2011 Supreme(Ker) 846

High Court of Kerala
MR. J. CHELAMESWAR & P.R. RAMACHANDRA MENON
APL (India) Pvt. Ltd.
Versus
Chairman, Cochin Port Trust & Others
W.A. No. 2549 of 199 & Connected Cases
Decided on : 27-09-2011

Headnote:

Major Port Trusts Act 1963 - Sections. 42, 47A , 60( 1), 61, 62 , 63 - Procedure in case of goods not cleared, warehoused or transhipped within 1[thirty days] after unloading - Procedure for sale of goods and application of sale proceeds - Performance of services by Board or other person - Compensation payable in certain cases where use of any private wharf, etc., rendered unlawful - Ship-owner's lien for freight and other charges - Sale of goods after two months if rates or rent are not paid or lien for; freight is not discharged - Disposal of goods not removed from premises of Board within time limit - Application of sale proceeds - Whether Port Trust can demand 'Ground Rent' only to a maximum period of 75 days' in respect of the containers unloaded in the Cochin Port which is lying uncleared by the consignees/importers and refused to be destuffed by the Port for inadequate storage space - Whether Scheme of the Statute does not contemplate any liability to be satisfied by the vessel owner except to the extent as specified and the freight and other charges payable to them get top priority over other dues payable to the Government and also to the Port, if the lien is exercised in the manner as specified u/S.60(1) - Whether application of Ss.61/62 of M.P.T. Act or S.48 of the Customs Act, the Shipper's lien gets precedence and priority over any other dues/lien including the lien of the Port Trust or the amounts payable to the customers/Government or under such other heads, except the expenses for the sale proceedings - Whether Port cannot contend that there is no obligation to have the goods destuffed within a reasonable time - Held, When the Port says, that they are not having sufficient storage space to destuff the cargo, there is no point in saying that, they want to pursue more and more business activities, without causing the cargo already arrived at in the Port to be dealt with in accordance with law, enabling clearance after examination by the Customs or by causing the same to be sold or dealt with otherwise as prescribed, on failure to clear the same. So also, if lack of sufficient space is reckoned as a sufficient reason to refuse destuffing, the Port may put forth a similar contention referring to inadquacy of staff or other infrastructure, to detain the containers without being destuffed; at the same time realizing 'Ground Rent' from the Shipping Agents for no fault on their part, thus venturing into an 'easy money making business', doing nothing. Such a course is never visualized anywhere in the 'MPT Act' and the duty cast upon the Port to render the services is virtually the duty which the Central Government would have performed, had it been otherwise. This being the position, there is an obligation on the part of the Port in giving effect to the various provisions of the ' MPT Act' in the matter of rendering the necessary services and if any hurdle is placed from any corner, the same has to be crossed over, by pursing appropriate steps, at appropriate time, more so, in view of the power vested with the Board under Ss.61 and 62 of the Act to cause the uncleared cargo to be sold in public auction, realizing the best available market value, without getting the value deteriorated/diminished by delay and to render similar service to more and more prospective customers standing in the queue. In the above facts and circumstances, this Court finds that, there is no rationale on the part of Port Trust in contending that they are entitled to collect the 'Ground Rent' charges in respect of containers indefinitely. The course pursued by them without causing the goods to be destuffed, despite the specific request, on the failure of the Consignee/Importer to have it cleared and by proceeding against such goods for causing the same to be sold in public auction, realizing the funds, to be apportioned in the manner as specified under S.63, cannot but be deprecated. This Court holds that the respondent Port Trust can demand 'Ground Rent' only to a maximum period of 75 days, as specified by the Tariff Authority for Major Ports as per the relevant TAMP Orders discussed above - When the sale is conducted by virtue of the power under S.61 or 62, as the case may, the sale proceeds are to be appropriated in the order of priority, as provided under S.63, which gives precedence to claim of the Shipping Lines and those exempted under sub-s.(2) of S.59 from the priority of the lien of the Board, as specifically provided under sub-s.(1)(b). The order of priority is 'almost' similar, when it comes to the sale at the instance of the Customs as well (pursuant to the steps under S.48 of the Customs Act, 1962), in view of the clear stipulation recognizing the lien of the carrier towards freight and other charges, which gets top priority after meeting the expense of the sale as provided under S.150 of the Customs Act specifying the manner of appropriation. To put it short, the scheme of the statute does not contemplate any liability to be satisfied by the Vessel Owner except to the extent as specified and the freight and other charges payable to them get top priority over other dues payable to the Government and also to the Port, if the lien is exercised in the manner as specified under sub-s.(1) of S.60. - Nowhere has it been specified in the statutes or elsewhere that the Steamer Agents have a duty or liability to clear the goods from the custody of the Port, which in fact is the onus of the Consignee/their agents. By virtue of sub-s.(3), notwithstanding anything contained in the Section, the Board may, with the previous sanction of the Central Government, authorise 'any person' to perform any of the services mentioned in sub-s.(1) on such terms and conditions as may be agreed upon. If the contention of the Port, that the Port is justified in refusing to destuff the cargo for want of sufficient storage space indefinitely, (at the same time with liberty to realise Ground Rent in respect of the containers lying there) is accepted, it may be equally open for such 'other persons' engaged under sub-s.(3) of S.42 to raise similar contention, also referring to some or other similar circumstances as well like inadequacy of staff, obsolete appliances/devises, insufficient infrastructure etc. This will only enable them to make unlawful gains by collecting Ground Rent in respect of the containers brought in, thus generating 'easy money' without doing any work deploying sufficient staff/infrastructure. This is not the scheme of the statute. As such, the contention raised by the Port that there is no obligation to have the goods destuffed within a reasonable time does not hold any water at all. - Appeal preferred by Shipping Agents are allowed - The Port Trust is directed to recompute the actual liability in tune with the declaration as above, confining their right to claim the 'Ground Rent' in respect of the containers retained at the prescribed rates, only for a maximum period of 75 days' and return the balance to the parties concerned, as expeditiously as possible, at any rate, within two months from the date of receipt of a copy of this judgment. It is open for the Port Trust to proceed against the cargo, if still lying unsold and appropriate the dues subject to the priority as specified under the relevant provisions of law - Customs Act 1962, Sections. 48 & 150.