Judgment : 1. With the consent of both parties, this writ petition is taken up for final disposal. 2. The petitioner seeks for issuance of a writ of certiorari fied mandamus to quash the Proceedings of the second respondent, dated 28.08.2013 and the consequential Proceedings, dated 29.08.2013, by which the second respondent directed the petitioner to pay the differential short collection of wharfage charges in respect of coal imported by the petitioner during the period 2010- 2011 to 2012-2013, at the rate of Rs.38/-per M.T., along with service tax apart from remitting the said amount continue to remit wharfage rate at the rate of Rs.38/- per M.T., in future cases. 3. The petitioner is engaged in the business of generation of electrical energy from it's coal based plant, which is located in Tuticorin District. According to the petitioner, for the purpose of generating electricity, they import steaming (non-coking) coal from Indonesia and such imports have been done from 2010 onwards and continues even today. The petitioner's consignments are handled by their clearing and forwarding agents, M/s.Aspinwall Logistics Division, Tuticorin, on whom the consequential impugned proceedings, dated 29.08.2013, has been served to fulfil the demand of wharfage charges at the rate of Rs.38/- per M.T., from 2010-2011 onwards. 4. The learned senior counsel for the petitioner submitted that the scale of rates for the services performed by the Port Trust has been notified and in terms and Gazette notification, dated 11.11.2011, the wharfage charges for steaming (non-coking) coal is Rs.27/- per M.T., and for thermal coal, it is Rs.38/- per M.T. By referring to the bills of lading, shipping bills and bills of entry for home consumption for various imports from 2010 to 2012, the learned senior counsel submitted that the product imported by the petitioner is Indonesian Steaming (Non-coking) Coal in Bulk and as per the schedule of the rates, the wharfage charge is Rs.27/- per M.T., which has been remitted by the petitioner. Therefore, at this stage there cannot be a demand with retrospective effect with further compulsion to pay at the rate of Rs.38/- per M.T., in future. Therefore, it is submitted that the impugned order is arbitrary, illegal and unsustainable in the eye of law. 5. Therefore, at this stage there cannot be a demand with retrospective effect with further compulsion to pay at the rate of Rs.38/- per M.T., in future. Therefore, it is submitted that the impugned order is arbitrary, illegal and unsustainable in the eye of law. 5. Further, it is submitted that different rates have been fixed for steaming (non-coking) coal and thermal coal and the petitioner imported steaming (non-coking) coal, which is apparent from the import documents such as the certificate of origin, shipping bill, bill of entry etc., and no differential amount was demanded at any earlier point of time and for the first time, it is sought to be raised during 2013 demanding differential amount from 2010 onwards. Further, it is submitted that the audit reports or vigilance report relied on as basis of the demand have not been provided to the petitioner. It is further submitted that in terms of Section 56 of the Major Port Trust Act, 1963 (hereinafter, referred to as 'the Act'), the competent authority to take decision in the cases of any short levy is the Board as defined under Section 2(b) of the Act and the impugned proceedings have been passed by the second respondent Traffic Manager of the respondent Port Trust and the same is without jurisdiction. 6. It is further submitted that no materials have been placed before this Court to show that the product imported by the petitioner is thermal coal. Further, it is submitted that even while exercising power under Section 56 of the Act, a show cause notice ought to have been issued and since no decision has been taken by the Board, the second respondent Traffic Manager of the respondent Port Trust has no jurisdiction to issue the impugned proceedings. 7. Per contra, the learned counsel for the respondent Port Trust submitted that it is true that the respondent Port Trust collected the wharfage charge on the coal imported by the petitioner at the rate of Rs.27/- per M.T. under the classification of the same cargo steaming (non coking) coal provided in the Port Scale of Rates. The following are the classifications of coal available in the Port Trust Scale of Rates approved by the Tariff Authority for Major Ports (TAMP) and a statutory body formed under the provisions of the Act: i. Steaming (non-coking) Coal - Rs.27/ per tone ii. The following are the classifications of coal available in the Port Trust Scale of Rates approved by the Tariff Authority for Major Ports (TAMP) and a statutory body formed under the provisions of the Act: i. Steaming (non-coking) Coal - Rs.27/ per tone ii. Coal other than Steaming (Non-coking) Coal & Coke in bulk - Rs.30/ per tone iii. Coal & Coke handled through Coal Jetty other than Thermal Coal - Rs.38/ per tone iv. Thermal Coal - Rs.38/ per tone 8. It is further submitted that as it could be seen from the above classification, the 'Thermal Coal' will attract the wharfage rate of Rs.38/ per tonne. The Coal imported/handled for Tuticorin Thermal Power Station (TTPS) belonging to TANGEDCO is charged wharfage at the rate of Rs.38/ per tonne, though it is described as 'Steaming Coal'. Because the description of the Coal falls into the broad classification of 'Thermal Coal' and therefore Rs.38/ per tonne is charged. Similarly, though the description of the Coal imported by the petitioner is 'Steaming (non-Coking) Coal', it falls under the classification 'Thermal Coal' and hence the rate of wharfage of Rs.38/ per tonne is payable. The Port without going into the broad classification has been collecting a lesser wharfage rate of Rs.27/ per tonne, which is applicable to 'Steaming (non-Coking) Coal' handled for the other industries like Cement, Paper, Sugar, etc. The wharfage rate of Rs.27/ per tonne is applicable for Coal meant for the other non-descript industries and not for the Coal meant for Thermal Power Plants producing electricity. This point has been raised both by the AG Audit and the Vigilance Department of the Port. It is further submitted that after a careful reading of the contents of the letter on the subject matter received from the AG Audit and the Port Vigilance Department and after going into the merits of the case, the management of the Port has taken a decision to apply the correct classification of Coal handled by the Petitioner for the purpose of collection of wharfage, though the description of Coal in the import documents contained the words 'Steaming (Non-coking) Coal'. 9. Further, it is submitted that the very same rate of Rs.38/ per tonne is paid for the Coal handled in the Port for Tuticorin Thermal Power Station under TNEB/TANGEDCO. 9. Further, it is submitted that the very same rate of Rs.38/ per tonne is paid for the Coal handled in the Port for Tuticorin Thermal Power Station under TNEB/TANGEDCO. Hence, the petitioner should accept the legitimate claim from the Port and pay the same without demur. The contention of the petitioner that they had been paying Rs.27/-per tonne for their Coal handled in the Port since 2010 is not a legitimate contention. Since the decision taken by the Port management to collect the wharfage on Coal imported by the petitioner for their Power Plant is with reference to the correct classification of their Coal under the category 'Thermal Coal', the petitioner has no right to approach Court seeking direction upon the them to drop the demand raised under the proceedings dated 28.8.2013 and the claim of the petitioner is against the interests of the Port. 10. It is further submitted that the petitioner themselves confirmed the fact that there was an emergent need of Coal for running their Thermal Power Plant and they paid the harfage at the rate of Rs.38/ per tonne without any option in respect of Coal for their Power Plant carried in vessels M.V.Rinia and M.V.Veenus expected to the Port on 08.09.2013 and 09.09.2013 respectively and question of refund does not arise. It is further submitted that the respondent Port Trust had to convey to the petitioner the correct classification of Coal handled by them for the purpose of payment of wharfage to the Port in Proceeding, dated 28.8.2013 following the letter received from the AG Audit, Vigilance Department of the Port and the decision taken by the Port management. Notice to the petitioner and giving them opportunity to explain their stand was not warranted as it is only the process of correcting the course and not a revision of the rate. 11. The learned counsel thus reiterated that the decision taken by the port management to collect the wharfage charges on the coal handled by the consignees at the rate of Rs.38/- per M.T., applicable under the thermal coal classification and intimation to the petitioner to remit the short collection is perfectly justified. 