Allowed

The B.P.T. of Bombay v. Laldee Pvt. Ltd. and Ors.

Bombay HC4 Aug 2005S/1533/1985

Case brief

AI extract

What is this about?

In a suit for recovery of port trust dues, the court held that the cause of action arose only upon the auction sale in 1982, dismissing the limitation defense. The canalising agent as principal was held liable, but the shipper was relieved of liability after endorsing the bill of lading.

What did the court decide?

Decree for Rs.22,40,000/- with interest against Defendant 1 and 2; suit against Defendant 3 dismissed.

The B.P.T. of Bombay Vs Laldee Pvt. Ltd. and… — Contract and Commercial Disputes | Bombay HC (2005)

¶1

:1:

¶2

 IN THE HIGH COURT OF JUDICATURE AT BOMBAY

¶3

 ORDINARY ORIGINAL CIVIL JURISDICTION

¶4

SUIT NO. 1533 OF 1985

¶5

 The Board of Trustees of the

¶6

 Port of Bombay ......Plffs.
 vs.

¶7

 Laldee P.Ltd and Ors. ......Defnds.

¶8

 ---------

¶9

 Mr. V.J. Makhija i/b. Motiwala and Co. for the
 plaintiffs.

¶10

 None appears for defendant no.1 though served.

¶11

 Mr. Navneet Shah with Salil Shah i/b. M/s.
 Bhaishankar Kurga i/b. Girdharlal for defendant
 no.2.

¶12

 Mr. Chirag Balsara i/b. Bhatt and Saldanah for
 defendant no.3.

¶13

CORAM: S.U. KAMDAR, J.

¶14

DATE : 4TH AUGUST, 2005.

¶15

JUDGMENT :

¶16

 1. The present suit has been filed by the
 plaintiff which is a statutory corporation under
 the provisions of the Major Port Trust Act, 1963.

¶17

:2:

¶18

 Under the provisions of the Major Port Trust the
 plaintiff is the owner of the docks at Bombay and
 under the provisions of the said act the plaintiff
 is empowered to take charge of the goods landed
 from the ships coming to Bombay and also entitled
 to various charges inrespect of the wharfage,
 demurrage and other charges. The scales for the
 said charges are duly prescribed.

¶19

 2. Sometime in or about 1974 the first and the
 second defendant imported 54 bundles containing
 steel strips which were manifested at Item No.500
 of the Import General Manifest No.1791 dated
 19.3.1974. The defendant no.2 was the canalising
 agent at the relevant time and by virtue of its
 status as canalising agent was the sole agency for
 importing the said goods. The said goods arrived
 at Bombay in a vesssel known as ‘S.S. STATE OF
 MEGHALAYA’. The goods were landed on 8.4.1974 and
 the last free day to release the goods by the
 plaintiff without levy of any charges was
 15.4.1974. On 31.5.1975 an outturn was drawn
 inrespect of the said 54 bundles and it was shown

¶20

:3:

¶21

 that the said goods were lying at Haji Bunder Dump.

¶22

 The consignment of the said steel strips was not
 cleared by the defendant no.1 and/or the defendant
 no.2. The third defendant in the suit is the owner
 of the vessel and has been sued in its capacity as
 a bailor because the said vessel has discharged the
 said cargo at the port into the custody of the
 plaintiff. According to the plaintiff the

¶23

 defendants were bound and liable to take delivery
 of the said goods and clear the same within a
 period of 7 days which were prescribed as ‘clear
 days’ from the date of the landing and subsequently
 the said consignment was liable to wharfage and

¶24

 demurrage charges and other charges of the
 plaintiff. It is the case of the plaintiff that
 the said consignment was landed on 8.4.1974 and
 period of 7 clear days were over on 15.4.1974 still
 the defendant did not clear the said goods for more
 than two months and accordingly in exercise of
 power conferred under s.61 and 62 of the Major Port
 Trust Act the plaintiff placed the said goods for
 public auction in Lot No.J/2233. The notice of
 sale was sent by the plaintiff to defendant no.1, 2

¶25

:4:

¶26

 and 3 and called upon them that the consignment if
 not cleared then the same will be sold and the
 amount received will be adjusted against the port
 trust dues. The first defendant thereafter through
 their advocate replied and inter-alia stated that
 the defendant no.1 has filed a suit in this court
 being Suit No.1370 of 1975 against Hindustan Steel
 Limited and the third defendant for damages for
 causing delay in clearing of the said consignment.
 The second defendant is not the importer of the
 said consignment since the second defendant has
 sold the said consignment on High Sea Sales basis
 and thus the second defendant is not liable to make
 payment of the said charges.

¶27

 3. Since the said consignment was not cleared the
 plaintiff published a sale notice in Maharahstra
 Government Gazette (II) dated 5.6.1975 and also
 gave a newspaper notice in Free Press Journal on
 5.6.1975; and ultimately the consignment was sold
 by the plaintiff sometime in or about 14.6.1982.
 The said consignment was sold under Lot No. J/2233
 and the amount received by the plaintiff from the

¶28

:5:

¶29

 sale proceeds was Rs.3,01,548.50/-. It is the case
 of the plaintiff that for a period of two years the
 port trust charges accrued on the said consignment
 amounted to Rs.22,70,109.40/- and custom duty paid
 by the port trust on them was Rs.1,30,526.56p and
 ITC fine was imposed of Rs.1,80,000/- and the
 expenses for conducting the sale was incurred by
 the plaintiff of Rs.34,993.75p. The plaintiff
 adjusted the sale proceeds under the various
 expenses, customs duty and according to the

