithstanding anything contained in clause (a) of sub-section (1), the right to fix rates vested in the Board shall vest in the ‘TAMP’ as from the date it is constituted under sub-section (1) of Section 47A (i.e. 9-1-1997). Section 30 of the Act clearly stipulates that as from the appointed day, all rates, fees and other charges in relation to any Port, shall, unless and until they are varied by the competent authority, in accordance with the provisions of this Act, continue to be levied and collected at the same rate at which they were being levied and collected by the Central Government or, as the case may be, by any other authority immediately before such day.

26. Coming to Chapter V, apart from the power of the Board to execute the works and provide other appliances specified under Section 35, power is vested with the Board under Section 37 to order sea-going vessels to use docks, wharves etc. (When the works are completed with sufficient warehouses, sheds and appliances for receiving, landing or shipping goods or passengers, after obtaining the approval of the Collector of Customs and by notification published in the Official gazette, as prescribed). Section 38 further provides, if the accommodation is sufficient, all sea-going vessels to be compelled to use docks, wharves etc., by notification, after obtaining the approval of Collector of Customs and by notification to be published, as specified. Of course, the power is vested with the Central Government to give exemption from the operation of Sections 37 and 38 in appropriate cases.

27. With regard to the handling of Cargo and the service to be rendered by the Board, it is separately provided under Section 42, more particularly as described under sub-section (2), Board may, if so requested by the owner, take charge of the goods for the purpose of performing the service or services and shall give a receipt in such form as prescribed and it is also open for the Board to delegate such function authorizing any other person subject to such terms and conditions as agreed, subject to prior sanction obtained from the Central Government. As per sub-section (5), any such person shall, if so required by the owner, perform in respect of goods any of the said service and for that purpose take charge of the goods and give a receipt as prescribed. Sub-section (6) says that responsibility of any such person for the loss, destruction or deterioration of goods of which he has taken charge shall, subject to other provisions of this Act, be that of a bailee under sections 151, 152 and 161 of the Indian Contract Act, 1872, while sub-section (7) says that after any goods have been taken charge of and a receipt given as above, no liability for any loss or damage which may occur to them, shall attach to any person to whom a receipt has been given or to the Master or Owner of the Vessel from which the goods have been landed or transshipped.

28. As mentioned herein before, prior to the constitution of ‘TAMP’ under Section 47A (brought into force w.e.f. 9-1-1997), the power to prescribe the scale of rates for the service performed by the Board or other persons and so also to stipulate the scales of rates and statement of conditions for use of the property belonging to the Port absolutely vested with the ‘Board’. After introduction of Chapter VA giving shape to TAMP, such power came to be transferred to the said authority and the power vested with the Board was taken away including the authority to prescribe the fees for pilotage and certain other services, fixation of Port dues, consolidated rates for combination of services, port dues on vessels in ballast, port dues on vessels not discharging or taking in cargo, power to levy concessional rates in certain cases etc., as provided under various provisions in Chapter VI. The significant change made with regard to the ‘power of the Board’ and the scope of power of the ‘TAMP’ is the deletion of Section 52 from the statute; which earlier stipulated the necessity for ‘prior sanction’ of the Central Government, to specify the rates and conditions. In other words, when it was obligatory on the part of the Board earlier, to have obtained prior sanction from the Central Government to prescribe the rates and conditions, it was not necessary when the power was handed over to the TAMP w.e.f. 9-1-1997 onwards. The Central Government, however retained the power under Section 54 to require modification or cancellation of rates, whenever it was considered necessary, in public interest, so to do, by giving appropriate directions to TAMP, by virtue of necessary amendment brought into the said provisions.

29. To understand the relative rights and liabilities in a better manner, it is necessary to have a look into the provisions prescribing the ‘lien’ of different parties and the ‘priority’ in appropriation of the sale proceeds, as and when the goods are caused to be sold. Sections 59 and 60 of the MPT Act deal with the lien of the Board and that of the Ship owner respectively. Sub-section (2) of Section 59 says that the lien of the Board shall have priority over all other liens and claims, except for general average and for Ship owners’ lien upon the said goods for freight and other charges, where such lien exists and has been preserved in the manner provided in Sub-section (1) of Section 60 and for money payable to Central Government, under any law for the time being in force relating to Customs, other than by way of penalty or fine. Section 60 enables the Ship owner to have lien for freight and other charges subject to the condition that a notice is given in writing by the Master or Owner of any Vessel or his Agent, at or before the time of landing from such Vessel any goods which are to remain subject to a lien for freight or other charges payable to the Ship owner, while sub-section (2) of Section 60 stipulates that the goods shall be retained in the custody of the Board at the risk and expense of the owners of the goods until such lien is discharged and godown or storage rent shall be payable by the party entitled to such goods for the time during which they may be retained. The consequence which follows the failure to pay the rates or rent payable to the Port of the freight, is stipulated under Section 61; while Section 62 deals with the disposal of goods not removed from the premises of the Port within the time limit. Sub-section (1) of both the above Sections are relevant to the cases in hand and hence, are extracted below:

