Supreme Court of India
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS GALAXYversusBANQUE CANTONALE DE GENEVE
- Citation
- 2022 INSC 1015
- Decided
- 23 September 2022
- Disposal
- Appeal(s) allowed
- Bench
- INDIRA BANERJEE
Holding
An order adding a party under Order 1 Rule 10(2) of the CPC in an Admiralty suit is not appealable under Section 14 of the Admiralty Act, as only orders enumerated under Order 43 of the CPC are appealable.
Summary
The case involved an Admiralty suit filed by Banque Cantonale de Geneve against the owners of the vessel M.V. Polaris Galaxy for alleged mis‑delivery of cargo. The Commercial Division of the Madras High Court, exercising its power under Order 1 Rule 10(2) of the CPC, added Gulf Petroleum FZC as a necessary party. The appellant challenged the appellate jurisdiction of the Commercial Appellate Division to hear an appeal against that addition order. The Supreme Court examined the interplay between Section 14 of the Admiralty Act, 2017 and Section 13 of the Commercial Courts Act, 2015, both containing non‑obstante clauses, and read them harmoniously with Order 43 of the CPC. It held that an order adding a party under Order 1 Rule 10(2) is not an "interim order" attractable under the Admiralty Act and, therefore, is not appealable to the Commercial Appellate Division. Consequently, the Supreme Court set aside the Division Bench’s decision and allowed the appeals.
Issues considered
- Whether an order of addition of a party in an Admiralty suit passed by the Commercial Division (Single Bench) is appealable to the Commercial Appellate Division under Section 14 of the Admiralty Act read with Section 13 of the Commercial Courts Act.
- How to resolve the conflict between the non‑obstante clauses in the Admiralty Act and the Commercial Courts Act.
- Whether the expression "interim order" in Section 14 of the Admiralty Act includes orders made under Order 1 Rule 10(2) of the CPC.
Legislation cited
- Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017s. 12, s. 14
- Arbitration and Conciliation Act, 1996s. 37
- Carriage of Goods by Sea Act, 1971
- Code of Civil Procedure, 1908s. Order 1 Rule 10(2), s. Order 43 Rule 1
- Commercial Courts Act, 2015s. 13, s. 14, s. 16, s. 21, s. 2(1)(c)(iii), s. 7
- Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976s. 2
Subjects
Admiralty ActCommercial Courts Actappealabilitynon‑obstante clauseaddition of partyOrder 1 Rule 10(2)interim orderstatutory interpretationmaritime lawbills of lading
Judgment
[2022] 10 S.C.R. 1 1
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. A
POLARIS GALAXY
v.
BANQUE CANTONALE DE GENEVE
(Civil Appeal Nos. 6897-6898 of 2022) B
SEPTEMBER 23, 2022
[INDIRA BANERJEE AND A. S. BOPANNA, JJ.]
Admiralty (Jurisdiction and Settlement of Maritime Claims)
Act, 2017 – s.14 – Code of Civil Procedure, 1908 – Or.1 r.10(2) –
C
Commercial Courts Act, 2015 – Whether an appeal lies to the
Commercial Appellate Division of the High Court from an order of
the Commercial Division (Single Bench) of the same High Court for
addition of a party, in an Admiralty Suit governed by the Admiralty
Act – Held: No – An order for addition of a party u/Or.1 r.10(2) of
the CPC is not appealable u/s.14 of the Admiralty Act –Maritime D
Laws.
Admiralty (Jurisdiction and Settlement of Maritime Claims)
Act, 2017 – ss.12, 14 – Code of Civil Procedure, 1908 – Or. 1 r.10(2),
Or.43 r.1 – Commercial Courts Act, 2015 – s.13 – Interpretation of
Statutes – Harmonious Construction – Held: s.14 of the Admiralty E
Act provides the fora for an appeal from any judgment, decree,
final order or interim order of a Single Judge of the High Court
under the Admiralty Act to a Division Bench of the High Court –
“any interim order” has to be read harmoniously with Or. 43, r. 1 of
the CPC in view of s.12 of the Admiralty Act r/w s.13 of the
F
Commercial Courts Act – It is not the intent of the overriding
provision of s.14 to nullify s.12 of the Admiralty Act – s.12 of the
Admiralty Act applies to all proceedings in the High Court whether
they be original proceedings or appellate proceedings – On a
harmonious reading of ss.12 and 14 of the Admiralty Act with s.13
of the Commercial Courts Act, an intra-court appeal under the G
Admiralty Act to the Commercial Division of the High Court would
lie from any judgment, decree or final order under the Admiralty
Act or an interim order under the Admiralty Act relatable to the
orders specified in Or. 43, r.1 – It could not possibly have been the
legislative intent of the Admiralty Act to make all interim orders
H
1
2 SUPREME COURT REPORTS [2022] 10 S.C.R.
A appealable – Such a wide interpretation of the expression “interim
order” would mean that any party would be able to delay the trial
and final disposal by filing appeals even from inconsequential orders
calling for affidavits and the like – Maritime Laws.
Bills of Lading – Concept of – Law governing bills of lading
B – Discussed.
Interpretation of Statutes – Non-Obstante Clause in two or
more statutes – Held: As a general rule, the Special Statutes prevail
over General Statutes – If both statutes are general statutes or
special statutes containing identical or similar non-obstante clauses,
C the later statute would prevail – However, the rule that a non-obstante
clause in a later statute prevails over the non-obstante clause in an
earlier statute is not an absolute rule – The question of which
provision prevails, would necessarily depend on the object of the
enactment and, in particular, the object of giving overriding effect
to the enactment or any specific provision thereof – When two or
D more enactments operating in the same field contain a non obstante
clause stating that its provisions will have effect notwithstanding
anything inconsistent therewith contained in any other law, the
conflict has to be resolved upon consideration of the purpose and
policy underlying the enactments – Maxims – Generalia Specialibus
E Non Derogant.
Commercial Courts Act, 2015 – s.2(1)(c)(iii) – Held: A dispute
arising out of issues relating to admiralty and maritime law is a
commercial dispute as defined in s.2(1)(c)(iii) of the Commercial
Courts Act – Maritime Laws.
F Allowing the appeals, the Court
HELD: 1.1 Section 12 of the Admiralty Act applies the
provisions of the CPC to all Admiralty proceedings in the High
Court. Section 16 of the Commercial Courts Act makes it explicit
that the provisions of CPC, as amended by the Schedule to the
G Commercial Courts Act, applies to suits relating to commercial
disputes governed by the Commercial Courts Act. There can be
no doubt that the Commercial Division of the High Court has the
power to add a party to an Admiralty suit, on its own, without any
application having been made, if it is of the view that the presence
of that party before the Court may be necessary to effectively
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 3
GALAXY v. BANQUE CANTONALE DE GENEVE
and completely adjudicate upon and settle all the questions A
involved in the suit. The question is whether an order of the
Commercial Court or the Commercial Division of the High Court,
adding a party to an Admiralty Suit, is appealable under Section
13 of the Commercial Courts Act, read with Section 14 of the
Admiralty Act. [Paras 61, 62][27-B-D]
B
1.2 Both Section 13 of the Commercial Courts Act and
Section 14 of the Admiralty Act contain non-obstante clauses
giving the Sections overriding effect. While Section 14 of the
Admiralty Act which begins with a non-obstante clause as
observed, provides that notwithstanding contained in any other
law for the time being in force, an appeal shall lie from any C
judgment, decree or final order or interim order under the
Admiralty Act, of a Single Judge of the High Court to a Division
Bench of the High Court, Section 13(2) of the Commercial Courts
Act says notwithstanding anything contained in any other law for
the time being in force, or the Letters Patent of the High Court, D
no appeal shall lie from any order or decree of a Commercial
Division or Commercial Court otherwise than in accordance with
the provisions of the Commercial Courts Act. The proviso
restricts an appeal under the Commercial Courts Act, to such
orders as are specifically enumerated in Order 43 of the CPC.
[Para 67][29-F-H][30-A-B] E
1.3 A clause with the words “notwithstanding anything
contained in any other law for the time being in force” is generally
appended at the beginning of a section with a view to give the
enacting part of the section overriding effect in case of conflict
with any other law. Ordinarily, when two or more statutes contain F
statutory provisions which start with the clause “notwithstanding
anything contained in any other law for the time being in force”
and those statutes contain conflicting provisions, a question that
could arise is, which statute would prevail. As a general rule, the
Special Statutes prevail over General Statutes. If both statutes G
are general statutes or special statutes containing identical or
similar non-obstante clauses, the later statute would prevail. The
rule that a non-obstante clause in a later statute prevails over
the non-obstante clause in an earlier statute is not an absolute
rule. The question of which provision prevails, would necessarily
H
4 SUPREME COURT REPORTS [2022] 10 S.C.R.
A depend on the object of the enactment and, in particular, the object
of giving overriding effect to the enactment or any specific
provision thereof. When two or more enactments operating in
the same field contain a non obstante clause stating that its
provisions will have effect notwithstanding anything inconsistent
therewith contained in any other law, the conflict has to be
B
resolved upon consideration of the purpose and policy underlying
the enactments. [Paras 68-70][30-B-F]
M V Elizabeth v. Harwan Investment and Trading Pvt.
Ltd. (1993) 2 Supp SCC 433 – referred to.