¶30

 plaintiff after giving adjustment of the balance of
 the sale proceeds against the port trust charges

¶31

 there remained a deficit of Rs.22,15,534.30p. By
 letter dated 15.5.1985 the plaintiff informed all

¶32

 the three defendants of the aforesaid position and

¶33

 called upon them to make payment of

¶34

 Rs.22,15,534.30p towards the repayment of the port

¶35

 trust dues inrespect of the wharfage and demurrage
 incurred on the said consignment. It is the case

¶36

 of the plaintiff that neither the defendant replied
 to the said notice nor paid the said amount and
 thus the plaintiff filed the present suit for the
 recovery of amount of Rs.22,40,000/- which included

¶37

:6:

¶38

 interest of principal amount of Rs.22,15,534.50/-
 as on the date of the suit and has claimed further
 interest at the rate of 15%p.a. from the date of
 the suit till payment and/or realisation. The
 defendant no.1 has not filed any written statement
 in the present suit nor he has appeared or
 contested the present suit. In so far as the

¶39

 second defendant is concerned the second defendant
 has filed the written statement and has contended
 that the second defendant is a designated
 canalising agency in terms of the import and export
 policy published by the government of India from
 time to time and the said defendant no.2 never
 effected import of any consignment and before the
 said consignment is imported into India the said
 consignment is sold by the defendant no.2 on high
 sea-sales basis. It is the second defendants case
 that in the present case also by invoice dated
 5.3.1974 the defendant no.2 sold the goods to
 defendant no.1 on high-sea-sales basis and once the
 said sale is effected the defendant no.2 is not
 liable to make payment of wharfarage and demurrage
 charges which is incurred subsequent to the

¶40

:7:

¶41

 effecting of the sale by the defendant no.2 in
 favour of the defendant no.1. Thereafter the
 defendant no.2 has denied the various averments and
 statements made in the plaint and denied the
 quantum of liability payable by the defendant no.2
 to the plaintiff on an assumption that the
 defendant no.2 is at all liable for the aforesaid
 amount. The defendant no.2 has also contended that
 there is an unreasonable delay in effecting the
 sale in as much as the sale was advertised as far
 back as on 5.6.1975 still the sale of the said
 goods was effected only on 14.6.1982. Thus there
 was a delay of almost seven years in effecting the
 sale of the said goods. According to the written
 statement the claim if any as against the second
 defendant has become barred by the law of
 limitation as the cause of action arose in 1975 and
 still the plaintiff has taken no action either for
 the recovery of the same by sale of the said goods
 or by claiming the amount by filing a suit in this
 court. It has been thus contended in the written
 statement that the delay is most fraudulent and
 dishonest. Thus the delay has resulted in the

¶42

:8:

¶43

 non-availaibility of the best of the price

¶44

 available at the relevant time and in any event the
 said goods were lying for seven years in the dock
 which has resulted in deteriorating of the quality
 of the said goods. It is thus denied that the
 plaintiff is entitled to any amount whatsoever as
 claimed in the suit. It has been thus contended
 that the suit should be dismissed.

¶45

 4. The defendant no.3 has also filed the written

¶46

 statement. The defendant no.3 has denied the
 liability and has contended that the defendant no.3
 is not the owner of the goods or importer of the
 goods. It has been contended that the defendant
 no.3 is merely the shipper of the said goods and
 once the bill of lading is endorsed in favour of
 the defendant no.1 or the defendant no.2 then in
 that event the liability of the defendant no.3
 inrespect of the import of the said goods cease to
 exist and thus the defendant no.3 cannot be held
 liable for non payment of the wharfage and or
 demurrage charges by defendant no.1 and/or
 defendant no.2. The defendant no.3 has also denied

¶47

:9:

¶48

 various allegations in the suit made by the
 plaintiff against the defendant no.3.

¶49

 5. On the aforesaid pleadings the issued were
 framed by the learned single judge of this court on

¶50

 8.11.2003. The said issues are as under :

¶51

 1. Does the plaintiff prove that the
 plaintiff is entitled to recover charges from
 all the defendants jointly and severally as
 commission ?

¶52

 2. Does the defendant no.2 prove that it
 is a only a canalising agent and is not at
 all liable to pay anything to the plaintiff /

¶53

 3. Does the defendant no.3 prove that
 they are the owners of the vessel and their
 duty was only to hand over the goods to the
 carrier of the good and that they are not
 liable to pay anything to the plaintiffs /

¶54

 4. Do the defendants prove that the suit
 is barred by limitation ?

¶55

 5. Whether the plaintiffs prove that the
 port trust charges were amount to
 Rs.22,70,109.40/- paise ?

¶56

 6. What decree and order ?

¶57

 6. On the aforesaid pleadings and issues the

¶58

:10:

¶59

 matter went on trial and the plaintiff has examined
 two witness one Mr. Sanjiv Kumar and Mr. Shailesh
 Chavan who have deposed and have produced certain
 documents from the record. The second witness of
 the plaintiffs has produced certain additional
 documents which were not produced by P.W.1.
 Neither of the witness have any personal knowledge
 but both the witness have deposed to the facts on
 the basis of documents on record. The documents
 which have been produced by both the witness and
 marked as exhibits in the present proceedings
 inter-alia includes the extract of the Import
 General Manifest No.1791. The notices which are
 given by the plaintiffs to the defendants for the
 sale of the said goods and correspondence between
 the parties, the notice of sale published in the
 Maharashtra Government Gazette as well as in the
 newspaper have also been produced. The P.W.no.2
 has in addition thereto produced a copy of the
 worksheet, relevant page of the outturn book and
 the document indicating the sale of the said goods.
 A summary account of the sale has also been
 produced by P.W. no.2. P.W.NO.1 as well as

