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High Court Of Calcutta
RANAJIT KUMAR MITRA
ALEXANDROS DRYRON S.A. - Appellant
Versus
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. - Respondent
G. A. 3092 Of 1997
Decided On : 10/03/1997
ADMIRALTY - ARREST OF VESSEL - JURISDICTION - BENEFICIAL OWNERSHIP - STAY OF SUIT - INTERNATIONAL CONVENTIONS - ADMIRALTY JURISDICTION OF HIGH COURTS IN INDIA - COLONIAL COURTS OF ADMIRALTY ACT, 1890 - COLONIAL COURTS OF ADMIRALTY (INDIA) ACT, 1891 - BRUSSELS CONVENTION 1952 - ARBITRATION PROCEEDINGS - COMMON LAW PRINCIPLE OF SECURITY FOR AWARD.
Fact of the Case:
The plaintiff, Alexandros Dryron S. A. (owner of "m. V. TIRGU NEAMT"), let Arabian Express Line Ltd. (charterers) hire the vessel for a voyage from Bombay Kandla-range to the port in the Eastern Mediterranian Blacksea area. Disputes arose between the parties, and the plaintiff instituted arbitration proceedings in London against the charterers. The plaintiff also instituted an admiralty suit in rem in the Calcutta High Court against the "m. V. PRAPTI", a vessel owned by Eleanora Shipping Company Ltd. (owners), claiming similar reliefs as in the arbitration proceedings. The plaintiff obtained an ex parte order for the arrest of "m. V. PRAPTI" for a period of ten days or until further orders of the Court. The owners applied for variation of the order and for dismissal of the suit. Rastrya Ispat Nigam Limited (petitioner), whose goods were loaded on "m. V. PRAPTI", applied for permission to sail the vessel to Bedi Bander in the State of Gujarat to unload the petitioner's cargo, with the vessel continuing to remain under arrest.
Finding of the Court:
1. The High Courts at Bombay, Calcutta, and Madras, as Colonial Courts of Admiralty, have unlimited admiralty jurisdiction over the coastal waters of India, including the power to arrest vessels lying anywhere within the territorial waters of the country. 2. The provisions of the Brussels Convention 1952, though not adopted by India, can be drawn upon by analogy for the purpose of deciding questions of jurisdiction and arrest. 3. A plaintiff in an arbitration proceeding may issue a writ in rem against a vessel belonging to the respondents in the arbitration to obtain security for a possible award, even if the vessel is not a sister ship of the vessel in respect of which the claim arose. 4. The arrest of a vessel is justified if the Court is prima facie satisfied that the plaint in the suit is not entirely without a cause of action and that the plaintiff is entitled to have the order of arrest continued till the disposal of the suit by way of security for its claim.
Issues: 1. Whether the Calcutta High Court had jurisdiction to entertain the admiralty suit, considering that the arrested vessel was lying outside the territorial waters of its jurisdiction. 2. Whether the plaintiff was entitled to commence arbitration proceedings in London and obtain an order of arrest in respect of a vessel beneficially owned, managed, possessed, or controlled by the person against whom the plaintiff had a claim by way of security for the award that may be made in the pending arbitration. 3. Whether the verification of the affidavit of arrest, which relied on the records of the plaintiff's advocates, was sufficient.
Ratio Decidendi: 1. The Colonial Courts of Admiralty Act, 1890, and the Colonial Courts of Admiralty (India) Act, 1891, confer unlimited admiralty jurisdiction on the High Courts at Bombay, Calcutta, and Madras, putting them at par with the English High Courts. 2. The Supreme Court of India has held that the High Courts have inherent and plenary powers, including the power to determine their own powers, unless expressly or impliedly barred. 3. The Brussels Convention 1952, though not adopted by India, can be drawn upon by analogy for the purpose of deciding questions of jurisdiction and arrest, as it represents the "international common law" or "transnational law" arising from the general principles of national laws. 4. The principle of allowing a claimant in an arbitration to secure the claim by issuing a writ in rem is a principle based on common law procedure, which is not barred in India.
