H. Suresh, J.
1. This is an action of limitation of liability filed by the shipowners, Shipping Corporations of India Ltd., for the purpose of limiting their liability for the consequence of a collision between their vessel 'M.V. VISHVA APURVA' and the Greek vessel 'M.V. DIAS'. The action falls within the scope of Chapter XA of the Merchant Shipping Act, 1958 (hereinafter referred to as 'the said Act'). The cause title shows that the action has been initiated in this Court in its 'Admiralty Jurisdiction' and the suit has been numbered as 'Admiralty Suit No. 17 of 1988.' After filing the suit, the plaintiff's obtained an ex parte order dated 9th August, 1988, virtually constituting a Limitation Fund in the sum of Rs. 52,52,241.50P. for the purpose of section 352-C of the said Act. The 1st defendants-Hindustan Shipping Yard Ltd. have taken out the first Notice of Motion bearing No. 3350 of 1988, while certain applicants have taken out the second Notice of Motion bearing No. 3355 of 1988 for the purpose of having the said order dated 9th August, 1988 set aside.
2. There are two main contentions. Firstly, it has been contended as against the plaintiffs that this suit could not have been filed in the Admiralty Jurisdiction of this High Court and that, therefore, the suit is without jurisdiction and the plaint should be ordered to be returned to the plaintiffs for the presentation before the proper Court having jurisdiction. The second contention is that the interim order is against the provisions of law and the procedure adopted by the plaintiffs is illegal and improper.
3. On the first contention, the defendants and the applicants relied on section 13 of the Admiralty Court Act, 1861, which is as follows :
'Whenever any ship or vessel, or the proceeds thereof, are under arrest of the High Court of Admiralty, the said Court shall have the same powers as are conferred upon by the High Court of Chancery in England by the Ninth part of the Merchant Shipping Act, 1854.'
The argument is that neither the ship or vessel is under arrest of this Court nor the sale proceeds thereof are deposited in the Registry of this High Court and that this suit, being a suit under the said Act, could not have been filed in the Admiralty Jurisdiction of this Court. As against this, Mr. Mehta has pointed out that even in England it is no longer necessary to aver that the plaintiff's vessel is under arrest to invoke the Admiralty Jurisdiction of that Court. He submitted that actions of limitation of liability are filed in the Admiralty Division, despite the fact that under the Merchant Shipping Act, 1894 (of England), such matters are not assigned to the Probate, Divorce and Admiralty Division. Yet matters are brought in the High Court of Justice in England and they are assigned by plaintiffs to the Admiralty Division in the same manner as if the Division was the proper Division, to which such matters were assigned under the Rules of Court, in force. Mr. Mehta also pointed out that the Rules framed by this Court are under the Colonial Courts of Admiralty Act, 1890 and these have been considered in several judgments earlier. In that, he pointed out the High Court of Judicature at Bombay exercises the same jurisdiction in Admiralty as was done in the High Court of admiralty in England in 1890, either under any statute or otherwise, and having regard to the provisions of the Colonial Courts of Admiralty Act, 1890 and the Indian Admiralty Act (Act No. 16 of 1891), the High Court of Judicature at Bombay will have jurisdiction of the Colonial Courts of Admiralty to entertain this suit.
4. Despite a lengthy argument, citing history of the law and the case-law on the subject, I refrain from dealing with the same for the simple reason that the sooner we rid ourselves free from Colonial shackles, the better it is. Our procedure, our jurisdiction, our justice must be essentially a matter of our law. This is an action under the Merchant Shipping Act, 1958. Sub-section (15) of section 3 of the said Act defines 'High Court'' as follows :
'(15) 'High Court'', in relation to a vessel, means the High Court within the limits of whose appellate jurisdiction_
(a) the port of registry of the vessels is situate; or
(b) the vessel is for the time being; or
(c) the cause of action wholly or in part arises.'
5. It is true that the said Act does not say that the High Court would mean Admiralty Division. But in a Court where the backlog bogs down the march of justice, the niceties of law must yield to a more pragmatic approach, for, ultimately, whether it is a Judge of one Division or another, it should make no difference. By convention and practice, all such matters have always been assigned to the Judge who hears the Admiralty matters. There is no bar under the Act against such assignment. But what is important is that the Court that is assigned such matters shall exercise such powers as are provided for in the Act. Of course, I wish, the learned Chief Justice, while assigning matters, could as well clarify by mentioning that the assignment would include all matters arising under the said Act. But certainly there is no question of jurisdiction, as contended across the bar.
6. This takes me to the other contention. What the plaintiffs did was-after filing this suite, they applied for a Judge's order on the basis of an affidavit in support of the same and virtually obtained an order constituting the Limitation Fund. The limited question is whether the plaintiffs could have obtained such an order from this Court ?
