Bombay High Court

Sinica Graeca Shipping Limited vs M T Chemroad Mega (Imo 9228318) on 17 January, 2018

Bench: K.R. Sriram

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                 IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                     ORDINARY ORIGINAL CIVIL JURISDICTION
                         IN ITS COMMERCIAL DIVISION
                          COMMERCIAL SUIT NO.816 OF 2017
Sinica Graeca Shipping Limited, a company incorporated  )
under   the   laws   of   the   Marshall   Islands   having   its  )
Corporate   office   at   Trust   Company   Complex,   Ajeltake  )
Road,   Ajeltake   Island,   Majuro   Marshall   Islands  )
MH96960                                                            )       ....Plaintiff
              Vs.
M T CHEMROAD MEGA (IMO 9228318) a vessel flying  )
the flat of Panama together with her hull, engines, gears,  )
tackles,   bunkers,   machinery,   boats,   apparel,   plant,  )
furniture,   fixtures,   appurtenances,   equipment   and  )
paraphernalia   on   board   presently   lying   and   being   at  )
Jawaharlal Nehru Port, Navi Mumbai through her owner  )
and all persons claiming to be interested in the vessel            )
                                                                   )       ....Defendant

                                      WITH
                           COMMERCIAL SUIT NO.98 OF 2015
North Star Marine Limited, a company registered under  )
foreign laws having office address at Hunkins Waterfront  )
Plaza, Suite 556, Main Street, Charleston, Nevis 4        )
                                                          )                ....Plaintiff
              Vs.
1. M V XING AN DA (INO No.8307507)                                    )
a vessel flying the flat Panama together with her hull,  )
tackle, engines, gears, plant, machinery articles, things,  )
apparel, equipment, stores and other paraphernalia on  )
board,   at   present   lying   in   the   port   and   harbour   of  )
Bhavnagar, State of Gujarat in Indian territorial waters  )
within the Admiralty Jurisdiction of this Hon'ble Court. )
                                                                      )
2. XING AN DA SHIPPING LIMITED                                        )
a   company   registered   under   foreign   laws   having   its  )
office   address   at   P.O.   Box   957,   Offshore   Incorporation  )
Centre, Road Town, Tortola, British Virgin Islands                    )
                                                                      )
                                                                      )    ....Defendants
                                    ----
Mr. R.V. Narichania, senior advocate a/w. Mr. Arjun Mittal and Mr. Ruchir 

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Goenka i/b. Bose and Mitra and Co. for plaintiff in COMS/816/2017.
Ms.   P.H.   Kantharia,   Government   Pleader   a/w.   Ms.   Deepali   Patankar, 
Honorary Assistant to the Government Pleader for office of the Deputy of 
Sheriff of Mumbai in COMS/816/2017.
Mr. Prasad Shenoy a/w. Mr. Aman Rungta i/b. Crawford Bayley and Co. for 
plaintiff in COMS/98/2015.
None for defendants in COMS/98/2015.
Mr. S.D. Chitgopikar, Deputy Sheriff of Mumbai present.
                                      ----
                                        CORAM  : K.R.SHRIRAM, J.

                                        DATE      : 17th JANUARY, 2018
ORAL JUDGMENT :

1                 These two suits are totally unrelated. They have been tagged

together and heard today is because a very important issue that arises time

and again in admiralty suits has to be decided. The issue relates to payment

of poundage to the Sheriff of Mumbai under the table of fees which forms

part of the Bombay High Court (Original Side) Rules.

2 The issues can be split as under :

(i) In a case where, before the Sheriff of Mumbai executes the

warrant of arrest issued by the Admiralty Registrar or before he serves the

order of arrest passed by this Court in cases where warrant of arrest has

been dispensed with, the parties settle the matter, whether the Sheriff will

be entitled to any poundage?

