2001 (1) TMI 1014 - HC - Indian Laws

Summary

Issues Involved:
1. Delay in the voyage of the vessel Kobe Queen 1.
2. Arrest and detention of the vessel by Customs authorities.
3. Claims for wages by the crew.
4. Confiscation of the vessel by Customs authorities.
5. Maritime lien and its precedence over confiscation.

Issue-wise Detailed Analysis:

1. Delay in the Voyage of the Vessel Kobe Queen 1:
The vessel Kobe Queen 1, registered in Panama, was delayed during its voyage from Istanbul to Montego Jamaica. The delay led to frantic efforts by the cargo receiver to locate the vessel, culminating in an advertisement in Lloyds List on 8.11.1999. The vessel was spotted at various ports not designated as Ports of Call, suggesting it was allegedly drifting between the Senegalese Coast and Cape Verde Islands.

2. Arrest and Detention of the Vessel by Customs Authorities:
On 21.12.1999, Customs Officers spotted the vessel, now bearing the name Gloria Kopp, anchored near Pondicherry Coast. The vessel was boarded on 22.12.1999, and it was found loaded with steel products. M/s. Inter Cargo Insurance Company filed a suit in the admiralty jurisdiction of the High Court, seeking the arrest and detention of the vessel until their claim was satisfied. An interim order for the arrest of the vessel was passed on 24.12.1999, and a Receiver was appointed to inspect and take possession of the cargo.

3. Claims for Wages by the Crew:
The Chief Officer of the vessel, on behalf of the crew, filed an application on 11.02.2000, seeking payment of wages from the sale proceeds of the vessel. The crew had not been paid their wages since May 1999. The learned single Judge ruled that the crew's wages must be paid and directed the Coast Guard and Customs authorities to pay the wages lawfully due to the crew within two weeks from the sale proceeds of the cargo.

4. Confiscation of the Vessel by Customs Authorities:
The Customs authorities issued a show-cause notice on 31.08.2000, proposing the confiscation of the vessel under Section 115(2) of the Customs Act, 1962. Despite objections from the crew, the Commissioner of Customs passed an order on 26.09.2000, confiscating the vessel absolutely. The crew did not appeal this order, and the learned single Judge declined to order the sale of the vessel, leaving it to the Customs authorities to act according to their powers.

5. Maritime Lien and Its Precedence Over Confiscation:
The learned single Judge concluded that the crew's claim for wages, constituting a maritime lien, could be processed in the existing suit without the need for a separate civil suit. However, the appeal court held that the maritime lien of the seamen is only against the ship and not the cargo. The court further ruled that the confiscation order, being a proceeding in rem, vested the ship absolutely with the Government, thereby defeating the maritime lien. The court noted that the maritime lien could be defeated if the res (ship) is sold by court order or transferred to a foreign government claiming sovereign immunity.

Conclusion:
Both appeals were allowed, and it was clarified that the crew could still challenge the validity of the confiscation order separately. The court emphasized that the confiscation resulted in the ship vesting absolutely with the Government, thus nullifying the crew's maritime lien for their wages.