MAKALI METALS PVT. LIMITED v. CHAIRMAN, CALCUTTA PORT TRUST
2001-10-18
SEN GUPTA
body2001
DigiLaw.ai
SEN GUPTA, J. ( 1 ) IN this case the petitioner have prayed for a declaration that the petitioners are not liable to pay any demurrage or any other Port charges in respect of six consignments of Mild Steel Low Carbon uncoated defective secondary sheets in coils (hereinafter referred to as the aforesaid materials) from 9/08/1990 till the date of delivery. ( 2 ) THE short fact of this case is that the petitioners brought the aforesaid materials for home consumption from abroad and the same were discharged at the Port of Calcutta. In the body of the petition, however, it has not been mentioned the date of discharge of the materials from the vessel unto wharf and/or port premises. The petitioner filed the bills of entry and paid all port charges on 8/08/1990. Thereafter the petitioner is said to have made an attempt to remove the goods from the port premises through its clearing agent. It is stated in the petition that its clearing agent could not take delivery and remove the goods because of some casual workers employed by the port authorities had started agitation in front of the gate outside the port premises for pressing demand of regularization of their services. Those striking casual workers effectively blocked and/or prevented the petitioners from taking delivery and removing of the goods. As such, in spite of best effort, the goods could not be removed till this Court had passed an order. ( 3 ) ON the aforesaid background the petitioners claim no demurrage charge is leviable, and payable by the petitioners on and from 9/08/1990 till the date of removal as the aforesaid incident constitutes a special case so much so the port authority could exempt from payment. ( 4 ) IN the affidavit-in-opposition a case has been made out by the port authority that the striking casual workers were not employees of the port authority. They were engaged by the contractor and/or clearing agent and this agitational programme resulted in preventive and/or obstructive action being perpetrated outside the port premises. The port authorities did not have any control over the aforesaid casual workers employed by the third party.
They were engaged by the contractor and/or clearing agent and this agitational programme resulted in preventive and/or obstructive action being perpetrated outside the port premises. The port authorities did not have any control over the aforesaid casual workers employed by the third party. However, considering the plight of the importers the port authority as a good gesture took some measure so that the goods could be removed and brought out from the port premises with the help of the police and the State administration in general. By notice dated 4/08/1990 all the importers were informed accordingly. In fact accepting this advice some of the importers could bring out the materials with the police help. Therefore, the aforesaid agitation of the casual workers of contractor cannot be attributed to be a special case. ( 5 ) MR. Samit Talukdar, learned Advocate appearing on behalf of the petitioners contends that it is an admitted position that on and from 6/07/1990 the casual workers who were responsible for loading and unloading of the goods started agitational programme that prevented and/or obstructed effectively importers including his client from bringing out the goods from the port premises. It will appear from the newspaper ultimately the strike was resolved through the intervention of the Port Secretary who promised to look into their grievances. This fact per se suggests that those casual workers were employed by the port authority and as such promise for absorption and/or regularization of their services was given. It is settled law that strike, civil riots and other natural calamities are sufficient cause and/or grounds for relieving a person from hardship occurred due to such incident. Hence, the port authority should not realize demurrage charges on and from 9/08/1990 in this case. In support of his submission he has cited an unreported decision of this Court dated 19-7-2000 of Justice D. P. Kundu in matter being W. P. No. 2231 of 1990 V. G. Veenears Pvt. Ltd. and ors. v. The Chairman, Calcutta Port Trust. ( 6 ) HE contends in the aforesaid judgment His Lordship has been pleased to hold amongst other that the aforesaid agitation of the casual workers is sufficient cause, and/or constitute a special cause for granting exemption from payment of the demurrage charges.
