: 1 : IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION SUIT NO.667 of 1989 SUIT NO.667 of 1989 SUIT NO.667 of 1989 The Board of Trustees of the Port of Bombay, a Body corporate constituted under the provisions of the Major Port Trusts Act, 1963 as amended by the Major Port Trusts (Amendment) Act, 1974, having its principal place of business at "Vijay Deep", Shoorji Vallabhdas Marg, Bombay - 400 038. .. Plaintiffs. Versus 1. M/s.Surya Plastics Company, a firm carrying on business at G.I.D.C, Industrial Area, Panch Mahal, Dist.Halol, Gujarat. 2. M/s.Avin Exports Inc., a firm carrying on business : 2 : at 4, High View Drive, Wood Bridge, N.J. 07095, U.S.A. 3. United States Lines Agency, a firm carrying on business at 301/303, Emca House, Shahid Bhagatsingh Road, Bombay - 400 023. .. Defendants. Mr.U.J.Makhija i/b.Mulla & Mulla for plaintiffs. None for defendant No.1. Suit against defendant No.2 was withdrawn on 21.4.2008. None for defendant No.3. CORAM : R.Y. GANOO, J. CORAM : R.Y. GANOO, J. CORAM : R.Y. GANOO, J. DATE : 14th August, 2008. DATE : 14th August, 2008. DATE : 14th August, 2008. ORAL JUDGEMENT :- ORAL JUDGEMENT :- ORAL JUDGEMENT :- 1. The plaintiffs is an organisation governed by the provisions of the Major Port Trusts Act, 1963 (hereinafter referred to as the said Act). : 3 : 2. Defendant No.1 is an importer / owner / consignee. Defendant No.2 is the consignor and defendant No.3 is the agent of the vessel by name "m.v. Jamuna Pioneer". 3. The plaintiffs have filed this suit to recover an amount of Rs.16,05,000/- alongwith interest at the rate of 15% per annum from the date of filing of the suit till realisation on Rs.15,87,263/- and for costs. 4. It is the case of the plaintiffs that defendant No.1 imported 2 consignments containing 2083 bags of Moulding Powder under Item Nos.16 and 65 vide Import General Manifest No.2670 dated 7.11.1985 by vessel m.v. Jamuna Pioneer. The general landing date was 8.11.1985 and the last free date of the cargo was 15.11.1985. The goods were discharged according to the dates as mentioned aforesaid. Though 2083 bags of Moulding Powder were imported, in fact 83 bags were short landed by the said vessel and hence remaining 2000 bags became the subject matter of the unloading of the goods from the vessel i.e. the suit cargo. 5. According to the plaintiffs, delivery of cargo should have been taken within 7 days from the last free : 4 : date. The defendants did not take the delivery of the suit cargo. The customs department passed an order of confiscation on 10.8.1987 vide order No.S/10-74/87 SIIB under Section 111(d) of the Customs Act, 1962 r/w. Section 3(2) of the Imports and Exports Control Act, 1947. 6. The plaintiffs by letter dated 17.10.1988 called upon defendant Nos.1 and 3 to pay to plaintiffs what may be referred to wharfage, demurrage and sale warehousing charges, commonly called as port trust charges. The plaintiffs by another letter dated 29.10.1988 called upon defendant Nos.1 and 3 to pay to plaintiffs Rs.15,87,263.60 by way of port trust charges and interest thereon from the date of demand till the filing of the suit. The plaintiffs by another letter dated 1.11.1988 called upon the defendant No.1 to pay to plaintiffs Rs.15,87,263.60 alongwith interest till the date of payment. As no payment was made over by any of the defendants, the plaintiffs instituted the suit in this court on 15.11.1988 praying for a decree to the tune of Rs.15,87,263.60 being the principal amount plus interest @15% per annum from the demand notice till filing of the suit amounting to Rs.17,736.40, making it together Rs.16,05,000/-. The plaintiffs have also prayed for interest @15% per annum : 5 : from the date of the filing of the suit till realisation. 7. Defendant No.1 has not filed any written statement. Defendant No.3 has filed the written statement and defendant No.3 has contended that defendant No.3 could not take the delivery and as such defendant No.3 cannot be held liable to pay to plaintiffs wharfage and the demurrage charges. It was also the stand of defendant No.3 that defendant No.3 is not the owner or the consignee or the bailor and, therefore, defendant No.3 is not liable to pay the said charges. According to defendant No.3, there was negligence on the part of the plaintiffs in selling the goods and if the goods would have been sold in time, it could have fetch a good amount and that would have helped the plaintiffs to recover maximum amount by the sale of goods. 