The impugned Notification and Circular were found to be against the Scheme of the Act, 1958, and were made absolute by the court.

JUDGMENT :

Suresh Kumar Kait, J.

Cm APPLN. 14120/2019 in W.P.(C) 3070/2019

CM APPLN. 14123/2019 in W.P.(C) 3071/2019

CM APPLN. 14130/2019 in W.P.(C) 3073/2019

CM APPLN. 14136/2019 in W.P.(C) 3076/2019

1. Vide these applications, the applicants/petitioners sought stay of the operation of Notification No. 2 of "Make in India" dated 13.02.2019 and Circular No. 2/2019 dated 22.03.2019. The same were stayed vide order dated 28.03.2019 till further orders.

2. Being aggrieved, the respondents filed LPA Nos. 326/2019, 327/2019, 328/2019 and 331/2019 and the same have been disposed of vide order dated 13.05.2019, whereby, requesting this Court to take-up and dispose of the applications for interim relief at the earliest. Accordingly, these applications are taken up for disposal by this common order.

3. Since reply and rejoinder have been filed in C.M. No. 14123/2019, therefore, the said application is being taken up as a lead application and the order passed in this application shall be applied in all the applications.

4. The case of the applicants/petitioners is that promulgation of Notification dated 13.02.2019 by the respondent no.1 and Circular No.02/2019 dated 22.03.2019 by the respondent no.2 which have been issued under Sections 406 and 407 of the Merchant Shipping Act, 1958 (hereinafter referred as MS Act, 1958), whereby allowed a completely alien concept of an "Indian Built Ship" to get commercial rights higher than an Indian Flag Vessel under the Act, 1958 and to destroy any statutory recognition and preference available to an Indian Flag Vessel over Foreign Flag Vessels.

5. Mr. Kapil Sibal, learned senior counsel appeared on behalf of applicants/petitioners submitted that the Act, 1958 was promulgated by the Parliament to encourage and promote the growth and development of ships under the Indian Flag consequent to their registration as "Indian Ships". The ACT, 1958 has no concern with the place of built of the ship. The said Act only concern itself with the ownership and registration of the ship. If the ownership is wholly Indian, it becomes an Indian Ship, otherwise it is a Foreign Ship. The DGS exercises control through the Act, 1958 upon the Indian Ships in case of emergencies or war. Indian Ships are, therefore, the second line of defence in the case of an emergency. As of the year 2002, there were 560 Indian Ships and as on date, there are 1384 Indian Ships. The Gross Tonnage has increased from approximately 68 lakh GRT in 2002 to approximately 1.25 crore GRT in 2018. All nations of the world zealously protect their national flag fleet of ships by providing incentives/benefits. This in legal terms is known as "Cabotage Law". In India, cabotage exists in limited form, to promote the growth and development of Indian Ships. A Right of First Refusal (RoFR) was available to an Indian Ship wherein any customer/consumer/charterer who wished to engage a ship and had floated an enquiry/tender for the same. If an Indian Ship was available for the said business at the price quoted by the foreign flag ship, the business would be awarded to the Indian Ship. If the Indian Ship is not available or is unwilling to pick up that business at a rate which is tendered by a Foreign ship, only then a license under the Act, 1958 was granted to the Foreign Ship.

6. Learned senior counsel further submitted that by virtue of the above, the Indian Ship-owners were incentivized to invest in Indian Flag Ships which resulted in increase in the national tonnage though foreign built, as mentioned above. Under the Act, 1958, it is only the Indian character of the Ship through registration which is of concern to the DGS. By the Impugned Notification/Circular, the regime has been altered to the prejudice of the Indian Ships to the effect that there is no incentive or preference available to them in the Indian business, due to which, a ship which was originally built in India, but may be owned by a foreigner will get the first preference in Indian business. This amou