C 2.1 A dispute arising out of issues relating to admiralty and
maritime law is a commercial dispute as defined in Section 2(1)
(c)(iii) of the Commercial Courts Act. It is clear from a reading of
the Admiralty Act and the Commercial Courts Act, that orders
passed under the Admiralty Act pertaining to the exercise of in
rem jurisdiction by the High Court are the only orders which are
D appealable under section 14 of the Admiralty Act, whereas orders
passed in the trial of a suit and on applications made under the
provisions of the Code of Civil Procedure, 1908 are not orders
under the Admiralty Act but orders under the CPC which would
be appealable only if they fall under Order 43 of the CPC as
E provided in Section 13 of the Commercial Courts Act. Both the
Admiralty Act and Commercial Courts Act are Special Acts. Even
assuming that the Commercial Courts Act provisions are
considered to be general provisions relating to appeals, whilst
the provisions in the Admiralty Act are considered to be special
provision for appeal, then too the maxim Generalia Specialibus
F Non Derogant, which is ordinarily attracted where there is a
conflict between a special and a general statute, would not apply.
[Paras 73, 78-80][31-E-F; 33-E-G; 34-B-C]
Ashoka Marketing Ltd. v. Punjab National Bank (1990)
4 SCC 406 : [1990] 3 SCR 649 – followed.
G
Kandla Corporation v. OCI Corp. (2018) 14 SCC 715
: [2018] 1 SCR 915 – relied on.
CTO v. Binani Cements 2014 SCC Online SC 140 –
referred to.
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 5
GALAXY v. BANQUE CANTONALE DE GENEVE
2.2 If such an order under the Code of Civil Procedure A
which does not fall under Order XLIII of CPC is held to be
appealable, then the entire purpose of the Commercial Courts
Act would be defeated, and every single order passed in a course
of a trial of an admiralty suit would be appealable under section
14 of the Act. Such orders would be large in number including
B
orders in relation to discovery, inspection, case management
hearing, admissibility of evidence, framing of issues,
interrogatories, etc. This would make a mockery of the intended
purpose of Parliament in enacting the Commercial Courts Act,
which is to expedite trials in commercial suits of a specified value,
and restrict the number of interlocutory appeals. An order for C
addition of a party under Order 1 Rule 10(2) of the CPC is not
appealable under section 14 of the Admiralty Act. Gulf Petrochem
is a party to the dispute and the suit transaction and the Contract
of Carriage (Bill of Lading) and hence is a necessary party. Gulf
Petrochem is also a proper party whose presence is necessary
D
for complete and final decision on questions in the suit. The
pleadings in Paragraphs 10 to 12 of the Plaint [Page 264] which
are extracted in the Impugned Judgement at Page 11-13
demonstrate that Gulf Petrochem is a proper and necessary party
even though the Respondent may choose not to claim any reliefs
against them in the present Suit. [Paras 81-83][35-G-H; 36-A-E] E
Anil Kumar Singh v. Shivnath Mishra (1995) 3 SCC
147 : [1994] 5 Suppl. SCR 135 – relied on.
2.3 Section 14 of the Admiralty Act provides the fora for an
appeal from any judgment, decree, final order or interim order of
a Single Judge of the High Court under the Admiralty Act to a F
Division Bench of the High Court. The expression “any interim
order” has to be read harmoniously with Order 43, Rule 1 of the
Code of Civil Procedure in view of Section 12 of the Admiralty
Act read with Section 13 of the Commercial Courts Act. It is not
the intent of the overriding provision of Section 14 to nullify G
Section 12 of the Admiralty Act. Section 12 of the Admiralty Act
applies to all proceedings in the High Court whether they be
original proceedings or appellate proceedings. On a harmonious
reading of Sections 12 and 14 of the Admiralty Act with Section
H
6 SUPREME COURT REPORTS [2022] 10 S.C.R.
A 13 of the Commercial Courts Act, an intra-court appeal under
the Admiralty Act to the Commercial Division of the High Court
would lie from any judgment, decree or final order under the
Admiralty Act or an interim order under the Admiralty Act
relatable to the orders specified in Order 43, Rule 1. [Paras 84-
86][36-F-H; 37-A-B]
B
2.4 It could not possibly have been the legislative intent of
the Admiralty Act to make all interim orders appealable. Such a
wide interpretation of the expression “interim order” would mean
that any party would be able to delay the trial and final disposal by
filing appeals even from inconsequential orders calling for
C affidavits and the like. We, therefore, hold that an appeal does
not lie to the Commercial Appellate Division of the High Court
from an order of the Commercial Division (Single Bench) of the
same High Court for addition of a party in an admiralty suit
governed by the Admiralty Act. Even otherwise, the Division
D Bench erred in law in allowing the appeal from the order of the
Commercial Division (Single Judge) adding Gulf Petroleum as
party defendant to the suit. [Paras 88, 89][37-D-F]
Cho Yang Shipping Co. Ltd. v. Coral (UK) Ltd. (1997)
2 Lloyd’s Rep 641 – referred to.
E Magic Frames v. Radiance Media P Ltd 2019 SCC
Online Mad 38929 – held inapplicable.
Case Law Reference
[2018] 1 SCR 915 relied on Para 73
F [1990] 3 SCR 649 followed Para 79
[1994] 5 Suppl. SCR 135 relied on Para 82
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 6897-
6898 of 2022.
G From the Judgment and Order dated 28.10.2021 of the High Court
of Judicature at Madras in OSA (CAD) No. 88 of 2021 and CMP No.
16921 of 2021.
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 7
GALAXY v. BANQUE CANTONALE DE GENEVE
K. V. Vishwanathan, Prashant S. Pratap, Sr. Advs., Amitava A
Majumdar, Arvind Kumar Gupta, Pabita Dutta, Rishi Bhardwaj, Amartya
Saran, A. Sumant Gupta, Advs. for the Appellant.
Zarir Bharucha, Aditya Verma, Bimal Rajasekhar,
Chandrashekhar Haridh, Ms. Priyamvada Mishra, Rigved Prasad, Advs.
for the Respondent. B
The Judgment of the Court was delivered by
INDIRA BANERJEE, J.
Leave granted.
2. These appeals are against a judgment and order dated C
th
28 October 2021 passed by the Commercial Appellate Division of the
High Court of Judicature at Madras allowing Commercial Appeal being
O.S.A (CAD) No.88 of 2021 filed by the Respondent, and setting aside
an order dated 24th September 2021 passed by the Commercial Division
(Single Bench) of the High Court, adding Gulf Petroleum FZC as D
defendant in the Admiralty Suit filed by the Respondent, Banque Nationale
De Geneve being CS (Commercial Division) No.96 of 2021.
3. The Appellant, M/s Galaxy Marine Services Limited is the
registered owner of the Vessel, M. V. Polaris Galaxy, a sea-going oil
tanker, flying the flag of Liberia, which is hereinafter referred to as, “the
E
Vessel”.
4. M/s Polaris Marine Services, acting as Commercial Managers
of M/s Galaxy Marine Services, entered into a charterparty agreement
with Profitable Wealth Inc., a company registered in the British Virgin
Islands and operated by Wirana Shipping Corporation Private Limited, a
F
well-known maritime company based in Singapore, for charter of the
vessel to Profitable Wealth Inc. Profitable Wealth Inc. in turn sub-
chartered the vessel to Gulf Petroleum FZC for carriage of cargo of
Marine Fuel Oil.
5. On 6th May 2020, Gulf Petroleum FZC entered into a contract
for purchase of 27-28,000 Metric Tons (MT) of Marine Fuel from Indian G
Oil Corporation Limited (IOC) which was to be loaded at the Kandla
Port, for discharge at Fujairah.
6. Gulf Petroleum FZC requested the Respondent, Banque
Cantonale de Geneve, hereinafter referred to as the Respondent Bank,
H
8 SUPREME COURT REPORTS [2022] 10 S.C.R.
A to finance the purchase of the said 27-28,000 MT of Marine Fuel Oil
from IOC. Gulf Petroleum FZC informed the Respondent that the Marine
Fuel Oil had been sold to Aramaco for delivery at Fujairah, on open
credit.
7. By a letter dated 11th May 2020, the Respondent Bank requested
B Gulf Petroleum FZC to provide a copy of the Sale Contract between
Gulf Petroleum FZC and Aramco and also sought certain clarifications.
On the same day i.e., 11th May 2020, Gulf Petroleum FZC and Aramco
entered into a Sale Contract for delivery of Marine Fuel Oil at Fujairah
between 23-30 May 2020, against credit of 60 days from the date of
invoice.
C
8. On 12th May 2020, a copy of the Sale Contract between Gulf
Petroleum FZC and Aramco was forwarded to the Respondent Bank.
Thereafter, the Respondent Bank agreed to finance the transaction. The
Respondent Bank issued a Letter of Credit in favour of IOC for USD
6,050,000.00. The Letter of Credit provided that if original Bills of Lading
D were not available, then payment under the Letter of Credit would have
to be made against a Letter of Indemnity.
9. On 15 th May 2020, Gulf Petroleum FZC requested the
Respondent Bank to amend the Letter of Credit by changing the Port of
Discharge from Fujairah to Singapore. The Respondent Bank sought
E certain clarifications on the proposed amendment.
10. On 15th May 2020, Gulf Petroleum FZC and Aramco made an
addendum to their Sale Contract changing the Port of Discharge from
Fujairah to Singapore. On 17th May 2020, Gulf Petroleum FZC forwarded
a copy of the addendum to the Sale Contract, to the Respondent Bank.
F On 18th May 2020, the Respondent Bank amended the Letter of Credit
by changing the Port of Discharge from Fujairah to Singapore.
