Andhra Pradesh High Court - Amravati
Piraeus Bank vs M V Evangella M on 10 February, 2023
HON'BLE SRI JUSTICE R. RAGHUNANDAN RAO
I.A.Nos.6,7, 9, 12 to 14, 16, 20 to 23 of 2019
I.A.Nos.13, 14, 15 & 16 of 2020
I.A.No.1 of 2021
In
COMS No.1 of 2019
ORDER:
The vessel M.V. Evangelia M, after discharging her cargo in
Visakhapatnam, had berthed at Kakinada Port on 26.03.2018 for supply of
spares. At that stage, various suits and execution petitions came to be
filed for attachment and sale of the vessel for payment of the dues of the
creditors.
2. M/s. Pacific World Shipping Pte. Limited, filed Execution
Petition No.2 of 2018 for recovery of 25,000 USD. An order of attachment
and arrest of the vessel was passed by the Hon'ble High Court of
Judicature at Hyderabad for the State of Telangana and the State of
Andhra Pradesh, on 06.09.2018. M/s. Sinwa Singapore Pvt. Ltd., filed
Commercial Suit No.2 of 2018 and obtained an order of arrest from the
High Court on 24.09.2018. While the vessel was under arrest, the crew of
the vessel filed Commercial Suit No.3 of 2018, for recovery of wages of
320,000 USD and obtained an order of arrest from the High Court of
Judicature at Hyderabad for the State of Telangana and the State of
Andhra Pradesh, on 26.10.2018. M/s. Brothers Shipping filed Commercial
Suit No.4 of 2018 for recovery of 51,000 USD and obtained an order of
arrest on 09.11.2018. Finally, the present Commercial Suit was filed by the
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plaintiff for recovery of 15,000,000 USD and an order of arrest was passed
by this Court on 25.01.2019.
3. This Court, by an order dated 09.09.2019, in I.A.No.18 of
2019 had allowed the sale of the defendant vessel to be carried out. By an
order dated 05.10.2020, this Court accepted the bid of M/s. Fastfreight
Pte Ltd., for an amount of 2,200,100 USD. The proceeds of sale were
deposited with the Registrar of this Court and the sale was confirmed by
this court by an order dated 20.11.2020. A sum of Rs.53,45,000/- and
another sum of Rs.10,00,000/- was paid out to the plaintiff, out of the sale
proceeds, as reimbursement for the expenses incurred for the auction of
the vessel.
4. The vessel, at the time of its arrest, was manned by a crew
of 21 sailors and officers (hereinafter referred to as "the first crew"). This
crew sought to leave the ship as their wages were not being paid and the
living conditions in the vessel had become difficult. Thereupon, one M/s.
Evic Human Resources Management Inc., through the good offices of a
local agency, viz., M/s. His Grace Management Private Ltd., had replaced
the first crew with a second crew consisting of 19 members (hereinafter
referred to as "the second crew"). The second crew also sought to leave
the ship as their wages were not paid and the second crew was replaced
over time by another 28 persons (hereinafter referred to as "the third and
fourth crew"). Further, the sailors on the vessel had to be supplied with
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essentials for living on the vessel and to maintain the vessel. On account
of these facts, various claims were raised against the vessel.
5. The first crew, apart from filing Commercial Suit No. 3 of
2018, moved the following applications for the following reliefs in the
present suit:-
a) I.A.No.4 of 2019 was filed to permit the petitioners to intervene in
the suit.
b) I.A.No.5 of 2019 was filed for sale of the defendant vessel.
c) I.A.No.6 of 2019 was filed for payment, from out of the sale
proceeds of the vessel.
d) I.A.No.7 of 2019 was filed to determine the wages due to the
applicants therein.
e) I.A.No.8 of 2019 was filed for arrest of the defendant vessel.
6. M/s. Evic Human Resources Management Inc. filed
applications for recovery of 241,246.90 USD and 63.248 USD towards
wages paid out by M/s. Evic Human Resources Management Inc., to the
crew of the ship from time to time and for other supplies and services
including procuring Air Tickets for the first crew to fly home etc., in the
following manner:
a) I.A.No.9 of 2019 was filed for permission to intervene.
b) I.A.No.10 of 2019 was filed for arrest of the vessel.
c) I.A.No.11 of 2019 was filed for sale of the vessel.
