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IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. ANAND VENKATESH, J.
Marine Container Services (South) Pvt. Ltd., Chennai - Appellant
Versus
The Board of Trustees of the Port of Chennai, Chennai & Others - Respondent
W.P. No. 15617 of 1999
Decided On : 24-08-2022
Writ Petition - Recovery of Charges - Major Port Trusts Act, 1963, Sections 60-63 - The court held that until the port trust takes charge of the goods, the liability falls on the steamer agent, and once they take charge, it falls on the consignee. The destuffing of the cargo from the container is irrelevant for determining liability.
Fact of the Case:
The petitioner, a steamer agent, challenged a bill issued by the port trust for demurrage and container storage charges. The petitioner claimed that the charges should be recovered from the consignee, as they had abandoned the cargo and advised the port trust to collect the charges from the consignee.
Finding of the Court:
The court found that the liability for charges depends on whether the port trust has taken charge of the goods. It held that until the port trust takes charge, the liability falls on the steamer agent, and once they take charge, it falls on the consignee.
Issues: The main issue was to determine who is liable for the payment of charges to the port trust for goods not cleared by the consignee.
Ratio Decidendi: The court applied the interpretation of Sections 60-63 of the Major Port Trusts Act, 1963, and relied on the judgment of the Hon'ble Supreme Court in Chairman, Board of Trustees, Cochin Port Trust Vs. Arebee Star Maritime Agencies Private Limited and others (2021 11 SCC 641) to establish the liability for charges based on whether the port trust has taken charge of the goods.
Final Decision: The court set aside the port trust's recovery of charges from the petitioner and directed the port trust to refund the amount to the petitioner. It allowed the port trust to recover the dues from the consignee directly or by bringing the cargo for public auction.
JUDGMENT
(Prayer: This Writ Petition is filed under Article 226 of the Constitution of India, to issue a writ of Certiorarified Mandamus or any other Writ, order or direction of a like nature calling for the records of the first respondent culminating in the Bill dated 26.04.1999 bearing No.039071 debiting the petitioner's current account with a sum of Rs.6,04,390/- (Rupees Six Lakhs Four Thousand Three Hundred and Ninety only) and the communication dated 09.06.1999 bearing No.CT/II/692/99/T(CT) and quash the same and consequently, forbear the first respondent from making any demand and debiting the petitioner's account with the amounts payable by the second respondent to the first respondent in respect of the container storage charges and direct the first respondent to forthwith refund the sum of Rs.1,78,750/- (Rupees One Lakh Seventy Eight Thousand Seven Hundred and Fifty only) and the sum of Rs.6,04,390/- (Rupees Six Lakhs Four Thousand Three Hundred and Ninety only) debited to the petitioner's current account under the impugned bill dated 26.04.1999.)
1. This Writ Petition has been filed challenging the impugned bill dated 26.04.1999 issued by the first respondent debiting the petitioner's current account and the subsequent communication dated 09.06.1999 and for a consequential direction for the refund of the amount that was debited from the current account of the petitioner, through the impugned bill dated 26.04.1999.
2. The case of the petitioner is that they are carrying on the business as Steamer Agents and in the course of their business, shipper at Antwerp entrusted two containers for being carried to the port of Chennai and to deliver the same to the second respondent, who was the consignee of the goods. The containers contained saw-cutting machines.
3. The further case of the petitioner is that the containers landed at Chennai port on 25.08.1992. The petitioner issued the cargo arrival notice to the second respondent and informed them to arrange for the clearance of the cargo without any delay.
4. The further case of the petitioner is that they issued a letter dated 24.09.1992 to the second respondent to present the original bill of lading and pay the freight and other charges to enable the petitioner to issue the delivery order. The second respondent failed to clear the cargo and as a result, the storage and demurrage charges started to accrue on the petitioner and the first respondent started to debit the same from the current account of the petitioner.
5. The petitioner left with no other option, through letter dated 15.10.1992, informed the first respondent that they are abandoning the containers/cargo and the first respondent was advised to recover from the second respondent all the amounts on account of the cargo lying uncleared.
6. It is stated that the first respondent acted upon the said letter issued by the petitioner and stopped debiting the current account of the petitioner. The first respondent also took steps to bring the cargo for public auction. Pursuant to the request made by the second respondent and the assurances given by them, the steps taken for conducting the auction was withdrawn. Inspite of the same, the second respondent failed to clear the cargo.
7. The grievance of the petitioner is that the first respondent debited a sum of Rs.6,04,390/- (Rupees Six Lakhs Four Thousand Three Hundred and Ninety only) towards the demurrage and container storage charges, from the petitioner for the period from 25.08.1992 to 18.04.1999. According to the petitioner, recovery of the charges must be made only from the second respondent and it was not open to the first respondent to recover the same from the petitioner. This is inspite of the fact that the petitioner had abandoned the cargo as early as on 15.10.1992. Aggrieved by the same, the present Writ Petition has been filed before this Court.
8. The first respondent has filed a counter affidavit and the relevant portions in the counter affidavit are extracted here
The liability for demurrage and storage charges depends on whether the port trust has taken charge of the goods, and the destuffing of the cargo from the container is irrelevant for determining liabi....
The main legal point established in the judgment is the obligation of the Port Trust to act within a reasonable time and the conditions under which a shipping line can issue an abandonment letter, cl....
Carriers and their agents retain liability for goods until actual delivery is completed, and failure to deliver constitutes a breach of contract.
The failure of the port authority to act timely in recovering dues led to a constructive waiver of charges, reinforcing equitable considerations in maritime claims.
Ownership of goods can transfer without physical delivery if the intention of the parties is clear, supported by documentation, and an agent cannot impose a lien or charge for storage absent contract....
Legal ownership of goods can transfer based on contractual agreements without physical delivery, provided supporting documentation clearly establishes ownership intent.
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