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2023 DIGILAW 1105 (CAL)

In The Matter Of : Grasim Industries Ltd. v. Owners And Parties Interested INT In The Vessel M. V. Fazah 1(IMO 9331593)

2023-07-11

RAVI KRISHAN KAPUR

body2023
JUDGMENT : (Ravi Krishan Kapur, J.) : 1. This is an application for deletion of name of the defendant no.1 M.V. Fazah-1 (the vessel) and for amendment of the plaint. This suit was instituted in the Admiralty Jurisdiction of this Court inter alia seeking arrest of the defendant no.1 vessel and a decree for Rs.13,96,10,000/-against the defendants jointly and severally. 2. The defendant no.2 is a company incorporated under foreign laws having its registered office at Cyprus. The defendant no.3 is a company inter alia engaged in providing logistic support. 3. Briefly, the plaintiff had in or about 2020, purchased an ammonia shell converter (the cargo) for commission at its plant at Jagdhispur, Uttar Pradesh. The expeditious delivery of the cargo was of paramount importance to the ongoing business activities of the plaintiff. Thereafter, in order to transport the cargo from Italy to India, the defendant no.3 in response to a request had submitted an offline bid and the same was accepted by the plaintiff. Subsequently, a work order dated 6 April, 2021 for transportation of the cargo was issued in favour of the defendant no.3. 4. Pursuant to the aforesaid, the vessel was booked for ocean carriage of the plaintiff’s cargo from Italy to India. On 24 May, 2021, a bill of lading was issued in favour of the plaintiff. The vessel was to deliver the cargo in June, 2021. However, after substantial delay, the vessel ultimately docked at Haldia on 10 September, 2021. During the pendency of the suit, the plaintiff had entered into a settlement with the defendant no.1, whereby the plaintiff undertook not to pursue any claim against the owners and parties interested in the defendant vessel and to take steps for striking off the name of the defendant vessel from the array of the parties to this suit. 5. By this application, the plaintiff seeks to delete the name of the defendant no.1 and amend its claim insofar as the defendant nos.2 and 3 are concerned. The amendments proposed by the plaintiff seek to convert the suit to an action simpliciter in personam for damages against the defendant nos.2 and 3. The allegations against the original defendant no.1 have been deleted and reliance has been placed on a charterparty agreement. A case of negligence is now sought to be made out against the defendant no.3. The amendments proposed by the plaintiff seek to convert the suit to an action simpliciter in personam for damages against the defendant nos.2 and 3. The allegations against the original defendant no.1 have been deleted and reliance has been placed on a charterparty agreement. A case of negligence is now sought to be made out against the defendant no.3. The monetary claim against the defendant nos.2 and 3 have also increased. 6. On behalf of the plaintiff it is contended that, the amendments sought for do not alter the fundamental character of the suit. The proposed amendments only bring on record certain subsequent events and make suitable amendments in support of their claim against the defendant nos.2 and 3. It is further contended that the cause of action against the defendant nos.2 and 3 was in personam and such claim is maintainable under the provisions of The Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017 (the Act). It is also contended that all the documents sought to be relied on by the plaintiff have been found subsequent to the filing of the suit. In support of their contentions, the plaintiff relies on the decisions in Rajesh Kumar Aggarwal vs. K.K. Modi 2006 SCC OnLine SC 320, Sampath Kumar vs. Ayyakannu (2002) 7 SCC 559 , Nitya Naraya Sarkar vs. Anandamoyee Dikpati 1998 SCC OnLine Cal 229 and Sudhir Kumar @ S. Baliaya vs. Vinay Kumar G.B. 2021 SCC OnLine SC 723. 7. On behalf of the defendant no.3, it is contended that the amendments sought for alter the nature and character of the suit and are impermissible. In particular, after deletion of the name of the defendant no.1, the proposed amendment ousts the Admiralty Jurisdiction of this Court. It is further contended that in view of sections 2(f), 4 and 7 of the Act, the amendments substantially change the nature of the cause of action. In such circumstances, in the absence of the defendant vessel being a party to the proceeding, the claim of the plaintiff loses its character of a maritime claim against the vessel and the suit cannot be proceeded with any further in the Admiralty Jurisdiction. In such circumstances, in the absence of the defendant vessel being a party to the proceeding, the claim of the plaintiff loses its character of a maritime claim against the vessel and the suit cannot be proceeded with any further in the Admiralty Jurisdiction. In support of their contentions, the defendant no.3 relies on the decisions in Global Integrated Bulkers (P) Ltd. v. Cargo of 14,072.337 Mts of Limestone, 2018 SCC OnLine Bom 86, M/s. Universal Marine vs. M/T Hartati (2014) 2 Bom CR 854, Laxmi Polyfab Private Limited vs. Eden Realty Ventures Private Limited AIR 2021 Cal 190 and Patil Automation Pvt. Ltd. vs. Rakheja Engineers Private Limited 2022 SCC OnLine SC 1028. 