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2021 (2) TMI 393 - SC - Indian LawsLevy of Charges - Port Trust on a consignment of logs lying within the docks - HELD THAT - The grievance of the Port Trust against the order of the Division Bench is legitimate. The Port Trust has a statutory lien on the goods, for unpaid charges under the provisions of Sections 58 and 59 of the Act. The decisions of this Court in International Airports Authority of India v. Grand Slam International 1995 (2) TMI 70 - SUPREME COURT and in Om Shankar Biyani v. Board of Trustees of Port of Kolkata 2002 (2) TMI 104 - SUPREME COURT have authoritatively recognized this principle. The Port Trust was in appeal against the order of the Single Judge directing the release of half the cargo against a payment of ₹ 25 lakhs. The Division Bench in appeal directed the release of the entire cargo against a payment of ₹ 50 lakhs, placing the Port Trust in a position which is worse off than under the interim order. We are hence constrained to interfere with the order of the Division Bench, though it arises in interlocutory proceedings because of the evident error. The Division Bench has ignored the statute, the binding precedents of this Court and acted contrary to judicial norms. Instead of remanding the proceedings back to the Division Bench for reconsideration of the appeal and since the writ petition has been directed to be disposed of, this Court has heard the rival submissions on an appropriate interim arrangement. Mr. Dave submitted that the consignment of goods may be allowed to be cleared, since the goods were imported for business, subject to the first and second respondents being put on terms. Mr. Rohatgi submitted that if the entire consignment is sought to be cleared, this has to be against the payment of port charges and dues for the entire consignment. There is merit in the submission of the Port Trust. The Port Trust cannot be relegated to pursue the importer for the recovery of its dues after the goods have been cleared and removed from the dock premises. The charges payable to the Port Trust have to be duly paid before clearance in view of the statutory lien over the goods. The error of the High Court was precisely because the interim directions fail to secure the interest and lien of the Port Trust. The issue of whether the first and second respondents are entitled to any remission or waiver in terms of the Circulars of the Ministry of Shipping will be decided in the course of the hearing of the writ petition. If they succeed, consequential directions for refund with interest can follow. It is directed that the first and second respondents shall pay to the Port Trust an amount of ₹ 1.35 crores as a condition precedent for the release of the goods. This shall be subject to the first and second respondents complying with all other formalities, including obtaining customs clearance. In the event that the first and second respondents are held entitled to any refund under the final directions of the High Court after the petition is heard, the High Court would be at liberty to direct the refund of the excess amount collected, if any, together with interest. Appeal allowed - decided in favor of appellant.
Issues:
1. Impugned levy of charges by Port Trust on consignment of logs. 2. Interpretation of Circulars of Ministry of Shipping. 3. Statutory lien of Port Trust on goods for unpaid charges. 4. Interim relief for release of consignment and payment of port charges. Issue 1: Impugned levy of charges by Port Trust on consignment of logs: The first and second respondents filed a writ petition challenging the levy of charges by the Port Trust on a consignment of logs within the docks. The Single Judge initially directed the payment of ?25 lakhs for the release of 50% of the cargo, while the Division Bench later allowed the removal of the entire goods upon payment of ?50 lakhs. The Port Trust appealed to the Supreme Court under Article 136 of the Constitution, arguing that the Division Bench's order breached the Port Trust's lien under the Major Port Trusts Act 1963. The Supreme Court held that the Port Trust's statutory lien on the goods for unpaid charges must be upheld, as recognized in previous court decisions, and set aside the Division Bench's order. Issue 2: Interpretation of Circulars of Ministry of Shipping: The real issue in the writ petition revolved around the interpretation of Circulars of the Ministry of Shipping. The High Court was directed to resolve this issue expeditiously. The first and second respondents claimed entitlement to a waiver of rent based on the Circulars due to the lockdown affecting the removal of goods. The Supreme Court emphasized that the High Court should decide on the interpretation of the Circulars, and any refund or waiver would depend on the final directions of the High Court after a full hearing. Issue 3: Statutory lien of Port Trust on goods for unpaid charges: The Supreme Court reiterated the Port Trust's statutory lien on goods for unpaid charges under Sections 58 and 59 of the Act, citing previous court decisions that recognized this principle. The Court emphasized that the Port Trust's interests and lien must be secured, and any clearance of goods should be subject to the payment of port charges to protect the Port Trust's rights. Issue 4: Interim relief for release of consignment and payment of port charges: The Supreme Court directed the first and second respondents to pay ?1.35 crores to the Port Trust as a condition precedent for the release of the goods, in addition to complying with all formalities, including obtaining customs clearance. The Court emphasized that the payment of port dues must be made before clearance to uphold the Port Trust's statutory lien. The High Court was granted the authority to direct any refund of excess amount collected, if applicable, along with interest. The appeals were allowed, setting aside the High Court's order, and the writ petition was to be expeditiously disposed of by the Single Judge. This detailed analysis of the Supreme Court judgment highlights the key issues, arguments presented by both parties, legal principles applied, and the final directives provided by the Court.
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