¶60

:11:

¶61

 P.W.No.2 has been extensively cross-examined. In

¶62

 the course of the cross-examination of P.W.no.1 by
 the second defendant, the P.W. no.1 has admitted
 that he is not personally aware of the facts of the
 case. He has also stated that the various
 documents such as the Import General Manifest,
 Tallysheet, outturn report has not been available
 and therefore cannot be produced. He also admitted
 in his cross-examination that the bill of entry,
 packing list and invoices are also not produced

¶63

 from the record which has been filed for the

¶64

 purpose of clearing of the said goods. However he
 has deposed that every bundle which is imported and
 landed at the port are always imported with the
 identification mark for the purpose of
 identification of the said goods. He has stated
 that he cannot recollect what was the mark of
 identification inrespect of the 54 bundles being
 the subject matter of the present consignment. He
 also admitted that in 1975 though the said goods
 were put for auction the said auction was not
 conducted because on the request of the defendant
 no.1 the same was postponed. He has deposed in his

¶65

:12:

¶66

 cross examination that he is unable to produce all

¶67

 the documents pertaining to the said consignment.
 He has also deposed that the plaintiff maintains a
 sale register in the office but he is not aware
 whether the same is available or not. He admitted

¶68

 in his cross examination that the goods were lying
 in Haji Bunder area before effecting sale of the
 said goods. In so far the calculation of the
 demurrage charges is concerned he was unable to
 give the details of the said calculation. He has
 also deposed that he has not produced the record to
 show that how the said claim of the plaintiff in
 the present suit has been computed and/or arrived

¶69

 at. In view of some lacuna in the evidence of P.W.
 no.1 the plaintiff put forward another witness P.W.
 no.2. He has produced additional documents and
 made himself availaible for cross examination. In
 his examination in chief he has produced large
 number of documents including the work sheet and
 the audited worksheet which inter-alia in detail
 sets out the sale price realised by the plaintiff,
 the expenses incurred by the plaintiff on the said
 sale of the goods, customs duty paid, ITC fine etc.

¶70

:13:

¶71

 He has categorically deposed by relying upon the
 worksheet that the plaintiff has filed the suit
 inrespect of the wharfage and demurrage charges and
 other dues only for two months. Though the auction
 has taken place in 1982 the plaintiffs have not
 claimed the charges for the subsequent period but
 restricted to a period of two years from the date
 of the landing after excluding seven clear days.
 The P.W.No.2 was also cross examined in detail. He
 is cross examined on the procedure for sale of the
 goods and various documents produced by him. In
 the cross examination he has deposed that he is
 unable to produce the documentary evidence in the

¶72

 form of voucher or bills to show the amount
 actually paid by the plaintiffs to the various
 parties towards the sale expenses, custom duty etc.
 He has also deposed that he has produced the record
 whichever was available which inter-alia includes
 the audited work-sheet. He has identified the
 consignment in the present case by virtue of import
 General Manifest No. 1791 and has stated that the
 said goods are sold. When he is questioned about
 the identification mark of the consignment he has

¶73

:14:

¶74

 stated that when the goods are landing there is
 identification mark but once the goods are noted in
 Import General Manifest the said goods are referred
 to by the said IGM number and Lot number therein.
 He has also deposed that the plaintiff issued
 various notices to the defendants threatening to
 sell the goods but the plaintiff could not sell the
 goods because of the request of the defendant no.1
 for postponement of the sale and ultimately sale
 came to be effected only on 14.6.1982. He admitted
 that there has been a delay in effecting the sale
 of the said goods.

¶75

 7. The defendant no.1 has not filed any written
 statement nor he has appeared. Therefore an
 ex-parte decree is required to be passed as against
 defendant no.1.

¶76

 8. Mr. Shah learned counsel appearing for
 defendant no.2 has placed before me the following
 proposition for consideration. It is his
 contention that the suit must fail because the
 plaintiff has failed to establish that there was an

¶77

:15:

¶78

 auction sale of the goods which were imported. The
 plaintiff has also failed to show that there was
 any valuation carried out inrespect of the said
 goods. Learned counsel for defendant no.2
 contended that in the absence of any evidence to
 establish that there was any valuation carried out
 on the said goods and subsequently sold the court
 must hold that there was no auction sale at all by
 the defendant. The next contention advanced by the
 learned counsel is that the newspaper notice issued
 by the plaintiff and/or in the Maharashtra
 Government Gazzette publication did not identified
 t he said goods by markings thereon which were
 placed on the consignment at the time of the
 landing of the goods for identifying purpose. It
 is therefore his case that in absence of any
 markings stipulated in the public notice and
 Maharashtra Government Gazette the auction sale
 notice is defective and cannot be related to the
 suit consignment and therefore also the suit should
 be dismissed because there is no valid notice or
 valid publication thereof relating to these goods.
 Alternatively he has contended that the plaintiff

¶79

:16:

¶80

 has in his evidence admitted that the wharfarage

¶81

 charges are levied only for a period of two years
 i.e. upto to 1976 because the goods are landed in
 1974. Thus in that view of the matter the claim of
 the plaintiff which has been filed in 1985 is
 hopelessly barred by the law of limitation.
 Therefore the suit is required to be dismissed.
 Itis also contended by him that the 2nd defendant
 being only canalising agency but not the owner of
 the said goods is not liable for any claim of the
 plaintiff. It is further contended that in view of
 the fact that the 2nd defendant have sold the goods
 to the 1st defendant on ‘High-Sea’ Sales basis
 i.e. before the goods landed in the dock they
 cannot be termed as ‘owner’ or ‘importer’ as
 provided in the Major Port Trust Act and thus they
 are not liable to port trust charges.