11. The learned counsel thus reiterated that the decision taken by the port management to collect the wharfage charges on the coal handled by the consignees at the rate of Rs.38/- per M.T., applicable under the thermal coal classification and intimation to the petitioner to remit the short collection is perfectly justified. The learned counsel submitted that the website of the petitioner clearly states that they are coal based thermal power plant located in Tuticorin and the coal, which was imported, is coal intended for thermal power plant and therefore, wharfage charge has to be remitted at the rate of Rs.38/-per M.T. Further, it is submitted that all other organizations such as TANGEDCO, Sterlite etc., who have established thermal power plant, have been importing coal and paying wharfage charge at the rate of Rs.38/- per M.T. 12. Further, it is submitted that the schedule of the rates has been fixed by the tariff authority in exercise of power under Section 47-A of the Act and the same has been published in Gazette and the petitioner is bound by the schedule of rates. Further, it is submitted that the Traffic Manager is the delegate of the Board and action has been taken when it was found that the amount remitted by the petitioner falls short of the schedule of the rates and issuance of show cause notice would not make any difference because the schedule of rates is as per the notification published in the Gazette. It is further submitted that the petitioner themselves accepted that if there is any short levy, the same could be demanded within a period of two years. 13. Further, it is submitted that in terms of Section 115 of the Act, penalty can belevied for evading rates by imposing fine, which may extend to ten times of the rates so due subject to the minimum of Rs.500/- and in cases, where fraud has been played, there is no limitation for issuing the demand. 13. Further, it is submitted that in terms of Section 115 of the Act, penalty can belevied for evading rates by imposing fine, which may extend to ten times of the rates so due subject to the minimum of Rs.500/- and in cases, where fraud has been played, there is no limitation for issuing the demand. Further, by referring to information downloaded from Internet, the leaned counsel explained as to what is Coal and the difference between the coal and coke as has been imported by the petitioner is thermal coal and the appropriate wharfage charge is Rs.38/- per M.T. Further, it is submitted that though certain consignments might have been cleared and some officers of the Port Trust might have passed order that itself cannot affect the respondent Port Trust. If it is found that certain officers have not acted in accordance with the statutory provisions or the notification, the matter would be being dealt with by the Port Trust and open for appropriate action. However, that will not absolve the petitioner from it's liability. 14. In reply, the learned senior counsel submitted that they are not challenging the schedule of rates, but only the classification issue and no fraud has been alleged against the petitioner and unless it is made out, the question of stating that fraud has been played cannot be made against the petitioner and in any event, opportunity ought to have been given to the petitioner and such procedure is contemplated under Section 56 of the Act and such thing being the statutory procedure should be done in such manner alone and not in other manner. Further, it is submitted that there is no power delegated to the traffic manager to raise such a demand. 15. Heard the learned counsel for the parties and perused the materials placed on record. 16. Further, it is submitted that there is no power delegated to the traffic manager to raise such a demand. 15. Heard the learned counsel for the parties and perused the materials placed on record. 16. A bare reading of the impugned proceedings show that the same it is a two fold demand, firstly demanding wharfage charges for the coal imported by the petitioner for the period from 2010-2011, 2011-2012 and 2012-2013, at the rate of Rs.38/-per M.T., and the other for the future period to be paid at the same rate of Rs.38/-per M.T. In respect of the past imports i.e., prior to the impugned proceedings, wharfage charges had been collected from the petitioner at the date of Rs.27/- per M.T. By virtue of the impugned proceedings in respect of the past period the difference amount of Rs.11/- per M.T., is demanded. The impugned proceedings have been challenged on the ground that the traffic manager of the respondent Port Trust has no jurisdiction in terms of Section 56 of the Act and it is only the Board, as defined under Section 2(b) of the Act, which can take a decision. 17. Secondly, the impugned proceedings are challenged as being in violation of the principles of natural justice, since no opportunity was granted to the petitioner and no show cause notice was issued. The third ground of attack is that there is no material to show that the petitioner imported thermal coal when all the import documents show that the petitioner has imported Indonesian steaming (non-coking) coal in bulk and as per the schedule of rates the wharfage charge is Rs.27/- per M.T. Fourthly, it is submitted that no fraud has been alleged against the petitioner and if there is any such allegation, it has to be made out and established and therefore the impugned proceedings are illegal. Fifthly, it is submitted that for the future cases, the respondent Port Trust can not make claim by way of a blanket order and the charges have to be collected in terms of the materials imported. 