Judgment

KAILASAM, J.:- This appeal by special leave is preferred by the Board of Trustees of the Port of Bombay against the judgment of the Bench of the Bombay High Court in first appeal confirming the decree passed by the City Civil Court and dismissing the appeal with costs. The respondents, Indian Goods Supplying Co., a partnership firm in Bombay filed suit No. 3304 of 1959 in the Bombay City Civil Court at Bombay praying for a decree against the Trustees of the Port of Bombay in the sum of Rs. 24,950 with interest.

2. Three consignments of Chinese newsprint were imported by the respondents for home consumption in India. The first two consignments arrived on February 16, 1957 Suffice it to say that the clearance of the two consignments as well as the third consignment was considerably delayed and the Port Trust claimed demurrage for the period from March 25, 1957. The respondents disputed the right of the Port Trust to charge any demurrage for the period during which the goods were detained by the Customs authorities for analytical test as well as for the Import Trade Control formalities. It is common ground that so far as the period for analytical test certified by the Customs authorities is concerned the Port Trust cannot charge demurrage. But so far as the period during which the goods were detained for the Import Trade Control formalities by the Customs authorities the Port Trust claimed demurrage. Due to protracted correspondence between the parties the goods were not cleared and ultimately the suit was filed by the respondents for recovery of a sum of Rs. 24,950 and interest thereon from the Port Trust being the aggregate loss sustained by them. The appellants denied that liability and pleaded that the Port Trust was in law entitled to collect the demurrage levied on the respondents and that as they failed to pay the demurrage the Port Trust was entitled to sell the goods by public auction.

3. The City Civil Court, Bombay, decreed the suit for a sum of Rupees 24,950 with interest at the rate of 6 per cent per annum from the date of the suit till judgment and thereafter at 4 per cent per annum and costs of the suit.

4. The appellants preferred an appeal to a Division Bench of the Bombay High Court which dismissed the appeal and confirmed the decree passed by the City Civil Court.

5. When the appeal was pending before the High Court the appellants deposited the decretal amount in court which was withdrawn by the respondents. Mr. Nariman, counsel for the Port Trust, stated that the Port Trust does not want to ask for the repayment of the money and that he will confine himself to the question of the correctness of the decision of the Bombay High Court holding that the Port Trust is not entitled to collect demurrage in the circumstances of this case. It is therefore sufficient for the purposes of the appeal to confine ourselves to determining the question of law which has been raised before the High Court and decided by it.

6. The question that was raised before the High Court was whether the claim of demurrage by the Port Trust for the period during which the goods were detained with the Port Trust in respect of Import Trade Control formalities is maintainable. The High Court held that the importer of the goods cannot be held responsible for any delay not attributed to his own default and that the importer whose goods are detained by the Customs Department is entitled to claim the clearance of goods without demurrage during the period for which the Customs Department has detained them.

7. The appellants, the board of Trustees of the Port of Bombay, is a statutory body constituted by the Bombay Port Trust Act, Act 6 of 1879, and is a body corporate. Chap. VI of the Act relates to Revenue and Expenditure and provides for levy of rates S. 43 empowers the Board to frame a scale of tools, dues, rents, rates and charges to be levied for each or any of the matters enumerated in cls. (a) to (d). Sub-s. (a) enables framing of scale of r