¶82

 9. The defendant no.3 has supported the arguments
 of the defendant no.2 on the point of limitation.
 He has further contended that in any event the
 defendant no.3 is not liable because the bill of

¶83

:17:

¶84

 lading was already endorsed in favour of the first

¶85

 defendant and once the bill of lading is endorsed
 the liability of the defendant no.3 who is the
 shipper cease to exist and cannot be enforced by
 filing the present suit.

¶86

 10. Firstly let us consider the issue of
 limitation. Both the learned counsel have

¶87

 contended that the suit is hopelessly barred by the
 law of limitation and thus the same is required to
 be dismissed. On the other hand the learned
 counsel for the plaintiff has relied upon a
 division bench judgment of this court in the case

¶88

 of The Trustees of the Port of Bombay vs. M/s.
Jayantilal L. Gandhi reported in AIR 1979 Bom.12

¶89

 in which inter-alia it has been held as under :

¶90

 This is a suit to recover the balance
 of the wharfage and demurrage charges,
 after giving credit for the sale
 proceeds. Such amount of deficit
 could only be ascertained when the
 auction sale took place on February 6,
 1964 and since the appellants have
 adopted the remedy permitted to them
 under s. 67-A of the Act, the cause
 of action for such a suit arose when
 such deficit was determined upon an
 auction sale having effectively taken

¶91

:18:

¶92

 place. Thus under section-67-A of the
 Act the cause of action to recover the
 balance of the amount, after giving
 credit for the sale proceeds, accrues,
 for the first time, when the sale took
 place, and the deficit of the balance
 of the amount recoverable is
 ascertained. Thus, clearly under
 section -67-A of the Act to recover
 the amount, the cause of action
 accrues when such deficit or balance
 of the amount to be recovered is
 ascertained. That event took place in
 the present case on February 6, 1964.

¶93

 11. Learned counsel hasalso relied upon an
 unreported judgment of the single judge of this
 court in suit No. 194 of 1976 in the case of The

¶94

Board of Trustees of the Port of Bombay vs.
Caravan Hosiery Factory and Ors decided on
20-21.7.1988 in which following the judgment of the
 division bench of this court the learned single
 judge has held as under :

¶95

 "As laid down by the Division Bench of
 our court in the case of the Trustees
 of the Port of Bombay vs. M/s.
 Jayantilal and Gandhi reported in AIR
 1979 Bom. Pg.12, the cause of action
 in favour of the plaintiffs under
 Section 67A accrues when the balance
 of the amount to be recovered is

¶96

:19:

¶97

 ascertained. In my view, in cases
 where goods are under a detention
 order the actual amount can only be
 ascertained after the adjudication
 proceedings by the Customs Authorities
 is completed.

¶98

 Thus in the present case the cause of
 action must be deemed to accrue when q
 the adjudication by the Customs
 Authorities is completed. This is so
 because had the customs authorities
 adjudicated in favour of the
 defendants and released the goods, the
 customs authorities would have been
 bound to issue a detention certificate
 for the period during which the goods
 were under detention. In such a case
 the plaintiffs would have been bound to
 grant a remission in the demurrage
 charges. The evidence of the
 plaintiffs witness in this behalf has
 not been questioned by the defendants.
 Had the plaintiffs before the date of
 the order of adjudication sought to
 claim the amount of demurrage charges,
 the defendants could have refused to
 pay and have validly taken up the
 contention that until there is an
 adjudication the exact amount payable
 by the defendants cannot be
 determined. In my view the exact
 amount chargeable could only be
 ascertained on the adjudication
 proceedings being completed. In this
 case that would be the order of
 confiscation passed on 28th August,
 1973. In this case the suit having
 been filed within a period of three
 years from 28th August, 1973 it cannot
 be said that the suit is barred by the
 law of limitation.

¶99

:20:

¶100

 An additional submission made by Mr.
 Thakkar must also be noted. Mr.
 Thakkar has submitted that on 17th
 January 1981 an order was passed in
 the Appeal preferred by the 1st
 Defendants against the order of
 confiscation. According to Mr.
 Thakkar the order of confiscation was
 set aside. Mr. Thakkar submits that
 under these circumstances, the
 plaintiffs right to sue must be deemed
 to have accrued from day to day. He
 submits without prejudice to the right
 to claim remission that in this case
 no remission has so far been claimed
 and therefore the right to sue must
 bee deemed to have accrued day to day.
 In my view Mr. Chinoy is quite
 right when he submits that no order
 of the Appellate authority bas been
 referred to an relied upon by the
 defendants nor brought on record in
 this suit and therefore Mr. Thakkar
 cannot be allowed to ever to refer to
 it. It must be noted that it is not
 argued that a detention certificate
 has been issued and/or that the
 defendants are now entitled to a
 remission. Further an event of this
 sort, subsequent to the filing of the
 suit can have no bearing on the
 question of limitation. The right to
 sue is not dependent on whether there
 is an order of release by the customs.
 The right to sue accrues on the amount
 due being finally ascertained after
 adjudication by the customs
 authorities."