(ii) In a case where, order of arrest has been served or warrant

of arrest has been executed/levied against the vessel, parties have entered

into an Agreement to refer the disputes either to arbitration or submit to

the jurisdiction of a Court other than this Court, may be in a different

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country and have exchanged letters of undertaking to pay such amount as

awarded by the Arbitrator or the Court, whether any poundage is payable?

COMMERCIAL SUIT NO.98 OF 2015

3 This suit relates to a transaction for sale and purchase of

defendant vessel, wherein plaintiff (purchaser) advanced an amount of

USD 4,92,602/- to owner of defendant vessel, viz., defendant no.2 (the

seller) towards purchase of defendant vessel. As defendant no.2

failed to honour its obligations under the suit contract, plaintiff was

constrained to initiate these proceedings seeking to recover refund of

principal sum of USD 4,92,602/- and further sum of USD 1,27,389/-

towards interest, cost and damages. An application seeking arrest of

defendant no.1 vessel was moved on 4 th August, 2015 and the Court was

pleased to pass an order of arrest of defendant no.1 vessel at around 3.30

p.m. By the time the authenticated copy of the order of arrest was made

available to plaintiff's advocates, plaintiff's advocates received instructions

stating that the disputes have been sorted out between plaintiff and

defendant no.2, who was the owner of defendant no.1 vessel, and

therefore, there was no need to arrest defendant no.1 vessel and if the

order of arrest has already been passed, then not to execute the order.

Consequently, plaintiff did not serve the order of arrest upon any of the

authorities, viz., Port or Customs and did not even request the Sheriff of

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Mumbai to execute it. The order of arrest, therefore, never came to be

served upon either the vessel or any of the authorities and Sheriff did not

do anything. Therefore, no arrest or seizure or detention or attachment of

first defendant vessel was executed/levied. It is the case of Shri Shenoy,

counsel for plaintiff, that no poundage, therefore, is payable.

4 Shri Shenoy submitted that this Court in Malpani Brothers Vs.

Ramjidas Shyamlal Saboo and Anr.1 has held that poundage can be levied

only where there is actual attachment or seizure and plaintiff is not liable

to pay any poundage to the Sheriff when there is no attachment or seizure

or arrest even if an order of arrest has been passed by the Court.

Shri Shenoy added that plaintiff will not be liable to pay any poundage to

the Sheriff even if plaintiff recovers any amount from defendant as such

amount has been received without the actual arrest or attachment of the

property. Shri Shenoy submitted that it is only where actual seizure is

effected or where actual attachment is levied or where there is actual arrest

of the vessel and thereafter, if any amount is realised, that the Sheriff,

under the existing Rules, can demand poundage.

5 In response, Ms. Kantharia, Learned Government Pleader, in

fairness submitted that she cannot, as an Officer of this Court, disagree

with the submissions made by Shri Shenoy. Ms. Kantharia stated that the

1. 1987 MH.L.J. 223

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judgment of this Court in Malpani Brothers (Supra) is quite clear on this

aspect. Therefore, my answer to issue no.(i) as raised above, will be in

negative.

COMMERCIAL SUIT NO.816 OF 2017

6 This suit relates collision damage. On or about 17 th August,

2017 a collision occurred between first defendant vessel - m.t. Chemroad

Mega and another vessel - m.v. Sinica Graeca in the waters of Malaysia/

Indonesia. Each party had a claim for loss and/or expense and/or damage

arisen out of or in relation to the collision.

On 18th August, 2017, an in rem action was commenced by

plaintiff against first defendant vessel (m.t. Chemroad Mega) in the High

Court of Malaya at Kuala Lumpur but before the arrest could be effected,

m.t. Chemroad Mega sailed.

On 24th September, 2017, an in rem action was commenced by

the owners of m.t. Chemroad Mega against m.v. Sinica Graeca in the High

Court of the Republic of Singapore and m.v. Sinica Graeca was arrested. On

25th September, 2017, an in personam action was commenced by the

owners of m.t. Chemroad Mega against the interests of m.v. Sinica Graeca in

the High Court of the Republic of Singapore. On 3rd October, 2017, to

procure the release of m.v. Sinica Graeca from arrest in Singapore, m.v.

