In present petition, the petitioners have prayed for below mentioned relief:- “10(A) That the Hon'ble Court be pleased to issue a writ of mandamus or a writ in the nature of mandamus or any other appropriate writ, order or direction commanding the respondents to allow the petitioners to remove the winch, large stand used for mounting the winch, chains and other miscellaneous items like scrap of the construction/infrastructure belonging to the petitioners lying on Plot No.144, Alang Sosiya Ship breaking Yard from the said plot;”
2. The facts involved in and leading to submission of present petition are that:-
2.1 The petitioner No.1 is a company which is, inter alia, engaged in ship breaking activity. As a part of its business activity, the petitioner company had brought one vessel “MV Palanga” to Plot No.144 at Alang Sosiya Ship Breaking Yard. Subsequently, various disputes arose in connection with the said vessel and the said disputes resulted into civil litigations. In view of certain orders passed in the proceedings which were taken out, the ship breaking activity of the said vessel was stayed and that therefore, it could not be undertaken.
2.2 It is claimed by the petitioners that on 8.2.2008, the Hon'ble Apex Court passed certain order in Special Leave Petition (Civil) No.5256 of 2008, which was followed by another order dated 11.12.2009 passed by the Hon'ble Apex Court in the same proceedings. The Hon'ble Apex Court by the said two orders permitted the petitioner company to dismental the vessel. So as to allow the activity of dismentaling the vessel and subsequent activities, the Hon'ble Apex Court also constituted a Committee comprising of Registrar General of Gujarat High Court as Chairman of the Committee, one representative of the petitioner company and representatives of other respondents.
2.3 After the said orders dated 8.2.2008 and 11.12.2009, the Committee was constituted and its meeting was held on 31.3.2012. In the said meeting, after deliberations and discussions, the Committee granted permission to the petitioner company for breaking the vessel. The decision was conveyed to the petitioner company vide communication dated 2.4.2012. The said decision of the Committee was followed by the authorization/permission of the Port Officer. The Port Officer, by his letter dated 29.4.2010, granted permission to the petitioner company to start cutting the vessel.
2.4 The petitioner company has claimed that pursuant to the said permissions, the petitioner company commenced the activity of dismentaling the said vessel (MV Palanga) and for that purpose, the petitioner company brought on the site several equipments and machineries, including the winch, large stand used for mounting the winch and its chains, etc. It is claimed by the petitioner company that the dismentaling of the vessel was completed by 31.8.2010. Since on completion of the dismentaling of the vessel, the plot was to be handed over to the Gujarat Maritime Board [hereinafter referred to as “GMB” for short] on 31.8.2010. The petitioner company addressed a letter to the Port Officer, GMB requesting the GMB to grant about 4 days time to enable it to remove the equipments, machineries, etc., which were brought on the site for dismentaling activity. The petitioner company has claimed that despite the said request by the petitioner company, the GMB took possession of Plot No.144 on the same day. It is alleged by the petitioner company that the possession of the site (i.e. Plot No.144) was taken over by the GMB without giving any time to the petitioner company to remove the equipments, machineries, etc. which were lying on the site and the letter dated 31.8.2010 was not even replied by the GMB. The petitioner company has also alleged that subsequently, the petitioner company made several oral as well as written requests and representations to the officers of the respondent GMB seeking permission to remove its equipments, machineries, etc. from the plot in question, however, the respondent GMB did not allow the petitioner company to remove the equipments, machineries, etc.
2.5 The petitioner company has further claimed that it came to the notice of the petitioner company that the parts and items, i.e. equipments, machineries, etc., were being stolen and that therefore, the petitioner company again addressed another letter dated 29.11.2010 informing the competent authority of the respondent GMB about the theft of the parts and items lying on the plot in question and also requesting for permission to remove the said parts and items. The petitioner company has claimed that it was in response to the said letter dated 29.11.2010 that the petitioner company received a communication dated 22.12.2010 from the respondent GMB informing the petitioner company that any decision as regards the petitioner's request for permission to remove the parts and items will be taken by the respondent GMB only after the petitioner company clears the dues.