7. The relevant provisions under the said Act are as follows :
'352-A(1) The owner of a sea-going vessel may limit his liability in accordance with the provisions of section 352-B. In respect of any claim arising from any of the following occurrences unless the occurrence giving rise to the claim resulted from the actual fault or privity of the owner_
(a) loss of life of, or personal injury to, any person being carried in the vessel, or loss of, or damage to any property on board the vessel;
(b) loss of life, or personal injury to, any other person (whether on land or on water), loss of or damage to any other property or infringement of any rights_
(i) which is caused by the act, neglect or default of any person on board the vessel for whose act, neglect or default the owner is responsible; or
(ii) which is caused by the act, neglect or default of any person not on board the vessel for whose act, neglect or default the owner is responsible;
Provided that the owner shall be entitled to limit his liability in respect of any claim arising out of any act, neglect or default as is referred to in sub-clause (ii) only when the act, neglect or default is one which occurs in the navigation or the management of the vessel or in the loading, carriage or discharge of cargo or in the embarkation, carriage or disembarkation of its passengers.
(2) The burden or proving that the occurrence giving rise to a claim against the owner of a vessel did not result from his actual fault or privity shall be on the owner.'
Section 352-B provides for fixing the limits of liability. Section 352-C provides for the constitution of Limitation Fund and provides for dealing with the claims against the owners. The relevant provisions are as follows :
'352-C(1) Where any liability is alleged to have been incurred by the owner of a vessel in respect of claims arising out of an occurrence and the aggregate of the claims exceeds or is likely to exceed the limits of liability of the owner under section 352-B, then the owner may apply to the High Court for the setting up of a limitation fund for the total sum representing such limits of liability.
(2) The High Court to which the application is made under sub-section (1) may determine the amount of the owner's liability and require him to deposit such amount with the High Court or furnish such security in respect of the amount as in the opinion of the High Court is satisfactory and the amount so deposited or secured shall constitute a limitation fund for the purpose of the claims referred to in sub-section (1) and shall be utilised only for the payment of such claims.' (The remaining portions are not relevant at this stage.)
8. Thus under section 352-A, the owner of the ship will be entitled to limit his liability in respect of any claim arising out of any act or default, as is referred to in sub clause (ii) of section 352-A of the said Act only when the act, neglect or default is one which secure in the navigation or the management of the vessel, etc. But the owner has to prove that the occurrence giving rise to a claim against the owner of a vessel 'did not result from his actual fault or privity of the owner.' In other words, till such time, it is established that the owner was not at actual fault, there is no question of constituting any such fund or there can be no question of limiting his liability. Further under section 352-C, the High Court will have to determine the amount of the owner's liability, which results in the relief of constitution of the Limitation Fund. Mr. Mehta dealt with the objects and reasons for drafting such a Limitation Fund. There is no dispute about any of these proportions. The question is as to how to proceed when a suit of this type is filed.
9. In this connection, Mr. Mehta pointed out as to how such a suit is dealt with in the English courts. He pointed out that limitation section is one in which a person is faced by two or three actual or potential claimants with claims against him arising out of an occurrence of a casualty and he invokes the courts special statutory powers. He can file a suit and get a writ issued as plaintiff. In such a suit, at least one of the persons with claims against him in respect of the casualty to which the section relates must be made defendant and if he makes any or all of the others also as defendants, one of the defendants must be named in the writ by his name but the other defendants may be described generally and not named by their names. So far, so good. This is what the plaintiffs did in the present case. But under the English Procedure (see Halsbury's Laws of England, 4th Edition, Vol. 1, Pages 291 and 292, paras 461 to 464, and also R.S.C. Ord. 75 Rules 38(1) to (7) before any order is obtained, the writ must be served on anyone or more of the defendants who are named by their names therein and need not be served on any other defendants. The defendants who have been served must then enter their appearance as they would do in any other action in personam. Within 7 days of entrance of appearance by one of the defendants or after 7 days after the time limited for acknowledging service, the plaintiff must take out a summons returnable in chambers before the registrar or district registrar as he case may be, asking for a decree limiting his liability or, in default of such a decree, for directions as to the further proceedings in the action. The summons must be supported by a affidavit or affidavits proving_(a) the plaintiff's case in the action, and (b) if name of the defendants named in the writ by their names has acknowledged service, service of the writ on at least one of the defendants so named. The affidavit is support must stated_(a) the names of all the persons who, to the knowledge of the plaintiff, have claims against him in respect of the casualty to which the section relates, not being defendants to the section who are named in the writ by their names, and (b) the address of each of these persons, if known to the plaintiff. The summons and every affidavit in support thereof must, at least 7 clear days before the hearing of the summons, be served on any defendant who has acknowledged issue or service of the writ. On the hearing of the summons the Registrar, if it appears to him that it is not disputed that the plaintiff has a right to limit his liability, shall make a decree limiting the plaintiff's liability and fix the amount to which the liability is to be limited. On the hearing of the summons the registrar, if it appears to him that any defendant has not sufficient information to enable him to decide whether or not to dispute that the plaintiff has a right to limit his liability, shall give such directions as appear to him to be appropriate for enabling the defendant to obtain such information and shall adjourn the hearing. There are further rules as to what the registrar should do if there is a contest, etc. Unfortunately, we have none of these rules in this behalf. The rules framed under the admiralty jurisdiction do not provide for any rule in an action for limiting the liability. We have also no rules under the said Act for the purpose of issuing any summons for directions, etc. With the result, we are constrained to treat this like any other suit. Therefore, I will have no hesitation to set aside this order, as the order is clearly without any provision of any law or of any rule of this High Court.