“61. Sale of goods after two months if rates or rent are not paid or lien for freight is not discharged.-(1) A Board may, after the expiry of two months from the time when any goods have passed into its custody, or in the case of animals and perishable or hazardous goods after the expiry of such shorter period not being less than twentyfour hours after the landing of the animals or goods as the Board may think fit, sell by public auction or in such cases as the Board considers it necessary so to do, for reasons to be recorded in writing, sell by tender, private agreement or in any other manner, such goods or so much thereof as, in the opinion of the Board, may be necessary-

(a) if any rates payable to the Board in respect of such goods have not been paid, or

(b) if any rent payable to the Board in respect of any place on or in which such goods have been stored has not been paid, or

(c) if any lien of any ship-owner for freight or other charges of which notice has been given has not been discharged and if the person claiming such lien for freight or other charge has made to the Board an application for such sale.”

“62. Disposal of goods not removed from premises of Board within time limit.-(1) Notwithstanding anything contained in this Act, where any goods placed in the custody of the Board upon the landing thereof are not removed by the owner or other person entitled thereto from the premises of the Board within one month from the date on which such goods were placed in their custody, the Board may, if the address of such owner or person is known, cause a notice to be served upon him by letter delivered as such address or sent by post, or if the notice cannot be so served upon him or his address is not known, cause a notice to be published in the Port Gazette or where there is no Port Gazette, in the Official Gazette and also in at least one of the principal local daily newspapers, requiring him to remove the goods forthwith and stating that in default of compliance therewith the goods are liable to be sold by public auction or by tender, private agreement or in any other manner:

Provided that where all the rates and charges payable under this Act in respect of any such goods have been paid, no notice of removal shall be so served or published under this sub-section unless two months have expired from the date on which the goods were placed in the custody of the Board.”

When the sale is conducted by virtue of the power under Section 61 or 62, as the case may, the sale proceeds are to be appropriated in the order of priority, as provided under Section 63, which gives precedence to claim of the Shipping Lines and those exempted under sub-section (2) of Section 59 from the priority of the lien of the Board, as specifically provided under sub-section (1)(b). The order of priority is ‘almost’ similar, when it comes to the sale at the instance of the Customs as well (pursuant to the steps under Section 48 of the Customs Act, 1962), in view of the clear stipulation recognizing the lien of the carrier towards freight and other charges, which gets top priority after meeting the expense of the sale as provided under Section 150 of the Customs Act specifying the manner of appropriation. To put it short, the scheme of the statute does not contemplate any liability to be satisfied by the Vessel Owner except to the extent as specified and the freight and other charges payable to them get top priority over other dues payable to the Government and also to the Port, if the lien is exercised in the manner as specified under Section (1) of Section 60.

30. The dispute involved in the instant cases pertains to the ‘Ground Rent’ Charges demanded/appropriated by the Port for retaining the goods kept in the containers at the Port premises, for the lapses on the part of Consignee/Importer in clearing the same on time. When the goods were sought to be destuffed by the writ petitioners/Shipping Agents, the stand of the Port was that they cannot do so for inadequacy of the space, since, once the goods are destuffed, it will occupy more space and will lie there uncleared because of the dispute between the Consignee/Importer and Customs, who, in turn asked the writ petitioner/Shipping Agents to ‘pressurise’ the Customs (vide Ext.P-4). When the writ petitioners/Shipping Agents approached the Customs for permission to take the containers to the warehouse at Pettah and to have it destuffed the, the Customs refused such permission saying that it can be done “only on request by the Importer/Consignee”. In short, because of the lapse on the part of the Importer/Consignee on one hand and the Port/Customs on the other hand, the writ petitioners/Shipping Agents were made to pay through their nose in respect of the alleged liability towards ‘Ground Rent’, keeping the containers without being destuffed in the premises of the Port, however, conveniently forgetting the loss caused to the Vessel Owners/Agents in respect of the non-return of the containers on time. The scope of the procedure prescribed under Sections 61 and 62, to have the goods sold by the Port, is to be analysed and appreciated in the above background.

