Pacific Carriers Limited Vs. M/S. Singhee Marine Services Pvt. Ltd. and ors. - Court Judgment

V.K. Gupta, J.

1. The appeal is directed against the Judgment dated 19.11.99 passed by learned single Judge of this Court in Admiralty Suit No. 3 of 1999 whereby learned single Judge passed a decree for a sum of Rs. 32.00 lakhs in favour of Respondent No. 1 and against the appellant. The brief facts leading to the filing of the present appeal are as given herein below :

2. The appellant is the owner of ship 'MV-NELSON'. This Ship is a foreign Vessel registered in MONROVIA, Liburia (Greece) and files the flag of St. Vincent. The appellant is a Company incorporate under the Corporate Laws of Singapore and has its registered Office at Singapore. Respondent No. 2Multimedia Maritime Private Limited was appointed as the Agent of the Appellant in respect of the Appellant's Ship's activities after its arrival in the Port of Calcutta. On 6th February, 1999 Respondent No. 2, as authorised by the Appellant engaged Respondent No. 1 to supply and place sufficient numbers of barges lighters alongside the Vessel 'MV-NELSON' at Sagar anchorage on and from 8th February, 1999 continuously and without any break in order to complete the discharge of part quantity of Cargo on board 'MV-NELSON' latest by 16th February '99 to enable the Vessel to achieve the days's permissible draft on 16th February '99 so that the Vessel cruises the Hooghly River from Diamond Harbour and reaches the port of Calcutta. These barges were required for lighterage in respect of the aforesaid Vassel because the lighter the weight of the Vessel the easier for the Vessel to manoeuvre its way through the Hooghly River to reach the Port of Calcutta. On 6th February '99 accordingly a communication was sent by Respondent No. 2 acting on behalf of the Appellant to Respondent No. 1 containing therein the terms and conditions relating to the engagement of the barges. Since this letter is very relevant for our purposes, we reproduce hereinbelow the entire text of the letter for ready reference. It reads as under :-

'Multimode Maritime Private Limited

Excellence in Shipping Services Under One Roof.

Feb 06, 1999.

Singhee Marine Services (P)

Ltd. Marcantile Buildings,

9/12, Lal Bazar Street, 'E' Block,

(2nd floor).

Calcutta-700 001.

Dear Sirs,

Re : MV. Nelson at Sauger.

We refer to the discussion which the undersigned had With your Mr. Surender Singhee and are pleased to issue the work order herewith for supplying empty barges for more or less 3000 M. ton capacity to receive bagged peas to be discharged at Sauger Uncharged from above vessel under our Agency.

The terms & conditions of the contact have been mutually agreed by both of us.

1.Rate of Barge Hire :Rs. 325.00 per metric ton (MTON) of charge weight Including all relative charges.2.Demurrage Free-Period:15 days from the date of placement of each barges alongside the Vessel at Sauger only.3.Demurrage for Barges:Rs. 10.00 per Metric ton of cargo weight after 15 days free time i.e. w.e.f. 16th day.

It may be noted that the barge hire rate Rs. 325.00 MTON is inclusive of Towage of Barges from Saugor to Calcutta Dock (29 KPD). Such toll and over-stayal charges inside dock or in the river.

Please ensure that the laden barges are towed upriver in Calcutta and placed at 29 KPD as seen as possible for clearance of charge without any delay.

Royal Trading Co. are the charge receivers and will take delivery of cargo free of cost to you from the barges after doing the port and custom formalities against our local delivery orders. Labour, unloading or any relative charges to be absorbed by receivers, which please note.

The vessel will discharge two grades of peas CHICK & DUN which are to be kept separately stored in the barges.

Placement of Barges

You are essentially required to place sufficient number of barges alongside the vessel at Sauger from Feb. 08. 1999 continuously and without break in order to complete discharge of engaged quantity latest by Feb 16 at 0800 hrs to enable the Vessel to achieve the day's permissible draft to come upriver at Diamond Harbour on the same afternoon.

In fine, we appreciate your extending the best co-operation for smooth & fact operation and would request you to keep the undersigned informed all development for any clarification, assistance or whatsoever.

Thanking you in anticipation.

Yours truly

Sd/-

Biplab Ray

Director.'

3. It appears that various disputes and differences arose during the course of the Lighterage of the Vessel, some of them relating to the barges lighters supplied by respondent No. 1. Respondent No. 1 accordingly filed a Suit being Admiralty Suit No. 3 of 1999 in this Court. In that Suit the respondent No. 1 filed an application claiming the following reliefs :

'(a) Judgment upon admission for a sum of Rs. 32,00,000/- as stated in paragraph 26 hereof, against the Respondent No. 2 and 3.