Final Decision: 1. The owners' application for dismissal of the suit was dismissed with costs. 2. The ad interim order dated August 22, 1997, made in the plaintiff's application for arrest was confirmed. 3. The vessel "m. V. PRAPTI" was to continue to be under arrest and remain in the port of Bedi Bander, State of Gujarat, until further orders of the Court or the disposal of the suit.
( 1 ) IN an action in rem, in an admiralty matter, it was of course open to a plaintiff to seek to recover its alleged dues in respect to one vessel by causing another vessel to be arrested which either belonged to the same owner or a beneficial owner or one having control and possession of the arrested vessel. If both the vessels were owned by the same person, it was unlikely that the matter would come before the Courts. When the plaintiffs however, sought to establish and rely on beneficial ownership, or control and possession of the arrested vessel, intricate questions of interpretation, erudite deliberations by the Courts, public common law, provisions contained in international conventions and indeed the facts and circumstances of the case would become necessary to be considered, to decide the contentions of the parties. The exercise no doubt would, and in the instant case did, necessitate counsels for the parties, to resist the temptation of going on a pleasure cruise on the vast, and I dare say, very interesting expanse of the laws of admiralty both Indian and foreign, and restrict themselves to clarify, distinguish and apply only those portions of the laws which were relevant, according to them, for the purpose of adjudication of the disputes at hand. I believe, it would be prudent to start at the very begining and consider the facts of the case.
( 2 ) ALEXANDROS Dryron S. A. as the owner of a vessel "m. V. TIRGU NEAMT" let and Arabian Express Line Ltd. as the charterers hired the vessel, for a voyage from the port at Bombay Kandla-range to the port in the Eastern Mediterranian Blacksea area, and the terms and conditions were stipulated in the charter-party agreement dated October 24, 1996. Disputes and differences arose between the parties in respect to moneys alleged to be payable by the charterers to Alexandros Dryron S. A. , on account of freight, Sues-canal Toli, demurrage due to breach of 4 charter-party, laytime, loss and damages by reason of over-time, and in accordance with an arbitration-agreement contained in the charter-party it instituted in London, arbitration proceedings against Arabian Express Line Limited, to be referred to as the charterers hereafter. Thereafter, Alexandros Dryron S. A. , referred to hereafter as "the plaintiff", instituted an admiralty suit, in rem, in this Court against the, "owners and Parties Interested In The Vessel "m. V. PRAPTI ", being Admiralty Suit No. 18 of 1997, on similar cause of action as in the arbitration proceedings, and had also claimed similar reliefs. In this suit the plaintiff made an interlocutory application and by an ex parte-order dated August 22, 1997, made by the Hon'ble Judge taking interlocutory matters, the vessel "m. V. PRAPTI", then berthed in the port of Vishakhapatnam in the State of Andhra Pradesh, was placed under arrest "for a period of ten days from date or until further orders of this Court whichever is earlier". The Hon'ble Judge was "prima facie satisfied" as to the correctness of the claim of the plaintiff/petitioner. " The matter did not appear in the Cause List on the returnable date, and counsel on behalf of Eleanora Shipping Co. Ltd. , the owner of "m. V. PRAPTI", hereinafter referred to as "the owner", mentioned the matter and prayed for variation of the order. The Hon'ble Judge upon hearing counsel for the owner, was not inclined to vary the order, though leave was granted to make, and an application was made on behalf of the owner on August 28, 1997 for dismissal of the suit and the plaint be taken off the file. Parties agreed, that upon completion of the filing of affidavits the two applications ought to be heard analogously and the Court gave directions accordingly. The matter was thereafter released by the Hon'ble Judge, and His Lordship The Hon'ble Acting Chief Justice assigned the matters to be heard by this Court. The matters were heard analogously on September 18, 22, and 23, 1997.
( 3 ) IN the course o
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