18. It is not in dispute that the petitioner was permitted to clear the imported cargoon aying wharfage charge at the rate of Rs.27/-per M.T., and this has been permitted since 2010 till 2013 i.e., till the date of issuance of impugned proceedings. 18. It is not in dispute that the petitioner was permitted to clear the imported cargoon aying wharfage charge at the rate of Rs.27/-per M.T., and this has been permitted since 2010 till 2013 i.e., till the date of issuance of impugned proceedings. By the impugned proceedings, the respondent Port Trust seeks to demand the differential amount of Rs.11/- per M.T., for the past imports stating that the product imported by the petitioner is used for power generation in the thermal power plant. Therefore, the respondent Port Trust seeks to apply the test that the product imported by the petitioner is only for power generation in their thermal power plant, which is a coal based thermal power plant and therefore the product is for thermal power plant. That similar imports by other governmental organisations have been charged at the rate of Rs.38/- per M.T. The import documents furnished a different classification, which according to the respondent Port Trust does not bind them, since the same is only for the purpose of assessing customs duty and the respondent Port Trust is governed by the schedule of rates as determined and notified by the tariff authority constituted under Section 47-A of the Act. 19. It is to be noted that there is no challenge to the tariff announced by the tariff authority fixing schedule of rates for different services. The dispute raised by the petitioner is as regards rate of wharfage that could be charged on the product imported by them. The petitioner would go by the description of the product given in the import documents. This is not accepted by the respondent Port Trust by contending that they are not bound by the said documents but bound only by the tariff published by the tariff authority. In my view, such contention cannot be raised, since the import documents are the documents which give the description of the product imported based on which the classification of the product is ascertained may be for the purpose of assessment of the customs duty and other charges. Therefore, the respondent Port Trust cannot take a stand that the classification adopted by the customs authority is of no relevance to assess the nature of the product. Though such classification may not bind the respondent Port Trust or the tariff authority, nevertheless it is a material which shows that the nature of the product imported into India. Therefore, the respondent Port Trust cannot take a stand that the classification adopted by the customs authority is of no relevance to assess the nature of the product. Though such classification may not bind the respondent Port Trust or the tariff authority, nevertheless it is a material which shows that the nature of the product imported into India. If the respondent Port Trust has material to show that the nature of product imported though described differently in the import documents yet it would fall within a particular entry under the schedule of rates published by the tariff authority, then it is open to the respondent Port Trust to establish the same and effect demand of charges in accordance with the schedule of rates published by the tariff authority. However, such exercise appears not to have been done in respect of the past period i.e., from 2010 to 2013. 20. While on this issue, it is has to be considered as to whether the traffic manager is empowered to issue the impugned demand. The learned senior counsel for the petitioner would submit that in terms of Section 56 of the Act, it is only the Board, as defined under Section 2(b) of the Act, to take a decision in the matter. It is true that in all cases the Board cannot be expected to take a decision in the matter and the Board may be entitled to delegate there powers. In terms of Section 21 of the Act, the Board may, with the approval of the Central Government, specify the powers and duties conferred or imposed upon the Board by or under this Act, which may also be exercised or performed by the Chairman or by the Deputy Chairman or by any other officer of the Board subject to any conditions or restrictions, which may be issued. While exercising such powers, as a delegated authority the same is being performed under the supervision and control of the Chairman. When there is power for the Board to delegate it's power, it cannot be stated that the second respondent has absolutely no jurisdiction to issue the impugned proceedings especially when the second respondent is the officer in-charge of handling the entire traffic in the port. Therefore, this Court is not inclined to accept the contention of the petitioner that the second respondent lacks jurisdiction to issue the impugned proceedings. 