31. Nowhere, has it been specified in the statutes or elsewhere that the Steamer Agents have a duty or liability to clear the goods from the custody of the Port, which in fact is the onus of the Consignee/their agents. This is more so since, as per the Bills of Lading Act, the ownership and title to the goods are vested on the Consignee or an endorsee of the Bill of Lading. Once the goods are landed in the Port premises, the same cannot be cleared by the Owners of the Vessel/Steamer Agents and their rights stand confined ‘only to the lien’ for freight and other charges to be exercised in conformity with Section 60(1) of the Major Port Trusts Act, which of course is having priority in the matter of satisfaction/appropriation in the event of sale of the goods, as provided; on pursuing the course stipulated under Section 61/62 of the Major Port Trusts Act or such similar course as contemplated under Section 48 of the Customs Act. In both the cases, the Shippers’ lien gets precedence and priority over any other dues/lien including the lien of the Port Trust or the amounts payable to the Customs/Government or under such other heads, except the expenses for the sale proceedings, which is the mandate under Section 63 of the MPT Act and Section 150 of the Customs Act.

32. By virtue of various provisions in the Customs Act, (like Sections 7, 8 and 33) and those under the MPT Act (like Sections 37 and 38), the Cochin Port area is a Customs approved place and the Vessels have to discharge their goods only at such places. Sections 61 and 62 of the MPT Act enable the Port to sell the cargo, if the rates/rent payable to the Port are not paid or the goods are not cleared within 30 days from the date of landing, to be effected after a period of two months, in the manner as specified. True, the expression given in the aforesaid provisions is ‘may’ and not ‘shall’; based on which a contention is raised by the Port that there is no obligation to destuff the goods immediately on landing. But considering the scheme of the statute, particularly the very purpose of the enactment and constitution of the Board of Trustees, the wide powers conferred on the Central Government to give effect to the various provisions of the Act, the transfer of assets and liabilities of the Central Government to the Board under Section 29 and other provisions as discussed already, it gives a clear idea that the Port Trust is bound to provide the various services in connection with the shipping activities as referred to under Section 42 of the MPT Act. The power fixed upon the Board to prescribe the scale of rates and the conditions in this regard was subsequently taken away and came to be vested with the Tariff Authority for Major Ports (TAMP), on amendment of the statute giving rise to the constitution of the said ‘Authority’ under Section 47A with effect from 9-1-1997. This being the position, it is not at all open for the Port to contend that it will not discharge the obligation in rendering the service in the requisite manner and will keep the goods in the containers till they are destuffed at their sweet will. The scope and authority of the TAMP as to the fixation of scale of rates and conditions has to be examined in the said circumstance.

33. There is no dispute for the Port with regard to the power vested with the TAMP to prescribe the scale of rates and the conditions as provided under Sections 48 and 49 of the MPT Act. It is in exercise of the power in this regard, that the scale of rates and the conditions were prescribed by the TAMP including as per the TAMP Order dated 10-11-1999, whereby it was stipulated that the storage charges could be levied on abandoned FCL containers for a maximum period of two months, beyond which the Port had no right to levy Storage Charge/Ground Rent. This in fact is in tune with the mandate of Sections 61 and 62 of the MPT Act, giving effect to the same. The said period was, subsequently extended, taking note of the request made by some of the Ports, to ’75 days’ as per the TAMP Order dated 19-7-2000. The said Order also stipulates that, in the absence of an abandonment letter, a ‘Line’ has no other option but to wait till the expiry of 75 days, for the Port to act under Section 61 of the MPT Act.

