Board of Trustees of the Port of Bombay & others vs Sriyansh Knitters

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1982 Supreme(Bom) 208

IN THE HIGH COURT OF BOMBAY
D.P. Madon, Acting C.J. M.L. Pendse, J.
Board of Trustees of the Port of Bombay others ... Appellants.
Versus
Sriyansh Knitters ... Respondents.
And
Saroj Chowdhary ... Respondent.
And
Oswal Woollen Mills Ltd. (Export Wing) another... Respondents.
And
Metals and Metals another... Respondents.
And
Stretch Fibres (India) Limited another... Respondents.
Appeal No. 78 of 1982 with Appeals Nos. 76, 77,79 80 of 1982, decided on 11/12-8-1982.
Advocates appeared :
D.R. Zaiwala with U.J. Makhija, for petitioner.
A.H. Desai, A.Hidayatullah, C.M. Mehta, V.B. Agarwal, R.J. Gagrat, for respondents.

Headnote:Sections 151, 152 and 161Major Port Trusts Act (38 of 1963), Section 42(6)-The receipt contemplated by Section 42(2) of the Major Port Trusts Act evidences the good coming into the possession of the Port Trust-Under Section 42(6). Major Port Trust Act, the Port Trust would be regarded as bailee thereof to whom the provisions of Sections 151, 152 and 161 of the Contract Act become applicable-It is because of this the relationship of bailor and bailee comes into existence when the Board of Trustees is required to store the imported goods.
       Section 171 and Major Port Trusts Act (38 of 1963), Section 1 Major Port Trusts Act does not oust the provisions of Section 171 of the Contract Act.
       Section 171 and Major Port Trusts Act (38 of 1963), Section 42The claim for wharfage and demurrage could be covered by the expression "general balance of account" occurring in Section 171 of the Contract Act-The services which are undertaken under Section 4;; of the Major Port Trusts Act have to be paid for and any amount due in respect thereof will be regarded as "general balance of account" -There is no reason to give a restricted meaning to the expression "general balance of account" to mean only wharfage charges which would imply the charges for loading or unloading of goods and would not include demurrage. [The first part of Section 171 of the Contract Act identifies five categories of persons who can have a general lien and retain the goods bailed to them. Wharfinger is one of them the general balance of account has to be of the amount legally due to bankers, factors, wharfingers, attorneys and policy-brokers. The appellants come in the category of wharfingers, namely, the owners of the wharf. The duties which they are required to perform are provided in the statute itself, namely, Section 42 of the Major Port Trusts Act. In other words the services which are undertaken under Section 42 have to be paid for and any amount due in respect thereof will be regarded as "general balance of account". There is no reason to give a restricted meaning to the expression "general balance of account" to mean only wharfage charges which, according to the respondents would imply the charges for loading or unloading of goods, ad would not include den1urrage. Once goods are taken charge of by the appellants as wharfingers then in respect of the services rendered, as contemplated by Section 42, if there is any amount which is due and payable to it, the same would be regarded as "general balance of account" in respect of which it has a general lien over the goods baled to it. (Paras 18 and 29).
       Section 171 and Major Port Trusts Act (38 of 1963), Sections 59 and 61-Section 171 of the Contract Act only enables the retention of bailed goods as security and does not give any power to sell the goods unlike the power contained in Section 61 of the Major Port Trusts Act-But the added advantage of sale given by Section 61 in respect of current dues cannot be regarded as whittling down the right of a general lien in Section 171 of the Contract Act in respect of old dues.

Judgment

M.L. PENDSE, J.:---This group of five appeals is preferred by the Board of Trustees of the Port of Bombay and its Officers, and raises an interesting questions as to whether the Trustees of the Port Trust constituted under the Major Port Trusts Act, 1963 have general lien for their dues over the consignments imported by the importers at the Bombay Port. As identical question arises in all these appeals and as the facts giving rise to these appeals are almost similar, we propose to dispose of all these appeals by common judgment.

2. The respondents in all these five appeals are importers and have imported various consignments from time to time. The respondents imported woollen rags and after the consignments arrived at Bombay Port, there was dispute between the respondents and the Customs authorities as to whether the imported goods were woollen garments. After a considerable period, the Customs Authorities confiscated the imported goods under the provisions of section 111 (d) of the Customs Act, 1962, but the order of confiscation gave an option to importers to get the goods released on payment of fine. Some of the importers preferred appeals against the order passed by the Customs Authorities confiscating the goods, but it is not necessary to refer to appellate orders. As the imported goods remained in the Docks till the order of confiscation, the appellants issued notices to the respondents demanding the demurrage charges. The importers denied their liability and thereupon the Port Trust Authorities instituted various suits to recover wharfage and demurrage charges. These suits filed on the Original Side of this Court are still pending decision.

3. After the institution of the suits, the respondents imported Acrylic Fibre under the Import Licences held by them and after the consignments arrived in Bombay Port, the respondents filed Bills of Entry for clearance of the goods for home consumption. The respondents secured the requisite permission from the Customs Authorities and thereupon called upon the Board to release the goods in their possession. The appellants refused to remove the goods and on enquiries, the respondents learnt that the refusal of the Port Trust Authorities is based upon a Circular issued by the appellant on October 2, 1979. It would be convenient to set out the Circular at this juncture :

"BOMBAY PORT TRUST DOCKS

Dock Circular No. S/29-89/52/79-80 2-10-1979 To,

All Vessel Agents/ Vessel Owners/Clearing Agents.

Sub : Recovery of Port Trust Charges

This Circular is in supperession of Circular No. 5/29/89/39/79-80 of 13th August, 1979 which is hereby withdrawn. The Board of Trustees of the Port of Bombay have been advised that under section 171 of the Indian Contract Act, 1872, they have a general lien which they can exercise on the goods which come into their custody of Importers, Exporters, Owners, Consignees who have for any reason whatsoever not paid the Port Trust charges such as whargage, cranage, storage, demurrage or any other dues in respect of any earlier consignments Imported/Exported or sought to be exported by them.

"2. In the circumstances this department will exercise a lien for General Balance of account in respect of wharfage, cranage, storage, demurrage and other dues of the Board of Trustees of the Port of Bombay against the Importers/Exporters, Owners or Consignees of the goods taken charge of by the Board of the Trustees.

3. In case where suits have already been filed against the Importers/Exporters, Owners, Consignees or other persons liable, they will be called upon to, at their option, to pay, such dues to the Bombay Port Trust without prejudice to their rights and contentions in such suit or approach the Court to deposit such dues in the suits filed against them without prejudice to their rights and contentions. In such suits only after such deposits is made with the Board of Trustees or in the Court such Importers/Exporters, Owners, Consignee

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