THE CHAIRMAN, BOARD OF TRUSTEES COCHIN PORT TRUST versus M/S AREBEE STAR MARITIME AGENCIES PVT. LTD. & ORS.

Citation: [2018] 3 S.C.R. 196 · Decided: 07-03-2018 · Supreme Court of India · Bench: R.K. AGRAWAL · Disposal: Matter referred to larger bench

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Judgment (excerpt)

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SUPREME COURT REPORTS
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THE CHAIRMAN, BOARD OF TRUSTEES
COCHIN PORT TRUST
v.
M/S AREBEE STAR MARITIME AGENCIES
PVT. LTD. & ORS.
(Civil Appeal No. 2525 of 2018)
 MARCH  07, 2018
[R. K. AGRAWAL AND DR. D. Y. CHANDRACHUD, JJ.]
Major Port Trust Act, 1963 – s. 2(o) – Liability of the consignee
or steamer agent in respect of ground rent charges to be paid to the
port trust – Determination of – Containers unloaded at port trust,
but not cleared by the consignees or importers and refused to be
de-stuffed by the Port, on the ground of inadequate storage space
– Liability to pay ‘ground rent’, if can be imposed on the owners of
the vessel/steamer agents beyond the period of 75 days, fixed by
the Tariff Authority of Major Ports – Held: In view of the
inconsistencies in the decisions in *Rowther-I, **Rowther-II,
***Sriyanesh Knitters, ****Forbes-II and *****Rasiklal as regards on
whom the Port Trust has to fasten the liability for payment of its
charges, matter referred to the larger Bench – Reference to larger
Bench.
Synthetic woolen rags were imported in containers. The
said containers were destuffed in the Cochin Port Trust premises
to facilitate Customs examination. The destuffed-unloaded cargo
occupied much larger space and was not promptly cleared by the
consignees due to certain reasons. The goods were lying idle in
the Port premises for quite long. The port trust charged ground
rent from the steamer agents/owners of the containers. The same
was challenged. The question arose before the High Court that
whether the liability to pay ‘ground rent’ on containers unloaded
at Cochin Port, but not cleared by the consignees/importers and
refused to be de-stuffed by the Port, on the ground of inadequate
storage space, can be imposed on the owners of the vessel/
steamer agents beyond the period of 75 days, fixed by the Tariff
Authority of Major Ports. The High Court held that there was no
justification for the Port Trust to collect ‘ground rent’ charges in
  [2018]  3 S.C.R. 196
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respect of the containers indefinitely; and that the Port Trust
could demand ‘ground rent’ only for a maximum period of 75
days, under the orders issued by Tariff Authority of Major Ports.
Hence the present appeals by the appellant-Port Trust.
Referring the matter to larger Bench, the Court
HELD: 1.1 The decisions in *Rowther- I, **Rowther- II,
***Sriyanesh Knitters, ****Forbes-II and *****Rasiklal do not
seem to follow a consistent line about whom the Port Trust has
to fasten the liability for payment of its charges.
(ii) The Constitution Bench judgment in Rowther-I holds
that when Port Trust takes charge of the goods from the ship-
owner, the ship-owner is the bailor and the Port Trust is the bailee.
While the Bench of two Judges in Sriyanesh Knitters holds that
there comes into existence the relationship of bailor and bailee
between the consignee and the Port Trust, the decision in Forbes-
II disagrees with this view of Sriyanesh Knitters. Rasiklal opines
that enquiry into such relationship is irrelevant in determining
the right of a Port Trust to recover its dues.
(iii) While the decision in Sriyanesh Knitters was based on
the interpretation of the term “owner” under Section 2(o) of the
Major Port Trust Act, 1963, the judgment in Forbes-II and
Rasiklal do not find the question of interpretation of the term
“owner” to be relevant.
(iv) While Forbes-II relies upon the Constitution Bench
decision in Rowther-I to come to its conclusions, Rasiklal does
not find Rowther-I to be an authority for the proposition that until
the title in goods is passed to the consignee, the liability to pay
various charges payable to a Port Trust, for its services in respect
of goods, falls exclusively on the steamer agent.
(v) In Rowther-II, it was held that once the goods are handed
over to the Port Trust by the steamer and the steamer agents
have duly endorsed the bill of lading or issued the delivery order,
their obligation to deliver the goods personally to the owner or
the endorsee comes to an end. The decision in Rasiklal, which
has been delivered after the reference of Forbes-I was disposed
of, takes a contrary view that in cases where the consignee does
THE CHAIRMAN, BOARD OF TRUSTEES COCHIN PORT TRUST v.
M/S AREBEE STAR MARITIME AGENCIES
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not come to take delivery of goods, the position of law laid down
by Rowther-II would result in a situation that the

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