¶101

 12. On the other hand the learned counsel Mr.

¶102

:21:

¶103

 Shah has relied upon the latest judgment of the
 Supreme Court in the case of Omprakash Biyani vs.
Board of Trustees reported in AIR 2002 S.C. 1217.
 The relevant portion of the said judgment reads as
 under :

¶104

 19. Faced with this situation, Mr.
 Nageshwar Rao submits that the 1st Respondent
 should have exercised their power of sale
 under section 62 of the Major Port Trusts Act.
 He submits that it was the duty of the 1st
 Respondent to sell off the goods. He submits
 that the 1st Respondent cannot be permitted to
 continue to levy demurrage charges when they
 themselves do not sell of the goods. He
 submits that after they obtained a stay on
 11th May, 1990 the 1st Respondent should have
 sold off the goods. He submits that the 1st
 Respondent should not b e allowed to claim
 demurrage charges after 11th May, 1990. We
 are unable to accept this submission. Till
 19th December, 1989 the goods were under a
 seizure. Thus they could not have been sold.
 On 19th December, 1989 the appellant has
 already obtained orders dated 27th September,
 1989 and 15th December, 1989. The orders
 permitted clearance of the goods. Thus the
 1st Respondents were further directed by order
 dated 2nd February,1989 not to raise any
 objection to the goods being cleared. Even
 though they obtained order of stay of
 clearance they could have sold off the goods
 when the subject matter of clearance of goods
 was before the court. Thereafter by order
 dated 16th September, 1991 the High court
 again permitted clearance of goods. The
 interim order dated 16th November, 1991 in the

¶105

:22:

¶106

 Appeal filed by the 1st Respondents, also
 permitted clearance on furnishing a Bank
 guarantee. At no stage did the appellant
 informed the 1st Respondent that they were not
 going to furnish a bank guarantee. Thus the
 1st Respondent could not have sold the goods.

¶107

 20. Mr. Nageshwar Rao then submits that
 the 1st Respondent had applied to the
 Appellate court for permission to sell teh
 goods. he points out that by order dated 10th
 Januaery, 1992 it was held as follows:
 "........After hearing the counsel for the
 parties, it is not possiboe for this court to
 specify as to what consequential action the
 board of Trustees for the part of calcutta is
 entitled to take in view of non-furnishing of
 he bank guarantee by the
 petitioner/respondents. That course ofa
 action has to be decicded by the appeallant
 itself. However, we direct that teh appeal
 shall appear in the list for hearing on
 31.1.1982 at the top of the list subject to
 part-heard......".

¶108

 21. Mr. Nageshwar Rao submits that now
 the 1st Respondents could have sold the goods.
 He submits that it was the duty of the 1st
 Respondent to have sold the goods so that
 further demurrage charges are not incurred.
 Mr. Jaideep Gupta does not deny that such an
 application was made by the 1st Respondent.
 He admits that in the order dated 10th
 January, 1992 it was held that the 1st
 Respondent could decide what course of action
 they should adopt. He submits that as, on
 10th January, 1992 the court directed the
 matter to be listed on 31st January, 1992 the
 1st Respondent could not have sold the goods.

¶109

 22. In our view, the 1st Respondent should

¶110

:23:

¶111

 have sold off the goods at that stage. They
 are a statutory body. Merely because there is
 no obligation to sell does not mean that they
 can allow the goods to lie around. By this
 time the 1st Respondent well knew that the
 appellant was not paying the charges. Now the
 court had permitted them to take recourse to
 such action as was available in law. Sale is
 contemplated in the Major Port Trusts Act
 itself. In our view the 1st Respondent should
 have now sold the goods. Apart from the fact
 that demurrage charges would have stopped
 running, valuable godown space would also have
 become available to them. On facts of this
 case, we feel that it would be just and proper
 that the 1st Respondent not be allowed to
 charge demurrage charges after 10th January,
 1992.

¶112

 13. In the present case the undisputed facts are
 that the goods have landed on 8.4.1974. Seven
 clear days expired on 15.4.1974. The goods were
 put for auction in 1975. Admittedly the said
 auction did not take place and the same was
 postponed from time to time. Ultimately the
 auction has taken place on 14.6.1982. Applying the
 principles of the judgment cited above it is clear
 that the cause of action to recover the amount in
 the present case arose on 14.6.1982 when the
 auction sale took place and the claim thus

¶113

:24:

¶114

 recoverable by the plaintiff was ascertained after
 giving the set off to the sale proceeds which is
 received by the plaintiff in the said auction sale.
 However the learned counsel for the second and the
 third defendant has contested the aforesaid claim
 and has contended that if the claim in the present
 suit is only upto 1976 then in that event the
 amount has become due and payable in 1976 itself
 and cause of action to recover the said money
 aroused in 1976 and has become barred by the law of
 limitation within a period of three years from 1976
 i.e. in 1979. I am unable to accept the aforesaid
 contention because even if the claim is restricted
 to 1976 still the claim amount was not crystalised
 till the auction of the said goods took place in
 1982. In that view of the matter it cannot be held
 that the cause of action to recover the said amount
 arose in 1976. The cause of action will arise only
 when there is a ascertainment of the amount
 recoverable i.e. debt become crystalised. In view
 of the judgments of this court referred to above it
 is clear that debt payable by the defendants to the
 plaintiffs got crystalised only upon auction sale

¶115

:25:

¶116

 which took place in 1982. The present suit is
 filed within three years from the said date of
 auction sale i.e. 14.6.1982. In view thereof the
 contention of the learned counsel for both the
 defendant nos.2 and 3 on the issue of limitation is
 required to be rejected.

