: 1 : IN THE HIGH COURT OF JUDICATURE AT BOMBAY ADMIRALTY AND VICE-ADMIRALTY JURISDICTION ADMIRALTY SUIT NO.18 OF 2000 Bhatinda Chemicals Ltd. . a company incorporated under the . Companies Act, 1956 and having . its registered office at Hazi . Rattan Link Road P.O. Box No.71, . Bhatinda, Punjab, India ....Plaintiffs . V/s. 1. m.v. "X-PRESS NUPTSE", a motor vessel registered in a port other than one in India, flying a foreign flag along with her hull, gears, engines, tackle, bunkers, machinery, plant, furniture, equipment, appurtenances and paraphernalia and presently in Port JNPT and within the jurisdiction of this Hon’ble Court. 2. Fintas Shipping Company Ltd., A company incorporated under the foreign Laws and having its place of business at C/o Marconsult Bereederungs GMBH Grosse Elbstrasse 36,22767 Hamburg, Germany. 3. Any person or persons who may be concerned, either beneficially or otherwise with the first defendant vessel ....Defendants Mr.S.Sen i/b Mr.Manoj R. Khatri for the Plaintiffs. Mr.Rahul Narichania i/b Bhatt & Saldhana for the Defendants. CORAM: S.J.VAZIFDAR, J. DATED: 13TH/14TH FEBRUARY, 2006. : 2 : ORAL JUDGMENT :- 1. The Plaintiffs have filed the suit for arrest of the vessel m.v. "X-PRESS NUPTSE", the first Defendant and for a decree against the Defendants in the sum of US $ 63,760=21 together with interest thereon at the rate of 12% p.a. from the date of the suit till payment. Defendant No.2, Fintas Shipping Company Limited is the owner of the said vessel. 2. Original Defendant No.2 was described as "Any person or persons who may be concerned either beneficially or otherwise with the first Defendant vessel". Thereafter an order of arrest was passed on 4.5.2000. The charterer M/s.Express Container Lines (U.K.) Ltd. appeared at the hearing of the Notice of Motion on 10.5.2000. By an order dated 10.5.2000, the learned Judge permitted the vessel to be released on Defendant No.1 furnishing a bank guarantee. Pursuant to an order dated 14.9.2000 the owners of Defendant No.1 - Fintas Shipping Company Limited were impleaded as Defendant No.2. Original Defendant No.2 was continued as Defendant No.3. The reference hereafter to the Defendants is restricted to Defendant Nos.1 and 2. : 3 : 3. I will first set out the Plaintiffs’ case. The Plaintiffs claim to be the consignees in relation to a consignment of 260 bags of Irani Pistha (hereinafter referred to as the "said goods") initially containerised for shipment from Dubai, U.A.E. and to be discharged at Mumbai. A bill of lading dated 10.4.2000 was issued by Balaji Shipping (UK) Ltd. Ivory Foodstuff Trading L.L.C., Dubai was shown as the shipper and the Plaintiffs were shown as the consignees and parties to be notified. The agent’s address in Mumbai was the address of one NLS Agency (India) Pvt.Ltd. The intended port of loading was Dubai and the place of delivery was Mumbai. Defendant No.1 was shown as the intended vessel. The bill of lading also described the goods under the caption "SAID TO CONTAIN". The box at the bottom of the bill of lading on the right side contained the following provision :- "Received in apparent good order and condition except as otherwise noted the total number of Containers or packages or units enumerated to be transported to such place of receipt as agreed,authorised or permitted herein subject to all the terms and conditions appearing on the front and reverse of this Bill of Lading to which the Merchant agrees by accepting this Bill of lading, any local privileges and customs notwithstanding." The clause, part of which I have extracted above, contained at the foot thereof the words : " Signed on : 4 : behalf of the carrier". Below these words the word "by" is printed. Along side the word "by" appears the seal of one Albatross Shipping Co. LLC. Below the seal is the name "ALBATROSS SHIPPING CO. LLC." & below that is the stamp with the words : "AS AGENTS FOR CARRIER BALAJI SHIPPING (U.K.) LTD." The front of the bill of lading also has the following clause : "JURISDICTION JURISDICTION JURISDICTION AND LAW CAUSE : AND LAW CAUSE : AND LAW CAUSE : ANY CLAIM UNDER THIS BILL OF LADING SHALL BE SUBJECT TO ENGLISH LAW AND DECISIONS OF ENGLISH COURTS SHALL ONLY APPLY. CLAIMS FILED OTHER THAN ENGLISH COURTS SHALL NOT BE ENTERTAINED". The conditions of carriage on the reverse of the bill of lading define carrier to mean the party on whose behalf the bill of lading had been signed. . Clause 32 which appears on the reverse of the bill of lading reads as under :- "32. DEMISE CLAUSE. If the ship is not owned or chartered by demise to the Company or line by whom this Bill of Lading is issued (as may be the case notwithstanding anything that appears to the contrary) this Bill of Lading shall take effect only as a contract with the owner or demise charter as the case may be as Principal made through the agency of the said Company or Line who act as agents only and shall be under no personal liability : 5 : whatsoever in respect thereof." 