Sinica Graeca interests provided security to m.t. Chemroad Mega interests in

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the form of two Letters of Undertaking (LOU), one issued by Aspen

Insurance UK Limited in the sum of USD 6,477,000/- and one issued by

The United Kingdom Mutual Steam Ship Assurance (Europe) Limited in the

sum of USD 2,159,000/-.

On 11th November, 2017, plaintiff (m.v. Sinica Graeca interests)

filed the present suit and arrested m.t. Chemroad Mega.

7 Thereafter, parties have entered into two Agreements, both

dated 14th November, 2017, one is called "Collision Jurisdiction Agreement"

under which parties agreed to refer their respective claims for

determination under English Law and jurisdiction with unrevised 1996

Protocol Limits of Liability to apply to their respective claims. The second

agreement is called "Side Agreement" under which the Letters of

Undertaking issued by both the parties to secure each others claims would

be replaced by the mutual promises and obligations reflected in the Side

Agreement. Under this Side Agreement, the original LOU's issued by m.v.

Sinica Graeca interests to be returned and to be replaced with security in an

identical sum, responsive to a judgment of the English High Court, and

subject to English Law and English High Court jurisdiction. Upon the

provision of security by m.t. Chemroad Mega interests in the total sum of

USD 15,000,000 inclusive of interest and cost, m.t. Chemroad Mega was to

be released from arrest and this suit was to be discontinued. As per the Side

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Agreement, the Singapore proceedings as well as Malaysian proceedings

were also to be discontinued. Under the Agreement, m.t. Chemroad Mega

interests also agreed to pay a sum of GBP 150,000 in respect of legal costs

incurred by plaintiff because post collision on 20 th August, 2017 plaintiff

had made suggestion and offered m.t. Chemroad Mega interests that all

issues relating to the collision could be referred to English Court

jurisdiction but defendant declined to accept that suggestion resulting in

plaintiff having to go looking for m.t. Chemroad Mega to Malaysia, India

and to other jurisdiction. It should be noted that plaintiff's Protection and

Indemnity (P & I) Club has also given a counter security to defendants' P &

I Club to pay such sum as damages as will be awarded by the English

Court.

8 According to plaintiff, since there is no payment of money

realised under the two Agreements, the question of paying any poundage to

the Sheriff does not arise. Shri Narichania submitted that the facts in this

case are almost identical to the facts in the case of Seabird Marine Limited

Vs. m.v. Kota Berani and Ors.2 in which case this Court has concluded that

no poundage is payable. Shri Narichania also submitted that this Court in

Great Pacific Navigation (Holdings) Corporation Ltd. Vs. m.v. Tongli

Yantai3 has held that the Sheriff is entitled to claim poundage, in the event

2. Admiralty Suit No.20 of 1992 unreported oral order dated 8th October, 1992

3. 2014 (5) Mh. L.J. 359

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of claim being satisfied, compromised or settled upon the amount of such

satisfaction, compromise or settlement. Therefore, to calculate the amount

payable as poundage, the Court has to look for, is the amount of

satisfaction or compromise or settlement as received by plaintiff from

defendant in full or part satisfaction of the order. The amount that has to be

considered for calculating poundage is the amount of satisfaction or

compromise or settlement that plaintiff has received and in this case, as

there is no amount received by plaintiff, the Court cannot even calculate

the poundage payable because 1% of zero will still be zero.

Shri Narichania submitted that plaintiff and defendants have entered into

only Jurisdiction Agreement with Side Agreement wherein they have

agreed to refer all their disputes to English Court and English law to apply

and there is a possibility that plaintiff may not succeed in the proceedings

before the English Court. If the English Court comes to a conclusion that

plaintiff is not entitled to any claim, but on the contrary plaintiff has to pay

damages to defendants for the collision, the question of satisfaction or

compromise or settlement of plaintiff's claim or plaintiff having recovered

any money would not arise and, therefore, there is no question of paying

any poundage.