8. On the basis of the pleadings as aforesaid, the issues came to be framed by my learned predecessor on 19.11.2007 and they are as under :- I S S U E S I S S U E S I S S U E S i) Whether the defendants are importers/owners/consignees/bailors of the suit consignment as stated in para 5 of the plaint? .. : 6 : In the affirmative. In the affirmative. In the affirmative. ii) Whether the confiscation of suit consignment incurred pre-confiscation port trust charges of Rs.15,87,263.60 as stated in para 7 of the plaint? .. As per final order. .. As per final order. .. As per final order. iii) Whether the plaintiffs are entitled to recover from the defendants the amount of Rs.15,87,263.60 being the pre-confiscation port trust charges in respect of suit consignment together with a sum of Rs.17,736.40 paise being interest @15% p.a. from 1.10.1988 till 7.12.1988 aggregating to Rs.16,05,000/- as stated in para 10 of the plaint? .. As per final order. .. As per final order. .. As per final order. iv) To what reliefs, if any, the plaintiffs are entitled? .. As per final order. .. As per final order. .. As per final order. v) What order and decree? .. As per final .. As per final .. As per final order. order. order. 9. Answer to each of the issue is mentioned against the respective issue. 10. It is required to be mentioned that the defendant Nos.1 and 3 went for trial on the basis of the aforesaid issues. By order dated 21.4.2008, the suit was allowed to be withdrawn as against defendant No.2. Hence, the aforesaid issues survive as between the plaintiffs on one hand and defendants 1 and 3. 11. At trial on behalf of the plaintiffs Mr.E.J. Almeida, Assistant Docks Manager gave evidence. He filed evidence affidavit as well as compilation of documents on : 7 : which the plaintiffs wanted to rely upon. The evidence of the said Mr.Almeida, P.W.1 was recorded on 24.4.2008. At that time, nobody appeared on behalf of the defendant Nos.1 and 3. As such the evidence of Mr.Almeida, P.W.No.1 went unchallenged as there was no cross-examination on behalf of the defendant Nos.1 and/or defendant No.3. It is in these circumstances, after the job of recording of evidence was over, this court was required to hear the arguments on the part of the plaintiffs and defendants if they were to remain present. At the stage of arguments, nobody appeared on behalf of the defendant Nos.1 and 3. I have heard arguments advanced by learned Advocate Mr.Makhija in support of the plaintiffs’ case. 12. The present suit is filed by the plaintiffs for recovery of charges, namely, wharfage, demurrage and sale warehousing charges. These charges are cumulatively called as port trust charges. The evidence of P.W.No.1 goes to show as to how the suit consignments were brought to Bombay and as to how defendants 1 and 3 did not participate in the matter of taking the delivery of the goods. My attention was drawn to the fact that Confiscation Order dated 10.8.1987 was passed by the Customs Department of Govt. of India and, therefore, the : 8 : plaintiffs waited till 10.8.1987 for the purposes of calculating the port trust charges. It is only when the Confiscation Order was passed, the port trust charges could be calculated and that is how the plaintiffs could prepare working sheet which is at Exhibit-P-3 Exhibit-P-3 Exhibit-P-3 and quantify the port trust charges and it is on the strength of the said working sheet, the present suit came to be filed for recovery of Rs.15,87,263.60. Learned Advocate Mr.Makhija had submitted that since the Confiscation Order was passed on 10.8.1987, institution of the suit on 15.11.1988 was well within the period of limitation in view of the provisions of Article 113 of Limitation Act as also in view of the principle that the port trust charges would become crystalised only on the date of passing of the confiscation order. 13. Learned Advocate Mr.Makhija had submitted that in the absence of appropriate cross-examination on the part of defendant Nos.1 and/or 3, the stand of defendant No.3 that there was a delay in not attending to the matter as regards recovery of port trust charges cannot sustain and that the plaintiffs are entitled to recover port trust charges. Mr.Makhija had submitted that the defendants have not participated in the suit and there is no evidence : 9 : placed on record to show that the plaintiffs were negligent in attending to the suit cargo. He had, therefore, submitted that the claim of the plaintiffs is required to be granted as it has gone unchallenged. 