2.6 The petitioners are aggrieved by the said response of the respondent authority and it is claimed that the said action of the respondent authorities of not permitting the petitioner company to remove its own property is illegal and arbitrary and amounts to forcibly taking possession of petitioner's properties. It is against the said action of the respondent GMB that the petitioners have taken out present petition.
3. The petition is resisted by the respondent GMB by filing reply affidavit. The crux of the defence raised by the respondent GMB is that in view of the provisions contained under the Gujarat Maritime Board Act, 1981 [hereinafter referred to as “the Act” for short], the respondent GMB has lien over any goods for the purpose of recovery of all freight and rent leviable by it and the GMB has authority to seize and retain the goods until the freight and rent are fully paid and therefore, action of the respondent GMB cannot be said to be illegal or arbitrary, particularly when the petitioner company has not paid the dues of the respondent GMB in the sum of about Rs.1 Crore.
3.1 The respondent has, in its reply affidavit, stated inter alia that:-
“3. The answering respondent states that the Petitioner has preferred this petition seeking directions against it to allow the petitioner to remove the various equipments and machineries like winch, large stand used for mounting the winch, chains and other scrap items. The answering respondent states that the said relief of allowing the petitioner to remove these objects from the plot no.144 which is in the possession of the answering respondent cannot be granted for the following reasons:
a. The Petitioner surreptitiously and by misdirecting the Courts sought permission to dismantle the vessel M.V Palanga which the petitioner claimed was its vessel. However, the true facts are that the said vessel was brought by one M/s. Deep Shipbreaking Industries Co. Op.Society of which Jiten Jogadia claims to be the Manager/Secretary. Thus, as he is a director of Jogadia Polymers and Secretary of the M/s. Deep Shipbreaking he misdirected the Hon'ble Supreme Court that the petitioner company was the real owner of the vessel. As the ship was lying in the breached condition for more than ten years without any productive use and was deteriorating and corroding by the day the Hon'ble Supreme Court allowed the dismantling of the ship vide order dated 8/2/2008 passed in SLP (C) No.5256/2006 which was later modified vide order dated 20/10/2008 whereby the Registrar General of this Hon'ble Court was appointed as the Chairman of the Committee under the supervision of which the vessel was to be broken down and the proceeds of the sale to be disbursed amongst the respondent board and the petitioners' various creditors and financial institutions. The permission for breaking the vessel was given by the Committee vide order dated 2/4/2010. The petitioners as well as M/s. Deep Shipbreaking owed huge outstanding amounts running in crores to the respondent board. The petitioner owed an amount of Rs.1,05,56,676/- towards principal amount along with 8% interest. Thus as per Section 47 of the Gujarat Maritime board Act, 1981 the respondent board would have first lien over entire dues and other creditors would be satisfied only after the dues of the board are fully realized.
b. The answering respondent submits that it is pertinent to throw some light and the conduct of the petitioner. The cutting permission was granted on various terms and conditions as stipulated in the minutes of the meeting dated 31/3/2010 of the committee headed by Registrar General which was in the nature of MOU. However, as per the report of the said Committee dated 4/2/2011 the Petitioner had violated the terms and conditions of the said MOU. The Petitioner had been specifically prohibited from receiving any payments for sale of scrap in its own name and the payments were to be received by account payee cheques or drafts in the name of Registrar however the petitioner had directly collected the payments from the buyers and not deposited with the committee the total sum of Rs.3,07,90,550/- received from sale of the scrap. Though the payments were directly collected by the petitioners from the buyers 13 post-dated cheques deposited by petitioners in favour of the Chairman were dishonoured. Further, the petitioner has till date not paid the outstanding amount of Rs.1.75 crores to the respondent board. A copy of the said report of the Committee headed by the Registrar General of the High Court of Gujarat is marked and annexed as ANNEXURE-A.