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d) I.A.No.12 of 2019 was filed for payment of 242,246 USD.
e) I.A.No.13 of 2019 was filed to declare that the applicant was
entitled to recover a sum of 241,246 USD.
f) I.A.No.21 of 2019 was filed to declare that a sum of Rs.44,93,770/-
is due to the applicant.
g) I.A.No.22 of 2019 was filed to pay out a sum of Rs.44,93,770/-.
h) I.A.No.1 of 2021 was filed for further payment of Rs.1,34,587.44.
7. M/s. Azariah Ship Management Pvt. Ltd., moved this Court
for recovery of Rs.44,20,578/- and Rs.19,95,795.68 as dues payable on
account of various supplies and services given to the crew of the vessel
and for maintenance of the vessel. The applications filed by it are -
a) I.A.No.14 of 2019 to permit intervention.
b) I.A.No.15 of 2019 for arrest of the vessel
c) I.A.No.16 of 2019 for payment of Rs. 44,20,578/-, out of the sale
proceeds of the vessel.
d) I.A.No.17 of 2019 for a declaration that the aforesaid amounts are
due and payable to the applicant.
e) I.A.No.20 of 2019 for payment of Rs.19,95,795/-.
f) I.A.No.23 of 2019 for a declaration that a sum of Rs.19,95,795/- is
due to the applicant.
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8. The plaintiff itself had filed I.A. No. 3 of 2019 to implead all the
plaintiffs in the other suits, including the first crew, who had also filed I.A.
No. 2 of 2019, to implead themselves as respondents in this suit. Both
these applications were allowed on 14.02.2019 and the first crew were
added as Respondents 5 to 25. I.A. No. 4 of 2019 was filed by the Indian
crew to implead themselves. This application was allowed on 28.02.2019
and the Indian crew were impleaded as respondents 27 to 45. The
applications which have now come up for consideration are:
I. IA No. 9/2019 filed by EVIC Human Resources Management Inc.,
IA No. 14/2019 filed by M/s. Azariah Ship Management Pvt. Ltd.,
and IA No. 15/2019 filed by Mr. Suresh Babu Rossana Syam Kumar
& 27 others to implead themselves as Defendants in the present
suit.
II. IA No. 16/2020 filed by Mr. Suresh Babu Rossana Syam Kumar &
27 others for exemption from paying court fees.
III. IA No. 13/2019, IA No. 21/2019 & IA No. 1/2021 filed by EVIC
Human Resources Management Inc., IA No. 23/2019 filed by M/s.
Azariah Ship Management Pvt. Ltd., IA No. 7/2019 filed by Mr. Amit
Kumar & 18 others and IA No.14/2020 filed by Mr. Suresh Babu
Rossana Syam Kumar & 27 others for determining the amounts
payable to them and IA No. 12/2019 & IA No. 22/2019 filed by
EVIC Human Resources Management Inc., IA No. 16/2019 & IA
No.20/2019 filed by M/s. Azariah Ship Management Pvt. Ltd., IA
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No.6/2019 filed by Mr. Amit Kumar & 18 others & IA No.13/2020
filed by Mr. Suresh Babu Rossana Syam Kumar & 27 others praying
for determination of amounts due to them payable out of the sale
proceeds.
9. The plaintiff has filed counter affidavits in the pending
applications. The issue, for determination, before this Court at this stage,
is whether these applications are maintainable. The objection raised by
the plaintiff against these applications is that the applicants are seeking to
obtain a decree, in the case filed by the plaintiff, without paying the
requisite Court fees. The basic principle enshrined in the Code of Civil
Procedure, which is also applicable to actions under the Admiralty
(Jurisdiction and Settlement of Maritime Claims) Act, 2017 (for short 'the
Admiralty Act') is that such decrees can be obtained only in suits instituted
by such applicants and such relief cannot be obtained, by way of
interlocutory applications, in the suits filed by other creditors. The attempt
of the applicants to obtain a decree out of the sale proceeds of the
defendant vessel without instituting independent suits for adjudication of
their claims and without paying requisite Court fee, is not permissible.