9 So far as the submissions made by Shri Narichania on behalf of

plaintiff in Commercial Suit No.816 of 2017 are concerned, Ms. Kantharia

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submitted that a Division Bench of this Court in State of Maharashtra Vs.

Quesham Bonyad Ship Management Co. Ltd. and Anr. 4 has concluded

that the liability to pay poundage arises the moment the ship is arrested by

the office of Sheriff on the basis of order of arrest made by this Court and,

therefore, in case where ship is arrested and after its arrest, there is a

settlement, there is no scope to say that poundage is not payable.

10 Ms. Kantharia further submitted that because the order of

arrest of m.t. Chemroad Mega was executed or levied by the Sheriff of

Mumbai, plaintiff was able to obtain security by way of the Side Agreement

and also make defendants agree to the Collision Jurisdiction Agreement

and if tomorrow, plaintiff succeeds in the proceedings to be filed in the

English Court or there is a compromise or settlement, the reason for success

or compromise or settlement and for consequent recovery of amount under

the Letter of Undertaking is only because the Sheriff levied or executed the

warrant of arrest. Ms. Kantharia submitted that 1% poundage will be the

amount that plaintiff may recover in the English proceedings or later

compromise or settlement.

Ms. Kantharia submitted that Clause 5 of the table of fees

provided "Poundage on every debt levied ............. or in the event of the

claim being satisfied, compromised or settled upon the amount of such

4. Appeal No.397 of 2009 in Notice of Motion No.2565 of 2008 in Admiralty Suit No.5 of 2008 dated 16 th/19th December, 2016 (unreported).


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satisfaction, compromise or settlement". Therefore, if the claim of plaintiff

is satisfied by the English Court or there is compromise or settlement, then

that satisfaction of plaintiff's claim has to be linked to the arrest order being

executed/levied by the Sheriff of Mumbai and poundage payable will be

1% of that amount. Ms. Kantharia submitted, as that amount is yet to be

determined, plaintiff should be directed to secure Sheriff's claim for

poundage. In the affidavit in reply, this such amount has been explained to

be the difference between security provided by or on behalf plaintiff and

security provided by or on behalf of defendant. Ms. Kantharia submitted

that that cannot be the amount but though it is not stated in the affidavit in

reply, security should be for USD 1,50,000/- being 1% of USD 15,000,000/-

which is the maximum amount to which defendants have limited their

liability, under the Side Agreement.

11 There are four judgments before this Court for consideration,

viz., in the order of vintage, Malpani Brothers (Supra), Kota Berani (Supra),

Tongli Yantai (Supra) and State of Maharashtra (Supra). The fifth judgment

which finds a mention in State of Maharashtra (Supra), viz., Peerless

General Finance and Investment Co. Ltd. Vs. Swan Mills Ltd. and Ors.

and Sheriff of Mumbai5 has not been made available to this Court. Both

Shri Narichania and Ms. Kantharia stated that they have not been able to

5. Chamber Summons No.399 of 2000 in Suit No.787 of 1997

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obtain a copy of this judgment.

12 Before we proceed further, it will be useful to reproduce Rule

474, 475 and 476 of the Bombay High Court (Original Side) Rules and the

same read as under :

474. Liability for Sheriff's poundage.--

(1) In cases where a person is arrested or property is attached, the party or the Advocate on record for the party at whose instance the arrest was made or the attachment levied shall be liable to the Sheriff for his fees or poundage, as the case may be.

(2) Any amount received by the judgment-creditor from the judgment- debtor in full or part satisfaction of a decree or order in respect of which a warrant of arrest or a warrant of attachment has been executed shall be presumed to have been realized under the warrant, if the warrant is merely suspended and not dead.

(3) Where the execution-creditor or his Advocate on record receives direct any installment or other sum ordered to be paid by the Judgment-debtor in full or part satisfaction of the decree or order, he shall file a precipe in the Sheriff's office informing him of the payment made.