c. The answering respondent submits that the petitioner has not cleared its outstanding amount due to the answering respondent. Thus, it has priority claim over the sale proceeds over rest of the creditors under Section 47(1)(2) of the Gujarat Maritime Board Act, 1981. The relevant Section 47 of the Gujarat Maritime Board Act, 1981 is reproduced and marked and annexed as ANNEXURE-B.
d. The answering respondent states that in vies of the above stated statutory provision the answering respondent has a lien over all the equipments, machinery, winches and other objects of the Petitioner lying on the said plot. The Petitioner has dismantled the ship and pocketed the money and thus now the only manner in which the answering respondent can recover its dues is by disposing of the equipments like winches, chains etc lying on the plot. Though the sale of those objects will enable the answering respondent to realize only a small part of its dues the answering respondent will atleast not be left completely high and dry. The answering respondent have stated in their lette5r dated 11/12/2010 produced at Annexure-H of the petition that the petitioner owes it an amount of Rs.1.75 crores and only once the dues are cleared the petitioner's request to allow it to remove the winches, chains and equipments will be aceeded to.”
4. Ms. Jani, learned advocate, and Mr. S.M.Thakore, learned advocate have appeared for the petitioners and Mr. P.R.Nanavati, learned advocate, with Ms. Contractor, learned advocate, have appeared for the respondent GMB. Heard learned counsel appearing for the respective parties.
5. Ms. Jani, learned advocate for the petitioners, has submitted, inter alia, that the equipments and machineries, etc. lying on the site, i.e. Plot No.144, are the properties of the petitioner company and that therefore, the respondent GMB has no authority to take over the said property and/or to restrain the petitioner company from taking out its own properties from the plot in question. It is also claimed that the impugned action of the respondent GMB of not allowing the petitioner company to remove its own properties is violative under Article 300A of the Constitution of India and that the petitioner company cannot be deprived of its own property without following due process of law.
5.1 Ms. Jani, learned advocate for the petitioners, has also claimed that the respondent GMB's defence based on the provisions contained under Section 47 of the Act is misconceived, unjustified and unsustainable. She also disputed and denied that any amount/dues are required to be paid by the petitioner company to the respondent GMB. She submitted that since without any valid reason or justification or without any authority in law, the respondent GMB is not permitting the petitioner company to remove its own properties, i.e. equipments, machineries, etc., the petitioner company is aggrieved by such action as the petitioner company is suffering huge loss and that therefore, it is constrained to prefer present petition.
6. Mr. Nanavati, learned counsel for the respondent Board, reiterated the details mentioned in the reply affidavit. He submitted that the petitioner company owes huge amount to the respondent Board and that therefore, in view of the provisions under Section 47 of the Act, the respondent Board has first lien on goods and the respondent Board is also authorized to seize and retain the goods until such rates and rents are fully paid and therefore, the petitioner company's claim that the petitioner should be allowed to remove and take away the goods, equipments, etc. is unjustified and may not be permitted. He also submitted that the conduct of the petitioner company is also required to be taken into account. For the said purpose, he relied on the Minutes drawn by the Committee appointed by the Hon'ble Apex Court.
7. I have heard the submissions made by learned counsel for the contesting parties and also considered the documents placed on record of present petition as well as the orders passed by the Hon'ble Apex Court.
8. It appears from the record that the petitioner company had brought a vessel for the purpose of breaking. The vessel was parked at plot No.144 at Alang Sosiya Ship Breaking Yard. It appears that subsequently, several disputes arose which laid to litigation. The litigation was also carried before the Hon'ble Apex Court. It appears that, ultimately, in view of orders passed by the Apex Court and upon complying the conditions prescribed by orders of the Hon'ble Apex Court, the petitioner was permitted to start and complete the cutting and dismantling process. The proceeds from disposal of the material received after cutting and dismantling of the vessel were made subject to the directions by the Apex Court in the orders passed in Special Leave Petition (Civil) No.5256 of 2006 and subsequent applications in the said petitions. It appears that for the purpose of carrying out the work of cutting and dismantling the vessel, the petitioner brought certain equipments, tools, etc. According to the petitioner, the said equipments, tools, etc. are still lying at the said plot and the petitioner desires to remove and take away the said equipments, tools, etc. contending that it is petitioner's property and the petitioner has right to remove and take away the said equipments, tools, etc. The request is opposed by the respondent Board.