Further, the question of making any payment out of the sale proceeds of
the defendant vessel, would arise only when a decree determining the
amounts due to such applicants and after determination of priorities of
their claims to the sale proceeds of the vessel is completed. The counter
affidavits also dispute and deny the claims of the applicants.
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10. Sri Amitava Majumdar appearing for the plaintiff reiterates
the above objections raised in the counter affidavit.
11. Sri Vasudevan appearing for the crew, who are seeking to
intervene in the suit and are seeking determination of their claims and
consequent payment, would submit that crew, seeking payment of their
wages, need not file a separate suit and are also not required to pay any
Court fee. He would rely upon the provisions of Sections 145 and 146 of
the Merchant Shipping Act, 1958 and the judgment of the Hon'ble High
Court of Madras reported in P. Udaya Shankar vs. Andhra Bank1 to
contend that the said provisions enable a seaman to resort to a process
for recovery of his wages which need not, necessarily, be an independent
proceedings. The Division Bench further held that in appropriate cases
such applications could be taken up in proceedings which are already
pending at the instance of another party.
12. Sri Vasudevan would submit that the procedure being
followed by the High Court of Madras is that an Advocate Commissioner is
generally appointed to determine the wages payable to seamen and
wages are paid as the first priority under the Merchant Shipping Act, 1958.
13. Sri Vasudevan would further submit that the Admiralty Act
does not, in any manner detract from these principles. He would further
submit that the Rules framed under Section 16 of the said Act, by the
96 Law Weekly 502
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Hon'ble High Court at Madras, also states in Rule 1(vii) that "suit" shall
mean any suit, action, or other proceeding instituted in the said Court in
its Admiralty Jurisdiction. He would submit that Rule 11 and Rule 12 of the
Rules framed under Section 16 in relation to cases brought before the
High court at Madras, in exercise of its Admiralty Jurisdiction, also
stipulate that the right of a person to intervene and claim interest in the
property, under arrest, or in the fund in the Registry, is permitted under
Rule 11 and the requirement of paying Court fee, contained in Rule 12, is
conditional as Rule 12(b) grants discretion to the Court to either exempt
any person seeking to intervene from payment of Court fee or to direct
that the Court fee is to be obtained out of the funds granted to such
persons. He would submit that, since Rules have not yet been framed in
relation to this Court, the Rules, framed by the Hon'ble High Court of
Madras, can always be applied by this Court.
14. He would further rely upon the judgment of the High Court
of Bombay in the case of the Swedish Club vs. V8 Pool Inc. and Ors.,
Commercial Appeal No.108 of 2021 dated 23.03.2022, in Interim
Application No.2062 of 2021.
15. In reply to these contentions, Sri Amitava Majumdar would
submit that the Merchant Shipping Act is applicable only to those vessels,
which are registered in India. As the defendant vessel is not registered in
India, the provisions of the Merchant Shipping Act, including Sections 145
and 146 of the said Act, would not be applicable to the present case and
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the judgment cited by Sri Vasudevan in P. Udaya Shankar vs. Andhra
Bank would not be applicable to the present case. He would further
submit that the facts of that case relate to a suit which had already been
decreed and the matter was pending at the stage of execution. He would
submit that in such circumstances, the said judgment would not be
applicable to the present case.
16. Sri Amitava Majumdar would also rely upon AK.A.CT.V.C.
Meenakshisundaram Chettiar vs. AK.A.CT.V.C.V. Venkatachalam
Chettiar2 (Para 28) to contend that Court fee has to be paid before any
further steps can be taken for determining the amounts due to the
intervenor or for payment of the said amounts. He also relies upon a
judgment of the Hon'ble High Court of Delhi reported in Sahara India
Airlines Ltd., vs. R.A. Singh3 (paras 7 & 8) to contend that the
provisions of Civil Procedure Code read with the relevant Court Fee Act
clearly stipulates that Court fee is required to be paid in all such matters.