4. The Plaintiffs have further alleged that they took necessary steps to ensure that the shipment was as per the norms ; that a debit memo dated 8.4.2000 was raised upon them by the foreign shipper. The plaint merely states that the payment was required to be made as arranged. Nothing further is stated in the plaint regarding what the arrangement was - the significance of which I will deal with later. The Plaintiffs accepted the documents received from the Punjab National Bank. The Plaintiffs claim to be entitled to take delivery of the consignment on the basis of the endorsement in their favour on the reverse of the bill of lading. The Plaintiffs contacted M/s.NLS Agency (India) Pvt.Ltd., the vessel’s local agent and called upon them to issue delivery orders M/s.NLS Agency (India) Pvt. Ltd. informed the Plaintiffs that they were awaiting instructions from their principal’s office regarding issuance of the delivery orders. The Plaintiffs were also consignees/holders of the bills of lading in respect of three other shipments under three different bills of lading. The Plaintiffs’ advocate addressed a notice dated 19.4.2000 to M/s.NLS Agency : 6 : (India) Pvt.Ltd. Thereafter delivery orders in respect of three consignments were given to the Plaintiffs and the Plaintiffs collected the cargo thereunder. In respect of the said consignment, the Plaintiffs were informed by M/s.NLS Agency (India) Pvt.Ltd. that the container was not on board the first Defendant. Non-delivery of the cargo in these circumstances is the Plaintiffs’ cause of action for the reliefs claimed in the suit. 5. The Defendants filed a written statement after furnishing the security as aforesaid. In the first instance, the Defendants have pleaded certain facts pursuant to which orders were passed by the Court in Dubai attaching the container. The Defendants have stated that it appears that the Plaintiffs had purchased the cargo from Ivory Foodstuff Trading L.L.C. who in turn had purchased the same from Abid Khosh Trading Company LLC Dubai. Ivory Foodstuff Trading LLC took delivery of the cargo and issued two cheques for the value thereof. The cheques however were dishonoured. Abid Khosh Trading Company LLC Dubai therefore filed a suit in the Dubai Court for revocation of the sale contract between them and Ivory Foodstuff Trading LLC, for refund of the price of the said goods and for attachment of the cargo. At the : 7 : hearing, Ivory Foodstuff Trading LLC remained absent. On 11.4.2000/22.4.2000 an order was passed by the Dubai Court attaching the container on the vessel, which was then at the Port of Rashed. The Dubai Court by a letter/order dated 24.4.2000 issued instructions to the Harbour Operation Management to permit the Court Bailiff to break open the container. By a final order and judgment the Dubai Court decreed the claim of Abid Khosh Trading Company LLC Dubai and sustained the attachment order. According to the Defendants, it was in view of the aforesaid orders that the cargo was offloaded and carried to the warehouse of Abid Khosh Trading Company LLC Dubai. The Defendants submitted that they had no option but to comply with the orders of the Dubai Courts and they cannot therefore be held responsible or liable for the consequences arising from the said orders. 6. The Defendants also denied the particulars of the cargo stated in the bill of lading. They have denied that M/s.NLS Agency (India) Pvt.Ltd. were their agents. They submitted that the declarations and in fact all the contents of the bill of lading are by Balaji Shipping (U.K.) Ltd. and not by them and therefore they are not bound by the declarations contained in the bill of lading. They submitted that : 8 : there was no privity of contract between the Plaintiffs and themselves. The Defendants have also denied the averments and the submissions based on the said Clause 32 on the reverse of the bill of lading. 7. The Defendants have further contended that the Plaintiffs have no cause of action against them and that they chartered the said vessel to M/s.Express Container Lines (U.K.) Ltd. by a charter dated 3.5.1999. The Defendants’ case is that the bill of lading was issued by Balaji Shipping (U.K.) Ltd. and not by them ; that since the contract of affreightment was with Balaji Shipping (U.K.) Ltd., the Plaintiffs’ cause of action, if any, would only be against them and not against the Defendants. The Defendants stated that the bill of lading had not been issued by or on their behalf or by on behalf of M/s.Express Container Lines (U.K.) Ltd. The Defendants had no connection whatsoever with Balaji Shipping (U.K.) Ltd. The Plaintiffs had deliberately failed to join Balaji Shipping (U.K.) Ltd., a necessary party and that no order of arrest could be issued against the Defendants’ vessel for the dues of the third party. 