(b) In the alternative a decree for a sum of Rs. 36,00,927.00 on the basis of the compromise arrived at by and between the petitioner and the respondent Nos. 2 and 3 as stated in para hereof and/or the same be recorded and a decree be a passed in accordance therewith in favour of your petitioner for a sum of Rs. 36,00,000/- as claimed in paragraphs 26 and 27 hereinabove.

(c) Further demurrage charges (r) Rs. 35/- per M.T. per day from June 16, 1999 till the five barges are delivered to your petitioner after removing the charge therefrom.

(d) Further interest.

(e) Costs of this application be borne by the respondents.

(f) Such further orders(s) or directions given as this Hon'ble Court may deem fit.'

4. It is in this background therefore and in the light of the aforesaid prayers in the aforesaid application that the learned single Judge passed the impugned decree in the sum or Rs. 32.00 lacs in favour of respondent No. 1.

5. Two points have broadly been urged before us by Mr. R. Dey, learned Advocate, appearing for the appellant while assailing the judgment under appeal. Firstly Mr. Dey submits that even though the learned single Judge correctly upheld the objection of the appellant to the applicability of section 111(2) of the Code of Civil Procedure to proceedings under the Admiralty Jurisdiction of this Court, he wrongly applied Rule 14 of the Admiralty Rules in coming to the conclusion that it is under this power that the learned single Judge exercised the Jurisdiction to pass a decree on the basis of a so-called admission. The other point urged by Mr. Dey is that in any event there was no occasion for the learned single Judge to have passed a decree on the basis of the so called admission because no case was made out as such since there was no admission on the part of the appellant or his Agent, Respondent No. 2 in this appeal. Mr. Ghosh, learned counsel for the respondent No. 1. controverted those submissions and argued that section 111(2) of the Code has no applicability and therefore Order 12 Rule 6 of the Code is attracted to proceedings arising out of Admiralty Jurisdiction and that learned single Judge went wrong on that score.

6. Let us first deal with the question relating to the jurisdictional aspect, viz. applicability and non applicability of section 111(2) CPC and Rule 14 of the Admiralty Rules section 112 CPC reads as under :--

'112. Savings.--(1) Nothing contained in this Code shall be deemed--

(a) to affect the powers of the Supreme Court under Article 136 or any other provision of the Constitution, or

(b) to interfere with any rules made by the Supreme Court, and for the time being in force, for the presentation of appeals to that Court, or their conduct before that Court.

(2) Nothing herein contained applies to any matter of criminal or admiralty or vice-admiralty Jurisdiction, or to appeals from orders and decrees of Prize Courts.'

7. Rule 14 of the Admiralty Rules framed under Colonial Courts of Admiralty Act 1890 read as under :--

'14. Judgment for the claim if well founded--If when the suit comes before the Court, the Judge is satisfied that the plaintiffs claim is well founded, he may pronounce for the claim and may order the property to be said with or without previous notice and the proceeds paid in to the Registry or may make such order in the promises as he shall think Just.'

8. Even though section 112 by itself is placed in the group of 'Appeals to Supreme Court' under Chapter VII of the Code and sub-section (1) thereof does deal with matters relating to the filing and maintainability of appeals in the Supreme Court, coupled with the scope of section 109 of the Code, which also deals with all such matters relating to the appeals in the Supreme Court, a bare look at sub-section (2) of section 112 clearly suggeststhat the provisions of the Code do not apply to matters relating to admiralty, vice admiralty or criminal jurisdiction. A lot was said about the expression 'nothing herein contained' by urging that in contra-distinction to the expression ..... 'Code', as used in sub-section (1) of section 112, weshould take a restriction meaning and scope of the expression 'herein' occurring in sub-section (2), as being distinct from the expression 'Code' as occurring in sub-section (1) and by taking such narrow view interpret sub-section (2) to mean that only section 112 should be held non applicable to matters relating to admiralty Jurisdiction or by stretching such narrow interpretation a little farther, we should held that Chapter VII is not applicable to such matters. We do not find ourselves in agreement with such view. Notwithstanding the placement of section 112 in the group relating to 'Appeals to Supreme Court' or in Chapter VII, and having regard to the expression 'herein' as opposed to the expression 'Code' we firmly feel that sub-section (2) of section 112 clearly intended to say that no provision of the Code of Civil Procedure should apply to any matter relating to admiralty, vice admiralty or criminal Jurisdiction or to appeals from Orders and Decrees of prize Courts. This, apart from the fact that Order XII Rule VI of the Code dealing with admissions is a substantive law, not a procedural law, nor a rule of Procedure and therefore such substantive law cannot be held applicable to proceedings arising out of admiralty Jurisdiction in the absence of a specific provision relating to the exercise of such jurisdiction. With regard to the fact that Order XII Rule 6 is indeed a substantive law, and not a part of procedural law, we are fortified by a Judgment of the High Court of Delhi in the case of Messrs Modern Neon Sign v. Union of India and Others reported in ILR (1978) I Delhi 568.