Consideration of the Court:
17. The primary argument of Sri Vasudevan is that, sections 145
and 146 of the Merchant Shipping Act, 1958 (hereinafter referred to as the
Shipping Act) permit seamen to claim and collect their wages by
intervening in any pending litigation and without payment of court fees
(1979) 92 Law Weekly 471
1997 (43) DRJ 217 (DB)
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and without filing a suit. Section 145 & 146 of the Merchant Shipping Act,
1958 reads as follows:
145. Summary proceedings for wages:
(1) A seaman or apprentice or a person duly authorized on
his behalf may, as soon as any wages due to him become
payable, apply to 1[any Judicial Magistrate of the first class
or any Metropolitan Magistrate, as the case may be,]
exercising jurisdiction in or near the place at which his
service has terminated or at which he has been discharged
or at which any person upon whom the claim is made is or
resides, and 2[such Magistrate] shall try the case in a
summary way and the order made by 2[such Magistrate] in
the matter shall be final.
(2) An application under sub-section (1) may also be made
by any officer authorized by the Central Government in this
behalf by general or special order.
146. Restrictions on suits for wages:
A proceeding for the recovery of wages due to a seaman or
apprentice shall not be instituted by or on behalf of any
seaman or apprentice in any civil court except where--
(a) the owner of the ship has been declared insolvent;
(b) the ship is under arrest or sold by the authority of any
court;
(c) a Judicial Magistrate of the first class or a Metropolitan
Magistrate, as the case may be, refers a claim to the court.
18. The judgement of the Hon'ble High Court at Madras, in P.
Udaya Shankar vs. Andhra Bank, holds, on the basis of this provision,
that seamen are entitled to move such applications and do not have to
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file independent suits. The ratio of the said judgement is contained in
paragraphs 6 and 7, thus:
"6. Mr. V. Sridevan, learned counsel for the appellant,
made his submissions that the expression 'proceeding' S.146
need not necessarily mean a regular suit, the filing of which
may involve the payment of court fee on an ad valerem basis
and it can take the form of an application in the present suit
itself or an independent original application. Our construction
of the provision also leads us to hold that the expression
'proceeding' occurring in S.146 of the Act need not
necessarily mean a regular suit and it can take in the form of
an interlocutory application in an already instituted suit or an
independent original application for the reliefs available to
the seaman. S.3(31) of the Act defines 'proceeding' in
relation to Ss.178 to 183 (inclusive) as including any suit,
appeal or application. Learned counsel for the appellant
contends that this provides an indicia that the expression
'proceeding' occurring in S.146 of the Act will normally have
to be construed as excluding a suit and the relief sought for
by the seaman can be secured by taking a step in aid in the
suit already instituted by a third party. There is a fallacy in
this sort of construction of the provision because S.3(31) not
only refers to a suit but also appeal or application. Hence, it
is not safe to fall back upon S.3(31) to find out the true
meaning of the expression 'proceeding' occurring in S.146 of
the Act. Ss.178 to 183 have got a definite purpose to serve
and in order to avoid any ambiguity and obviate an
argument that the expression 'proceeding' occurring in
Ss.178 to 183 will not refer to any suit or appeal or
application S.3(31) has been incorporated. In this view, we
do not find any support from S.3(31) of the Act, for
construing the expression 'proceeding' occurring in S.147 of
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the Act. This obliges us to fall back upon the normal meaning
that could be attached to the expression 'proceeding.' We
find the following meaning to the expression 'proceeding' in
Stroud's Judicial Dictionary, 4th Edn., volume 4 at page 2124,
-
"Any proceeding: (Judicature Act, 1873 C.66, S.89) is
equivalent to 'any action' and does not mean any step
in an action ..."proceeding' is used as meaning a step
in an action."