8. The following issues were framed/reframed with consent :- : 9 : I S S U E S 1(a) Whether the Plaintiffs prove that they were consignees in relation to 260 bags of Irani Pistha as alleged in Paragraph 3 of the plaint? (b) Whether the Plaintiffs prove that they were entitled to take delivery o f the said cargo? 2. Whether the Plaintiffs prove that the value of the cargo is US$ 63,700.21 as alleged in paragraph 4 of the plaint? 3. Whether this Court has no jurisdiction to receive, try and dispose off this suit as alleged in paragraph 17 of the written statement? 4. Whether the Plaintiffs have no cause of action as alleged in paragraphs 4, 5, 9 and 14 of the written statement? 5. Whether the alleged contract of affreightment was frustrated and/or whether the Plaintiffs cannot enforce the same against the Defendants : 10 : for the reasons and as alleged in paragraph 6 of the written statement? 6. Whether the suit should be dismissed because of non-joinder of a necessary party as alleged in paragraph 5 of the written statement? 7. What reliefs, if any, is the Plaintiffs entitled to? 8. What orders? . The issues were however settled subject to the following qualification stated in the same order dated 24.1.2006 :- "II. It is however, clarified that issue No.2 is subject to Mr.Sen’s objection that the Defendants cannot now be permitted to urge this point regarding the contents and value of the cargo as no issue to this effect was raised when the parties went to trial. Mr.Narichania on the other hand submitted that though no issue was raised he is entitled to urge this point in view of the fact that the evidence in this regard was led and that the Plaintiffs were aware that this was a point in dispute. : 11 : III. This aspect will be considered and decided at the hearing". 9. The Plaintiffs led the evidence of one Navdeep Gupta by filing his affidavit in lieu of examination-in-chief. The Defendants did not lead any evidence. They however, cross-examined the Plaintiffs’ witness extensively. The evidence was recorded on commission by Satish J. Shah, an advocate of this Court. He has filed his report on 1st June, 2003. There is no challenge to the report or to anything that is stated therein. The Commissioner’s report records that during the cross-examination, the Defendants tendered various documents which were taken on record and marked as Exhibits as set out below. 10. The learned Commissioner thereafter stated :- "I enclose herewith the following : 1. The notes of cross-examination ; 2. The minutes of the proceedings of each day (2 days) ; 3. The original affidavit of : 12 : examination-in-chief of Mr.Navdeep Gupta together with the annexures thereto ; 4. The following documents tendered by the Defendants during cross-examination ; (i) letter dated 15th July, 2002, from Mr.Khatri to M/s.Bhatt & Saldanha (marked Exhibit ‘D-1’) ; (ii) Copy of order dated 24th April, 2000, passed by the Court of First Instance, Dubai, in Case No.1213/2000 (Provisional Attachment) together with an official translation thereof (marked Exhibit ‘D-2’) ; (iii) Judgment delivered by the Court of First Instance, Dubai, on 24th June, 2000, in Case No.205 of 2000 (Commercial Claim)." 11. It would be convenient to deal with issue No.5 first. ISSUE NO.5 : 5. Whether the alleged contract of affreightment was frustrated and/or : 13 : whether the Plaintiffs cannot enforce the same against the Defendants for the reasons and as alleged in paragraph 6 of the written statement? . Mr.Narichania, the learned counsel appearing on behalf of the Defendant submitted that though the goods were initially loaded on board the vessel, they had to be offloaded pursuant to and in compliance with the orders and directions of the Court at Dubai. 12. It is clear that the learned Commissioner inadvertently did not mark item 4 (iii) above viz. "Judgment delivered by the Court of First Instance, Dubai, on 24th June, 2000, in Case No.205 of 2000 (Commercial Claim)" as Exhibit D-3. It is nobody’s case that there was any objection when the evidence was being recorded to the documents. It is not the Plaintiffs’ case that the Commissioner wrongly did not record an objection to the document. No objection was therefore recorded by the Commissioner in this regard. 