14. Learned Advocate Mr.Makhija had submitted that defendant No.1 is the consignee, who had imported the goods. According to learned Advocate Mr.Makhija, defendant No.1 is liable to pay the port trust charges because it was the importer/consignee. Sofar as defendant No.3 is concerned, it was argued by learned Advocate Mr.Makhija by relying upon the provisions of Section 2(o) of the said Act i.e. the definition of the term "owner" that defendant No.3 in their capacity as the agent of the vessel are liable to pay the port trust charges. He had also submitted that the judgement delivered by the Supreme Court in the case of Trustees of the Port of Madras, Trustees of the Port of Madras, Trustees of the Port of Madras, through its Chairman v/s. M/s.K.V.P.Sheikh Moh. Rowther through its Chairman v/s. M/s.K.V.P.Sheikh Moh. Rowther through its Chairman v/s. M/s.K.V.P.Sheikh Moh. Rowther & Co. Pvt. Ltd. and Anr. reported in AIR 1995 S.C. & Co. Pvt. Ltd. and Anr. reported in AIR 1995 S.C. & Co. Pvt. Ltd. and Anr. reported in AIR 1995 S.C. 1922, 1922, 1922, the agent of the vessel will have to be treated as the person liable to pay the port trust charges as he will be termed as the owner of the goods. Mr.Makhija had, therefore, submitted that the defendant No.3 in their capacity as the agent of the vessel would be liable to pay : 10 : the port trust charges. 15. Learned Advocate Mr.Makhija had submitted that the plaintiffs in their demand notice had claimed interest @15% per annum and since defendant Nos.1 and 3 have not complied with the notice of demand, plaintiffs are entitled to recover from defendants 1 and 3 interest @15% per annum from the date of demand i.e. 17.10.1988 till realisation. Mr.Makhija had, therefore, submitted that the plaintiffs claim be granted and a decree as prayed for be passed. 16. I have perused the record. The plaintiffs have been able to produce Import General Manifest at "Exhibit-P-1 Exhibit-P-1 Exhibit-P-1" and the import of the suit cargo cannot be disputed by defendants 1 and 3. Same is the position as regards Confiscation Order dated 10.8.1987 at Exhibit-P-2. Exhibit-P-2. Exhibit-P-2. 17. The working sheet on the basis of which the plaintiffs are relying is at Exhibit-P-3. Exhibit-P-4 to Exhibit-P-3. Exhibit-P-4 to Exhibit-P-3. Exhibit-P-4 to P-10 P-10 P-10 are the demand notices addressed to defendants 1 and 3 respectively. 18. I now give reasons to decide various issues. : 11 : Issue No.1 :- Issue No.1 :- Issue No.1 :- ============= 19. Defendant No.1 is the consignee and as such defendant No.1 will have to be styled as the "owner" of the goods. Defendant No.3 is the agent of the vessel. In view of the definition of the term "owner" appearing in Section 2(o) of the said Act as well as in view of the Supreme Court judgement in the case of Trustees of the Trustees of the Trustees of the Port of Madras, through its Chairman v/s. Port of Madras, through its Chairman v/s. Port of Madras, through its Chairman v/s. M/s.K.V.P.Sheikh Moh.Rowther & Co. Pvt. Ltd. and Anr. M/s.K.V.P.Sheikh Moh.Rowther & Co. Pvt. Ltd. and Anr. M/s.K.V.P.Sheikh Moh.Rowther & Co. Pvt. Ltd. and Anr. reported in AIR 1995 S.C. 1922, reported in AIR 1995 S.C. 1922, reported in AIR 1995 S.C. 1922, the defendant No.3 will have to be styled as the "owner" of the suit cargo. It is required to be mentioned that no evidence is placed before the court by defendant No.3 so as to show that a bill of lading duly endorsed by defendant No.3 was delivered to defendant No.1. There is no material to show that defendant No.3 had issued a delivery order in favour of defendant No.1 addressed to the plaintiffs. As a result of this, defendant No.3 will have to be styled as the owners/bailors of the suit cargo and that is how, Issue No.1 will have to be answered in the affirmative. Hence, I answer Issue No.1 in the affirmative. Issue Nos.2 and 3 :- Issue Nos.2 and 3 :- Issue Nos.2 and 3 :- ==================== : 12 : 20. These two issues relate to recovery of the port trust charges by the plaintiffs from defendants 1 and 3. As indicated earlier, defendant No.1 as the consignee of the suit cargo will be directly responsible to pay the port trust charges. Defendant No.3 as discussed above, will have to be styled as the owner of the goods and that is how, defendant No.3 will also be liable to pay the port trust charges. 