¶117

 14. Learned counsel for the defendant no.2 and 3
 has thereafter contended that in the light of the
 judgment of the apex court in the case of Omshankar
 (supra) wherein the court has held that the port
 trust authorities are not entitled to claim
 demurrage charges indefinitely nor the auction of
 the said goods can be carried out after
 unreasonable delay. It has been contended that
 once the cause of action arose for sale of the
 goods by the auction then in that event it was for
 the plaintiff trust to auction the same
 immediately. In the present case according to the
 second and third defendant the goods were infact
 put for auction as far back as 1976 and thus the
 plaintiff is not entitled to continue to claim
 demurrage charges right upto 1982. Learned counsel

¶118

:26:

¶119

 has placed reliance on the aforesaid judgment of
 the apex court and has contended that the said
 goods ought to have been sold in 1975 itself since
 there was no prohibition or embargo on auction sale
 thereof. The act on the part of the respondents
 not to sell the goods even though in law they were
 entitled to sell affects the right of the parties.
 In any event he has submitted that the accrual of
 cause of action for limitation ought to be computed
 on the basis that the goods were available for
 auction but the plaintiff has failed and neglected
 to conduct the said auction inrespect of the said
 consignment. The contention advanced by the
 defendant nos.2 and 3 in my opinion cannot be
 accepted. The judgment relied upon in the case of
 Om Prakash (supra) of the apex court do not deal
 with the aspect of the limitation at all. The
 limited issue before the apex court was once there
 was no prohibition and or any embargo on auctioning

¶120

 of the said goods then the conduct on the part of
 the port trust authority not to do so and keep the
 said goods lying in their godown and at the same
 time levying the wharfage and demurrage charges

¶121

:27:

¶122

 would be highly unreasonable and without any
 merits. After considering the rival submissions I
 am of the opinion that the judgment of the apex
 court does not deal with the contention pertaining
 to limitation for filing of a suit and/or that when
 does a cause of action arise in such cases.
 Undoubtedly the cause of action to file a suit
 arose only after the amount was ascertained as due
 and payable by the defendants to the plaintiff
 herein. The judgment of the apex court deals with
 the justification of the levying of charges by the
 port trust authority towards demurrage and wharfage
 even after the said goods were available for
 auction sale. It is undoubtedly true that the said
 goods were available for auction sale in the
 present case as far back as in 1975-76 and thus the
 port trust authority ought to have sold the said
 goods as far back as in 1975-76. However in the
 present case the port trust having restricted their
 claim only for an initial period of two years i.e.
 upto 1976 only and having not charged for the
 demmurage for subsequent period the question of any
 delay in conducting the auction sale is irrelevant

¶123

:28:

¶124

 in the present case. The defendants have not been
 saddled with the wharfage and or demurrage charges
 for the entire period of 1976 to 1982. In the
 light of the aforesaid position in law I do not
 think on the facts of the present case the judgment
 of the apex court in the case of Omshankar (supra)
 is relevant or applicable to the facts of the
 present case. I therefore hold the issue of
 limitation in favour of the plaintiffs and against
 the defendants.

¶125

 15. This leads me to the next issue which has been
 raised by the learned counsel for the defendant
 no.2. The defendant no.2 has contended that the
 defendant no.2 is merely a canalising agency and
 not the importer of the goods. Thus it not the
 ‘owner’ and therefore is not covered by definition
 under section 2(O) of the Major Port Trust Act.
 However the learned counsel for the plaintiff has
 drawn my attention to the judgment of the learned
 single judge of this court in the case of The Board
 of Trustees of the Port of Bombay (supra) and
 pointed out that the said issue has already been

¶126

:29:

¶127

 decided and no more a res-integra. It has been

¶128

 held that the canalising agency being the State
 trading corporation in the said case is covered by
 the definition under the said section 2(o) of Major
 Port Trust Act. It has been brought to my notice
 that the said judgment of the learned single judge
 was carried in appeal by the State Trading
 Corporation of India which was the canalising
 agency in that case being Appeal No. 902 of 1989
 and division bench has by its order and judgment
 dated 27/28.7.1992 has dismissed the appeal and
 held that the canalising agencies included within
 the meaning of the word ‘owner’ u.s 2(O) of the
 said act. Learned counsel for the defendant no.2
 has thereafter argued that since they have sold the
 goods on high sea-sales basis they are not liable
 inrespect of the said goods nor they can be treated
 as the owner at the time of landing of the said
 goods. However same argument was advanced in the
 aforesaid judgments of this court and the same were
 not accepted by this court. In the aforesaid
 judgment it is held as under :

¶129

:30:

¶130

 "11 The expression ‘owner’ has been
 defined under s. 2(o) of the Major Port
 Trusts Act and reads as follows :

¶131

 ‘owner’,(i) in relation to goods
 includes any consignor, consignee,
 shipper or agent for the sale,
 custody, loading or unlading of such
 goods, and

¶132

 (ii) in relation to any vessel or
 any aircraft making use of any port,
 includes any part-owner, charterer,
 consignee, or mortgagee in possession
 thereof."

