Orissa High Court Orders Sale Of Cargo Ship 'MV Debi' For Failure To Pay Hire Charges To Paradip Cargo Terminal
The Orissa High Court has ordered the sale of cargo vessel 'MV Debi' for its failure to pay berth hire and penal berth hire charges amounting to almost eight crore rupees.Taking into account inaction on the part of the owner of the cargo vessel and considering depreciating value of the same, the Admiralty Judge Justice V. Narasingh ordered for valuation and sale, the proceeds of which shall...
The Orissa High Court has ordered the sale of cargo vessel 'MV Debi' for its failure to pay berth hire and penal berth hire charges amounting to almost eight crore rupees.
Taking into account inaction on the part of the owner of the cargo vessel and considering depreciating value of the same, the Admiralty Judge Justice V. Narasingh ordered for valuation and sale, the proceeds of which shall be adjusted towards the outstanding dues.
Background of the Case
On 30.11.2023 and 01.12.2023, 22 packets of contraband/cocaine were recovered from the defendant vessel, namely, 'MV Debi'. Subsequent to such recovery, the Assistant Commissioner, Paradeep Customs Division addressed to the Traffic Manager, Paradip Port Trust, Paradip directing that no movement authorizations be given to the vessel without prior consultation.
As the movement of the vessel was restricted, it was parked at the space provided by the plaintiff-Paradip International Cargo Terminal Pvt. Ltd. However, when the vessel failed to pay the berth hire charges, the plaintiff filed this admiralty suit praying for a decree against the defendant to pay a sum of Rs.7,95,47,170/- in terms of Section 4(1)(n) read with Section 9(1)(d) of the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017.
Subsequently, the Court had ordered for arrest of the cargo vessel in February this year as it failed to submit the dues. After the arrest of the vessel, it remained parked at the space provided by the plaintiff.
Despite of the order of arrest, neither the owner nor any person interested in the vessel deposited the security relating to the claim amount. Also they did not file any written statement denying the averments taken in the plaint.
Due to such inaction on the part of the defendant, the plaintiff prayed for sale of the vessel as delay of each day contributes to the increasing claim of the plaintiff. Further, the plaintiff-terminal argued that unless immediate step for sale of the vessel is taken, its value will come down gradually due to depreciation and will also affect its 'seaworthiness'.
Court's Order
The Court referred to the provision of sale of vessels enumerated under Section 11(3) of the Act read with Rule 16 of the Orissa High Court Admiralty (Jurisdiction and Settlement of Maritime Claims) Rules, 2020.
Accordingly, the Court modified the order of arrest of the vessel which it had passed in the month of February and directed for sale of the same. It also ordered the Deputy Registrar (Judicial) to act as Court Commissioner till the sale of the defendant vessel.
Moreover, the Admiralty Judge asked the Court Commissioner to appoint 'Adonia Offshore Consultants Private Limited' in terms of the memo filed by the plaintiff as surveyors as well as valuers to submit the report, for ascertaining the valuation of the vessel both for scraping as well as for trading, in a sealed cover on or before 21.09.2024.
The plaintiff-cargo terminal was directed to deposit a sum of Rs.3,00,000/- with the Deputy Registrar (Judicial) for meeting the expenses for survey. It was clarified the above sum shall be reimbursed to the plaintiff out of sale proceeds of the defendant vessel.
Case Title: Paradip International Cargo Terminal Pvt. Ltd. v. M.V. Debi (IMO. 9616735)
Case No: ADMLS No. 1 of 2024
Date of Order: August 20, 2024
Counsel for the Plaintiff: Mr. P. Kamat, Mr. N.N. Naik, Mr. I. Patil, Mr. S. Mohanty & Mr. S. Moharana, Advocates
Counsel for the Defendant: None
Citation: 2024 LiveLaw (Ori) 69