7. In our view, 'proceeding' with regard to a party vis a
vis a court of law includes all and every step or action taken
before and/or all or every paper, document, or record
presented or filed in such a court of law by such party with
the object of advancing a case of his to obtain the desired
relief or reliefs. Of course, it does not require reiteration that
such 'proceeding' must have the backing of substantive as
well as procedural law. The very clause in S.146 also throws
light on this question. Cl.(a) refers to the contingency, when
the owner of the vessel has been declared insolvent. In such
a case, a claim proceeding in insolvency may suffice the
purpose and not necessarily a civil suit by the seaman for
recovery of his wages. Cl. (c) contemplates reference of the
claim itself to the court by the Magistrate. Hence there will
not be a necessity to file a civil suit. Cl. (b) contemplates the
contingency where the vessel is under arrest or sold by the
authority of any Court. Hence to state that a seaman should
always resort to the remedy of an independent, civil suit
does not fit in with the scheme of the provisions. It is true
that the marginal note to S.146 of the Act speaks about
'restrictions on suit for wages.' We do not think that we
should refer to the well accepted propositions as to how far
courts should fall back upon marginal notes for construing
the substantive provisions in the statute. Marginal notes can
afford little guidance to the construction of enactments
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especially when the language is plain and unambiguous, as
we find in the case of S.146 of the Act. The highest court in
the land has also frowned upon attempts to derive assistance
for statutory constructions from the marginal notes. Hence
the expression 'proceeding' found in S. 146 of the Act cannot
be bound down to have a restricted meaning of a regular
suit alone. In this view, we are not able to lend our support
to the reasoning of the learned Judge that S.146 of the Act
does not envisage that the remedy sought for by the
appellant could be obtained by means of an interlocutory
application in a suit already instituted by the plaintiff, and
the appellant has got his remedy in a civil suit.
19. This contention is opposed by Sri Amitava Majumdar on the
ground that the said Act does not apply to foreign ships and on the
ground that the said judgement was delivered in a case where the
intervention of the seaman came up after a decree had been passed and
the same is not a pending suit.
20. The applicability of the Shipping Act, to various vessels is
contained in section 2 of the Merchant Shipping Act, 1958, which reads:
2. Application of Act.--
(1) Unless otherwise expressly provided, the provisions of
this Act which apply to--
(a) any vessel which is registered in India; or
(b) any vessel which is required by this Act to be so
registered; or
(c) any other vessel which is owned wholly by persons to
each of whom any of the descriptions specified in clause (a)
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or in clause (b) or in clause (c), as the case may be, of
section 21 applies, shall so apply wherever the vessel may
be.
(2) Unless otherwise expressly provided, the provisions of
this Act which apply to vessels other than those referred to
in sub-section (1) shall so apply only while any such vessel is
within India, including the territorial waters thereof.
21. The defendant vessel is a foreign owned vessel to which the
provisions of section 2(1) would not apply. Section 2 (2), at first blush,
appears to exclude foreign ships from the ambit of the Shipping Act.
However, the Hon'ble Supreme Court, in Captain Subash Kumar v.
Principal Officer, Mercantile Marine Department4, (at page 454) held
as follows:
"11. The ship was not a ship owned wholly by persons each
of whom was a citizen of India or by a company satisfying
the descriptions under clause (b) or (c). Sub-section (2) of
Section 2 makes the provisions of the Act applicable to
vessels other than those referred to in sub-section (1) only
while any such vessel is within India, including the territorial
waters thereof. The ship being a Panamanian ship registered
in Panama would come within the purview of the Act only
while it is within India including the territorial waters."
22. The Hon'ble Supreme Court again held in World Tanker
Carrier Corpn. v. SNP Shipping Services (P) Ltd.5, at page 321) that:
(1991) 2 SCC 449
(1998) 5 SCC 310
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"26. Both these sections apply to those provisions of the Act
which apply to a vessel. Section 2 provides that those
provisions of the Merchant Shipping Act which apply to
vessels falling in Section 2(1), shall apply wherever such a
vessel may be. Those provisions which apply to vessels
falling in Section 2(2), i.e., foreign vessels, shall apply only
while the vessel is in Indian territorial waters. There are
several sections and/or parts of the Merchant Shipping Act
which apply to vessels, e.g., Part V of the Merchant Shipping
Act, 1958 (Sections 20 to 74) deals with registration of Indian
ships. Part VIII deals with passenger ships and so on. In
relation to litigation regarding vessels the High Court having
jurisdiction is specified in Section 3(15)."