8. The suit has been filed in the Admiralty Jurisdiction of this Court. An action in rem is directed against the vessel itself to satisfy the claim of a plaintiff out of the res. The vessel is for this purpose treated as a person. Such an action may constitute an inducement to the owner to submit to the jurisdiction of this Court thereby making himself liable to be proceeded against by the plaintiff in personam. However, it is imperative in an action in rem that the vessel is a party to the proceedings and should be within the jurisdiction at the time the proceedings are initiated. It is by means of an action in rem that the arrest of a particular vessel is secured by the plaintiff. A plaintiff in an admiralty action, does not sue the owner directly and by name; but the owner or anyone interested in the vessel may appear and defend. The writ is issued to the owners and parties interested in the property proceeded against [M. V. Elisabeth and Harwan Investment and Trading Pvt. Ltd. AIR 1993 SC 1014 ]. 9. Section 4 of the Act defines a maritime claim. It provides that an aggrieved person may institute a suit against the defendant vessel and its owners and parties to enforce a maritime claim. Section 5(1) provides that in order to arrest a vessel for enforcement of a maritime claim, the vessel must be the subject of an admiralty proceeding. This would necessarily mean that the vessel has to be a party to an action in an admiralty suit. The vessel is treated as a juristic entity for the limited purpose in an action in rem. This would necessarily mean that the vessel has to be a party to an action in an admiralty suit. The vessel is treated as a juristic entity for the limited purpose in an action in rem. Section 6 confers jurisdiction to hear and determine an action in personam in respect of any maritime claim referred to in clauses (a) to (w) of section 4(1) as set out hereinabove subject to section 7 of the Act. 10. In Global Integrated Bulkers PTE vs. Cargo of India 2018 SCC OnLine Bom 86 it was held as follows: “48. This Court in case of Greenwich Maridian Logistics (India) Pvt. Ltd. [CST v. Greenwich Meridian Logistics (I) (P) Ltd., 2018 SCC OnLine Bom 21236] has considered the issue whether an Admiralty Court can entertain a suit filed by a ship owner or carrier against a consignee without a vessel being a party to the suit. This Court held that an action in Admiralty jurisdiction has to be against the ship or its owner. It is held that the jurisdiction of the Admiralty Court is specific and if any controversy does not arise within specific jurisdiction of the Admiralty Court, the Admiralty Court cannot entertain any such situation like a Court of Ordinary Original Civil Jurisdiction. This Court in the said judgment also considered the judgment of the Supreme Court in case of M.V. Elisabeth v. Harwan Investment & Trading (P) Ltd., 1993 Supp (2) SCC 433 and also the judgment of the Supreme Court in case of Liverpool & London S.P. & I Association Ltd. [Liverpool & London S.P. & I Assn. Ltd. v. M.V. Sea Success I, (2004) 9 SCC 512 ]and held that the action in Admiralty jurisdiction has to be against the ship or its owner. It is also held that since the ship owner, receiver, consignee would be residing or carrying on business within the ordinary original civil jurisdiction, action against them without the vessel being a party to the suit can be filed only in the ordinary original civil jurisdiction of the Civil Court. It is an admitted position that this suit filed by the plaintiff is not invoking the ordinary original civil jurisdiction of this Court but has filed invoking the Admiralty jurisdiction. It is an admitted position that this suit filed by the plaintiff is not invoking the ordinary original civil jurisdiction of this Court but has filed invoking the Admiralty jurisdiction. It is also not in dispute that the vessel has not been joined as a party defendant to this suit and no relief against the said vessel has been claimed in the suit.” 11. In Siem Offshore Redri AS v. Altus Uber, 2018 SCC OnLine Bom 2730, it was held that: “47. … it is only after the owner enters appearance and