21. Therefore, this Court is not inclined to accept the contention of the petitioner that the second respondent lacks jurisdiction to issue the impugned proceedings. 21. Having held that the impugned proceedings are not vitiated for want of jurisdiction, the next issue to be considered is as to whether the demand could have been issued without issuing a show cause notice. Section 56 of the Act deals with notice of payment of charges short levied or erroneously refunded. In terms of sub-Section (1) of Section 56, when any charge leviable under Chapter VI of the Act (imposition and recovery of rates at ports) has been short levied or erroneously refunded a notice may be issued to the person, who is liable to pay charge, requiring him to show cause why he should not pay the amount specified in the notice. Proviso under Section 56(1) provides that no such notice shall be issued after the expiry of two years and limitation is calculated in accordance with clauses (a) and (b) under proviso to Section 56 (1) of the Act. Thus, when there is a demand for payment of charges short levied the statute contemplates that notice to be issued to a person who is liable to pay the charge. The respondent Port Trust cannot take a stand that no purpose will be served in issuing a notice, since the demand is as per the tariff schedule notified by the tariff authority. As pointed out earlier, the dispute in this case is not with regard to the rate, but, with regard to the classification of the product. Therefore, it is held that the impugned demand in respect of the past period i.e., from 2010 to 2013 having been made without issuing any show cause notice has to be necessarily held to be bad for violation of the statutory provisions and violation of principles of natural justice. Hence, to that extent the impugned demand calls for interference. 22. The next issue to be considered relates to the future period. Even in respect of future cases, the respondent Port Trust demanded the wharfage charge at the rate ofRs.38/- per M.T. It is their contention that the coal imported by the petitioner though it may be described in a different manner in the import documents is intended for their thermal power plant which is coal based plant and therefore it is a thermal plant. The respondent Port Trust rely on the imports effected for TTPS, who had described the product imported as 'steaming coal' where charged wharfage at Rs.38/- per M.T., as the description of the coal falls into the broad classification of 'Thermal Coal'. In my view, such out-right decision cannot be taken without examining the product imported by the petitioner on scientific parameters. Without doing so, the demand cannot be unilaterally imposed, since wharfage has to be collected based on the description or the tariff entry as found in the tariff schedule. Therefore, in sofar as the future cases, the respondent Port Trust should be permitted to collect wharfage charge on independent assessment of the cargo imported by the petitioner dehorse the description given in the import documents since the tariff is fixed by a statutory authority after due notification in the gazette notified after giving a public hearing to all the stakeholders and therefore there cannot be any challenge to the rate of wharfage fixed as per the tariff schedule. Hence, the respondent Port Trust is entitled to make an independent assessment with regard to the nature of product imported by the petitioner. 23. In the result, the writ petition is partly allowed and (i) the impugned proceedings in so far as the period prior to 2013 is set aside and the respondents are directed to issue show cause notice to the petitioner clearly setting out the basis on which there is allegation of short levy and on receipt of the show cause notice, the petitioner is entitled to submit their objection/reply and thereafter after affording of personal hearing to the petitioner, the second respondent shall pass orders on merits in accordance with law. The entire exercises shall be completed within a period of eight weeks from the date of receipt of a copy of this Order. (ii) in respect of the further imports, the respondent Port Trust is entitled to examine the cargo for fixing the correct entry under the schedule of rates as per the tariff published by the tariff authority constituted under Section 47-A of the Act dehorse the description of the product in the import documents and fix the rate and thereafter issue a demand to the petitioner to enable them to remit the said charges for clearing the cargo. Consequently, connected miscellaneous petitions are closed. No costs.