11. On 21st May 2020, the Master of the Vessel issued a Bill of
Lading No.21052020/01, in respect of cargo of marine fuel. In terms of
the Bill of Lading the consignee was the Respondent Bank, the ‘Notify
G Party’ was Gulf Petrochem FZC and the Port of Discharge was
Singapore. On the said date Gulf Petroleum FZC instructed the Master
of Vessel that the cargo should to be discharged to Chevron Singapore
Private Limited (hereinafter referred to as “Chevron”) at the Horizon
Terminal at Singapore.
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 9
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
12. On 24th May 2020, Profitable Wealth Inc. gave a Letter of A
Indemnity to Polaris Marine Services. Gulf Petroleum FZC, in turn gave
a counter-indemnity to Profitable Wealth Inc.
13. IOC issued an invoice dated 27 th May 2020 for USD
5,985,084.28 to Gulf Petroleum FZC. In terms of the Sale Contract
between IOC and Gulf Petroleum FZC, the Respondent Bank honoured B
the Letter of Credit and paid IOC the amount due in terms of the invoice.
14. On 31st May 2020, the Vessel arrived at the Port of Discharge
at Singapore and tendered its Notice of Readiness as per the instructions
of Gulf Petroleum FZC. By an email dated 2nd June 2020, Gulf Petroleum
FZC requested the Vessel to tender Notice of Readiness to Chevron C
being receivers of the cargo. Thereafter, between 9th June 2020 and
10th June 2020 the cargo was discharged at Horizon Terminal, Singapore.
15. On 11th June 2020, Gulf Petroleum FZC issued an invoice of
USD 6,707,357.38 to Aramco under a Sale Contract with Aramco. The
due date of the invoice was 10th August 2020 i.e. 60 days from the date D
of discharge as agreed in terms of the Sale Contract.
16. On 15th June 2020, Gulf Petroleum FZC provided the
Respondent Bank with a copy of the invoice issued by Gulf Petroleum
FZC to Aramco. On 20th July 2020, GP Global Group being the parent/
holding company of the Gulf Petroleum FZC issued a media statement E
with regard to financial restructuring of Gulf Petroleum FZC on account
of financial difficulties.
17. Thereafter, news reports surfaced that GP Global Group had
uncovered a massive fraud within Gulf Petroleum FZC. Gulf Petroleum
FZC and its employees were by various ways and means defrauding F
and cheating various parties, including the Appellant
18. The Respondent Bank sent a letter to the Master of the Vessel
marking a copy to P&I Club and the registered owners stating that no
payment had been received by the Respondent Bank on the due date
which is 60 days after delivery of the cargo. The cargo should therefore
G
not be discharged without the consent of the Respondent Bank. However,
by this time the cargo had already been discharged and delivered on the
basis of instructions given by Gulf Petroleum FZC to Chevron.
19. In October 2020, there were news reports that another
company, Gulf Petrol Supplies LLC had filed criminal proceedings against
H
10 SUPREME COURT REPORTS [2022] 10 S.C.R.
A Gulf Petroleum FZC making allegations of fraud in relation to contracts
for refined product cargoes, including fuel oil. It was alleged that Gulf
Petroleum FZC had fabricated several contracts for supply of petroleum
products to Gulf Petrol Supplies LLC and had issued fraudulent/fake
invoices.
B 20. On 8 th March 2021, the Respondent Bank instituted the
Admiralty Suit being C.S. (Commercial Division) No. 96 of 2021 before
the Commercial Division of the Madras High Court.
21. In the plaint filed in the said Admiralty suit, the Respondent
Bank pleaded the following:-
C “7. The Plaintiff submits that its claim in the present suit arises
under a Bill of Lading and is for mis-delivery of cargo. The
claim is a maritime claim under section 4(1)(f) of the Admiralty
(Jurisdiction and Settlement of Maritime Claims) Act, 2017
(hereinafter referred to as the said Act). The claim is against
D the owners of the Defendant vessel. The Defendant vessel is
within the territorial jurisdiction of this Hon’ble Court. In
the circumstances the Plaintiff is entitled to file the present
Suit in rem against the Defendant vessel and entitled to an
order of arrest of the Defendant vessel in respect of its
maritime claim.
E
8. The Plaintiff is the lawful holder of the original Bill of
Lading no. 21052020/01 dated 21st May 2020 issued by the
owner of the Defendant vessel for carriage of 27,132.411
MTs of marine fuel from Kandla to Singapore.
F 9. The central issue in the present suit is that the owner of the
Defendant vessel has unlawfully and in breach of its
obligations misdelivered cargo belonging to the Plaintiff to
someone else, without production of the original bill of lading.
The Defendant vessel and or its owner is therefore, liable to
the Plaintiff for the tort of conversion. The Plaintiff is entitled
G to be compensated for its loss. The liability of the Defendant
vessel is established once the Plaintiff demonstrates that it
continues to be the lawful holder of the original bill of lading
and that the Defendant vessel has unlawfully delivered the
cargo to someone else. However, it may be useful to provide
some background.
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 11
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
10. On 8 th May 2020, one Gulf Petrochem FZC (“GP”) A
approached the Plaintiff seeking financing for a transaction
of purchase of fuel from Indian Oil Corporation Ltd.
(“IOCL”) and onward sale of marine fuel to Aramco Trading
Fujairah FZE (“Aramco”). The proposed transaction was as
follows :
B
a. GP would buy marine fuel from IOCL at USD 220.5880
per MT.
b. GP would sell on the marine fuel to Armco at USD 246.726
per MT
c. The load port for the cargo would be Kandla and the C
discharge port would be Fujairah
d. The Plaintiff would finance the purchase of the fuel by
GP from IOCL by way of letter of credit so as to enable
GP to procure the cargo and sell it onward to Aramco.
The purchase price for the onward sale would be remitted D
by Aramco into GP’s bank account maintained with the
Plaintiff.
11. The payment terms under the sale by GP to Aramco were
to be on open credit given that Aramco was an Oil Major.
In other words, the Plaintiff would rely on the name of E
Aramco as having never defaulted as security for payment
due from them. The relevant payment terms expressed in
the contract stated:
“THE PAYMENT SHOULD BE MADE WITHIN 60 (SIXTY)
CALENDAR DAYS FROM THE DATE OF INVOICE F
(INVOICE DATE = DAY 0) AGAINST PRESENTATION OF
THE SELLER’S INVOICE AND COQ [Certificate of
Quality].”
12. The understanding between the parties in relation to this
aspect of security, was as follows: G
a. It was agreed that the original Bill of Lading
representing the cargo would be issued by the
shipowner to the order of the Plaintiff. The title/
property in the cargo of fuel financed and paid for by
the Plaintiff would vest with the Plaintiff H
12 SUPREME COURT REPORTS [2022] 10 S.C.R.
A b. Independent of the obligation to pay from Aramco, the
Plaintiff would remain the lawful holder of the original
Bill of Lading and would be entitled to delivery of the
cargo thereunder., the security for the Plaintiff’s claim
was the cargo, i.e., the fuel itself. However, until the
Plaintiff received confirmation of the onward sale of
B
Aramco, the title/property in the cargo of fuel would
vest with the Plaintiff by virtue of being the lawful
holder of the original Bill of Lading.
11. Further emails were exchanged between GP and the
Plaintiff on the above proposed transaction. GP had, on
C 8 May 2020, provided to the Plaintiff the contract between
it (as buyer) and IOCL (as seller). On 12 May 2020, on
the basis of the above understanding, the Plaintiff opened
the Letter of Credit in IOCL’s favour. There were some
amendments to the contract between GP and Aramco, as
D regards the discharge port – it was changed from Fujairah
to Singapore. This was conveyed by GP to the Plaintiff on
17 May 2020. The corresponding amendment in the letter
of credit was carried out by the Plaintiff on 18 May 2020.
***
E 13. The relevant documents such as the bill of lading,
commercial invoice etc. were negotiated by IOCL under
the letter of credit opened by the Plaintiff. The Plaintiff
accordingly made payment to IOCL as per the financial
agreement with GP. The bill of lading was to the order of
F the Plaintiff. By reason of the bill of lading being made
out to order and being the lawful holder of the bill of
lading, the Plaintiff acquired rights of suit against the
Defendant vessel in respect of the goods, pending further
onward endorsement.
G 14. The Plaintiff was concerned, when, even as 10 August
2020 (i.e., the deadline for Aramco to make payment for
the Cargo) was fast approaching, there was no update
about any such payment nor was there any news of the
status of the Cargo. This is in spite of the fact that, by
virtue of being in possession of the original bill of lading,
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OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 13
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
it would have rights of suit against the Defendant vessel A
if any mischief had been engaged in respect of the Cargo.
***
17. It now appears that the Defendant vessel has delivered
the Cargo to Aramco or an unknown third party, on or
about 10 August 2020, without insisting on production of B
the original bill of lading. An invoice was raised on 11
June 2020, by GP on Aramco for the amount of USD
6,705,357.38 (approx INR 49,07,04,087.89 (Forty-Nine
Crore, Seven Lakh, Four Thousand and Eighty Seven only)
(CALCULATED AT 1 USD=73 INR). The Plaintiff learnt C
about this subsequently when in the course of a fraud
investigation against GP.”
22. On 9th March 2021, the Commercial Division of Madras High
Court (Single Bench) passed an ex parte order of arrest of the Vessel.
Thereafter, on 26th March 2021, the Respondent Bank filed an Application D
No.1494 of 2021 in the said Admiralty suit, for summary judgment under
Order XIV Rule 8 and Order XIIIA of the Civil Procedure Code 1908,
as amended by the Commercial Courts Act 2015 (hereinafter referred
to as “Commercial Courts Act”).