34. Coming to the chronology as to the line of judicial precedents, it was held by the Apex Court in, Trustees of the Port of Madras v. K.P.V. Sheikh Mohd. Rowther and Co. Pvt. Ltd. and another (1997 (10) S.C.C. 285), that demurrage charges, harbour dues etc. payable to the Port were to be satisfied by the ‘Consignee’ and not by the Steamer Agent. This was reiterated in the subsequent decision in Sun Export Corporation and anr. V. Board of Trustees of the Port of Bombay (1998 (1) S.C.C. 142) holding that such liability exclusively vested upon the consignee or the endorsee of the Bill of Lading. It was further made clear by the Apex Court in Board of Trustees of the Port of Bombay and others v. Sriyanesh Knitters (1999 (7) S.C.C. 359) that, by virtue of the definition of the term ‘owner’ under Section 2(o) of the MPT Act and the relevant provisions of the Bills of Lading Act, the consignee of the goods named in the Bills of Lading or every endorsee of the Bill of Lading for the purpose of MPT Act, is regarded as the owner of the goods and that, it is from the owner that the recovery of charges under the MPT Act is provided in respect of such goods. The Port being a statutory authority, cannot allow the goods to lay around simply stating that there is no obligation to sell the same, despite the default on the part of the Consignee/Importer to clear the same, as observed by the Apex Court in Om Shanker Biyani v. Board of Trustee, Port of Calcutta and others (2002 (3) S.C.C. 168) making it clear that such a course to have it sold on time, would have put to an end to the necessity to satisfy the demurrage, besides saving much valuable godown space, making available the same for further transaction. This is more so, in view of the further observation of the Supreme Court in Dwarkadas Marfatia and Sons v. Bombay Port Trust (1989 (3) S.C.C. 292), holding that the Port Trust is very much a “State” who cannot act arbitrarily even in contractual matters and must act to further/promote public interest. The terminology under Section 61/62 of the MPT Act incorporating the word ‘may’ has necessarily to be read and understood as a command (at least in restricting the liability as per the relevant TAMP orders), when discretion is conferred upon the Public Authority like Port Trust, who is coupled with an obligation to render the services as specified under the Act. This Court finds support from the law laid down by the Apex Court in State of Uttar Pradesh v. Jogendra Singh (A.I.R 1963 S. 1618).

35. It is true that the ‘MPT Act’ provides recovery of demurrage charges on uncleared goods. As the very word indicates, it refers to a failure on the part of the party concerned, who is bound to do or discharge certain act. As a natural consequence, the demurrage is fixed in such a manner so that, it will be unprofitable for the importers to use the Port premises as a warehouse, as made observed by the Apex Court in Board of Trustees of the Port of Bombay v. Jai Hind Oil Mills Co. and Others ((1987) 1 S.C.C. 648). Admittedly, demurrage is being realized from the Consignee, who becomes the owner of the goods by virtue of the Bill of lading in their name, which is in tune with the law declared by the Apex Court in The Board of Trustees of the Port of Bombay and others v. Sriyanesh Knitters (1999 (7) S.C.C. 359) (cited supra).

36. Coming to the question, as to who is to clear the goods from the Port premises, there cannot be any doubt that it is not for the Shipping Agents who do not have any ownership rights over the goods, but for the ‘lien’ under Section 60 in respect of freight and other charges, if the same is exercised in the manner as specified under sub-section (1) of Section 60. Such a lien can be established only if a notice in writing is given by the Master or Owner of the Vessel or his Agent, at or before the time of landing, from such vessel, any goods at the dock/prescribed landing place. This shows that this lien is only in respect of the amount mentioned in such notice, which by itself suggests that the Shipping Agent cannot be found fault with, in respect of the subsequent turn of events, either due to the default on the part of the Consignee or the lapses on the part of the Customs/Port in taking timely action.

37. The concept of ‘container shipping’ is of recent origin, as the handling and transportation of cargo in olden days was in bulk. The goods so unloaded in the port premises were to be cleared by the Consignee/Importer on the strength of the endorsement on the Bills of lading and on production of the delivery order from the Shipping Agents, subject to the satisfaction of the lien of the Owner of the Vessel on such cargo. The delay, if any, in clearing the cargo, as above, invited payment of demurrage, as provided, which was exclusively on the shoulders of the Consignee and not on the Vessel Owner/Shipping Agent. The goods, actually belong to the Consignee/holder of the Bill of lading on endorsement, whether it is lying in bulk or kept in the storage device by name ‘container’.

38. By the advent of container era, more and more goods were facilitated to be transported/handled, generating more income by all concerned including the Ports and also lesser expenses and lesser time for the Consignee/Importer. By virtue of the very nature of transaction in containers, the Port also could handle more cargo as the goods contained in containers occupied only lesser space, thus earning more revenue. In short, there was a symbiotic relationship between the Port and the Vessel Owners, whereby both the sides were being benefited to appropriate extent, enabling them to handle more cargo. The contention of the Port Trust that it was not possible to have the goods destuffed for want of sufficient storage space pops up for scrutiny in the above background, as the next point.