13. Before noting the contents of the orders of the Dubai Court, it would be convenient to consider Mr.Sen’s, objection on behalf of the Plaintiff, in : 14 : regard thereto. Mr.Sen submitted that a foreign judgment can only be proved in the manner prescribed in Sections 74 (1) (iii), 78(6) and 86 of the Indian Evidence Act, 1872 which read as under :- "74. Public documents. - Public documents. - Public documents. - The following documents are public documents :- (1) Documents forming the acts, or records of the acts - (i) ............................ (ii) ............................ (iii) of public officers, legislative, judicial and executive, (of any part of India or of the Commonwealth), or of a foreign country ;" 78. Proof Proof Proof of other official of other official of other official documents documents documents - - - The following public documents may be proved as follows:- (1) ............................ (2) ............................ (3) ............................ (4) ............................ (5) ............................ (6) Public documents of any other class in a foreign country , - by the original, or by a copy certified by the legal keeper thereof, with a certificate under the seal of a Notary Public, or of (an Indian Consul) or diplomatic agent, that the : 15 : copy is duly certified by the officer having the legal custody of the original, and upon proof of the character of the document according to the law of the foreign country. 86. 86. 86. Presumption Presumption Presumption as to certified as to certified as to certified copies copies copies of foreign judicial records.- of foreign judicial records.- of foreign judicial records.- The Court may presume that any document purporting to be a certified copy of any judicial record of (any country not forming part of India) or of Her Majesty’s dominions is genuine and accurate, if the document purports to be certified in any manner which is certified by any representative of the (Central Government) (in or for) ( such country) to be the manner commonly in use in (that country) for the certificate of copies of judicial records. (An officer who, with respect to any territory or place not forming part of (India or) Her Majest’s dominions, is Political Agent therefore, as defined in section 3, (clause (43) ), of the General Clauses Act, 1897 (10 of 1897), shall for the purposes of this section, be deemed to be a representative of the (Central Government) (in and for the country) comprising that territory or place). 14. The submission is unfounded for two reasons. Firstly the documents were tendered in evidence. They were received and marked in evidence. There was no objection to the documents being received and marked in evidence. In view thereof, it was not necessary for the Defendants to prove the same. The provisions : 16 : of Sections 74, 78 and 86 of the Indian Evidence Act would apply where foreign judgments and orders are disputed or objected to being received in evidence for any reason. It is not necessary for a party to prove a foreign judgment or order if there is no objection to the same being received and marked in evidence. 15. Secondly, the facts necessary in support of Mr.Narichania’s contention have been admitted by the Plaintiffs’ witness in his cross-examination. . The Plaintiffs’ witness has admitted the fact of the said orders of the Dubai Courts in his cross-examination. 16. I must preface a consideration of the evidence of the Plaintiffs’ witness by noting a few facts which are important not only to this issue but to some of the other issues as well. Initially, the Plaintiff had filed the affidavit in lieu of examination-in-chief of its Chief Executive one Krishan Bansal. The affidavit was affirmed on 4.6.2001 and was served upon the advocate of Defendant Nos.1 and 2 under cover of the Plaintiffs’ advocates letter dated 20.6.2002. Mr.Narichania prior to commencing the cross-examination of the witness, : 17 : though not bound to, put the Plaintiff to notice that if Bansal was not produced for cross-examination, the Defendants would contend that an adverse inference ought to be drawn against the Plaintiff for non-production of Bansal for cross-examination. The same was recorded by the Commissioner. 17. I will now revert to the evidence of the Plaintiffs witness admitting the orders of the Dubai Court. It would be convenient to quote the evidence in this regard. "110 Q) The said affidavit in paragraph 23 also says as follows "The Defendants have failed to comply with their obligation under the contract. They were well aware of the Dubai Court’s order, but yet failed and neglected to inform the consignee of this". A) Yet it is true to my mind also. 111 Q) You are therefore aware that the Doubt Court ordered and directed the said container containing the said purported consignment to be attached and retained at the port ? A) Yes, at a later stage but only after the arrest of the vessel, it has come to our notice that there was any Dubai Court order in this case though we have nothing to do with the Dubai Court’s order. 