9. Once therefore we held that by virtue of section 112, sub-section (2), the Code is not applicable to proceedings relating to the exercise of admiralty jurisdiction, we have to advert to Rule 14 (supra) to find out whether in the exercise of such Jurisdiction the Court has any power to pass decree on the basis of the so called admission, in the nature as contemplated by Order XII Rule 6 of the Code.

10. Admiralty Rules prescribes and lay down procedure for disposal of Suits filed before the Admiralty Courts constituted under the Colonial Courts of Admiralty Act, 1890. Rule 14 is one of such Rule. A bare reading of Rule 14 suggests that it does not talk of a decree being passed on the basis of an admission of such since the language employed in Rule 14 patently is an indicator that the passing of a Judgment under this Rule is an event which has to be on contest between the parties, at the final stage of the proceedings and not one based on an admission by the defendant. In our view therefore, the learned single Judge was incorrect in invoking or applying Rule 14 in aid of the premises that he had the jurisdiction to pass a decree on the basis of an admission.

11. Despite holding that in Suits under the Colonial Courts of Admiralty Act, 1890 which are to be dealt with under the Admiralty Rules a decree cannot be passed on the basis of a so called admission in the nature contemplated under Order XII Rule 6 CPC because of the non-applicability of the provisions of the Code and because of the in-applicability as such of Rule 14 (supra), we may nonetheless strive to find out as to whether therewas any occasion for the learned single Judge to have hold that an admission was made by the defendants in the suit thus enabling the learned single Judge to pass a decree on the basis of such an admission. The entire Case of the Respondent No. 1 with regard to the admission of the defendants (Appellant No. 1 and Respondent No. 2 before us) revolves around the communication dated 17th May. 1999 sent by Respondent No. 2 to Respondent No. 1 and the communication between 19th May. 1999 sent by Respondent No. 1 to Respondent No. 2. Both these communication deserve re-production so as to find out as to whether any admission was made by and/or on behalf of the appellant either itself or through Respondent No. 2. Letter dated 17th May, 1999 reads as under :--

'Multimode Maritime Private Limited

Excellence in Shipping Services Under One Roof.

Dated : May 17, 1999

Singhee Marine Service as (P) Ltd.

Mercantile Buildings,

9/12. Lal Bazar Street, 'E' Block,

(2nd floor),

Calcutta-700 001.

Re ; MV. Nelson-Your Demurrage claims.

Dear Sirs,

This has reference to your letter dated 15.5.99 in respect of your outstanding claim of Rs. 61,91,580/- upto 31.05.99.

We have discussed the matter with your Shri Surender Singhee and Shri Dilip Bhattacharya of The Bengal Water Transport Association to-day and have forwarded the claim to our principle. M/s. Pacific Carriers Ltd., Singapore to settle your Demurrage Bill at Rs. 32,00,000/- (equivalent to US $ 75,000) upto May 31, 1999.

We place on record that the following points have been mutually agreed between us :

1. We shall disburse the payment of the settled amount of US $ 75000 or Rupees equivalent immediately on receipt of the same from our Principals, Pacific Carriers Ltd., Singapore.

2. You shall withdraw all cases filed in the Hon'ble High Court on the vessel as well as the charge in the five barges immediately on receipt of the above amount.

Yours faithfully,

for Multimode Maritime Pvt. Ltd.

SD/-

Biplab Ray

Director.

C.C. Mr. Dilip Bhattacharjee, BWTA.'

Letter dated 19th May, 1999 reads thus :--

'Singhee Marine Services Private Limited Ship Managers, Agents Chartering Brokers & Inland Navigation 2nd Floor E Block, Mercantile Building, 9/12 Lal Bazar Street Calcutta.

To

M/s. Multimode Marttime

Pvt. Ltd. 53A, Mirza Ghalib Street,

Calcutta-700 016. Kind Attn : Shri Biplab Ray.

Dear Sir,

Ref: Our outstanding bills on a/c. of barges Demurrage and interest upto 31.5.1999.