(4) The Advocate on record shall be responsible for filling this precipe, if the payment has been made through his office or he has been informed of it by the execution creditor.

475. Advocate to file in Sheriff's Office copy of order releasing judgment-debtor or raising attachment.--

When an order is passed releasing a judgment-debtor or raising an attachment, the Advocate on record for the party at whose instance the order is made shall file a certified copy thereof in the Sheriff's Office and shall inform the Sheriff whether there has been any satisfaction, compromise or settlement and, if so, for what amount and also whether poundage has been paid in respect thereof.

476. Satisfaction not to be entered without Sheriff's certificate.-- Where warrants in execution have been lodged with the Sheriff, no satisfaction in full or part of any decree or order in any suit or matter shall be entered thereon without the production of a certificate of the Sheriff that no poundage is due to him.

13 The table of fees payable to Sheriff of Mumbai, which is part of

the Bombay High Court (Original Side) Rules, reads as under :

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"5. Poundage on every debt levied by execution including an attachment before judgment or in the event of the claim being satisfied, compromised or settled upon the amount of such satisfaction, compromise or settlement. 1%"

14 In State of Maharashtra (Supra) the facts were that after the

vessel was arrested, plaintiff and defendant had entered into terms to refer

all disputes to mediation and thereafter, by consent, the order of arrest was

vacated. While ordering the vessel to be released, the Single Judge of this

Court had said "The Sheriff's poundage, if any, to be paid by plaintiff, as per

Rules. The suit allowed to be withdrawn with no order as to costs."

Alongwith the letter dated 4th March, 2008 addressed by the

advocate for plaintiff in that suit to the Sheriff of Mumbai, a copy of the

order of release dated 3rd March, 2008 and a cheque in the sum of

Rs.3,99,800/- drawn in favour of the Sheriff of Mumbai was also sent.

There was no statement in the forwarding letter that the amount was being

paid under protest or without prejudice to the rights and contentions.

Subsequently, plaintiff in that suit took out a notice of motion for a

direction against the Sheriff of Mumbai to refund the amount of

Rs.3,99,800/- on the ground that after the poundage was paid, they

realised that no poundage was payable in light of the order passed by the

Single Judge of this Court in Kota Berani (Supra). The Single Judge, who

heard the notice of motion, allowed the notice of motion and the State

went in appeal against the said order. The Division Bench came to a

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conclusion that the liability to pay poundage arises the moment the ship is

arrested by the office of Sheriff on the basis of order of arrest made by this

Court and in case where ship is arrested and after its arrest, there is a

settlement, there is no scope to say that poundage is not payable or that the

poundage which is paid should be refunded. Paragraph 17 of the said

judgment reads as under :

17. Firstly, the liability to pay poundage arises the moment the ship is arrested by the office of Sheriff on the basis of order of arrest made by this Court. We have already quoted Clause 5 of the schedule. Therefore, in case where ship is arrested and after its arrest, there is a settlement, there is no scope to say that poundage is not payable or that the poundage which is paid should be refunded. There is no provision in the Original Side Rules empowering the Court to relax the requirement of Sub Rule (1) of Rule 474.

As plaintiff had paid Rs.3,99,800/- as poundage the Court

directed to return that amount to Sheriff of Mumbai, who had refunded the

amount pursuant to the order of the Single Judge.

15 The Division Bench, while deciding the appeal, however, has

also considered Malpani Brothers (Supra) and Kota Berani (Supra). The

Division Bench has not come to a conclusion or held that Malpani Brothers

and/or Kota Berani as erroneous or requires/has to be set aside. The Court

has come to a conclusion in the facts of that case that where ship is arrested

and after its arrest, there is a settlement, poundage has to be paid. Perhaps

the Division Bench assumed that plaintiff recovered large amount of money

from defendants, otherwise why would they pay a large sum of almost

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Rs.4 lakhs as poundage. Further, in State of Maharashtra (Supra) facts were

different in as much as parties were referring their disputes to mediation

and not to arbitration or another Court, where the claim had to be

adjudicated.