8.1 In order to appreciate and consider the request made by the petitioner, it is necessary to take into account the observations and directions made by the Apex Court in order dated 8.2.2008 passed in Special Leave Petition (Civil) No.5256 of 2006. The relevant part of the order reads thus:-
“On 3rd March, 2006, on the submissions made on behalf of the petitioners, that the Ship could be broken under the supervision of a person nominated by the Court, notice was issued on the Special Leave Petition. Subsequent to the said order, on 25th April, 2007, the Court passed the following order:-
“After some discussion, it appears that it maybe possible to dispose of the matter at this stage. Counsel for the petitioner submits that the best value that one can get for the ship in question, having regard to the facts and circumstances of the case, is about Rs. 3 Crores out of which a sum of approximately Rs.25.30 lacs would be spent on breaking the ship. The petitioner submits that the ship may be directed to be sold after inviting tenders. If no one is willing to offer more than Rs.2.7 Crores, the petitioner may be permitted to break the ship and sell it of. In case there is a better offer than Rs.2.7 Crores and the petitioner and the bidder wish to improve their offer, the ship may be sold for the highest price offered.
For this purpose, we may have to direct the D.R.T. to appoint a person who shall take necessary steps in the matter. Counsel for the petitioner also prays for some time to seek instruction as to the nature of security that it may furnish and the time within which such security shall be furnished so that the payment is secured. The amount of Rs.2.7 Crores shall be deposited by the petitioner after the ship is broken and sold within the period specified.
It is expected that the breaking of the ship may take about two months, depending upon weather conditions.
The question of ownership of the ship may be gone into later.”
By a subsequent Order passed on 16th May, 2007, the Debts Recovery Tribunal, Ahmedahad, was permitted to hold a public auction for sale of the ship after advertising such sale. The reserve price for the said public auction was fixed at Rs.2.7 Crores, which was the amount which the petitioner had offered to pay for the Ship. It was also directed that the proceeds of the auction sale would be deposited by the Tribunal in an interest-bearing fixed deposit with the State Bank of India, Ahmedabad, which deposit would be for an initial period of six months. The Tribunal was directed to hold auction within a period of two months from the date of the Order and to submit a report after the completion of the auction sale.
xxx xxx In the ultimate analysis, it appears that the ship could not be sold in terms of the direction given by this Court earlier. Having regard to the above, this I.A. has been filed on behalf of the petitioner for leave to allow the petitioner to dismantle the ship subject to:
(i) Recovery of costs towards the ship breaking;
(ii) The proceeds recovered from the sale of scrap to be deposited with the Court Receiver and used towards defrayment of customs duties, payment to Alang Ship-breaking yard, towards rent of Plot No.144-145, along with payment of the dues of State Bank of Bikaner and Jaipur and the Bhavnagar District Cooperative Bank.
xxx xxx One of the other prayers in this I.A., is to appoint a Receiver to oversee the ship-breaking and to ensure the recovery of the proceeds from the sale of scrap and after adjustment of cost of ship-breaking, to deposit the remaining amount with the Court Receiver who shall invest the same in an interest bearing fixed deposit account.
xxx xxx Accordingly, on the suggestion made on behalf of the petitioner, which is accepted by all the respective parties, we appoint a Committee which is to consist of a representative of the petitioner, one representative of each of the three Banks in question and the Official Receiver of this Court, to oversee the dismantling of the ship which is to be conducted by the petitioner. The petitioner shall deposit an initial sum of Rs.24 lacs towards the cost of ship-breaking with the Official Receiver who shall deposit the same in an interest bearing fixed deposit account with the State Bank of India, Ahmedabad Branch. The Committee and the petitioner shall mutually fix the date and time when the work of dismantling of the ship can be commenced. The said ship, being M.V.Palanga, is to be dismantled in terms of this Order.