¶133

 Prior to the amendment effected on February 1,
 1975 by Act No.29 of 1974, the words ‘loading
 or unloading of the such goods" were absent
 and the expression ‘owner’ in relation to
 goods merely included ‘any consignor’,
 consignee, shipper or agent for the sale and
 custody,. Shri Thakkar submitted that the
 definition is exhaustive and unless the
 corporation is the consignor, consignee,
 shipper or agent for the sale and custody, it
 is not open for the Port Trust to demand
 wharfage and demurrage charges on the
 assumption that the Corporation is the owner.
 The submission overlooks that the definition
 ‘owner’ is an inclusive definition and the
 legislature has very wisely used the word
 ‘includes’. The expression ‘includes’
 indicates that the legislature never
 contemplated that the categories of persons
 set out in the definition are exhaustive, but
 on the other hand indicates that those
 categories are merely illustrative. Shri
 Thakkar referred to Stroud’s Judicial
 Dictiionary Vol.3 page 1333 and urged that
 ‘shall include’ is a phrase of extension and
 not of restrictive definition and is not

¶134

:31:

¶135

 equivalent to ‘shall mean’. The learned
 counsel urged that the dictionary further
 recites that ‘include’ is very generally used
 in interpretation clauses in order to enlarge
 the meaning of words or phrases occurring in
 the body of the statute, and when it is so
 used, these words or phrases must be construed
 as comprehending, not only such things as they
 signify according to their natural import but
 also those things which the interpretation
 clauses declares that they shall include. The
 learned counsel relied upon the subsequent
 passage in the dictionary which reads as
 follows :

¶136

 "But ‘include’ is susceptible of
 another construction which may become
 imperative if the context of the Act
 is sufficient to show that it was not
 merely employed for the purpose of
 adding to the nature significance of
 the words or expressions defined. it
 may be equivalent to ‘mean and
 include,’ and in that case it may
 afford an exhaustive explanation of the
 meaning which for the purpose of the
 Act, must invariably be attached to
 these words or expressions."

¶137

 Relying on the above quoted passage Shri
 Thakkar submitted that while examining the
 ambit of expression ‘owner’ it should be held
 that the categories set out therein are
 exhaustive and are not merely illustrative.
 The learned counsel submitted that the
 observations of Lord Catson in the case
 reported in (1899) Appeal Cases 99 (Dilworth
 V. Commissioner of Stamps) in this respect
 were approved by the Supreme Court in the
 decision reported in A.I.R. 1977 S.C. 90
 (the South Gujarat Boofing Tils Manufacturers
 Association and another V. State of Gujarat
 and Anr). It is not possible to accede to the
 submission of the learned counsel that inspite

¶138

:32:

¶139

 of the expression ‘includes’ categories set
 out under the definition of ‘owner’ should be
 treated as ‘exhaustive’. In our judgment
 taking into consideration the context in which
 the expression is used and the object for
 enlarge definition, it is clear that the
 categories set out are merely illustrative,
 The Major Port Trusts Act is enacted for the
 control and management of Ports and Chapter VI
 makes provision for imposition and recovery of
 rates at ports. The importer or exporter is
 receiving services from the Port Trust and for
 rendering those services the Port Trust is
 entitled to recover charges. Shri Chinoy is
 right in his submission that the liability of
 the importer or exporter arises because of the
 use of the Port Trust premises. In accordance
 with the provisions of the Act it is not
 permissible to load or unlaod any consignment
 at any place apart from those which are
 earmarked by the Government and these places
 are under control and management of the Port
 Trust Authorities. To enable the Port tust
 authories to receover the charges it is
 whoplly immaterial for the port Trust
 Authorities to ascertain whether a person is
 the principal or agent or the owner o the
 consignment in the sense that the title of teh
 godos vests in such person. The Act does not
 set oput as to who are liable to pay th
 charges, but in natural course of conducat a
 person who enjoys the services of the Port
 Trust is liable to pay Port Trust Charges.
 Shri Chinoy invited out attention to the
 decision recorded by single judtes of this
 court holding that as far as the Port trust
 authories are concerned, they can claim rates
 and charges from all person who have
 connection with or interest in the gioosd.
 Shri Thakkar invited our attention to an
 unreported decision of the Division Bench of
 this Court in Appeal No. 108 of 1967
 delivered on January 30, 1973. shri Thakkar
 submitted that while exam,ing the claim as to
 whether the defendants are the owners of the
 consignment the division bench examined each

¶140

:33:

¶141

 and every category set out in the expression
 ‘owner’ and recording a finding that the
 defendants not being the consignor or
 consignee or shipper or agent for the sale and
 custody, the defendants are not the owners.
 shri Thakkar submitted that the decision of
 the Division Bench is an authority for the
 submission that unless and until the
 corporation falls within one of the categories
 set out in the expression ‘owner’ the
 corporation cannot be treated as an owner.
 The decision of the Division Bench is recorded
 on peculiar facts of the case and cannot be
 treated as authority for the proposition
 canvassed on behalf of the Corporation. In
 our judgment, on the facts and circumstances
 of the present case, the Corporation cannot
 escape the liability by claiming that the
 corporation is not the owner of the
 consignment.