v. The Chairman, Calcutta Port Trust. ( 6 ) HE contends in the aforesaid judgment His Lordship has been pleased to hold amongst other that the aforesaid agitation of the casual workers is sufficient cause, and/or constitute a special cause for granting exemption from payment of the demurrage charges. As such in that case His Lordship was pleased to grant relief for exemption till 5/08/1990 as till that date the port authority was held to be unable to make any arrangement for clearing of the goods from the port premises. Therefore, the petitioners should be granted exemption in this case also. ( 7 ) MR. S. P. Majumdar, learned Advocate appearing on behalf of the Port authority while opposing this application highlighting the facts mentioned in the affidavit-in-opposition contends that agitation of the casual workers of the contractor outside the port premises though the same was partially obstructive and/or preventive in nature cannot be termed to be a special case for which exemption should be granted. In this case admittedly the petitioners could take delivery of the goods after 8/08/1990, for the port authorities had made arrangement for effective police escort. In spite of knowledge of this fact the petitioners did not make any arrangement. Therefore, there is no ground for granting exemption in this case. ( 8 ) HE contends that the port charges is always leviable and realizable except in a case where the port authorities and/or their employees are responsible for non-removal of the goods from the port premises. The fault on the part of the third parties even including the Customs authorities and other statutory authorities cannot be a cause and/or ground for granting exemption. This has been settled by the Supreme Court in various judgments reported in (1995) 3 SCC 730 : (1995 AIR SCW 3235), AIR 1977 SC 1622 and (1995) 3 SCC 151 : (1995 AIR SCW 1802 ). ( 9 ) HE contends that the judgment of Justice Kundu has been taken to the appeal Court, as such it is not a binding precedent. Even factually the ratio of the judgment of Justice Kundu rather supports his client's case as His Lordship has been pleased to hold the port authrities are entitled to realize demurrage charges after 5/08/1990. ( 10 ) I have heard respective contentions and perused the materials placed before me.
Even factually the ratio of the judgment of Justice Kundu rather supports his client's case as His Lordship has been pleased to hold the port authrities are entitled to realize demurrage charges after 5/08/1990. ( 10 ) I have heard respective contentions and perused the materials placed before me. It is necessary to examine the provision for exemption from payment of demurrage charges under Section 53 of the Major Port Trusts Act 1963. Section 53 is quoted hereunder : 53. The Board may, in special cases and for reasons to be recorded in writing, exempt either wholly or partially any goods or vessels or class of goods or vessels from the payment of any rate or of any charge leviable in respect thereof according to any scale in force under this Act or remit the whole or any portion of such rate or charge so levied. " ( 11 ) UNDER S. 49 of the Major Port Trusts Act 1963 the Board of Trustees for the Port of Calcutta is empowered to frame scale of rates for payment of amongst other, wharf charges. However, the aforesaid fixation of scale of rates is subject to sanction and/or approval of the Central Government. It has been laid down in the Supreme Court decisions reported in AIR 1977 SC 1622 and (1995) 3 SCC 151 : (1995 AIR SCW 1802), so also it has been observed in the judgment of Justice Kundu as above that once the sanction of the Central Government is accorded it partakes of the statutory character and statutory force. Upon careful reading of the wordings of S. 53 it appears to me the realization of the demurrage charges or any other port charges is a mandatory and as a matter of Rule. Exemption either wholly or partially of any goods or vessels from payment of any rate or any charge is an exception and this exception has to be fallen in case of special cases and for which reason has to be recorded in writing. It appears, as it is argued, under S. 2 of the scale of rates three days time is given for removal of the goods from the date of discharge of the goods unto premises without any payment of demurrage charges.
It appears, as it is argued, under S. 2 of the scale of rates three days time is given for removal of the goods from the date of discharge of the goods unto premises without any payment of demurrage charges. ( 12 ) THEREFORE, the aforesaid power under S. 53 of the Board for granting exemption is a discretionary one and this discretion has to be exercised judicially not capriciously or arbitrarily and the same can only be granted when there exists a special case. Section 53 provides for total exemption or partial exemption and the special case in my view constitutes such a situation and/or event for which the importer could not remove the goods after expiry of free time due to fault attributable to the port authority, or under any law authorizing port authority to waive demurrage charges or rates. In the decision of Supreme Court reported in AIR 1977 SC 1622 (Board of Trustees of the Port of Bombay v. Indian Goods Supplying Co.) it has been held in paragraph 14 as follows :- ( 13 ) THE position therefore is that even though the delay in clearing the goods was not due to the negligence of the importer for which he could be held responsible yet he cannot avoid the payment of demurrage as the rates imposed are under the authority of law the validity of which cannot be questioned. The claim cannot be resisted as there is no evidence that the delay was due to any act of the Port Trust or persons for whom the Port Trust is responsible. " ( 14 ) IN the case of International Airports Authority of India v. Grand Slam International reported in (1995) 3 SCC 151 : (1995 AIR SCW 1802) in its paragraph 66 it has been held as follows :- 66.
