Hari & Co. , Represented by its Partner A. Hariharan, Represented by its Power of Attorney Holder, R. Arul Murugan, General Manager, Chennai vs Chennai Port Trust, Represented by its Chairman, Port Trust, Chennai

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2022 Supreme(Mad) 18

IN THE HIGH COURT OF JUDICATURE AT MADRAS
S.M. SUBRAMANIAM, J.
M/s. Hari & Co., Represented by its Partner A. Hariharan, Represented by its Power of Attorney Holder, R. Arul Murugan, General Manager, Chennai - Appellant
Versus
Chennai Port Trust, Represented by its Chairman, Port Trust, Chennai & Others - Respondent
WP No. 16365 of 2011 & MP No. 1 of 2011
Decided On : 10-01-2022

Advocates Appeared:
For the Appellant :G. Masilamani, Senior Counsel, Mani Sundargopal, Advocate.
For the Respondents:R. Karthikeyan, R3, Anirudh Krishnan, Advocate.

Headnote:
Constitution of India, 1950 - Article 12 and 226 - Indian Contract Act, 1872 - Section 230 - Writ of Certiorari - Chennai Port Trust also permitted petitioner to act as a Steamer Agent - Executed Indemnity Bond in favour of Chennai Port Trust stating that 'they take full responsibility for payment of all dues, charges, expenses, accrued and accruing, including loss of revenue to Port arising through berths/navigable approach channel not being available for use and any impediment caused for safe navigation/ berthing of vessels through any mishap - Whether above resolution of Board was implemented by Deputy Conservator or not – Held, Court is of an opinion that as directed by Board, Competent Authority ought to have considered case of petitioner, considering peculiar facts and circumstances and pass appropriate orders - Contrarily, they have issued demand notice in a routine manner based on Rules, which seems to be incorrect and undoubtedly, caused certain hardships to petitioner, as certain occurrences took place beyond their control for which petitioner cannot be faulted or blamed - Court thought fit that Board should take a decision in respect of charging additional berth hire charges - In case of petitioner as facts and details and report of Sub-Committee were considered by Board itself and therefore, present writ petition cannot be compared with other cases, where commercial transactions are involved and in all such cases and in normal circumstances, Court would direct parties to approach Competent Civil Court of Law for resolving issues - Even in respect of other issues relating to contractual obligations and terms and conditions, parties herein are at liberty to approach Competent Civil Court of Law for appropriate relief - As far as demand notice is concerned, Court is inclined to consider present writ petition to limited extent of sending back issues to Board for reconsideration - This decision taken in present case cannot be followed as a precedent for purpose of entertaining writ petition involving contractual obligations or otherwise - Writ petition stands allowed.

JUDGMENT :

Prayer: Writ Petition is filed under Article 226 of the Constitution of India, praying for the issuance of a Writ of Certiorari, calling for the records relating to the Letter/Demand Notice dated 23.06.2011 on the file of the second respondent herein and quash the same.

1. The lis on hand has been instituted questioning the validity of the demand notice dated 23.06.2011 issued by Chennai Port Trust to remit the outstanding amount of Rs.44,35,33,691/- within 21 days from the date of receipt of the final demand notice.

2. In nutshell, the Vessel M.V. SAN GIORGIO sailed from the Port of West Africa with Cargo 12,800 Cbm of Timber developed sickness. Owner of Vessel failed to attend. M/s. Olam International Limited, owner of the Cargo towed her to Chennai. On the application moved by Bank of Beirut (UK) Ltd (Mortgagee of the Vessel), the Bombay High Court passed an order of arrest of the Vessel, M.V. SAN GIORGIO-1 in Admiralty Suit No.13/2007. M/s.Olam International Limited, Singapore (Sub-Charterer of the Vessel, M.V. SAN GIORGIO-1 and also the owner of Cargo in the said Vessel) requested Chenai Port Trust to permit the Vessel to discharge the Cargo and assured that the Vessel will be taken out of Port Trust once the Cargo is discharged. Further, M/s.Olam International Limited also expressed their willingness to give 'any suitable undertaking that the Port may require to protect its interest'. M/s.Olam International Limited on 11.04.2007 appointed the petitioner as its Steamer Agent to handle their Timber Cargo Vessel M.V. SAN GIORGIO-1 at Chennai Port. The petitioner-Agent was authorised to handle Customs/Port/Immigration/MMD and all ship related formalities.

3. On 12.04.2007, Chennai Port Trust also permitted the petitioner to act as a Steamer Agent. On 16.04.2007, M/s.Olam Export (India) Limited (a Sister/Subsidiary Company of M/s.Olam International Limited-R3) executed Indemnity Bond in favour of the Chennai Port Trust stating that 'they take full responsibility for payment of all dues, charges, expenses, accrued and accruing, including loss of revenue to the Port arising through berths/navigable approach channel not being available for use and any impediment caused for safe navigation/berthing of vessels through any mishap to the M.V. SAN GIORGIO-1'.

4. Many events occurred during the year 2007 itself and Chennai Port Trust moved M.V. SAN GIORGIO-1 Vessel under arrest from one berth to another vacant berth in the Ambedkar Dock. The charges for moving the ship were collected from the ship. The berth to which the Ship was moved was only vacant without any loading or unloading activities. The Vessel M.V. SAN GIORGIO-1 was moved out of the Ambedkar Dock and taken to Chokkani Jetty. The said Jetty was never used as berth since they were only Jetties with one Wharf (Platform) alongside berth. The movement charges were credited to the account of the Ship. Chokkani Jetty (C.J.) was never offered as berth for berthing of the Ships in Chennai Port as per the berth details furnished in the Website in Chennai Port. In between the years 2008 to 2010, the Vessel M.V. SAN GIORGIO-1 was moved to Coast Guard Berth, which was vacant.

5. All the above basic facts are not disputed between the parties. The Bombay High Court arrested the Vessel in Admiralty Suit. The petitioner-Company have stated that the Vessel was moved to a vacant berth and therefore, there was no loss of income to the Port. Thus, the additional berth hire charges are unreasonable and unjustified and against all canons of justice.

6. Several facts placed by the petitioner would reveal that the owner of the Vessel has not responded and the third respondent-M/s.Olam International Limited Cargo owner executed an Indemnity Bond to Chennai Port Trust and the regular berth charges were also settled in favour of the Port Trust. While-so, issuing a demand notice to the Steamer Agent is neither contemplated under the provisions of the Regulation or under the terms and conditions o

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