16 Shri Narichania, counsel for plaintiff is also in agreement with

the conclusion of the Division Bench. Shri Narichania also agrees that

where there is a settlement, poundage has to be paid but such settlement

has to be where the goods have been turned into money. Shri Narichania

submitted that in a situation like in the present case, where m.t. Chemroad

Mega was arrested, there is no goods which have been turned into money.

In other words, Shri Narichania submitted that plaintiff has not recovered

any money by virtue of the arrest. Plaintiff has only managed to get

defendant agree to Jurisdiction Agreement and obtained a Side Letter

whereby the P & I Club of m.t. Chemroad Mega will pay in case plaintiff

succeeds in the English proceedings damages upto a maximum of USD

15,000,000/-. There is no guarantee that plaintiff may succeed. Shri

Narichania submitted that only when there is money paid under the

settlement Agreement does poundage become payable and Kota Berani

(Supra) is on identical facts where this Court has come to a conclusion that

no poundage is payable in such cases where no money is received but

parties agreed to refer the disputes to a different jurisdiction.


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17                In  Kota Berani  (Supra) plaintiffs obtained a judge's order for

arrest of first defendant vessel on 28 th September, 1992 and pursuant to

that order, the vessel was arrested by the Sheriff of Mumbai. Subsequently,

on 7th October, 1992 by consent of plaintiffs and defendants, the order of

arrest was vacated as a compromise was arrived at between plaintiffs and

defendants under which the claim of each party against the other was to be

determined exclusively by the High Court of Justice in England and each

party will provide security in respect of the other's claim in a form

reasonably satisfactory to the other. By consent, the order of arrest was

ordered to be vacated subject to conditions of the question of liability of

fees or poundage payable to the Sheriff which was kept open to be decided

after hearing the office of the Sheriff. In that case also plaintiffs had

submitted that though there was an order of arrest of the ship there was no

realisation of the amount and the compromise is only to have the matter

decided by the High Court of Justice in England. The Court also accepted

that there was no passing of money between the parties. The Court

accepted the submissions of the counsel that the Sheriff has not levied the

debt in that case so as to be entitled to poundage under the statute until

the goods which are seized have been turned into money. The Court

concurred with the view of the Single Judge in Malpani Brothers (Supra)

wherein the view, while interpreting the provisions of Clause 5 of table of

fees read with Rule 474, 475 and 476, was that plaintiffs were not liable to

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pay any poundage to the Sheriff against the amount received by them

where such payments were received without the actual attachment of the

properties of the judgment-debtor and that it is only where the actual

seizure is effected or the actual attachment is levied and thereafter if the

amount is realised the Sheriff under the existing Rules can demand

poundage. The Court accepted the submissions of the counsel that though

the Sheriff can be said to have seized the vessel as a result of the warrant

issued by this Court and levied the warrant, plaintiffs have not been able to

realise the money which they claimed in the suit and for being paid

poundage, the money must be realised and that too as a result of execution

including the attachment as provided in the table of fees (Item No.5) must

be satisfied completely and if any of the condition is not satisfied, no

poundage can be claimed by the Sheriff. The Court directed the Sheriff to

issue a certificate to the effect that no poundage was due to him. The

Sheriff did not challenge that order and that order attained finality. It will

be useful to reproduce here paragraphs 8 and 9 of Malpani Brothers (supra)

which read as under :

8. I am afraid, that cannot be the construction of the said Rule. What the said Rule says that if a warrant is lodged in the Office of the Sheriff and thereafter a satisfaction of the decree in full or part has to be entered into in the Office, such an entry will not be made without production of a certificate from the office of the Sheriff that no poundage is due to him. It does not say that the Sheriff can demand his poundage and then only he can issue a certificate that no poundage is due to him. If in a given case, no poundage is due to him, he (i.e the Sheriff) must issue such a certificate. It could be that the warrant is just lodged in the Office of the Sheriff and no further