21. The last free date of the consignment was 15.11.1985. The confiscation order came to be passed on 10.8.1987. In the absence of any material to show that the plaintiffs could deal with the suit cargo till 10.8.1987, it will have to be treated that the plaintiffs were prohibited from dealing with the said cargo till the Confiscation Order dated 10.8.1987 will be passed. I am observing this because no effort was made by defendant No.1 and/or 3 to elicit from the evidence of P.W.No.1 or place on record any independent evidence to show that there were no restrictions on the plaintiffs to deal with the suit cargo prior to passing of Confiscation Order dated 10.8.1987. As a result of this discussion, the port trust charges would get crystalised on 10.8.1987. : 13 : 22. The plaintiffs have filed this suit for recovery of port trust charges from last free date i.e. 15.11.1985 till 10.8.1987. The plaintiffs will be entitled to recover these charges. 23. Evidence of Mr.Almeida, P.W.No.1 goes to show that the plaintiffs have charged wharfage as well as demurrage as per the Docks Scale of Rates. There is no challenge put up to this calculation in the cross-examination by defendant No.1 and/or 3. In such a situation, plaintiffs right to recover wharfage and demurrage charges has gone unchallenged and the plaintiffs will be entitled to recover such wharfage and demurrage. The working sheet goes to show that the wharfage and demurrage charges are to the tune of Rs.15,85,807/-. The plaintiffs will be entitled to recover from defendants 1 and 3 said amount of Rs.15,85,807/-. 24. The plaintiffs have demanded Rs.1,456/- as and by way of sale warehousing charges. No satisfactory material is placed before the court as to what was the authority for the plaintiffs to recover sale warehousing charges and to that extent, the claim of the plaintiffs will have to : 14 : be rejected. Hence, plaintiffs will not be entitled to recover from defendants 1 and 3 Rs.1,456/- towards sale warehousing charges though claimed in the plaint. 25. The plaintiffs have claimed interest @15% per annum from the date of demand i.e. 17.10.1988 till realisation on the port trust charges set out in the working sheet. According to the plaintiffs because the interest @15% per annum was demanded in the demand notice, they are entitled to receive interest @15% per annum. In the evidence of Mr.Almeida, P.W.No.1 except putting up such a demand @15% p.a., there is no material placed before the court to show as to how interest @15% p.a. could be recovered by the plaintiffs. In such a situation what rate of interest would be applied that will have to be determined on the basis of 3 dates, namely, last free date and the date of the Confiscation Order dated 10.8.1987 and the date when the suit came to be filed. Considering these three dates, namely, 15.11.1985, 10.8.1987 and 15.11.1988, I am inclined to observe that interest @12% can be recovered by the plaintiffs from the date of demand i.e. 17.10.1988 till filing of the suit, namely, 15.11.1988. In view of the provisions of Section 34 of the C.P.C., plaintiffs will be entitled to recover : 15 : from the defendants 1 and 3 interest @6% per annum on the port trust charges from the date of filing of the suit till realisation. 26. Having rejected the claim of the plaintiffs towards sale warehousing charges, the sum of Rs.1,456/- will have to be deducted from the amount appearing in the working sheet, namely, Rs.15,87,263.60. After doing this calculation, the amount towards wharfage and demurrage charges turns out to Rs.15,85,807/-. The plaintiffs will be entitled to have a decree against defendants 1 and 3 to the tune of Rs.15,85,807/- and the interest as mentioned aforesaid. Accordingly, decree in favour of plaintiffs will have to be passed. Hence Issue Nos.2 and 3 are decided as per the operative part. Needless to mention that the plaintiffs will be entitled for costs of the suit. Issue Nos.4 and 5 :- Issue Nos.4 and 5 :- Issue Nos.4 and 5 :- ==================== 27. Keeping in view the discussion on Issue Nos.2 and 3, the plaintiffs claim is being granted as per the operative part and Issue Nos.4 and 5 are decided as per : 16 : the operative part. 28. For the reasons mentioned aforesaid, I pass the following decree :- D E C R E E D E C R E E D E C R E E i) Defendants 1 and 3 jointly or severally do pay to plaintiffs Rs.15,85,807/-. ii) Defendants 1 and 3 jointly or severally do pay to plaintiffs interest @12% per annum on Rs.15,85,807/- from 17.10.1988 till 15.11.1988. iii) Defendants 1 and 3 do pay to plaintiffs jointly or severally interest @6% per annum on Rs.15,85,807/- from the date of filing of the suit till realisation. iv) Defendants 1 and 3 do pay to plaintiffs jointly or severally costs of the suit. (R.Y. GANOO,J.) (R.Y. GANOO,J.) (R.Y. GANOO,J.)