23. An alternative interpretation, that only certain provisions of
the Shipping Act, which are applicable to foreign ships, would be
applicable to such ships, when they are in Indian waters, has been
suggested. The same cannot be taken into account, as this court is bound
by the ratio of the above judgements of the Hon'ble Supreme court. It
must be held that the Shipping Act would be applicable to foreign ships
when they are in Indian Waters.
24. After going through the judgement of the Hon'ble High Court
at Madras, in P. Udaya Shankar vs. Andhra Bank, I am in respectful
agreement with the said ratio. The contention of Sri Majumdar that the
said principle would not be applicable as there is no decree in this case
cannot be accepted. The ratio in the above judgement is on the basis of
the interpretation of the Act and not on the basis of the facts of the case.
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At this stage it would be necessary to note that sections 145 and 146 of
the Admiralty Act would permit only seamen to recover their wages
through interlocutory applications. The benefit of these provisions would
not be available to other claimants under the Shipping Act. However, the
effect of The Admiralty (Jurisdiction and Settlement of Maritime Claims)
Act, 2017, (hereinafter referred to as the Admiralty Act) and the Rules
made, under the Act, has to be considered.
25. Prior to the enactment of The Admiralty (Jurisdiction and
Settlement of Maritime Claims) Act, 2017, this Court traced its power to
the Letters Patent of 1865, issued by Queen Victoria, establishing the
Hon'ble High Court at Madras and the various admiralty laws passed by
the British parliament. The scope and ambit, of the Admiralty jurisdiction
of this court, has been set out in the judgement of the Hon'ble Supreme
Court in the case of M.V. Elisabeth v. Harwan Investment and
Trading (P) Ltd.,6.
26. The Hon'ble Supreme Court had recognised the fact that,
while the Shipping Act regulates many aspects of shipping, it does not
cover or regulate the recovery of maritime claims and the same was
within the purview of the High Courts, on the basis of the letters patent of
1865 read along with the inherent powers of the High Courts. The Hon'ble
Supreme court, specifically noted the fact that the Admiralty jurisdiction of
1993 Supp (2) SCC 433
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this court does not flow from the Shipping Act or any enactment made by
Parliament and observed that such legislation is necessary. This court,
after the enactment of the Admiralty Act, traces its Admiralty Jurisdiction
to the provisions of the Admiralty Act.
27. The present suit has been filed, invoking the Admiralty
jurisdiction of this Court, conferred on it by the Admiralty Act. The
jurisdiction to try all maritime claims has been vested, by Section 3 of the
Admiralty Act, in this Court. A claim for wages, by the master or crew of
the Vessel, is treated as a maritime claim under Section 4 of the Admiralty
Act. Section 12 of the Admiralty Act, provides that the provisions of the
Civil Procedure Code, 1908 shall apply in all the proceedings before this
court. In the normal course it would mean that all claims, including claims
of seamen for wages, would have to be initiated before this court, by way
of a suit after paying court fees. However, the rules framed by the High
courts, under section 16 (2A) of the Admiralty Act, would have to be
considered before any final conclusion can be drawn in this regard.
28. The Hon'ble High Court at Bombay, has framed rules, by
amending the Bombay High Court (Original Side) Rules. Rule 1064
stipulates that Suits shall be filed in accordance with the procedure set out
in the Code of Civil Procedure. Rule 1086 of these Rules provides that any
person, who has any interest in the ship or the proceeds of the sale of the
ship, can intervene in the suit by making an application for leave to
intervene. Upon such leave being granted, the intervenor shall be made a
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party to the suit by treating him as a defendant in the suit. Rule 1087 of
these Rules states that where a ship has been sold in a suit, any party
who has obtained a decree or judgment against the ship or the proceeds
of the sale of the ship can apply, by way of an interim application for an
order determining the order of priority of claims against the proceeds of
the sale. When such an application is made, the Sherriff, under Rule 1087
(d), shall publish a notice calling for claims. Rule 1087 (e) sets out the
details that are to be set out in such a notice. Rule 1087 ( e ) (iv) requires
the notice to state that any person having a claim against the ship or the
proceeds of the sale should file a suit to prove his claim before the
expiration of the period set out in the order directing publication of notice.