" ( 14 ) IN the case of International Airports Authority of India v. Grand Slam International reported in (1995) 3 SCC 151 : (1995 AIR SCW 1802) in its paragraph 66 it has been held as follows :- 66. From the above decisions of this Court is becomes clear that an authority created under a statute even if is the custodian of the imported goods because of the provisions of the Customs Act 1961, would be entitled to charge demurrages for the imported goods in its custody and make the importer or consignee liable for the same even for periods during which he/it was unable to clear the goods from the customs area, due to fault on the part of the Customs Authorities or of other authorities who might have issued detention certificates owing such fault. " ( 15 ) AGAIN in case of Trustees of Port of Madras v. Nagavedue Lungi and Co. reported in (1995) 3 SCC 730 : (1995 AIR SCW 3235) following the above decision viz. , (1995) 3 SCC 151 : (1995 AIR SCW 1802) it has been held by the Supremecourt amongst other that the principle of above case is also applicable to hold importer/exporter liable for payment demurrage or rates to port authority even if the importer/exporter is not at fault when the goods are brought or carried through sea. ( 16 ) I am of the opinion that the above judgments lay down that exemption can only be granted in case of failure and lapses absolutely on part of the port authorities not of third party, provided of course law does not provide otherwise, however, the natural calamities and/or civil riots are always treated to be cases beyond the control of anybody else. In this case it appears that the casual workers employed by the contractor not by the port authorities started agitational movement aiming at to obstruct and/or prevent the importers from bringing out goods from the port premises. The casual workers were not employees of the port authorities. So the port authorities do not have any control over them. Mere fact that the Secretary of the Port Trust has entertained their grievance and mediated the matter with the striking workers that does not mean ipso facto that those workers were controlled and/or managed by the port authorities. Moreover, there was no agitation inside the port areas.
So the port authorities do not have any control over them. Mere fact that the Secretary of the Port Trust has entertained their grievance and mediated the matter with the striking workers that does not mean ipso facto that those workers were controlled and/or managed by the port authorities. Moreover, there was no agitation inside the port areas. The port authorities do not have any control administrative or otherwise outside its area nor do they have any administrative power and control over the police. The port authority at the highest can inform the police authorities or State administration for rendering help so that the working atmosphere and general law and order outside the port area are maintained. ( 17 ) THEREFORE, I am of the view that the agitation of the casual workers of the contractor is the cause attributable to the third party. The port authorities are not at fault at all rather the port authorities co-operated by making arrangement in consultation with the State administration for police escort and this is apparent from the letter dated 5/08/1990 as it appears from record. The judgment of Justice Kundu is not applicable in this case factually because in this case I find the petitioners were not ready to take out the materials before 8/08/1990 when the port authorities had made all arrangements within its mean to facilitate to take out the goods. ( 18 ) UNDER such circumstances I hold no special cause exists to grant any exemption. Therefore, the Board is absolutely justified in imposing demurrage charges in this case. Since the goods have been delivered by the port authorities on furnishing bank guarnatee which is still alive and valid, it would be entitled to invoke the same. However, the port authority must calculate the demurrage charges after allowing free time as provided in Section 2 in the scale of rates and if there is any surplus of proceeds after invocation of the bank guarantee the same shall be refunded to the petitioners. Accordingly, I dismiss the writ petition and vacate the interim order. ( 19 ) THE operation of the judgment and order will remain stayed for a period of three weeks after Long Vacation. Stay is granted on the condition that the petitioner shall keep the bank guarantee alive until further order of this Court.
Accordingly, I dismiss the writ petition and vacate the interim order. ( 19 ) THE operation of the judgment and order will remain stayed for a period of three weeks after Long Vacation. Stay is granted on the condition that the petitioner shall keep the bank guarantee alive until further order of this Court. ( 20 ) ALL parties concerned are to act on a signed copy of the minutes of the operative portion of this judgment on the usual undertakings. Petition allowed.