10. As far as I can see, the only proper procedure which can be adopted till such times rules are framed in this behalf, would be that it is open to the plaintiffs, after filing of the plaint, to request the learned Judge to give an early returnable date for the purpose of service of the writ summons. After the writ of summons is served, if the defendants file an appearance, then the suit should be placed on board, as in the case of any other suit. However, at that time, the plaintiffs can urge upon the Court to give as early date for hearing of the suit. If, of course, the defendants fail to file their appearance, then the plaintiffs will be at liberty to apply for judgment for want of appearance or for want of written-statement, as provided under the rules.
11. Mr. Mehta submitted that assuming that there is no provision for the purpose of constituting such a fund at this stage, still during the pendency of the suit, the Court can exercise its jurisdiction, either under section 151 of the Code of Civil Procedure or by resorting to the principles of equity, good conscience etc. to constitute interim limitation fund. Mr. Mehta submitted that under the Indian law, it is not possible for the claimants to proceed against the other ships of the plaintiffs. But under various provisions of law in other countries the claimants would be able to proceed against any agent or ship of the owners and that there by the plaintiffs' position will be considerably jeopardised, if the order constituting the Fund is vacated. But with the existence of the Limitation Fund, it will not be possible even for such claimants to proceed against the other ships of the shipowners. He, therefore, submitted that the order dated 9th August, 1988 need not be vacated, but the same can be treated as an interim order pending the hearing and final disposal of this suit and as early hearing may be given in this behalf.
12. I am afraid, I will not be able to accept the submissions made by Mr. Mehta. It is not a matter of mere procedure when the Court, by an order, constitutes a Limitation Fund. It is a matter of substantive law and in the absence of any provision for the purpose of an interim Limitation Fund , it is not possible for me to grant any such relief. The fundamental assumption when the Court constitutes a Limitation Fund is that the plaintiffs are not at fault. That fact will have to be established and then only the Court can proceed with the constitution of any such fund. Constitution of a limitation fund has various consequences, as provided under sub-sections (3) to (7) of Section 352-G of the said Act. It is not a matter of furnishing any security as such. It is a method of determining the liability and fixing a limit thereon. It curtails the rights of all claimants and circumscribes the scope of their action against the owners, once such a Fund is constituted. Neither under the English law nor under our law, is there any provision for constitution of interim liability Fund.
13. In the result, this order will have to be set aside.
14. Mr. Mehta submitted that as far as the second Notice of Motion bearing No. 3355 of 1988 is concerned, that notice of motion has been taken out by an underwriter and an Insurer, and relying on a certain case decided by this High Court and also on the basis of a Supreme Court case, he submitted that the same is not maintainable and, therefore, the same should be dismissed in limine. As against this, Mr. Gupta pointed out that the matter requires consideration as the Marine Insurance Act does not aliminate the Insurance altogether from taking actions of this type. Therefore, this matter requires consideration and cannot decided at this stage.
15. I think, since I am inclined to set aside this order dated 9th August, 1988, it is not necessary for me to consider these arguments advanced on either side. It is only as and when the question of limiting the liability arises in the suit itself and if at that stage the applicants in the second Notice of Motion comes forward, the Court will go into the question and decide whether their claim can be considered or not.
16. I therefore, pass the following order :
ORDER
Notice of Motion No. 3360 of 1988 : Motion made absolute in terms of prayers (b) and (c). However, there will be no order as to costs. I further direct that the defendants, that is , Hindustan Shipyard Ltd. shall file their written statement within a period of four weeks from today. Discovery and inspection to be completed within two weeks thereafter. On such completion of the formalities, as mentioned above, the suit shall be placed on board for the purpose of final hearing and disposal before the learned Judge taking up Admiralty suits. The suit shall be treated as if it is an expedited suit.
Order on Notice of Motion No. 3355 of 1988 : In view of the order passed in the Notice of Motion No. 3350 of 1988, there will be no order on this Motion. There will be no order as to costs.
In view of the above order, the plaintiffs are allowed to have the bank guarantee given by them, discharged, as there will be no limitation fund, as it stands. However, Mr. Sancheti submits that the operation of my order setting aside the order constituting the Limitation Fund and discharging the Bank guarantee be stayed for a period of four weeks from today.
P.C. That part of the order which sets aside the constitution of the Limitation Fund and discharges the Bank guarantee, stands stayed for a period of four weeks from today. The ad- interim order granted earlier in both the matters will also continue for a period of four weeks form today.