29. A reading of these Rules make it clear that the claims of only
those parties which have obtained a decree in a suit or are taking steps to
obtain decrees, in suits, will be considered. There do not appear to be
any rules which save the cases of seamen claiming wages under section
145 or 146 of the Shipping Act.
30. The Hon'ble High Court at Calcutta issued it's Admiralty Rules,
by a Gazette Notification dated 16.09.2019. Rule 3 requires claims to be
made by way of suits in accordance with the provisions of the Code of
Civil Procedure. Rule 10 provides for intervention, in suits, by persons who
are claiming interest in the property affected by an order passed in the
suit. Rule 19 (6) provides that the proceeds of the sale of the ship shall be
constituted into a fund. Rule 19 (6) (d) provides that any party having
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any interest in the fund can apply to the court to appoint a receiver to
receive claims against the fund and to make recommendations to the
court in this regard. Rule 19 (6) (g) states that the court shall make an
order, in this regard, as it deems fit. The procedure set out above is silent
about payment of court fees or whether the claims would be dealt with by
the court directly or only on the basis of a decree or judgment in a suit.
31. Rules 11 of the Rules framed by the Hon'ble High Court at
Madras, permits any person to raise claims by way of an intervention
application. Rule 12 requires any person raising a claim to pay ad valorem
court fees. The said court fees being levied by treating the claim as a
separate action against the property under arrest. However, Rule 12 (b)
also permits the court to grant exemption, to an intervenor, from payment
of court fees, provided the said court fees being recovered from the
payment received by the intervenor, under the suit.
32. The Hon'ble High Court of Kerala issued it's Rules, made under
the Admiralty Act, by way of gazette notification dated 02.03.2021. Rule 3
requires suits to be filed in accordance with the provisions of the Code of
Civil Procedure. Rule 13 (3) (c) of these Rules permits a stranger to the
suit to intervene and make a claim for payment and also for fixation of the
priority of his claim.
33. The High Court of Orissa issued it's Admiralty Rules, by
notification published on 28.08.2020. Rule 3 requires claims to be made
by way of suits, filed in accordance with the Code of Civil Procedure. Rule
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17 provides for permitting intervention applications to be filed. Rule 20 (2)
requires notice to be published for determination of priorities and claims,
over the proceeds of the sale of the ship. Rule 20 (3) (d) stipulates that
the notice shall contain a requirement that all parties making claims
against the sale proceeds, should apply for leave to intervene and prove
his claim before the court and obtain a decree before the expiration of the
period set out in the notice.
34. In all these Rules, parties seeking to intervene and raise
claims against the proceeds of the sale of the ship are permitted to do so,
in the main suit itself, by way of interlocutory applications and without
having to file separate suits. The Hon'ble High Court at Bombay, requires
all claims to be backed by decrees or judgments. All the other High Courts
permit such claims to be raised and adjudicated as interlocutory
applications. Such claims can be made by any claimant, who need not be
a seaman. These rules are more inclusive than the provisions of section
145 and 146 of the Shipping Act, which gives this facility only to seamen.
35. Section 12 of the Admiralty Act, makes the provisions of the
Code of Civil Procedure applicable to the proceedings under the Act. This
would mean that any adjudication for fixing priority or for recovery of
claims can be done only through a properly instituted suit. This runs
contrary to the Rules framed under the Admiralty Act. This inconsistency
can be resolved by relying on the provisions of Section 12 of the Admiralty
Act itself, which states that the provisions of the Civil code will be
21 RRR,J
COMS.No.1 of 2019
applicable to the extent that they are not inconsistent with or contrary to
the provisions of the Admiralty Act or the Rules made thereunder.
36. There is near uniformity of the Rules. However, rules have not
yet been framed for the Hon'ble High Court of Andhra Pradesh. In such
circumstances, only those applications which have been filed by the
seamen, for impleading themselves and for directions for payment of their
dues can be accepted. I am of the opinion that, pending the issuance of
Rules, parties can not be permitted to intervene, in pending suits, for
determination of their claims and the priority of their claims.