23. Pursuant to orders passed by the Commercial Division (Single E
Bench) of the Madras High Court, on an application made by the
Appellant, the Appellant furnished a Bank Guarantee to secure the claim
of the Respondent Bank. Thereafter, on 6th July 2021, the Commercial
Division of the High Court passed an order vacating the order of arrest
of the vessel and allowing the Vessel to sail out.
F
24. On 16th July 2021, the Appellant filed its response to the interim
application being Application No.1494 of 2021, filed by the Respondent
Bank for summary judgment under Order XIV Rule 8 and Order XIIA
of the Code of Civil Procedure as amended by the Commercial Courts
Act. In its response/Counter-Affidavit, the Appellant pleaded:-
G
“(k) The Plaintiff ’s customer Gulf Petrochem who is alleged
to have cheated and defrauded the Plaintiff and provided
the Plaintiff with false and fraudulent documents on the basis
of which credit was granted by the Plaintiff, is a necessary
and/or proper party whose presence is necessary to effectively
adjudicate the issues that arise in the suit. Whether the H
14 SUPREME COURT REPORTS [2022] 10 S.C.R.
A Plaintiff has been paid any amounts by Gulf Petrochem is an
issue that can only be gone into at trial and requires the
presence of Gulf Petrochem...”
25. On 13th August 2021, the Respondent Bank filed its Rejoinder
Affidavit to the aforementioned Application No.1494 of 2021 for summary
B judgment. After hearing the respective parties and after considering the
documents on record, the Commercial Division of the High Court (Single
Bench) passed an order dated 24 th September 2021 directing the
Respondent Bank to take necessary steps to implead Gulf Petroleum
FZC as a necessary and proper party to the suit.
C 26. The Single Bench observed and held:-
“6. In the written statement and the common counter filed by
the Vessel owner/the sole defendant, it is specifically stated
that on the instructions, the goods were delivered at Singapore
Port based on the delivery order issued by the customer of
D the plaintiff. In such circumstances, the original Bill of Lading
is not required. Acting upon the e-mail communication dated
21.05.2020 by the Gulf Petrochem, the customer of the
plaintiff, the defendant delivered the cargo at Singapore. The
plaintiff is the financier to GP and the defendant is the carrier
for GP. The plaintiff is not the owner of the cargo. Hence the
E suit has to be dismissed for non-joinder and mis joinder of
the party. If at all the plaintiff have any money claim, it has to
proceed against its customer Gulf Petrochem (GP) for breach
of contract and not a suit for maritime claim. The suit against
the carrier as if it is a maritime claim is abuse of law.
F 7. Heard. Records perused.
8. In the suit transaction, the Gulf Petrochem (GP), who is
the customer of the plaintiff, is the key player on whose
instructions, the goods have been delivered at Singapore by
the defendant. IOCL has sold marine fuel to GP based on the
G LC issued by the plaintiff for USD 6,050,000. GP has engaged
the defendant to transport cargo. As per the Bill of Lading,
the cargo is supposed to be delivered at Singapore. The
defendant has discharged the cargo at Singapore Port based
on the letter of indemnity dated 24.05.2020 given by Profitable
Wealth INC, Singapore. In the documentary credit opening
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 15
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
(LC) dated 12.05.2020 originated from the plaintiff there is a A
clause which indicates cargo can be delivered on obtaining
indemnity in case of temporary non availability of original
Bill of Lading.
9. From the documents and the facts pleaded, this Court is of
the view that Gulf Petrochem (GP) who is the customer of the B
plaintiff, is the proper and necessary party in the suit. Unless
the plaintiff impleads GP as a party, the suit cannot be
adjudicated to render proper justice.”
27. The Respondent Bank filed an appeal being OSA (CAD) No.88
of 2021, against the said order dated 24th September 2021, in the C
Commercial Appellate Division of the High Court (Division Bench), under
Section 13(1) of the Commercial Courts Act 2015. By the judgment and
order dated 28th October 2021 impugned in this appeal, the Commercial
Appellate Division of the High Court (Division Bench) allowed the appeal
and set aside the judgment and order of the Single Bench (Commercial
Division), imposing costs of Rs.1,50,000/- on the Appellant. The D
preliminary objection raised by the Appellant, to the maintainability of
the appeal, was rejected.
28. After recording the submissions of the parties, the Division
Bench, observed and held:
E
“12. Indeed, the order impugned is spread over eight
paragraphs. The first five are the preliminary paragraphs. At
the sixth paragraph, it is recorded that the sole defendant
delivered the goods at Singapore based on a delivery order
apparently issued by the customer of the plaintiff and the
defendant apparently acted on the basis of an e-mail of May F
21, 2020 issued by Gulf Petrochem. The trial court recorded
the defendant’s contention that the plaintiff had financed the
transaction and that the plaintiff was not the owner of the
cargo and since the owner of the cargo was Gulf Petrochem
which had not been impleaded, the suit was liable to be G
dismissed.
13. Upon noting such contention, the trial court concluded
as follows in the only paragraph in support of the order:
“8. In the suit transaction, the Gulf Petrochem (GP), who is
the customer of the plaintiff, is the key player on whose H
16 SUPREME COURT REPORTS [2022] 10 S.C.R.
A instruction, the goods have been delivered at Singapore by
the defendant. IOCL has sold marine fuel to GP based on the
LC issued by the plaintiff for USD 6,050,000. GP has engaged
the defendant to transport the cargo. As per the Bill of Lading,
the cargo is supposed to be delivered at Singapore. The
defendant has discharged the cargo at Singapore Port based
B
on the letter of indemnity dated 24.05.2020 given by Profitable
Wealth Inc. Singapore. In the documentary credit opening (LC)
dated 12.05.2020 originated from the plaintiff there is a
clause which indicates cargo can be delivered on obtaining
indemnity in case of temporary non availability of original
C Bill of Lading.”
***
18. The matter falls within a very short compass. The primary
document is not disputed. The plaintiff is the named consignee
in the bill of lading and it is also accepted by the defendant,
D in particular, that ordinarily it would be the consignee who
would be entitled to obtain delivery of the goods covered by
a bill of lading. In this case, it may also be noticed that Gulf
Petrochem is the notify party mentioned in the bill of lading.
In international trade, documents are of immense value and
E courts must proceed on the basis of the letter of the documents
without seeking to ascertain the nature of the underlying or
any incidental transaction. If it is imperative that a carrier
notifies the party indicated as the notify party, what it implies
is that notice of the arrival of the vessel or the notice of
readiness to discharge cargo must be given to such party
F whereupon such party would produce the bill of lading and
obtain the discharge of the cargo. It is also possible that the
consignee may authorise the carrier to release the cargo in
favour of the notify party or to any other as the consignee is
entitled to assign its right to obtain delivery under the bill of
G lading to any party of the consignee’s choice.
19. What is of paramount importance is that it is the consignee
and the consignee alone which can issue instructions or
authorise the delivery of the goods covered by the bill of lading
to any third party. The carrier is not obliged to act as per the
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 17
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
directions or instructions of any third party as the bill of lading, A
in a sense, is the document of title pertaining to the cargo
and it is elementary that it is only the owner of the goods who
has the right to alienate the goods or transfer the same.
20. Implicit in the letter of May 24, 2020 issued by Profitable
Wealth Inc. was that such entity required the carrier to do B
something unusual or out of the ordinary, and, as such,
exposing the carrier to a risk in course of such deviation. As
a consequence, to induce the carrier to deviate from the usual
practice, Profitable Wealth Inc. indemnified the carrier
harmless against any claim that may be made against the
carrier for the carrier acting according to the instructions of C
Profitable Wealth Inc. The plaintiff had nothing to do with
Profitable Wealth Inc. or any instructions that profitable
Wealth Inc. or Gulf Petrochem or even the Maharaja of
Gaipajama may have issued to the carrier. These instructions,
whether issued by Gulf Petrochem or Profitable Wealth Inc., D
were not backed by any authority of the plaintiff. In such
circumstances, what the arrangement between the defendant
and the third parties may have been may not be of any
relevance in the suit and in the context of the plaintiff’s claim
herein.
E
21. As to the averments in paragraphs 10 to 12 of the plaint,
it is sometimes better not to say too much. However, the
averments may be seen as part of a narrative leading up to
the claim of the plaintiff and the plaintiff ’s cause of action
against the defendant. In the scheme of the action and the
particular claim of the plaintiff as the consignee in the bill of F
lading against the defendant carrier, the transactions between
the plaintiff and Gulf petrochem or those between Gulf
Petrochem and Indian Oil Corporation or even that between
Gulf Petrochem and Aramco are of no relevance. Till such
time that the plaintiff ’s name appeared as the consignee in G
the bill of lading, the defendant was obliged only to the plaintiff
to deliver the goods to the plaintiff or to the order of the
plaintiff and the defendant, in acting on the basis of
instructions issued by others may not have affected the right
of the plaintiff or the plaintiff’s claim under the bill of lading.
H
18 SUPREME COURT REPORTS [2022] 10 S.C.R.
A 22. In such circumstances, Gulf Petrochem Inc., which may
have been financed by the plaintiff qua the subject transaction
is neither a necessary nor a proper party to the plaintiff ’s
simple claim against the carrier of the goods for the breach
of the contract of carriage and in the carrier’s failure to
deliver the goods to the plaintiff or to the order of the plaintiff.
B
It is not unusual in the industry for goods to be released at
the request of a stranger, but that is precisely why the stranger
indemnifies the carrier. It is more likely than not that the entity
that induced the defendant to discharge the goods in
Singapore may be beyond the defendant’s reach; but that may
C not be an excuse to resist the plaintiff ’s claim. It is equally
possible that the plaintiff may have acquiesced in the delivery
instructions issued by Profitable Wealth Inc., but when the
plaintiff has not, it is only the indemnity furnished by the entity
that the defendant can chase.