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attempt whatsoever is made for the purpose of executing the decree or executing the warrant of attachment, and after a period of one year the warrant is returned and in between, out of Court, the Judgment- Debtor pays some amount to the Decree-Holder and the question arises as to making an entry with regard to the satisfaction of the decree. Certainly in such a case, there is no question of payment of any poundage. Mrs. Chagla says that in the present case the bailiff had gone to the place of the Judgment-Debtor. That does not mean that without seizure of the properties, the Sheriff can demand poundage. He is entitled to his fees and expenses as provided under "The Table of Fees", but not to any poundage.

9. The plain meaning of the words "Poundage on every debt levied by execution" would be the relevant factor. In that connection, I must compliment Mr. Thakkar who has done a good job in trying to trace the meaning of the said words. He has drawn my attention to an English Judgment in the case of Thomas v. Sheriff of Middlesex, reported in 1899 (1) Queen's Bench Division 460, and the relevant portion is as follows:

"Poundage is a fee which is given by the statute of Elizabeth. Now, the language of the statute left it an open question whether the Sheriff was entitled to poundage, because the word was simply "levy". It was decided - I forgot the name of the case - even earlier than Miles v. Harris, that the word "levy" in the statute meant "turning, the goods into money"; and Erie C.J, in giving judgment, said:"The question is, whether a seizure of goods under the fi. fa. is a levy within that statute. I am of the opinion that the Sheriff has not levied so as to be entitled to poundage under that statute, until the goods seized have been turned into money."

Mr. Thakkar has also looked into the meaning of the word "levy", which would all indicate "actual seizure". The relevant passage from Halsbury's Laws of England in Volume 17 (4th Edition) at para 446 is as follows:

"446. Sheriffs remuneration. The sheriff is entitled to (1) poundage, and (2) certain fees and expenses allowed him by stature or order of court under statutory authority, but no other remuneration or charge. In execution for money, the sheriff, in order to become entitled to his poundage, must levy (namely seize) and get the money. If he does not seize, he is not entitled to poundage, even though the money is paid or tendered to him after the writ has been delivered to him for execution."

Then again, in Volume 42 (4th Edition) at para 1147, it is stated:

"The Sheriff is also entitled to poundage where, after seizure, a payment is made by the debtor of a third person under the compulsion of the writ and the plaintiff agrees to withdraw the sheriff from possession in consequence of the compromise

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between the parties."

Therefore, it is clear, despite any contrary practice, poundage can be levied only where there is actual attachment or seizure.

18 I am in respectful agreement with the findings of the Learned

Single Judge in Kota Berani (Supra) and in any way, I am bound by the said

judgment. Therefore, the parties having only agreed to have the matter

decided by the High Court of Justice in England and since plaintiff has not

recovered any amount (and possibly may not recover any amount as that

would depend on the decision of the English Court) even though the Sheriff

of Mumbai had executed or levied warrant of arrest, Sheriff of Mumbai will

not be entitled to any poundage.

19 Moreover, in Tongli Yantai (Supra) this Court has held that

under Rule 474 (2) read with serial no.5 of the table of fees payable to the

Sheriff of Mumbai, it is rather clear that the Sheriff is entitled to claim

poundage only on the amount of satisfaction or compromise or settlement

as received by plaintiff in full or part satisfaction of the settlement and the

amount to be considered for calculating poundage is the amount of

satisfaction or compromise or settlement that plaintiff has received. In this

case, there is no amount received and, therefore, there is no way to

calculate 1% as poundage either. The amount received by plaintiff pursuant

to the order of arrest is zero and 1% of zero will be zero. The question that

would arise is - The Sheriff having expended efforts and having executed

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the warrant of arrest, in such a situation, should he be left without any

compensation? Because the parties have decided to refer the matter to

English Court, should the Sheriff be left high and dry without being paid

any amount? For this, we will have to consider Rule 474 (1) where it says

"In cases where a person is arrested or property is attached, the party or the

Advocate on record for the party at whose instance the arrest was made or the

attachment levied shall be liable to the Sheriff for his fees or poundage, as the

case may be". When it says "as the case may be", it would mean "based on

the facts and circumstances of each case the Sheriff will be entitled to either

fees or poundage". The Sheriff will be entitled to his fees and expenses

provided under the table of fees, but not to any poundage.

