Back
2004 Supreme(Guj) 94
Gujarat High Court
Judgename :D.A.MEHTA
M.G.FORESTS PTE LTD - Appellant
Versus
M.V.PROJECT WORKSHIP - Respondent
ADMIRALITY SUIT14 of 2003
Decided On : 02/24/2004
Headnote:(a) [Indian] Penal Code, 1860 (Central Act 45 of 1860) - Sec. 4 - Criminal Procedure Code, 1973 (Central Act 2 of 1974) - Sec. 188 - The Merchant Shipping Act, 1958 (Central Act 44 of 1958) - Secs. 2(2), 3(15) & 437 - Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976 (Central Act 80 of 1976) - Sec. 13 - Admirality jurisdiction - Civil dispute - On conjoint reading of various provisions providing for different contingencies, it is clear that for the purpose of exercise of admirality jurisdiction in civil dispute the High Court cannot claim unbridled jurisdiction - For a Court, including High Court to be vested with jurisdiction an offender or offending vessel has to be found within local territorial limits of such Court.
If the overall scheme of Indian Penal Code (Sec. 4), Code of Criminal Procedure (Sec. 188). The Merchant Shipping Act (Sec. 437) and the Territorial Waters Act (Sec. 13) are taken into consideration read with Sec. 2(2) and Sec. 3(15) of the Merchant Shipping Act, it is apparent that for a Court, including High Court, to be vested with jurisdiction, an offender or offending vessel have to be found within local territorial limits of such Court. Taking a cue from this legal position which emerges on a conjoint reading of various provisions providing for different contingencies, it is apparent that for the purpose of exercise of admiralty jurisdiction in civil dispute the High Court cannot claim unbridled jurisdiction keeping in mind the constitutional provisions.
[Para 38]
(b) Action in Rem - Effect of - A suit against a vessel is an action in rem - Once an action in rem is initiated in relation to the same vessel before another High Court and that High Court has exercised jurisdiction validly, it is not possible then to exercise jurisdiction even if the Court has jurisdiction relating to that vessel - In the instant case the High Court of Tamilnadu had exercised jurisdiction and arrested the vessel by its orders dated 17.12.2003 even before plaintiff presented the suit before the Court - In the light of these facts suit of plaintiff is liable to be dismissed.
It is an admitted position between the parties that the vessel is already under arrest by two orders made by the High Court of Tamilnadu on 17.12.2003. It is also undisputed that these orders were made before the plaintiff presented the suit before this Court. And yet, in the plaint it is averred The plaintiff is constrained to file this suit at this stage as the defendant Vessel is likely to sail away immediately after unloading, which would cause grave and irreparable loss, harm and damage to the plaintiff. The plaintiffs conduct speaks volumes. Hence, even on this count, a Vessel which is already under an order of arrest by another High Court cannot be directed to be arrested once again by this Court in exercise of its admiralty jurisdiction. The position in law is well settled that the suit against the Vessel is an action in rem. Once an action in rem is initiated in relation to the same Vessel before another High Court and that High Court has exercised jurisdiction, and it is not disputed that the High Court of Tamilnadu had exercised jurisdiction validly, it is not possible to then exercise jurisdiction, even if this Court possesses such jurisdiction, in relation to the same Vessel.
[Para 40]
The suit of the plaintiff, therefore, is required to be dismissed on the ground of absence of jurisdiction and is dismissed accordingly.
[Para 41]
(c) Damages - Delayed delivery of cargo - Finding as to - Plaintiff contended that before he chartered vessel-defendant No. 1 he was given to understand that the speed of the cargo would be around 9 to 10 knots - On that basis plaintiff alleged that he entered into agreement with Shri Ambica Timber Depot but on account of delay it refused to accept the delivery to avoid loss - Court having gone through whole of the correspondence and fixtures found no evidence of any assurance about speed or time of reaching cargo - Contention of plaintiff with regard implied warranty/guarantee in terms of law on chartered parties is also not acceptable.
On behalf of the plaintiff attention was invited to various documents annexed with reply affidavit submitted in OJ MCA filed by the defendant vessel. Even if the said documents are taken into consideration all that it indicates is that plaintiff entered into contract with Barama Company Ltd. That the plaintiff was negotiating with defendant No. 2 for finalizing the purchases to be made and that ultimately a letter of credit was opened by defendant No. 2 in favour of Barama Company Limited, which sold goods to the plaintiff. There is no indication in relation to the basic claim of the plaintiff that it had executed the fixture note because of the representation made on behalf of the owners of the vessel as regards the speed of the Vessel.
[Para 48]
If the fixture note is read it becomes apparent that despite various particulars of the Vessel having been mentioned including the year of manufacture of the vessel, dimensions of the Vessel, various capabilities including the capacity of the Engine, etc., nowhere does the fixture note specify, nor even state anything as regards the speed of the vessel. Therefore, even if the correspondence leading to the fixture note is read with the fixture note there is no evidence to hold that the plaintiff was led into believing that the Vessel would travel at a particular speed so as to ensure the completion of the voyage within a particular period.