112 Q) Would you agree that orders or judgment of courts of law are to be respected and abided by ? A) Yes of course. 113 Q) So if the order was followed and abided by off loading the said consignment from the : 18 : first defendant vessel, the party complying with the order of the court cannot be said to have acted wrongfully and illegally ? A) Yes of course." 114 Q) (Shown certified copies of order passed by Dubai Court dated 24th June 2000 alongwith English transaction thereof at first instance and an order from Courts department at first instance dated 24th April 2000 together with an English translation thereof). Would you agree that under these two orders the consignment would not be carried on board the first defendant vessel to Mumbai ? A) No, I do not agree. 115 Q) Why do you not agree ? A) When the Bill of Lading issued in our name mentioning the container as "shipped on board", the first defendant vessel has to deliver the goods to us at Mumbai. The defendants have to inform us in time about the happenings at Dubai since they have not at all informed us about the same, we are entitled to get the delivery of the vessel at Mumbai Port. Further, the Courts order shown are not gone through by me as we are not at all concerned with the Courts order at Dubai and also there is no mention of our company Bhatinda Chemicals Ltd. Bhatinda, in these court’s order and these Court’s order are not at all binding upon our company". 18. The affidavit referred to in question 110 was filed by the said Bansal on 4.6.2001. The affidavit dated 4.6.2001 was affirmed/signed and forwarded to the Defendants’ advocate. Subsequently the Plaintiffs sought to withdraw the affidavit. Bansal was not even examined. The answer to question 110 itself indicates that the Plaintiffs were aware of and had admitted the : 19 : said orders of the Dubai Court. The answer to question 111 reinforces the fact of existence of the Dubai Court’s order. The answer to questions 112 and 113 supports the Defendants’ case that in view of the orders of the Dubai Court, they could have done nothing in the matter. Of course, even had the witness answered otherwise, it would not have made any difference for obviously the Defendants were bound to obey the order of the Dubai Court. In the unlikely event of the Defendants obstructing the execution of the order, the same would have been enforced in any event. . The answer to question 114 is not only contrary to the answer to questions 112 and 113 but is also incorrect. 19. The answer to question 114 is relevant for another reason. It establishes that the orders of the Dubai Court were not only tendered, received and marked in evidence without any objection but they were even relied upon in the cross-examination. Even during the cross-examination the same were put to the witness without any objection from the plaintiffs. The doubt, if any about the orders of the Dubai Court being proved in evidence is thus removed. : 20 : 20. The matter does not rest here. It goes further. I am inclined to accept Mr.Narichania’s contention that the Plaintiffs were aware of the orders of the Dubai Court before they filed the suit. 21. Mr.Narichania’s submission that an adverse inference must be drawn against the Plaintiff is well founded. There is no justifiable reason for not producing Bansal for cross-examination after tendering his affidavit in lieu of examination-in-chief. In fact in view of the cross-examination, which I shall now refer to, even if Bansal had not filed an affidavit in lieu of the examination-in-chief, the Defendants would have been entitled to contend that an adverse inference ought to be drawn against the Plaintiffs, even for non-production of Bansal as a witness. 22. The witness in answer to question 3 admitted that he was not personally involved in the suit transactions. He stated that he was informed about it by his Managing Director. He further stated that he became aware of the transactions only when the Plaintiff’s bankers received the documents. His contention thereafter that he became conversant with : 21 : the facts of the case is incorrect. Factually he admittedly therefore had no connection with either the formation or execution thereof except to the extent of what he was allegedly told by the Managing Director and from the file of the case. This is clear from