Back
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
DEVENDRA KUMAR UPADHYAYA, ARIF S. DOCTOR, JJ.
Madgavkar Salvage - Appellant
Versus
Bergen Offshore Logistics Pte. Ltd. - Respondent
COMM. Appeal No. 555 OF 2019 In COMM. Arbitration Petition No. 13 Of 2015
Decided On : 30-11-2023
Arbitration Act - Appeal - Section 37 - Salvage Agreement - Arbitration Act 1996 - Section 34 - Admiralty suit - Arbitral Award - Impugned Order
Fact of the Case:
The Appellant, engaged in marine salvage, entered into a Salvage Agreement with the Respondent for salvaging a dredging vessel. Dispute arose when the Respondent failed to furnish the security as per the contract, leading to termination of the contract and a claim for idle time charges.
Finding of the Court:
The court found that the challenge to the Arbitral Award was not within its jurisdiction, as it cannot undertake an independent assessment of the award. The court also noted that the Arbitral Tribunal was well-versed in maritime matters and had provided a detailed and reasoned award. The court dismissed the appeal, finding no grounds for interference.
Issues: The issues framed for determination by the Arbitral Tribunal included the validity of the Appellant's claims, waiver, and entitlement to idle time charges.
Ratio Decidendi: The court held that the challenge to the Arbitral Award was beyond its jurisdiction and that the Arbitral Tribunal's decision was plausible and within the contract's scope. The court also found that the Appellant's contentions regarding waiver and inconsistent findings were erroneous, and the Arbitral Tribunal's decision on liquidated damages was justified.
Final Decision: The court dismissed the appeal, upholding the Impugned Order and finding no infirmity that would warrant interference under Section 37 of the Arbitration Act.
JUDGMENT :
(Arif S. Doctor, J.)
1. The present Appeal is filed under Section 37 of the Arbitration and Conciliation Act, 1996 (“Arbitration Act”) and impugns an order dated 11th January 2019, by which the Petition filed by the Appellant under Section 34 of the Arbitration Act was dismissed. At the outset we must note that despite due service, none appeared on behalf of the Respondent. It was thus that we have heard Mr. Shanker learned counsel for the Appellant and have also ourselves perused the record of the proceedings in this Appeal.
2. Before dealing with the submissions made and the respective grounds on which the Impugned Order has been assailed, it is useful to set out the following facts, basis the submissions made and as also borne out from the record viz.
| SALVAGE AGREEMENT “NO CURE – NO PAY” (PART I) | |
| 1. Place and date Goa dated 07th November 2009 | 6. Place and manner of delivery [cl.2] Delivery afloat at/near Sanghipuram Port in sufficient draft of water in a stable upright floating condition with trim not exceeding 0.5m |
| 7. Time Period [cl. 1 (a)] 30 (thirty) continuous weather working days including mobilization | 8. Extension of time [cl. 1(b)] 15 (fifteen) continuous weather working days |
| 9. Nature of services [cl. 3] Re-floatation of stranded dredger and delivery in stable, upright floating condition, with trim not exceeding 0.5m. | 10. Remuneration [cl.4] Amount- Rs.7,50,00,000/-* Service Tax-Rs. 77,25,000/- *(@10.3%) ------------------------ TOTAL - Rs.8,27,25,000/-* Rupees Eight Crores Twenty Seven Lakhs Twenty Five Thousand Only). Subject to additional Clause 15. |
| 12. Security [cl.5] Irrevocable Bank Guarantee for Rs.8,27,25,000/- or in lieu a Letter of Undertaking by the Insurer and Maritime Lien on Dredger | 14. [Idle time charges [cl.12] Rs. 25,00,000/- per day (Rupees twenty five lakhs only) per day |
| 15. Safe keeping charges [cl.2] Rs.25,00,000/- per day (Rupees twenty five lakhs only) per day. |
|
| SALVAGE AGREEMENT (PART II) | |
| 3.NATURE OF SERVICES: The services as indicated in Box 9 shall be provided by the Salvor and accepted by the Owners on “NO CURE NO PAY” basis. | 5. SECURITY: The Owners shall provide security in favour of the Salvar, as indicated in Box 12. for the full salvage remuneration within 10 days of the signing of this agreement. The Salvor shall be free to invoke/encash the security if the remuneration indicated in Box 10 is not paid within the stipulated period. |
| 7. OWNERS DUTIES: The Owners, their servants and agents shall cooperate fully with the Salvor in and about the salvage including obtaining entry to the place of salvage or such other places as may be necessary, or if applicable the place of safety to which the salved property is to be taken. The Owners shall ensure that the Salvors shall have a free hand to carry out the salvage operations without any interference whatsoever from any prior contractors that may have been appointed by the Owners for any operations connected with the salvage of the dredger. The Owners shall permit the Salvors to make reasonable use of their vessel’s gears, chains, winches, render boat appurtenances and the accommodation spaces during and for the purpos | |
The court's decision emphasizes the limited scope of challenging an Arbitral Award and the importance of the Arbitral Tribunal's expertise in maritime matters.
Judicial intervention in arbitration matters is limited; arbitral awards should be upheld unless a party shows clear evidence of patent illegality or violation of fundamental public policy.
Arbitrators have jurisdiction to rule on claims unless expressly excluded by the contract, thus enabling courts to intervene when disputes fall outside contractual references.
The court upheld the Arbitrator's findings that the rescission of the contract was unjust and delays were primarily attributable to the petitioner, affirming the award under Section 34 of the Arbitra....
The Arbitrator's decision is final, and the court's interference is limited to specified grounds. The court should not substitute its view for that of the Arbitrator, and the Arbitrator's interpretat....
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