D 23. The observations made herein must be understood to be
in the context of what was required to be considered and
should not unduly weigh with the trial court in course of the
expeditious disposal of the application for summary judgment
that the plaintiff has filed.
E 24. The order impugned dated September 24, 2021 is set aside.
The trial court is requested to take up the application for
summary judgment and disposal of the same in accordance
with law as expeditiously as the business of the trial court
permits. OSA (CAD) No.88 of 2021 is allowed as above. The
defendant will pay costs assessed at Rs.1,50,000/- CMP
F No.16921 of 2021 is closed.”
29. There is no doubt that in international trade, documents are of
immense value and that Courts must proceed on the basis of the
documents as held by the Division Bench. It is, however, difficult to
accept that the Court is not required to ascertain the nature of the
G underlying transaction. The Division Bench rightly noted that when a
carrier notifies the party indicated as the ‘notify party’, what it implies is
that notice of the arrival of the vessel or notice of readiness to discharge
cargo must be given to such party, whereupon such party would produce
the Bill of Lading and obtain the discharge of the cargo.
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 19
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
30. The law governing bills of lading is a combination of mandatory A
international rules and rules of common law, while charterparties are
governed entirely by the common law.
31. The International Convention for the Unification of Certain
Rules of Law relating to Bills of Lading framed in 1924, and known as
the Hague Rules, govern the liability of carriers in respect of cargo, B
covered by bills of lading. The Hague Rules, which are mandatory, impose
certain non-derogable obligations on the shipowner, but in return, confer
an extensive list of immunities, a defence of limitation of liability and a
short time limit for the bringing of claims.
32. In 1968, the Hague-Visby Rules introduced a modified version C
of the Hague Rules, including amendments. The Hague-Visby Rules
are enacted into English law by the Carriage of Goods by Sea Act, 1971.
The Hague/Hague Visby Rules were widely adopted internationally.
33. In 1978, the United Nations conducted a Convention on the
Carriage of Goods by Sea. The Rules which emerged in the convention, D
which are known as Hamburg Rules, came into force in 1992. However,
the rules were not accepted by major trading nations of the world.
34. There was an attempt to replace the Hague/Hague-Visby
settlement, by for the adoption in 2008 of the United Nations Convention
on Contracts for the International Carriage of Goods Wholly or Partly E
by Sea, which is known as the Rotterdam Rules. Rotterdam Rules have
also not been uniformly implemented.
35. In modern English law, Bills of Lading are governed by the
Hague-Visby Rules with respect to the matters addressed by the Rules
and otherwise by rules of common law. F
36. A Bill of Lading is a type of transport document that may be
used in respect of the carriage of goods by sea or on behalf of owner, or
less commonly the charterer of the carrying ship. Bills of Lading are
commonly used when a vessel is employed as a general ship, being put
up for a particular voyage to carry the goods of any person.
G
37. A Bill of Lading serves as a receipt for the goods entrusted to
the carrier in respect of both the quantity and the condition of the goods
received.
38. A Bill of Lading serves also as evidence of the terms of the
contract of affreightment. As between the immediate parties to that H
20 SUPREME COURT REPORTS [2022] 10 S.C.R.
A contract, namely the carrier and the shipper, the evidence provided by
the bill is not conclusive and may be supplemented or even overridden
by extraneous evidence. Once the bill has been transferred however,
the bill provides conclusive evidence as between the carrier and the
new holder, as to the terms of the contract of affreightment. In this
sense the bill may be said to “contain” the contract.
B
39. Finally, the Hague-Visby Rules, to which effect is given in
English law by the Carriage of Goods by Sea Act 1971, apply as a matter
of law to contracts of carriage “covered by a bill of lading or any similar
document of title”. That a contract of affreightment contemplates the
issuing of a Bill of Lading serves, therefore, to attract the application of
C the Hague-Visby Rules.
40. Carver on Bills of Lading (2005) says, a bill of lading is a
document issued by or on behalf of a carrier of goods by sea to the
person, (usually known as the shipper) with whom he has contracted for
the carriage of goods.
D
41. Scrutton on Charterparties and Bills of Lading (1984) says
that “the Bill of Lading is not the contract, for that has been made before
the Bill of Lading was signed and delivered, but it is excellent evidence
of the terms of contract and in the hands of an endorsee, is the only
evidence.”
E
42. Three common characteristics of a Bill of Lading are (i) it
constitutes a receipt for the goods shipped or received by the carrier; (b)
it constitutes a document of title for such goods; and (iii) it contains or
evidences the contract of carriage by sea relating to the goods.
F 43. There is no universally accepted definition of bill of lading. To
quote Sir Richard Aikens “Bills of Lading” (2006), “Like an elephant, a
Bill of Lading is generally easier to recognize than to define”.
44. The Preamble to the Bills of Lading Act does not define a Bill
of Lading but mentions Bill of Lading. The Preamble reads “whereas by
the custom of merchants a Bill of Lading of goods being transferable by
G
endorsement of property in the goods may thereby pass to the endoresee,
but nevertheless all rights in respect of the contract contained in the Bill
of Lading continue in the original shipper or owner, and it is expedient
that such rights should pass with the property; it frequently happens that
the goods in respect of which Bill of Lading purport to be signed have
H not been laden on board, and it is proper that such Bills of Lading in the
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 21
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
hands of a bona fide holder for value should not be questioned by the A
Master or other person signing the same on the ground of the goods not
having been laden as aforesaid; it is enacted as follows”:- Though there
is no definition of the Bill of Lading but the concept of it is clear.
45. Delivery of goods covered by a Bill of Lading are ordinarily to
be made on presentation of the bill. The Carrier may be liable to the B
person lawfully in possession of such a Bill, if he wrongly delivers the
goods to anyone else. Whether the delivery of the goods to anyone other
than the holder of the Bill of Lading, is wrongful or not, would depend on
the facts and circumstances of the case.
46. As observed in Cho Yang Shipping Co. Ltd. v. Coral (UK) C
1
Ltd. , the Bill of Lading is not a contract but it is excellent evidence of
the terms of the contracts. It is open to the shipper to adduce oral evidence
to show the true terms of the contract.
47. As observed by the Division Bench, in the judgment and order
impugned in this appeal, it is also possible that the consignee may authorise D
the carrier to release the cargo in favour of the notify party or to any
other party. Whether the consignee authorised release of the cargo in
favour of the notify party or any other party, can effectively be adjudicated
in the presence of Gulf Petrochem, shown as the notify party in the Bill
of Lading.
E
48. Even assuming that the consignee alone can issue instructions
or authorise delivery of the goods covered by the Bill of Lading, to any
third party, as observed by the Division Bench, the question of whether
the consignee had issued any instructions authorising delivery of the
goods covered by the Bill of Lading to Chevron can also be effectively
adjudged in the presence of the notify party. F
49. On a reading of averments made in the plaint and, in particular,
paragraphs 10 to 12 to which reference has been made in the impugned
judgment and order, it cannot be said that Gulf Petrochem, the owner of
the cargo financed by the Respondent Bank, and the notify party who
had admittedly been communicating with the Respondent Bank as also G
the carrier and others, was a complete stranger to the proceedings.
50. The consignee named in the Bill of Lading, need not necessarily
be the owner of the cargo. Whether the Respondent Bank had anything
1
(1997) 2 Lloyd’s Rep 641 H
22 SUPREME COURT REPORTS [2022] 10 S.C.R.
A to do with any instruction that Gulf Petrochem might have given is to be
decided in the suit. It is perhaps preposterous to equate the instructions
that might be given by Gulf Petrochem, to instructions that might be
given by the fictitious Maharaja of Gaipajama.
51. Having noted the averments made in paragraph 10 to 12 of
B the plaint and commented “better not to say too much” it is difficult to
understand how the Division Bench could have imposed costs of
Rs.1,50,000/- on the Appellant, who had not even made any formal
application for addition of Gulf Petrochem as party.
52. In our view, the Division Bench erred in holding that Gulf
C Petrochem was neither a necessary nor a proper party to the admiralty
suit. Gulf Petrochem was a proper party, whose presence, as observed
above, was necessary for effective adjudication of the issue in the suit.
53. An important question of law involved in these appeals is,
whether an appeal lies to the Commercial Appellate Division of the High
D Court from an order of the Commercial Division (Single Bench) of the
same High Court for addition of a party, in an Admiralty Suit governed
by the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act,
2017, hereinafter referred to as “the Admiralty Act”.
54. If it is held that, an order in an Admiralty Suit, for addition of
E party, passed by the Commercial Division of the High Court, is appealable
to the Commercial Appellate Division, the question which would follow
is, whether the Commercial Appellate Division of the High Court (Division
Bench) should have allowed the appeal and set aside the order of the
Commercial Division (Single Bench) adding Gulf Petroleum FZC as
defendant in the suit?
F
55. The relevant provisions of the Admiralty Act, which governs
the above suit are as follows:
“3. Admiralty jurisdictions— (1) Subject to the provisions of
Sections 4 and 5, the jurisdiction in respect of all maritime
claims under this Act shall vest in the respective High Courts
G
and be exercisable over the waters up to and including the
territorial waters of their respective jurisdictions in
accordance with the provisions contained in this Act:
Provided that the Central Government may, by notification,
extend the jurisdiction of the High Court up to the limit as
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 23
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
defined in Section 2 of the Territorial Waters, Continental A
Shelf, Exclusive Economic Zone and Other Maritime Zones
Act, 1976(80 of 1976).