Re : M.V. Nelson.

This has reference to your letter dated 17th May, 1999 recording the understanding arrived at between us. Please be informed that the settled amount of Rs. 32.00,000.00 (Rupees thirty two lacs) equivalent to US $ 75000 (US $ seventy five thousand only) should be paid to us on or before 31st May '99 and the goods loaded in our barges be removed on or before the said date. If however you fail to do so, you shall pay us a further sum calculated @ Rs. 35.00 per M.T. per day w.e.f. from 1st June, 99 till such day the goods are unloaded. It may further be noted that upon receipt of the settled amount we shall withdraw all our claim and also the proceeding initiated by us before the Calcutta High Court

This letter is however without prejudice to our rights and contentions in the matters pending before the Hon'ble High Court at Calcutta.

Thanking you,

Yours faithfully,

for Singhee Marine Services Pvt. Ltd.

Sd/-

Director

S. Singhee.'

12. A plain reading of the letter dated 17th May, 1999 clearly suggests that all that Respondent No. 2 communicated to the Respondent No. 1 was that it was forwarding the claim of Respondent No. 1 to the appellant for setting the demurrage bill of Respondent No. 1 at Rs. 32.00 lacs. The latter goes on to suggest that this amount of Rs. 32.00 lacs shall be disbursed by Respondent No. 2 to Respondent No. 1 on receipt of the same by Respondent No. 2 from the appellant and the Respondent No. 1 shall withdraw all cases filed in the High Court Mere forwarding of a claim by an Agent to its Principal surely cannot be considered as an admission of the liability by the Agent on behalf of the Principal. Admission of liability has to be unequivocal. It has to be categorical. It has to be clear. Even if it is not unequivocal, clear or categorical, a communication of the like of the letter dated 17th May, '99 should be such as to clearly suggest that author of the letter does admit of the liability and on the basis of such admission promises to pay the amount. What we see from a plain reading of the letter dated 17th May, 1999 is that there is no admission as far as Respondent No. 2 is concerned. In any event the letter is cauched in such a language as to create plenty of doubts about the nature of admission, if at all. Once we concede that the true scope and perspective of the admission. If at all and if any, is shrouded in uncertainty and is doubtful.a case for passing decree on such admission cannot ever be said or hold to be made out and in such an event the Court should not pass a decree on the basis of such an admission. It should instead in such a situation and under such circumstances allow the defendant in the suit to put across its point of view, admitting or controverting the admission and placing before the Court all the materials explaining the attendant circumstances under which the letter was written and the purported statement, amounting to admission or not, was made. This, coupled with the fact that the basic agreement between the parties, as entered into on 6th February, 1999 stipulated a particular rate per metric ton for demurrage free period and another rate per metric ton thereafter. The question which is of paramount and vital importance in the Suit and which under all circumstances was required to be considered by the learned trial Judge was whether, in the face of the aforesaid agreed terms and conditions of the Contract between the parties, was it open to the Respondent No. I to claim demurrage/hire charges at any rate, over and above the aforesaid agreed rate, despite the alleged existence of alleged circumstances, factors and reasons as put forth by Respondent No. 1 in the Suit. Without answering such question and without dealing with this issue, by giving a go-by to the agreement between the parties, was it open to the learned trial Judge to have passed a decree merely on the basis of the so-called aforesaid admission. When we are referring to and commenting upon the terms of the aforesaid agreement contained in the communication dated 6th February, 1999 we are saying so in the context of the fact that a decree on the basis of an admission could not have been passed in the facts and circumstances of this case, particularly in the light of the terms contained in the aforesaid contract and that the issue was required to be considered by the trial Judge on its merits in order to find out, and decide whether Respondent No. 1 was at all entitled to receive demurrage/hire charges at a rate higher than the one agreed upon by the parties in the aforesaid agreement. This issue undoubtedly has to be decided by the trial Court and therefore we are not expressing any opinion on its merits. We leave this question open.

For the foregoing reasons therefore we allow the Appeal and set aside the Judgment of the learned Judge. We direct that the Suit be revived and in the light of the observations made here in-above further trial shall proceed in accordance with law and the Rules.

No Order as to costs,

G.C. De, J.--I agree.

Later

After the Judgment is pronounced by this Court an oral prayer has been made for staying its operation. On consideration the prayer is rejected.

Let a xerox copy of this judgment, duly countersigned by the Assistant Registrar of this Court, be given to the parties upon their undertaking to apply for and obtain certified copy of the same on usual undertaking.

13. Appeal allowed