37. However, the question of payment of court fees, by seamen
remains. The Rules framed for the High Courts at Bombay and Madras,
effectively require payment of court fees. The Rules framed for the other
High Courts are silent on this issue. In the absence of Rules in this regard,
Section 12 of the Admiralty Act would make the Code of Civil Procedure
applicable and consequently the requirement for payment of Court fees
cannot be waived. I respectfully agree with the view of the Hon'ble High
Court of Delhi, in Sahara India Airlines Ltd., vs. R.A. Singh (3 supra)
(paras 7 & 8), and the view of the Hon'ble High Court at Madras in
AK.A.CT.V.C. Meenakshisundaram Chettiar vs. AK.A.CT.V.C.V.
Venkatachalam Chettiar (para 28), that proceedings cannot be initiated
without payment of court fees.
22 RRR,J
COMS.No.1 of 2019
38. I.A.No.16/2020 has been filed by Mr. Suresh Babu Rossana
Syam Kumar & 27 others for exemption from payment of court fees. The
applicants, therein, claim that they are in dire pecuniary straits and are
unable to pay the necessary court fees and seek exemption from payment
of court fees, for the time being. They seek the indulgence of this court
for such a relief on the ground that the Rules framed by the Hon'ble High
Court at Madras, provides for such a relief.
39. The above application was moved in December, 2020. The
circumstances have changed since then and the claim of financial difficulty
in December 2020 would not be available for more than two years.
Further, the concession given under the Rules framed by the Hon'ble High
Court at Madras would not be applicable to the cases before this Court.
The said application is rejected.
40. In the circumstances, the following directions are being passed:
I. I.A.No.9/2019 filed by EVIC Human Resources Management
Inc., I.A.No.14/2019 filed by M/s. Azariah Ship Management
Pvt. Ltd., are dismissed.
II. I.A.No.15/2019 filed by Mr. Suresh Babu Rossana Syam
Kumar & 27 others to implead themselves as Defendants in
the present suit is allowed.
III. I.A.No.16/2020 filed by Mr. Suresh Babu Rossana Syam
Kumar & 27 others for exemption from paying court fees is
dismissed.
23 RRR,J
COMS.No.1 of 2019
IV. consequent upon the dismissal of I.A.No.9/2019 filed by
EVIC Human Resources Management Inc., I.A.No.14/2019
filed by M/s. Azariah Ship Management Pvt. Ltd.,
I.A.No.13/2019, I.A.No.21/2019 & I.A.No.1/2021 filed by
EVIC Human Resources Management Inc., I.A.No.23/2019
filed by M/s. Azariah Ship Management Pvt. Ltd., for
determining the amounts payable to them and
I.A.No.12/2019 & I.A.No.22/2019 filed by EVIC Human
Resources Management Inc., I.A.No.16/2019 &
I.A.No.20/2019 filed by M/s. Azariah Ship Management Pvt.
Ltd., praying for payments out of the sale proceeds, are
dismissed.
V. I.A.No.7/2019 filed by Mr. Amit Kumar & 18 others and
I.A.No.14/2020 filed by Mr. Suresh Babu Rossana Syam
Kumar & 27 others for determining the amounts payable to
them and I.A.No.6/2019 filed by Mr. Amit Kumar & 18 others
and I.A.No.13/2020 filed by Mr. Suresh Babu Rossana Syam
Kumar & 27 others shall be considered only upon payment of
court fees as prescribed under Andhra Pradesh Court Fees
and Suits Valuation Act, 1956.
_________________________
R. RAGHUNANDAN RAO, J.
10th February, 2023
Js.
24 RRR,J
COMS.No.1 of 2019
25 RRR,J
COMS.No.1 of 2019
HON'BLE SRI JUSTICE R. RAGHUNANDAN RAO
I.A.Nos.6,7, 9, 12 to 14, 16, 20 to 23 of 2019
I.A.Nos.13, 14, 15 & 16 of 2020
I.A.No.1 of 2021
In
COMS No.1 of 2019
10th February, 2023
Js.