4. Maritime claim.- (1) The High Court may exercise
jurisdiction to hear and determine any question on a maritime
claim, against any vessel, arising out of any— B
***
(g) agreement relating to the carriage of goods or passengers
on board a vessel, whether contained in a charter party or
otherwise;
5. Arrest of vessel in rem. -(1) The High Court may order C
arrest of any vessel which is within its jurisdiction for the
purpose of providing security against a maritime claim which
is the subject of an admiralty proceeding, where the court
has reason to believe that—
(a) the person who owned the vessel at the time when the D
maritime claim arose is liable for the claim and is the owner
of the vessel when the arrest is effected; or
(b) the demise charterer of the vessel at the time when the
maritime claim arose is liable for the claim and is the demise
charterer or the owner of the vessel when the arrest is E
effected; or
***
(2) The High Court may also order arrest of any other vessel
for the purpose of providing security against a maritime claim,
in lieu of the vessel against which a maritime claim has been F
made under this Act, subject to the provisions of sub-
section (1):
Provided that no vessel shall be arrested under this sub-section
in respect of a maritime claim under clause (a) of sub-
section (1) of section 4. G
6. Admiralty jurisdiction in personam.- Subject to Section 7,
the High Court may exercise admiralty jurisdiction by action in
personam in respect of any maritime claim referred to in
clauses (a) to (w) of sub-section (1) of section 4.
xxxxx H
24 SUPREME COURT REPORTS [2022] 10 S.C.R.
A 12. Application of Code of Civil Procedure.- The provisions
of the Code of Civil Procedure, 1908 (5 of 1908) shall apply
in all the proceedings before the High Court in so far as they
are not inconsistent with or contrary to the provisions of this
Act or the rules made thereunder.
B xxxxx
14. Appeal.- Notwithstanding anything contained in any other
law for the time being in force, an appeal shall lie from any
judgment, decree or final order or interim order of a single
Judge of the High Court under this Act to a Division Bench
C of the High Court.”
56. In view of Section 12 of the Admiralty Act, referred to above,
the provisions of the Code of Civil Procedure 1908, hereinafter referred
to as CPC shall apply to all proceedings before the High Court, under
the Admiralty Act, insofar as they are not inconsistent with, or contrary
D to the provisions of the Admiralty Act or any rule made thereunder.
57. Order 1 Rule 10(2) of the CPC provides:
“Court may strike out or add parties.—The Court may at any
stage of the proceedings, either upon or without the
application of either party, and on such terms as may appear
E to the Court to be just, order that the name of any party
improperly joined, whether as plaintiff or defendant, be struck
out, and that the name of any person who ought to have been
joined, whether as plaintiff or defendant, or whose presence
before the Court may be necessary in order to enable the
F Court effectually and completely to adjudicate upon and settle
all the questions involved in the suit, be added.”
58. There being no inconsistency between Order 1 Rule 10(2)
and any provision of the Admiralty Act, Order 1 Rule 10(2) of the CPC
would be applicable to suits and/or proceedings governed by the Admiralty
Act. Order 1 Rule 10 (2) enables the Court to add any person as party at
G
any stage of the proceedings, on its own, irrespective of whether there
is any application before it, if the Court deems it necessary to do so, to
enable the Court to effectively and completely adjudicate and settle all
questions involved in the suit. One of the objects of Order I Rule 10(2) is
to avoid multiplicity of proceedings.
H
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 25
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
59. The Commercial Courts Act, 2015, has, as per its preamble A
been enacted to provide for the constitution of Commercial Courts,
Commercial Appellate Courts, and for Commercial Division and
Commercial Appellate Division in the High Courts, for adjudicating
commercial disputes of specified value and matters connected therewith
or incidental thereto.
B
60. ‘Commercial dispute’ has been defined in Section 2(c) of the
Commercial Courts Act to include issues relating to admiralty and
maritime laws. Sections 7, 13, 14, 16 and 21 of the Commercial Courts
Act, relevant to the issues involved in this Appeal, are set out hereinbelow:
“7. Jurisdiction of Commercial Divisions of High Courts.— C
All suits and applications relating to commercial disputes of
a Specified Value filed in a High Court having ordinary
original civil jurisdiction shall be heard and disposed of by
the Commercial Division of that High Court:
Provided that all suits and applications relating to commercial D
disputes, stipulated by an Act to lie in a court not inferior to
a District Court, and filed or pending on the original side of
the High Court, shall be heard and disposed of by the
Commercial Division of the High Court:
Provided further that all suits and applications transferred E
to the High Court by virtue of sub-section (4) of Section 22
of the Designs Act, 2000 (16 of 2000) or Section 104 of the
Patents Act, 1970 (39 of 1970) shall be heard and disposed
of by the Commercial Division of the High Court in all the
areas over which the High Court exercises ordinary original
civil jurisdiction. F
13. Appeals from decrees of Commercial Courts and
Commercial Divisions.—20[(1) Any person aggrieved by the
judgment or order of a Commercial Court below the level of
a District Judge may appeal to the Commercial Appellate
Court within a period of sixty days from the date of judgment G
or order.
(1-A) Any person aggrieved by the judgment or order of a
Commercial Court at the level of District Judge exercising
original civil jurisdiction or, as the case may be, Commercial
Division of a High Court may appeal to the Commercial H
26 SUPREME COURT REPORTS [2022] 10 S.C.R.
A Appellate Division of that High Court within a period of sixty
days from the date of the judgment or order:
Provided that an appeal shall lie from such orders passed by
a Commercial Division or a Commercial Court that are
specifically enumerated under Order XLIII of the Code of
B Civil Procedure, 1908 (5 of 1908) as amended by this Act
and Section 37 of the Arbitration and Conciliation Act, 1996
(26 of 1996).]
(2) Notwithstanding anything contained in any other law for
the time being in force or Letters Patent of a High Court, no
C appeal shall lie from any order or decree of a Commercial
Division or Commercial Court otherwise than in accordance
with the provisions of this Act.
14. Expeditious disposal of appeals.—The Commercial
Appellate Court and the Commercial Appellate Division shall
D endeavour to dispose of appeals filed before it within a period
of six months from the date of filing of such appeal.
xxxxx
16. Amendments to the Code of Civil Procedure, 1908 in its
application to commercial disputes.—(1) The provisions of
E the Code of Civil Procedure, 1908 (5 of 1908) shall, in their
application to any suit in respect of a commercial dispute of a
Specified Value, stand amended in the manner as specified in
the Schedule.
(2) The Commercial Division and Commercial Court shall
F follow the provisions of the Code of Civil Procedure, 1908 (5
of 1908), as amended by this Act, in the trial of a suit in
respect of a commercial dispute of a specified value.
(3) Where any provision of any Rule of the jurisdictional High
Court or any amendment to the Code of Civil Procedure, 1908
G (5 of 1908), by the State Government is in conflict with the
provisions of the Code of Civil Procedure, 1908 (5 of 1908),
as amended by this Act, the provisions of the Code of Civil
Procedure as amended by this Act shall prevail.
21. Act to have overriding effect.—Save as otherwise provided,
H the provisions of this Act shall have effect, notwithstanding
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 27
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
anything inconsistent therewith contained in any other law A
for the time being in force or in any instrument having effect
by virtue of any law for the time being in force other than this
Act.”
61. As observed above, Section 12 of the Admiralty Act applies
the provisions of the CPC to all Admiralty proceedings in the High Court. B
Section 16 of the Commercial Courts Act makes it explicit that the
provisions of CPC, as amended by the Schedule to the Commercial
Courts Act, applies to suits relating to commercial disputes governed by
the Commercial Courts Act.
62. There can be no doubt that the Commercial Division of the C
High Court has the power to add a party to an Admiralty suit, on its own,
without any application having been made, if it is of the view that the
presence of that party before the Court may be necessary to effectively
and completely adjudicate upon and settle all the questions involved in
the suit. The question is whether an order of the Commercial Court or
the Commercial Division of the High Court, adding a party to an Admiralty D
Suit, is appealable under Section 13 of the Commercial Courts Act, read
with Section 14 of the Admiralty Act.
63. Proviso 2 of Section 13(1A) of the Commercial Courts Act
restricts intra Court appeals from the Commercial Division of a High
Court to its Commercial Appellate Division, only to those orders of the E
Commercial Division, which are specifically enumerated under Order
43 of the Code of Civil Procedure 1908 as amended by the Commercial
Courts Act and Section 37 of the Arbitration and Conciliation Act 1996.