submits to jurisdiction and furnishes security that the action in rem gets converted into an action in personam. It is at this stage before proceeding further with the action in personam, the Court will adopt the procedure devised by the Full Bench in Golden Progress [J.S. Ocean Liner LLC, Bur Dubai (U.A.E.) v. m.v. Golden Progress, 2007 SCC OnLine Bom 69]. Until such time as the owner has entered appearance and submitted to jurisdiction and furnished security, the action in rem remains an action in rem and the vessel is available to the Plaintiff as security in respect of its maritime claim which is the subject matter of in personam proceedings by way of arbitration against the owner or the party liable in personam. Furnishing of security is also essential for the action in rem to be converted to an action in personam because until such time security is furnished, the vessel remains under arrest and the action against the vessel continues in rem.” 12. Recently, in Angsley Invetsment Limited v. Jupiter Denizcilik Tasimacilik Mumessillik San. Ve Ticaret Limited Sirketi [2023 SCC OnLine Bom 559] it has been held as follows: “…Section 5(1) contemplates that to order arrest of a vessel for enforcement of a maritime claim, the vessel inter alia must be the subject of an admiralty proceeding. This would necessarily mean that the vessel has to be a party to the admiralty suit.” 13. Order VI Rule 17 of the Code of Civil Procedure, 1908 confers jurisdiction on the Court to allow either party to the suit to amend the pleadings at any stage of the proceedings on such terms as may be just. Ordinarily, amendments are permissible if they are necessary for determination of the real controversy in the suit. Order VI Rule 17 of the Code of Civil Procedure, 1908 confers jurisdiction on the Court to allow either party to the suit to amend the pleadings at any stage of the proceedings on such terms as may be just. Ordinarily, amendments are permissible if they are necessary for determination of the real controversy in the suit. However, the liberal principles which guide the exercise of discretion in allowing amendments in order to avoid multiplicity of proceedings cannot stretch to permitting amendments which fundamentally alter the character of the original action and substitute one distinct cause of action for another [Modi Spinning & Weaving Mills Co. Ltd. v. Ladha Ram & Co (1976) 4 SCC 320 at paragraph 9]. Where the amendment changes the nature of the suit or the cause of action, so as to set up an entirely new case different to the original case set out in the plaint, the amendment must be disallowed [Life Insurance Corporation of India v. Sanjeev Builders Pvt. Ltd. (2022) SCC OnLine SC 1128 at paragraph 70(x)]. The cases cited on behalf of the plaintiff are distinguishable. Though there is no quarrel with the general propositions laid down in each of the decisions the same are inapplicable and inapposite. 14. The plaintiff’s original cause of action arose out of a maritime claim against the defendant no.1 vessel. In the absence of the vessel, being a party to the proceedings the claim of the plaintiff loses its character of a maritime claim and cannot be proceeded with any further in the admiralty jurisdiction. The proposed amendments do not constitute a maritime claim as defined under the Act. The suit is now sought to be converted to an ordinary action for damages in personam against the defendant nos. 2 and 3 in the absence of the defendant no.1 vessel. By the proposed amendment, the original case of the plaintiff is wholly displaced and the fundamental structure of the suit is sought to be altered. The real controversy between the parties is also sought to be changed. The evidence which the plaintiff seeks to introduce is new. In such circumstances, the proposed amendments are impermissible. 15. For the foregoing reasons, the prayer for amendment is disallowed. The real controversy between the parties is also sought to be changed. The evidence which the plaintiff seeks to introduce is new. In such circumstances, the proposed amendments are impermissible. 15. For the foregoing reasons, the prayer for amendment is disallowed. Insofar as prayer (a) of the Notice of Motion is concerned, seeking deletion of the defendant no.1, there was no objection to this prayer and hence the same stands allowed. 16. GA 8 of 2022 stands allowed only to the limited extent of allowing prayer (a) i.e., the name of the defendant no.1 vessel be struck off and the words Indo-Gulf Fertilizer Unit be deleted from the plaintiff’s name. Accordingly, prayers (a), (b) and (e) stand allowed. The remaining prayers which seek amendments are rejected. With the aforesaid directions, GA 8 of 2022 stands disposed of.