The Court Receiver shall act as Chairman of the Committee and shall take whatever steps that are necessary for the purpose of overseeing the ship-breaking and sale of the scrap recovered from the dismantled ship. The Committee shall also ensure that the amounts received are deposited with the Court Receiver who shall invest the same in interest bearing fixed deposit accounts and keep the same renewed until further orders of this Court.
xxx xxx This Order is being passed on the understanding that the petitioner abides by its original offer of paying Rs.2.7 Crores as price of the Ship. It is also stated on behalf of the petitioner that if the sale proceeds do not cover the price offered by the petitioner, the balance amount shall be deposited by the petitioner with the Court Receiver before the matter is listed.
xxx xxx.”
8.2 Subsequently, interlocutory application was taken out in the aforesaid Special Leave Petition (Civil) No.5256 of 2006 wherein the Hon'ble Apex Court passed order dated 11.12.2009 which reads thus:-
“Although, a letter has been circulated on behalf of the respondents, we see no reason to entertain the same since we are only on the application for restoration of the Special Leave Petition which had been dismissed on the ground of default on the basis of erroneous assessment made by the learned counsel for the petitioner. Learned counsel for the petitioner, it seems, is ready to deposit the amount as directed but the same has not been accepted by the Registry of the Gujarat High Court.
Having heard learned counsel for the petitioner as well as for the respective parties, we allow the application to restore the Special Leave Petition. The petitioner is given a week's time to deposit the amount of Rs.25 lakhs as was directed earlier by the order of 8th February, 2009.
Let a copy of this order be transmitted to the Registrar General of the Gujarat High Court immediately.”
8.3 It also emerges from the record that in pursuance of the order dated 8.2.2008 passed by the Hon'ble Apex Court, the Committee which was appointed, held a meeting on 2.4.2010. The Minutes of the Meeting held at the Plot No.144 at Alang Ship Recycling Yard is placed on record. The relevant part of the Minutes of the Meeting reads thus:-
“- The Committee met at Plot No.144, Alang Ship Recycling Yard, Bhavnagar, for inspection of Ship, MV Planga. The committee inspected the Ship and dwelt on issuance of permission to M/s. Jogadia Polymers (P) Ltd., as ordered by the Hon'ble Supreme Court of India and in view of their fulfilling the conditions laid down in the consensual resolution passed by the committee passed on 31.3.2010.
- Accordingly, M/s. Jogadia Polymers (P) Ltd., allowed to dismantle the Ship, MV Palanga by communication, dated 2.4.2010, as ordered by the Hon'ble Supreme court of India and in view of their fulfilling the conditions laid down in the consensual resolution passed by the committee passed on 31.3.2010.”
It appears from the submissions made by learned counsel for the petitioner and the respondent Board that the vessel was dismantled and the material has been sold. The dispute is about the deposit of the proceeds.
9. The respondent Board has alleged that at initial stage, the sale proceeds were received by the petitioner company and thereafter, the petitioner company used to deposit the proceeds through cheque issued by it. It is also alleged that on certain occasions, the cheques issued by the petitioner company were dishonoured. The respondent Board has also submitted that said conduct of the petitioner company is taken note of by the Committee appointed pursuant to the order by the Hon'ble Apex Court. The respondent Board has relied on the report dated 4.2.2011 submitted by the said Committee. A copy of the said report is annexed to the respondent Board's affidavit wherein it is stated, inter alia, that, “D) Conduct of M/s. Jagadia Polymers Pvt. Ltd.