64. The Commercial Courts Act does not amend Order 43 Rule 1
of the CPC which provides: F
“1. Appeals from orders.—An appeal shall lie from the
following orders under the provisions of Section 104,
namely:—
(a) an order under Rule 10 of Order VII returning a plaint
G
to be presented to the proper Court except where the
procedure specified in Rule 10-A of Order VII has been
followed;
(b) ***
H
28 SUPREME COURT REPORTS [2022] 10 S.C.R.
A (c) an order under Rule 9 of Order IX rejecting an
application (in a case open to appeal) for an order to
set aside the dismissal of a suit;
(d) an order under Rule 13 of Order IX rejecting an
application (in a case open to appeal) for an order to
B set aside a decree passed ex parte;
(e) ***
(f) an order under Rule 21 of Order XI;
(g) ***
C (h) * * *
(i) an order under Rule 34 of Order XXI on an objection
to the draft of a document or of an endorsement;
(j) an order under Rule 72 or Rule 92 of Order XXI setting
aside or refusing to set aside a sale;
D
(ja) an order rejecting an application made under sub-rule
(1) of Rule 106 of Order XXI, provided that an order on
the original application, that is to say, the application
referred to in sub-rule (1) of Rule 105 of that Order is
appealable;
E
(k) an order under Rule 9 of Order XXII refusing to set
aside the abatement or dismissal of a suit;
(l) an order under Rule 10 of Order XXII giving or refusing
to give leave;
F (m) ***
(n) an order under Rule 2 of Order XXV rejecting an
application (in a case open to appeal) for an order to
set aside the dismissal of a suit;
(na) an order under Rule 5 or Rule 7 of Order XXXIII
G
rejecting an application for permission to sue as an
indigent person;
(o) ***
(p) orders in interpleader-suit under Rule 3, Rule 4 or Rule
H 6 of Order XXXV;
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 29
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
(q) an order under Rule 2, Rule 3 or Rule 6 of Order A
XXXVIII;
(r) an order under Rule 1, Rule 2, [Rule 2-A], Rule 4 or
Rule 10 of Order XXXIX;
(s) an order under Rule 1 or Rule 4 of Order XL;
B
(t) an order of refusal under Rule 19 of Order XLI to
readmit, or under Rule 21 of Order XLI to rehear, an
appeal;
(u) an order under Rule 23 [or Rule 23-A] of Order XLI
remanding a case, where an appeal would lie from the C
decree of the Appellate Court;
(v) [* * *]
(w) an order under Rule 4 of Order XLVII granting an
application for review.”
D
65. Sub-section (2) of Section 13 begins with a non obstante clause
giving the said Section overriding over all other laws including the Letters
Patent of the High Court. Sub-section (2) of Section 13 of the Commercial
Courts Act says that no appeal shall lie from any order of a Commercial
Division or Commercial Court otherwise than in accordance with the
provisions of the Commercial Courts Act. E
66. On the other hand, Section 14 of the Admiralty Act, which
also starts with a non-obstante clause saying that notwithstanding any
other law for the time being in force, an appeal shall lie from any judgment,
decree or final order or interim order of a Single Bench of the High
Court under the Admiralty Act, to a Division Bench of the High Court. F
67. Both Section 13 of the Commercial Courts Act and Section
14 of the Admiralty Act contain non-obstante clauses giving the Sections
overriding effect. While Section 14 of the Admiralty Act which begins
with a non-obstante clause as observed, provides that notwithstanding
contained in any other law for the time being in force, an appeal shall lie G
from any judgment, decree or final order or interim order under the
Admiralty Act, of a Single Judge of the High Court to a Division Bench
of the High Court, Section 13(2) of the Commercial Courts Act says
notwithstanding anything contained in any other law for the time being in
force, or the Letters Patent of the High Court, no appeal shall lie from
H
30 SUPREME COURT REPORTS [2022] 10 S.C.R.
A any order or decree of a Commercial Division or Commercial Court
otherwise than in accordance with the provisions of the Commercial
Courts Act. As stated above, the proviso restricts an appeal under the
Commercial Courts Act, to such orders as are specifically enumerated
in Order 43 of the CPC.
B 68. A clause with the words “notwithstanding anything contained
in any other law for the time being in force” is generally appended at the
beginning of a section with a view to give the enacting part of the section
overriding effect in case of conflict with any other law. Ordinarily, when
two or more statutes contain statutory provisions which start with the
clause “notwithstanding anything contained in any other law for the time
C being in force” and those statutes contain conflicting provisions, a question
that could arise is, which statute would prevail. As a general rule, the
Special Statutes prevail over General Statutes. If both statutes are general
statutes or special statutes containing identical or similar non-obstante
clauses, the later statute would prevail.
D 69. The rule that a non-obstante clause in a later statute prevails
over the non-obstante clause in an earlier statute is not an absolute rule.
The question of which provision prevails, would necessarily depend on
the object of the enactment and, in particular, the object of giving
overriding effect to the enactment or any specific provision thereof.
E 70. When two or more enactments operating in the same field
contain a non obstante clause stating that its provisions will have effect
notwithstanding anything inconsistent therewith contained in any other
law, the conflict has to be resolved upon consideration of the purpose
and policy underlying the enactments. Mr. Vishwanathan, learned Senior
F Counsel appearing for the Appellant, argued that Section 14 provides for
appeals from an interim order of a Single Judge of a High Court under
the Admiralty Act which means an interim order in relation to an action
in rem. Once the owner of the Vessel enters appearance and submits to
the jurisdiction and provides security for release of the Vessel, the
Admiralty Action proceeds to trial as an action in personam as in any
G other suit. This view finds support from the judgment of this court in
MV Elizabeth v. Harwan Investment and Trading Pvt. Ltd.2
71. The Statement of Objects and Reasons of the Commercial
Courts Bill, 2015 indicates that the Commercial Courts Bill followed
H 2
1993 Supp (2) SCC 433
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 31
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
from “(a) proposal to provide for speedy disposal of high value commercial A
disputes”, which “involves complex facts and question(s) of law”. The
Statement notes that “early resolution of commercial disputes shall create
a positive image to the investor world about the independent and
responsive Indian legal system”. The Statement says that “the proposed
Bill shall accelerate economic growth, improve the international image
B
of the Indian Justice delivery system, and the faith of the investor world
in the legal culture of the nation”.
72. The Statement of Objects and Reasons for the Admiralty
(Jurisdiction and Settlement of Maritime Claims) Bill, 2016 says that the
Bill “consolidates the existing British era laws on civil matters of Admiralty
jurisdiction of courts, Admiralty proceedings on Maritime claims, arrest C
of vessels and related issues, in line with modern trends in the maritime
sector and in uniformity with prevalent international practices”. The
Admiralty Bill “provides for adjudication of identified maritime claims
and, to ensure security against maritime claims, arrest of vessels in certain
circumstances”. The Bill also ‘provides for inter se priority on maritime D
lien.” The Statement of Objects and Reasons reiterates that CPC shall
be applicable in respect of aspects on which provisions are not laid down
in the Bill.” The Bill also “deals with admiralty jurisdiction in personam
and the order of priority of maritime claims.”
73. A dispute arising out of issues relating to admiralty and maritime E
law is a commercial dispute as defined in Section 2(1) (c)(iii) of the
Commercial Courts Act. Section 13 of the Commercial Courts Act, which
restricts the scope of appeals, has been interpreted by this Court in
Kandla Corporation v. OCI Corp.3, to mean that orders that are not
specifically enumerated under Order XLIII of the CPC would, not be
appealable. F
74. This Court held:
“14.The proviso goes on to state that an appeal shall lie from
such orders passed by the Commercial Division of the High
Court that are specifically enumerated under Order XLIII of G
the Code of Civil Procedure Code, 1908, section 37 of the
Arbitration Act. It will at once be noticed that orders that are
not specifically enumerated under Order XLIII of the CPC
would, therefore, not be appealable, and appeals that are
3
(2018) 14 SCC 715 H
32 SUPREME COURT REPORTS [2022] 10 S.C.R.
A mentioned in Section 37 of the Arbitration Act alone are
appeals that can be made to the Commercial Appellate
Division of a High Court.”
75. Mr. Vishwanathan submitted that, considering the scope of
the Commercial Courts Act, the Madras High Court has issued
B Notification No. 48 of 2018 in exercise of the powers conferred under
section 18 of the Act, which is a practice note in relation to the
Commercial Appellate Division. The Notification states “If the decision
of the Commercial Court and Commercial Division is an ‘order’, it should
be an order which has been specifically enumerated as an appealable
order under Order XLIII of the CPC [proviso to Section 13 of the Act 4
C of 2016]. Other than the above, even if there is an appeal provision
under the Letters Patent of a High Court or under any law, no appeal
will lie against an order or decree of a Commercial Division or Commercial
Court [Section 13(2) of Act 4 of 2016).” Incidentally the notification
was issued by one of us, (Indira Banerjee, J.) as Chief Justice of the
D Madras High Court, at the material time.
76. In Magic Frames v. Radiance Media P Ltd.4, relied upon
by Mr. Vishwanathan, the Madras High Court held that an Original Side
Appeal under Section 13(1A) was not maintainable against a Single
Judge’s order, dismissing an application filed by the defendants Magic
E Frames for summary judgment, seeking dismissal of the commercial suit
filed by the plaintiff, Radiance Media. The relevant paragraphs of the
judgment are reproduced herein below:-
“24. Further, as per Notification No.48 of 2018 of this Court,
in exercise of the power conferred under Section 18 of the
F Commercial Courts, Commercial Division and Commercial
Appellate Division of High Courts Act, 2015 (Act 4 of 2016),
the Hon. The Chief Justice is pleased to issue the Practice
Note therein and in relation to Commercial Appellate Division,
it is stated as follows:
G II. Commercial Appellate Division:
Jurisdiction of Commercial Appellate Division:
1) Jurisdiction of Commercial Appellate Division is set out in
three provisions of Act 4 of 2016, i.e. section 9(2), section 13
and Section 15(5).
H 4
2019 SCC Online Mad 38929
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 33
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
2) In suits relating to a Commercial Dispute (where the value A
of the suit when filed is not of specified value’) in the even of
counter claim/s by defendants/s of ‘Specified Value’) in the
event of counter claim/s by defendant/s of Specified value,
such a suit shall be transferred to Commercial court or the
commercial division, as the case may be (Section 9(1) of Act
B
4 of 2016). If such a suit is not transferred, on an application
by any of the parties to the suit, Commercial Appellate Division
may withdraw such suits from the regular.