39. The case of the Port Trust is that, once the goods are destuffed, it will occupy much more space and the Port will not be in a position to handle more cargo. It is to be noted that all the containers in these cases landed between August, 1998 and March, 1999 and destuffing was completed only years later. Even though the judgment was passed on 16-9-2002, in some cases the Port continued to levy the ‘Ground Rent’ from the Steamer Agents till 2003-2004, when such course was intercepted as per the various interim orders passed in the concerned appeals. The Port also do admit that, if the goods were being imported as bulk cargo, the liability to satisfy the demurrage solely rests on the Consignee and not on the Steamer Agent. There is also no case for the Port Trust that they had issued any instruction as to reluctance to accept any particular type of cargo as involved in the present case (in view of the dispute with the Customs and the course and events leading to the apprehension of delayed clearance). On the other hand, the Port was accepting more and more cargo brought in and was simply generating funds by keeping the containers in the premises (towards ‘Ground Rent’) without resorting to any procedure under Sections 61 and 62 for causing the uncleared cargo to be sold in public auction, when the consignee did not turn up to clear the same within time.

40. The very nature of the pleadings raised by the Port confirms the position that, if the import was only as ‘bulk cargo’, it would have occupied more space and as such, would have limited the extent of operation and generation of revenue to a considerable extent. But by virtue of container shipping, more and more goods were packed in compressed form in the containers, whereby the output/volume of cargo being handled by the Cochin Port Trust happened to increase many fold, thus generating more income for the Port as well. When the Port used to accept more and more containers in spite of the alleged/admitted non-availability of “sufficient space” or infrastructure to store the same after destuffing, but for keeping such goods in the containers themselves, the Port was indirectly making use of the containers as their storage sheds, retaining the containers without paying any consideration to the Owners of the containers/Shipping Agent, at the same time charging Ground Rent for storing such containers. In other words, by retaining the containers without causing the goods to be destuffed, the Port was generating revenue by way of Ground Rent, for no fault of the Steamer Agents/owners of the containers/Vessels. If the Port were conscious as to the inadequacy of the storage space and lack of sufficient infrastructure, they should have limited their extent and area of operation, instead of accepting more and more containers, attempting to render ‘more and more service’ (which cannot but be a defective service). Had the Port been vigilant and prudent enough in handling the cargo, causing the uncleared cargo to be sold in public auction by virtue of the enabling provision under Section 61 and 62, they could have legally aspired generating more income under this head. If at all any hurdle was placed from the part of the Customs or any corners in this regard, they could have approached this Court as well, for appropriate relief. The lapse/laxity is more evident, when the Customs, in their counter-affidavit, contend that the destuffing was to be done by the Port Trust and that the Customs had not prevented the Port Trust from effecting the destuffing. The stand of the Port Trust, that there is no obligation for them, to have destuffed the goods as and when the containers are landed and that they can do it according to their whims and fancies, cannot be heard and appreciated as the version of a prudent management. More so, in view of the nature of the operation to be pursued in terms of the shipping activities contemplated under the Act, the restraints as to the landing places and the services to be rendered as provided therein, on payment of requisite fees/charges.

41. As mentioned already, the authority and power to prescribe the scale of rates and conditions as given under Sections 48 and 49 of Major Port Trusts Act stands exclusively vested with the TAMP constituted under Section 47A of MPT Act w.e.f. 9-1-1997. As per the relevant TAMP Orders issued, the Tariff Authority stipulated that, no ‘Ground Rent’ shall be payable, if the goods are not destuffed by the Port within 60 days (in view of the mandate under Sections 61 and 62 of the MPT Act), which period was subsequently extended to ’75 days’, taking note of the request made by the some Ports in this regard. Since the power and authority vested with the TAMP is not under challenge, there cannot be any liability beyond the stipulation under the relevant TAMP Orders and the Cochin Port Trust is bound by the same, who hence cannot demand anything more than the extent clearly specified therein.

42. As mentioned herein before, the various services to be rendered by the Board, are stipulated under Section 42 of the MPT Act. By virtue of sub-section (3), notwithstanding anything contained in the Section, the Board may, with the previous sanction of the Central Government, authorise ‘any person’ to perform any of the services mentioned in sub-section (1) on such terms and conditions as may be agreed upon. If the contention of the Port, that the Port is justified in refusing to destuff the cargo for want of sufficient storage space indefinitely, (at the same time with liberty to realize Ground Rent in respect of the containers lying there) is accepted, it may be equally open for such ‘other persons’ engaged under sub-section (3) of Section 42 to raise similar contention, also referring to some or other similar circumstances as well like inadequacy of staff, obsolete appliances/devises, insufficient infrastructure etc. This will only enable them to make unlawful gains by collecting Ground Rent in respect of the containers brought in, thus generating ‘easy money’ without doing any work deploying sufficient staff/infrastructure. This is not the scheme of the statute. As such, the contention raised by the Port that there is no obligation to have the goods destuffed within a reasonable time does not hold any water at all.