i) Without informing the Committee or even the Chairman, M/s. Jagadia has taken all the cheques and drafts from the buyers of the scrap in their own name. Since the cheques being deposited with the Registrar General of the Gujarat High Court were signed by the bankers like HDFC Bank Ltd. in most of the cases, the Committee did not ralize at the relevant time that the cheques were being issued by M/s. Jagadia from their bank account whereas direct payment was being collected by M/s. Jagadia from the buyers of the scrap and other materials.
ii) xxx xxx
iii) xxx xxx
iv) Though it is the claim of M/s. Jagadia that a total sum of Rs.3,07,90,550/- was received from the sale of scrap, this amount is not fully deposited by M/s. Jagadia with the Committee. Though Rs.25 lakhs were deposited by virtue of the directions of the Hon'ble Supreme Court for which it was specifically agreed by M/s. Jagadia vide para 2(e) of the above minutes/MOU dated 31.3.2010 at Annexure-I for not claiming any adjustment from the Committee and to approach the Hon'ble Supreme Court for further orders qua this amount of Rs.25 lakhs, M/s. Jagadia has not deposited Rs.25 lakhs out of the total sum of Rs.3,07,90,550/- fetched from the buyers, and a unilaterial adjustment of this amount is made by them as against Rs.3,07,90,550/- to be deposited with the Committee.
v) xxx xxx
vi) Thus, the above Rs.25 lacs is still not deposited by M/s. Jagadia Polymers Pvt. Ltd. with the Committee and thus the full price of Rs.3,07,90,550/- fetched by them from sale of scrap is not deposited with the Committee. The statement of amount deposited by M/s. Jagadia Polymers is annexed herewith vide Annexure-II.
E) Suppression of facts by M/s. Jogadia:
The above facts like receiving price from the buyers in their name etc. were not disclosed to the Committee during any of the meetings; and it was also not disclosed to the Committee as well as the Chairman during last two meetings that an application for further orders has already been filed by M/s. Jagadia before the Hon'ble Supreme Court in November, 2010. It was brought to the notice of the members of the Committee as well as the Chairman by one of the members of the Committee that such an application was lodged before the Hon'ble Supreme Court stating therein that the entire amount of Rs.3,07,90,550/- received by M/s. Jagadia was deposited with the Committee and that the Committee should be directed to refund a sum of Rs.37,90,550/- to M/s. Jagadia. On perusal of the above interim application lodged by M/s. Jagadia in November, 2010 in the Hon'ble Supreme Court, it is found by the Committee that the facts discussed in this report hereinabove are not shown in the application and breach of various conditions agreed to by M/s. Jagadia is also not disclosed before the Hon'ble Supreme Court.”
9.1 In the said report, the Committee has also stated that despite utmost care taken by the Committee and full opportunity is given to the petitioner, a sum of Rs.3,07,90,550/- received by said M/s. Jagadia Polymers from the sale of scrap is not deposited with the Committee and that the petitioner has also not carried out the undertaking given by them to the Committee. The Committee has also mentioned, in the said report that serious breach of vital conditions like not depositing the full amount received by it from the buyers, are committed by the petitioner. The Committee has stated in the said report that “it is, therefore, felt that Committee was cheated by M/s. Jagadia and price of scrap etc. obtained from breaking up of vessel “M.V.Palanga” is dishonestly misappropriated by M/s. Jagadia...”
9.2 The respondent Board would contend that the request of the petitioner is required to be examined in light of the said report and remarks by the Committee appointed by the Hon'ble Apex Court. The respondent Board would also contend that huge amount in the sum of about Rs.1 Crore is outstanding and have not been paid by the petitioner. It is claimed that the said amount is still to be received/recovered from the petitioner and that if the request by the petitioner is allowed, then, any scope of realizing any amount will also come to an end. So as to justify its action of not allowing the petitioner to remove the equipments, tools, etc. the respondent Board has relied on the provisions contained under Section 47 of the Gujarat Maritime Board Act, 1981.