25. Therefore, from the above Notification, it is clear that the
amendment to section 13(1) of the Commercial Courts Act,
has no impact on the right of appeal, which was clarified in C
the practice directions to be limited under Order 43 of the
CPC, and section 37 of the Arbitration and Conciliation Act,
1996, if it had any impact, the practice directions would have
also been amended which the Court has not done till date.”
77. The judgment in Magic Frames (supra), in the context of D
dismissal of an application for summary judgment, is not attracted in this
case, even though the finding that an order dismissing an application for
summary judgment is not appealable, is correct. However, a Notification
giving Practice Directions can neither restrict nor expand the scope of a
statutory enactment. E
78. It is clear from a reading of the Admiralty Act and the
Commercial Courts Act, that orders passed under the Admiralty Act
pertaining to the exercise of in rem jurisdiction by the High Court are the
only orders which are appealable under section 14 of the Admiralty Act,
whereas orders passed in the trial of a suit and on applications made F
under the provisions of the Code of Civil Procedure, 1908 are not orders
under the Admiralty Act but orders under the CPC which would be
appealable only if they fall under Order 43 of the CPC as provided in
Section 13 of the Commercial Courts Act.
79. Both the Admiralty Act and Commercial Courts Act are Special G
Acts. In Ashoka Marketing Ltd. v. Punjab National Bank 5, a
Constitution Bench of this Court, after considering the law on the subject
of conflicting non-obstante clauses and inconsistency between the
provisions of the two statutes, observed in paragraph 61 that “The principle
5
(1990) 4 SCC 406 H
34 SUPREME COURT REPORTS [2022] 10 S.C.R.
A which emerges from these decisions is that in the case of inconsistency
between the provisions of the two enactments, both of which can be
regarded as special in nature, the conflict has to be resolved by reference
to the purpose and policy underlying the two enactments and the clear
intendment conveyed by the language of the relevant provisions
therein.…”
B
80. Even assuming that the Commercial Courts Act provisions
are considered to be general provisions relating to appeals, whilst the
provisions in the Admiralty Act are considered to be special provision
for appeal, then too the maxim Generalia Specialibus Non Derogant,
which is ordinarily attracted where there is a conflict between a special
C and a general statute, would not apply. “If it appears from a consideration
of the general enactment, in the light of admissible circumstances, that
Parliament’s true intention was to establish thereby a rule of a universal
application, then the special provision must give way to the general”. In
CTO vs. Binani Cements6, this Court held:-
D “34. It is well established that when a General Law and a
special law dealing with some aspect dealt with by the general
law are in question, the rule adopted and applied is one of
harmonious construction whereby the general law, to the extent
dealt with by the special law, is impliedly repealed. This
E principle finds its origins in the latin maxim of generalia
specialibus non derogant, i.e., general law yields to special
law should they operate in the same field on same subject.
(Vepa P. Sarathi, Interpretation of Statutes, 5th Ed., Eastern
Book Company; N. S. Bindra’s Interpretation of Statutes, 8th
Ed., The Law Book Company; Craies on Statute Law,
F S.G.G.Edkar, 7th Ed., Sweet & Maxwell; Justice G.P. Singh,
Principles of Statutory Interpretation, 13th Ed., LexisNexis;
Craies on Legislation, Daniel Greenberg, 9th Ed., Thomson
Sweet & Maxwell, Maxwell on Interpretation of Statutes, 12th
Ed., Lexis Nexis)
G 35. Generally, the principle has found vast application in
cases of there being two statutes: general or specific with the
latter treating the common subject matter more specifically or
minutely than the former. Corpus Juris Secundum, 82 C.J.S.
Statutes § 482 states that when construing a general and a
6
H 2014 SCC Online SC 140
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 35
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
specific statute pertaining to the same topic, it is necessary to A
consider the statutes as consistent with one another and such
statutes therefore should be harmonized, if possible, with the
objective of giving effect to a consistent legislative policy.
On the other hand, where a general statute and a specific
statute relating to the same subject matter cannot be reconciled,
B
the special or specific statute ordinarily will control. The
provision more specifically directed to the matter at issue
prevails as an exception to or qualification of the provision
which is more general in nature, provided that the specific or
special statute clearly includes the matter in controversy.
(Edmond v. U.S., 520 U.S. 651, Warden v. Marrero, 417 U.S. C
653)
36. The maxim generalia specialibus non derogant is dealt
with in Volume 44 (1) of the 4th ed. of Halsbury’s Laws of
England at paragraph 1300 as follows:
“The principle descends clearly from decisions of the House D
of Lords in Seward v. Owner of “The Vera Cruz”, (1884) 10
App Gas 59 and the Privy Council in Barker v Edger, (1898)
AC 748 and has been affirmed and put into effect on many
occasions .... If Parliament has considered all the
circumstances of, and made special provision for, a particular E
case, the· presumption is that a subsequent enactment of a
purely general character would not have been intended to
interfere with that provision; and therefore, if such an
enactment, although inconsistent in substance, is capable of
reasonable and sensible application without extending to the
case in question, it is prima facie to be construed as not so F
extending. The special provision stands as an exceptional
proviso upon the general. If, however, it appears from a
consideration of the general enactment in the light of
admissible circumstances that Parliament’s true intention was
to establish thereby a rule of universal application, then the G
special provision must give way to the general.”
81. If such an order under the Code of Civil Procedure which
does not fall under Order XLIII of CPC is held to be appealable, then
the entire purpose of the Commercial Courts Act would be defeated,
and every single order passed in a course of a trial of an admiralty suit H
36 SUPREME COURT REPORTS [2022] 10 S.C.R.
A would be appealable under section 14 of the Act. Such orders would be
large in number including orders in relation to discovery, inspection, case
management hearing, admissibility of evidence, framing of issues,
interrogatories, etc. This would make a mockery of the intended purpose
of Parliament in enacting the Commercial Courts Act, which is to expedite
trials in commercial suits of a specified value, and restrict the number of
B
interlocutory appeals.
82. This Court is of the view that an order for addition of a party
under Order 1 Rule 10(2) of the CPC is not appealable under section 14
of the Admiralty Act. Gulf Petrochem is a party to the dispute and the
suit transaction and the Contract of Carriage (Bill of Lading) and hence
C is a necessary party. Gulf Petrochem is also a proper party whose
presence is necessary for complete and final decision on questions in
the suit. In Anil Kumar Singh vs. Shivnath Mishra7, this Court held:
“10. A person may be added as a party defendant to the suit
though no relief may be claimed against him/her provided
D his/her presence is necessary for a complete and final decision
on the question involved in the suit. Such a person is only a
proper party as distinguished from a necessary party .... “
83. The pleadings in Paragraphs 10 to 12 of the Plaint [Page 264]
which are extracted in the Impugned Judgement at Page 11-13
E demonstrate that Gulf Petrochem is a proper and necessary party even
though the Respondent may choose not to claim any reliefs against them
in the present Suit.
84. Section 14 of the Admiralty Act, as argued by
Mr. Vishwanathan, provides the fora for an appeal from any judgment,
F decree, final order or interim order of a Single Judge of the High Court
under the Admiralty Act to a Division Bench of the High Court. The
expression “any interim order” has to be read harmoniously with Order
43, Rule 1 of the Code of Civil Procedure in view of Section 12 of the
Admiralty Act read with Section 13 of the Commercial Courts Act
G referred to above.
85. It is not the intent of the overriding provision of Section 14 to
nullify Section 12 of the Admiralty Act. Section 12 of the Admiralty Act
applies to all proceedings in the High Court whether they be original
proceedings or appellate proceedings.
7
H (1995) 3 SCC 147
OWNERS AND PARTIES INTERESTED IN THE VESSEL M.V. POLARIS 37
GALAXY v. BANQUE CANTONALE DE GENEVE [INDIRA BANERJEE, J.]
86. On a harmonious reading of Sections 12 and 14 of the Admiralty A
Act with Section 13 of the Commercial Courts Act, an intra-court appeal
under the Admiralty Act to the Commercial Division of the High Court
would lie from any judgment, decree or final order under the Admiralty
Act or an interim order under the Admiralty Act relatable to the orders
specified in Order 43, Rule 1.
B
87. We are unable to accept Mr. Barucha’s argument that Section
14 read with Section 12 of the Admiralty Act, 2017 demonstrates
legislative intent to permit appeals from any interim order passed by the
Single Judge of a High Court exercising admiralty jurisdiction to a Division
Bench of that High Court without any restriction or limitation. The
judgments of the High Courts referred to by Mr. Barucha rendered in C
the facts and circumstances of those cases, in respect of orders under
the Admiralty Act has specifically been made appealable under Section
14 of the Admiralty Act. The mere dismissal of a special leave petition
does not operate as a precedent of the Supreme Court.
88. It could not possibly have been the legislative intent of the D
Admiralty Act to make all interim orders appealable. Such a wide
interpretation of the expression “interim order” would mean that any
party would be able to delay the trial and final disposal by filing appeals
even from inconsequential orders calling for affidavits and the like. We,
therefore, hold that an appeal does not lie to the Commercial Appellate E
Division of the High Court from an order of the Commercial Division
(Single Bench) of the same High Court for addition of a party in an
admiralty suit governed by the Admiralty Act.
89. Even otherwise, we are of the view that the Division Bench
erred in law in allowing the appeal from the order of the Commercial F
Division (Single Judge) adding Gulf Petroleum as party defendant to the
suit.
90. For the reasons discussed above, the appeals are allowed.
The impugned judgment and order of the Division Bench is set aside.
G
Divya Pandey Appeals allowed.
(Assisted by : Roopanshi Virang, LCRA)
H
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