[Para 49]
The next contention on behalf of the plaintiff is that it would be a case of implied warranty/guarantee in terms of the law on charter parties. Suffice it to state that this contention would have been available to the plaintiff provided the fixture note did not contain the following term at the end of the fixture note :
This fixture is subject to all other terms, conditions exceptions as per `CENCON charter [As Revised 1922, 1976 and 1994].
The plaintiff has not been able to show that CENCON charter has any such implied warranty. It is not even averred. In fact the defendant Vessel in its Civil Application seeking vacating of the order of arrest has referred to Clause (2) pertaining to owners responsibility and stated that there is no loss or damage to the goods or delay in delivery of goods due to personal want of due diligence on the part of the owners or their Managers, etc. To this averment of the defendant vessel, in the Civil Application, the plaintiff in reply affidavit states that the clause relied upon by the defendant No. 1 is an exclusionary clause and is unreasonable and unconscionable. It is not an individually negotiated term. The fixture note is pre formulated and incorporation of the said term is allegedly by reference to `GENCON Charter. The plaintiff has indisputably not consciously agreed to incorporation of the said clause. This statement of the plaintiff, to say the least, belies comprehension. The plaintiff does not dispute having entered into the contract by way of fixture note. In fact, the Xerox copy of the fixture note available at page Nos. 15 to 20 bear the signature and seal of the plaintiff. Therefore, the say of the plaintiff that it has not consciously agreed to incorporation of the said clause is something which cannot be countenanced. It is a dishonest defence, if it could be termed as a defence.
[Para 50]
( 1 ) THE plaintiff in the suit is a Private Limited Company incorporated and registered under the laws of Singapore and its registered office is in Singapore at the address stated in the cause title. It is averred in the plaint that the plaintiff Company was promoted by Mr. Mukesh Gupta and Mrs. Gupta who are also the Directors of the plaintiff Company. It is further averred that the said promoters and Directors are also promoters and Directors of Gupta Global Exim Private Limited, a company incorporated and registered in India and having its office and works in Gandhidham (Gujarat ). It is further stated in the plaint that the promoters and Directors of the plaintiff Company are persons ordinarily residing in Gujarat and having their business in Gujarat.
( 2 ) DEFENDANT No. 1 is the vessel named "m. V. Project Workship" (hereinafter referred to as the vessel ). It is a foreign sea going vessel registered in Willenstad, Netherlands and flying a Dutch Flag. The registered owners are M/s. Sakhalin Heavy Transport Group. Though it is stated in the plaint that the registered owners are having place of business at the address mentioned in the cause title, in fact, no such address is mentioned in the cause title.
( 3 ) DEFENDANT No. 2 is a Company incorporated and registered under the laws of Hong Kong and having its registered office at the address mentioned in the cause title i. e. in Hong Kong. It is stated that defendant no. 2 is engaged in the business of financing transactions and one such transaction is entered into by the plaintiff for purchase of the goods in question.
( 4 ) THE case of the plaintiff is that it entered into a charter party agreement with owners of defendant no. 1 for transportation of goods by sea from Guyana to Tuticorin in India. For this purpose, a fixture note dated 26/8/2003 was executed on or around 8/9-9-2003. That defendant no. 1 Vessel arrived at Georgetown Guyana in or around 2nd week of September 2003 and the shippers loaded 5825. 8406 CBM hardwood wooden logs. That accordingly a bill of lading was issued dated 23/9/2003 denoting shipper as one Barama Company Limited. The column containing the name of the consignee does not bear any name but states to order while the column of notify address states name of defendant no. 2. The vessel sailed on 25/9/2003 from Georgetown Guyana.
( 5 ) IT is averred that on the basis of the aforesaid date of sailing the expected time of arrival of the vessel was last week of October 2003, but in fact the vessel arrived at the port of destination i. e. Tuticorin in India, only on 16. 12. 2003. Thus, according to the plaintiff the delay in delivering the cargo at the port of destination resulted in the inability of the plaintiff to deliver the cargo to one Shri Ambica Timber Depot, Chennai, with whom the plaintiff had entered into an agreement on 20/9/2003. According to the plaintiff, before the vessel was chartered the plaintiff was given to understand that the speed of the vessel would be around 9 to 10 knots and hence, the plaintiff had entered into an agreement for sale of the cargo in light of the expected time of arrival after 35 days of voyage from the date of sailing from Guyana. That due to delay in arrival of the vessel at the port of destination Shri Ambica Timber Depot had expressed its inability to take the delivery of the cargo at the rates agreed upon between the parties. This according to the plaintiff resulted in a situation where the plaintiff was likely to incur loss in the entire transaction. It is stated in paragraph 5. 5 of the plaint that the resultant loss to the plaintiff and/or the defendant no. 2 is USD 233,033. 62 which is solely attributable to delayed delivery of cargo by the defendant No. 1 vessel.
( 6 ) THE plaintiff, therefore, has preferred this suit and in paragraph 15a the following prayer is made :"15. The plaintiff therefore prays :- (A) That the defendant vessel M. V. "m. V. Project Workships" along with hull, tac