43. The only defence raised by the Port Trust to refuse the destuffing of cargo is the lack of sufficient storage space. It is to be noted that sufficient infrastructure to provide the various services contemplated under Section 42 of the MPT Act have necessarily to be provided by the Port, which is very much discernible from Sections 37, 38 and 39 of the Act. These provisions referrer to the power of the Board in issuing necessary orders, compelling the seagoing vessels to use docks, wharves etc., wherein sufficiency of warehouses, sheds, appliances for receiving, landing and shipping of the goods is given paramount consideration/importance. When the Port says, that they are not having sufficient storage space to destuff the cargo, there is no point in saying that, they want to pursue more and more business activities, without causing the cargo already arrived at in the Port to be dealt within accordance with law, enabling clearance after examination by the Customs or by causing the same to be sold or dealt with otherwise as prescribed, on failure to clear the same. So also, if lack of sufficient space is reckoned as a sufficient reason to refuse destuffing, the Port may put forth a similar contention referring to ‘inadequacy of staff’ or other infrastructure, to detain the containers without being destuffed; at the same time realizing ‘Ground Rent’ from the Shipping Agents for no fault on their part, thus venturing into an ‘easy money making business’, doing nothing. Such a course if never visualized anywhere in the ’MPT Act’ and the duty cast upon the Port to render the services is virtually the duty which the Central Government would have performed, had it been otherwise. This being the position, there is an obligation on the part of the Port in giving effect to the various provisions of the ‘MPT Act’ in the matter of rendering the necessary services and if any hurdle is placed from any corner, the same has to be crossed over, by pursing appropriate steps, at appropriate time, more so, in view of the power vested with the Board under Sections 61 and 62 of the Act to cause the uncleared cargo to be sold in public auction, realizing the best available market value, without getting the value deteriorated/diminished by delay and to render similar service to more and more prospective customers standing in the queue.

44. In the above facts and circumstances, this Court finds that, there is no rationale on the part of Port Trust in contending that they are entitled to collect the ‘Ground Rent’ charges in respect of containers indefinitely. The course pursued by them without causing the goods to be destuffed, despite the specific request, on the failure of the Consignee/Importer to have it cleared and by proceeding against such goods for causing the same to be sold in public auction, realizing the funds, to be apportioned in the manner as specified under Section 63, cannot but be deprecated. This Court holds that the respondent Port Trust can demand ‘Ground Rent’ only to a maximum period of ’75 days’, as specified by the Tariff Authority for Major Ports as per the relevant TAMP Orders discussed above.

45. Obviously, scope and effect of the TAMP Orders as aforesaid has not been discussed by the learned Single Judge while passing the common judgment. So also, the learned Single Judge has not considered the power, scope and authority of the Tariff Authority on Major Ports constituted as per Section 47A of the MPT Act, but proceeds to hold that, it is for the ‘Port’ to prescribe the scale of rates and conditions (Paragraph 13) which obviously is a mistake. We find it difficult to sustain the judgment passed by the learned Single Judge as to fixation of the extent of liability and the same is accordingly set aside, declaring that the maximum liability of the Shipping Agent for paying the Ground Rent in respect of the containers is for a period of ’75 days’, as stipulated by the TAMP, vide TAMP Order dated 19-7-2000 and as clarified by the Order dated 13-9-2005.

46. In the above circumstances, the Writ Appeals 2549, 2564, 2565, 2567, 2569, 2576 of 2002, O.P. 21041 of 1999 and W.P.(C) 32191 of 2004 preferred by Shipping Agents are allowed to the said extent, while the Writ Appeals 2783 and 2791 preferred by the Port Trust and Writ Appeal 2611 of 2002 preferred by the Consignee are dismissed as devoid of any merit. The Port Trust is directed to recomputed the actual liability in tune with the declaration as above, confining their right to claim the ‘Ground Rent’ in respect of the containers retained at the prescribed rates, only for a maximum period of ’75 days’ and return the balance to the parties concerned, as expeditiously as possible, at any rate, within two months from the date of receipt of a copy of this judgment. It is open for the Port Trust to proceed against the cargo, if still lying unsold and appropriate the dues subject to the priority as specified under the relevant provisions of law. No cost.


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