20 The table does not prescribed for any fees in a situation of this

nature. The table of fees does not specifically prescribe the fees payable for

executing the warrant of arrest on a vessel but where Sheriff is not entitled

to poundage. Therefore, we will have to consider the catch-all or sweeping

provision (every process not otherwise provided for) under the table of

fees :

3. For serving every injunction, order or Rule and ) Rs.30 every process not otherwise provided for. )

The Sheriff, therefore, will be entitled to a fee and expense of

Rs.30/-.

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21 On the submissions of Ms. Kantharia that plaintiff should be

directed to furnish security in the sum of USD 150,000/-, being 1% of USD

15,000,000/-, which is the upper limit of security provided in the Side

Agreement, I agree with Shri Narichania that such a security can be

directed to be provided only if the Court comes to a conclusion that it does

not agree with the conclusions arrived at in Kota Berani (Supra). As stated

earlier, I am in respectful agreement with the conclusions of the Learned

Single Judge in Kota Berani (Supra). I also agree with Shri Narichania that

interim relief can only be granted in aid of the final relief. If this Court does

not come to the conclusion that the Sheriff is entitled to poundage, the

question of the Court directing plaintiff to deposit security for poundage

does not arise. Therefore, the question of directing plaintiff to furnish any

security also does not arise.

Issue no.(ii) is answered, accordingly in negative.

22 As I conclude, I felt I must express my views on this concept of

payment of poundage. For that let us quote paragraph 6 of Malpani

Brothers (Supra) which reads as under :

6. At the outset, my reaction was that the notion "poundage" itself was anachronistic and I wish the Rule had been totally deleted. It is rather surprising that after a heavy Court fee is paid and a decree is obtained, the Plaintiff should still pay a further poundage, which is nothing but a commission for the purpose of executing a decree through the office of the Sheriff. This is one of the Anglo-Saxon legacies which has continued without any justification whatsoever. In the past, it is possible that the Sheriffs Office was not paid any salary as such and perhaps it was not a part of the Department of the

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Government, and in the absence of any other machinery for the purpose of executing a money decree, since the parties had to necessarily go through the Office of the Sheriff, the Sheriff was justified in demanding some commission by way of his fees. Today it is totally different. The Deputy Sheriff is an officer of the Government and all the staff and the bailiffs are paid their salaries. Whatever fees they are entitled to for the purpose of executing a decree, they can certainly take, it, but there can be no justification whatsoever for the purpose of demanding a commission over and above the fees and costs which the Sheriffs Office collects. However, I am not in a position to strike off that part of the Rule which relates to poundage. I hope that our Rules Committee will seriously reconsider this part of the Rules, and delete the same.

23 I am in respectful agreement with Suresh J. (as he then was).

My reaction also was that the notion "poundage" itself was obsolete or

antiquated and I also wish the Rule had been totally deleted. It is rather

surprising that after a heavy Court fee is paid (in this case Rs.3 lakhs) and a

decree or an order of arrest is obtained, plaintiff should still pay a further

poundage, which is nothing but a commission for the purpose of executing

a decree or order of arrest through the office of the Sheriff. This is one of

the Anglo-Saxon legacies which has continued without any justification

whatsoever. In the past, it is possible that the Sheriff's Office was not paid

any salary as such and perhaps it was not a part of the Department of the

Government, and in the absence of any other machinery for the purpose of

executing a money decree or order of arrest or attachment, since the parties