The said provision under Section 47 of the Act, reads thus:-
“47. Board's lien for rates. - (1) For the amount of all rates leviable by the Board under this Act in respect of any goods and for the rent due to the Board for any building, plinths, stacking are as or other premises on or in which any goods may have been placed, the Board shall have a lien on such goods and may seize and detain the same until such rates and rents are fully paid.
(2) Such lien shall have priority over all other liens and claims, except for general average and for the shipowner's lien upon the said goods for freight and other charges were such lien exists and has been preserved in the manner provided in sub-section (1) of section 48 and for money payable to the Central Government under any law for the time being in force, relating to customs other than by way of penalty or fine and to the State Government under any law for the time being in force.”
9.3 Of course, the allegations made by the respondent Board in its reply affidavit are disputed and denied by the petitioner company in its rejoinder affidavit. It is, inter alia, claimed by the petitioner in the said rejoinder affidavit that:-
“9. The contents of para 3(d) of the reply are denied. I deny that the respondents have any lien over the equipments, machinery, winch or other objects of the petitioner lying on the plot in question as stated or otherwise. I state that the provision referred to inter alia only relates to lien over goods. The said provision has no application to machinery, equipments, etc. used by the petitioner company for dismantling the vessel. The said machinery, equipments and scrap of construction as stated in the petition are property of the ownership of the petitioner company and the respondent board does not have any lien over the same. The Respondent authorities cannot be allowed to deprive the petitioner company of its property by force and without due process of law. I deny that the petitioners have pocketed any money as stated or otherwise. In any event, I deny that the respondent board has any right to recover its alleged dues by disposing off the equipments belonging to the petitioners like winches, chains, etc. lying at the plot. I deny that the respondent board has any right to recover any alleged dues by selling the same. In reply to the contents of the para under reply, I reiterate that I have stated in para 6 of the petition.”
9.4 From the report of the Committee it is noticed that the Committee has made allegations of serious nature against the conduct of the petitioner.
However, what is pertinent is the fact that the details mentioned in the said report are not the allegations made by the Board, but those are the details which are mentioned by the Committee appointed by the Hon'ble Apex Court.
It, prima facie, appears that the petitioner has not returned the full amount received by it on sale of scrap and other material obtained after cutting, breaking and dismantling the vessel.
The respondent Board has asserted that a sum of about Rs.1 Crore is outstanding and the petitioner has to pay the said amount which is not being paid by it despite the demand.
The respondent Board has claimed that it is in view of such huge outstanding dues that, in exercise of powers under Section 47 of the Act, it has not allowed the petitioner to remove the goods and material lying on the plot in question.
10. The petitioner would contend that the said provision does not allow the respondent Board to retain the equipments, tools, etc. brought at site by the petitioner for the purpose of dismantling the vessel. The petitioner has claimed that the said items do not fall within the purview of the terms “goods” defined under the Act. Learned advocate for the petitioner has also submitted that amount of Rs.3 Crores is already deposited by the petitioner. Learned advocate for the petitioner has relied on clause (m) and (o) of the terms and conditions for permission for utilizing the ship breaking plot.
The said column (m) and (o) read thus:-
“(m) The party shall remove at its own risk and cost all the goods, material or structure put up on the plot upon expiry of the term mentioned hereinabove or within one month from the date the Gujarat Maritime Board cancels the permission, If the party fails to so remove the goods/materials/structures the Gujarat Maritime Board shall be entitled to remove them at the risk and cost of the party without any liability for any kind of compensation.
(o) If the party commit a breach of any of the above terms and conditions the permission granted shall be liable to be cancelled. And the party shall not be entitled to any Notice except a Notice from the Port Officer of the concerned port calling upon the party to show cause why the permission should be cancelled. Therefore, the Chief Executive Officer shall take the decision after giving the party or opportunity of being heard. The party shall not be entitled to any other Notice.
