INDIA BUSINESS WORLD - FEBRUARY 1st - FEBRUARY 15st - 2008
PORT DEMURRAGE CHARGE CASE WITH LARGER SC BENCH
Disagreeing with its earlier ruling that demurrage charges have to be collected by the Port Trust only from the consignee and not the steamer agent, the Supreme Court has referred the issue to a larger bench.
A bench comprising Justice HK Sema and Justice Markandey Katju said, this court (SC) in Trustees of the Port of Madras through its chairman vs KPV Sheikh Mohd Rowther &Co had held that demurrage charges have to be collected from the consignee and not from the steamer agent.“We doubted the correctness of the said judgment and we are unable to persuade ourselves to accept the ratio laid down in the aforesaid judgment of this court,” the bench said. Having regard to the question of law of public importance involved here, which are of a recurring nature, the matter needs ot be considered in depth, the court said referring the matter to a larger bench.
The bench framed the following issues of public importance:
Whether a steamer agent at all can be made liable for payment of storage charges or demurrage which are uncleared by the consignee even where steamer agent has not issued delivery order?
In the event a steamer agent is held liable to what extent he is liable. Whether such liability can absolves the Port Trust from acting promptly under section 61 of 62 of the Major Port Trusts Act, 1963?
Whether a steamer agent can be construed as owner of the goods carried in his principal’s vessel within the definition of owner in relation to goods under section 2(o) of the Major Port Trusts Act?
It came on an appeal of a steamer agent Forbes Campbell & Co Ltd. The vessel was owned by a foreign company American President Lines Ltd. M/s Metal Fabs India was a consignee of 7 cartons of ball bearings which landed in port of Bombay on Feb 5, 1972. The goods remained uncleared for over a period of time. The authorities on October 10, 1974 asked the appellant to furnish details of the consignee. No reply was given. The port again on October 12, 1974 served a notice of sale upon the appellant. Again it went unheeded. Therefore, the authrities auctioned the goods and realised Rs 62,000. It found that even after deduction of due, Rs 4752 was due.
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