Provided that upon expiry of the period stipulated in the permission letter, the party shall not be a titled to any Notice whatsoever.”
10.1 In light of the said provisions, it is contended that it is the obligation of the petitioner to remove, at its own risk and costs, all goods, material, structures, etc. put up on the plot after expiry of the term or within one month after the permission is cancelled by the Board and that if the party fails to remove the goods, then, the Board can remove the goods at the risk of the party. Learned advocate for the petitioner would contend that in present case, the petitioner is ready and willing to remove the goods at its own costs which would save the costs and trouble of the Board to remove the said goods.
10.2 Section 47 of the Act allows the Board to exercise lien on the goods. The said provision also empowers the Board to “seize and detain the goods” until the rates and rents are fully paid.
In present case, the petitioner has alleged that the Board has not allowed it to remove the goods. From the reply filed by the respondent Board and the facts asserted by the respondent Board, particularly its submission that the petitioner has to pay a sum of about 1 crore to the respondent Board, it becomes clear that the Board has detained the said goods i.e. the equipments, tools, etc.
The words “rates and rents” used in Section 47 are, in view of the object of the provision, required to be construed to include “the dues” of the Board either by way of unpaid rent or rates or unpaid amount towards any other liability/obligation pursuant to and on account of allotment and use of plot.
10.3 In present case, the payments of dues which the Board is claiming are dues which the petitioner is obliged to play not only on account of allotment and use of the plot, but also in compliance of the directions by the Hon'ble Apex Court. Whether any amount as asserted by the respondent Board is outstanding or not and whether the petitioner has paid the entire amount in compliance of the direction by the Hon'ble Apex Court or not are the disputes which are not the subject matter of present petition and that therefore, any material throwing any light on the said aspects is also not available on record. Consequently, it is neither feasible nor proper to examine the said details in present case.
10.4 From the report of the Committee and details mentioned in the affidavit by the respondent Board, it appears that there are disputes as to the compliance of directions by the Hon'ble Apex Court and there are also disputes about the total amount paid/deposited by the petitioner vis-a-vis the amount received by it and/or its liability to deposit/pay the amount as per the directions by the Hon'ble Apex Court. It appears that if such disputes are not resolved and unless the petitioner establishes in appropriate proceedings before the Hon'ble Apex Court that the remarks made by the Committee do not survive and that it has complied with all directions by the Hon'ble Apex Court, the relief prayed for by the petitioner does not deserve to be granted at this stage.
10.5 So far as the submission made on the strength of clause (m) of the aforesaid terms is concerned, the said submission cannot be accepted in light of the provisions contained under Section 47 of the Act.
10.6 So far as the contention raised on clause (m) of the terms and conditions is concerned, when the Board has, in exercise of powers conferred on it under Section 47 of the Act, detained and/or seized the goods or has exercised lien, then, the petitioner cannot take recourse under clause (m) of the terms and conditions. The said clause (m) cannot be read to destruct or nullify the provisions under Section 47 of the Act. The said provision under clause (m) would operate only when the allottee of the plot is required to remove the goods upon occurrence of the events mentioned in clause (m), but the said provision would not operate when the goods are detained or seized or lien is exercised by the Board for recovery of its dues or for enforcing the recovery. Therefore, the contention based on clause (m) cannot be entertained and accepted. The facts of the case also clarify that the submission made on the strength of clause (o) of the terms and conditions is also misconceived. By making reference of the said provision or such other provisions under the terms and conditions, the petitioner intends to bring about a situation wherein the respondent Board may not be in position to effect recovery of its dues and/or the Board and the Committee may not be able to ensure full compliance of the directions of the Hon'ble Apex Court.
11. As a result of foregoing discussion and reasons, present petition does not deserve to be entertained and, at this stage, the relief, as prayed for by the petitioner, does not deserve to be granted. Therefore, present petition is not entertained and is accordingly rejected. Notice is discharged.
(K.M.Thaker, J.) kdc