¶142

 As mentioned hereinabove the import licence is
 issued in favour of the corporation and in
 accordance with the provisions of the Hand
 Book issuance of letter of authority to
 defendant no.1 merely enables defendant no.1
 to act as an Agent of the corporation. In
 other words the letter of authority merely
 creates relationship of principal and agent
 between the Corporation and defendant no.1 The
 corporation, therefore must be considered as
 the principal in respect of the import of the
 consignment and being the principal the title
 to the goods vests in the corporation and the
 corporation is clearly the owner of the
 consignment. Being the owner o the
 consignment the corporation is liable to pay
 the wharfage and demurrage charges, as the
 port Trust Authorities have rendered services
 for unloading and storage of the consignment
 belonging to the Corporation. In our judgment
 the learned single judge was perfectly
 justified in holding on the facts and
 circumstances of the case that the corporation
 was the owner of the consignment. the fact
 that the letter of credit was opened by

¶143

:34:

¶144

 defendant no.1 and bill of lading was also in
 the name of defendant no.1 does not make any
 difference to the corporation being the
 principal and defendant no.1 being the agent.
 The Corporation has not cared to produce on
 record the bill of lading to indicate as in
 whose name the consignment was received. The
 Corporation has also not produced any other
 documents to establish that the Corporation
 was not the owner save and except claiming
 that the defendant no.1 had engaged the
 services of M/s. Jeenah and Co. as clearing
 agents. That fact, in our judgment, makes not
 difference whatsoever to the corporation being
 the owner of the goods. In our judgment, the
 learned single was right in holding that the
 corporation was liable for the claim made by
 the Prot Trust."

¶145

 16. In view of the said decision in law it is not
 possible for me to accept the contention on the
 part of defendant no.2 that they being the
 canalising agency are not covered within the
 meaning of the word ‘owner’ u.s. 2(O) of the Major
 Port Trust Act and thus I reject the aforesaid
 submission of the learned counsel for the second
 defendant.

¶146

 17. Now turning on the merits of the case learned
 counsel for the defendant no.2 has contended that
 the plaintiffs have failed in proving their case in

¶147

:35:

¶148

 its entirety. It has been contended that the
 plaintiff has not proved their claim inrespect of
 the demurrage charges nor they have been able to
 produce any evidence to show that infact the goods
 were sold in auction. The plaintiff has also not
 produced any evidence to show that the condition
 precedent required under the provisions of s.61 and
 62 of the Major Port Trust Act, 1963 have been
 complied with. It has been contended by the
 defendant that since neither the computation of the
 demurrage charges is proved nor the auction of the
 said goods have been proved. Thus the question of
 claiming the amount by the plaintiff in the present
 suit cannot and does not arise. On the other hand
 the learned counsel for the plaintiff has drawn my
 attention to the various documents produced by the
 plaintiff particularly the evidence of plaintiff
 no.2 in which he has produced document at ex.P.33
 which inter-alia indicates a detailed work out of
 the amount computed towards the sale and expenses
 of sale and the total amount of claim pertaining to
 the demurrage charges. Exh.P.34 and P.35 which is
 at page-91 of the compilation is a work sheet and

¶149

:36:

¶150

 it is complete workout of the demurrage charges
 from time to time. Exh.P.34 gives details about
 the dock charges of the packages unclaimed and the
 goods sold by public auction indicates the working
 of the claim of the demurrage charges for the
 aforesaid period of two years. Thus on record
 there is material to show the amount of claim of
 wharfage and demurrage charges claimed by the
 plaintiff. On record there is material to show
 that there was an auction sale after giving notices
 to the parties. Notices are on record. The public
 advertisement issued is on record. The government
 gazette in which the said auction sale was notified
 is also on record. The amount offered and the
 amount received and the details of the work out of
 the amount received and adjusted towards the
 demurrage charges of the plaintiff is also on
 record. Apart therefrom the plaintiff has also led
 evidence of two witness who has categorically
 stated that the said goods were sold in auction
 towards the recovery of the demurrage charges and
 other expenses of the said consignment. The said
 deponent has also deposed that the notices were

¶151

:37:

¶152

 given to the defendants but the defendant did not

¶153

 clear the goods and the auction has taken place
 after completing all the steps prior to the sale of
 the goods as contemplated under s.61, 62. It is
 true that the valuation report has not been
 produced by the plaintiff in the present suit. But
 mere absence of the valuation report in my opinion
 cannot infer that there has been no auction of the
 sale goods nor there was any demurrage charges
 payable by the defendant. As against this both the
 defendants no.2 and 3 have not stepped in the
 witness box and therefore necessary adverse
 inference is also required to be drawn. The
 argument of the learned counsel for the second
 defendant that this court must hold that infact the
 plaintiff have failed to prove that there was any
 liability of the defendant and there was no auction
 sale of the said goods. The said argument in my
 opinion cannot be accepted in the light of the
 aforesaid material and evidence on record. In view
 thereof I reject the same.

¶154

 18. This now takes me to the next contention

¶155

:38:

¶156

 advanced by the learned counsel for the second
 defendant, namely, that the documents on record
 indicates that there was no valid auction sale of
 the suit consignment. It has been contended by the
 learned counsel for the second defendant that for
 the purpose of identification of the goods it is
 admitted by the witness that there has to be
 identification mark on the consignment. The
 learned counsel has further contended that in

¶157

 absence of such identification mark the goods could
 not be identified and thus cannot be placed for
 sale. The learned counsel has further contended
 that the document which has been produced namely
 the newspaper advertisement, government gazette
 notices as well as the statement indicating the
 sale of the goods does not have anything to
 correlate to show that it was the suit consignment
 which was put up for auction and sold by the
 plaintiff for the recovery of the demurrage
 charges. It is his case that the identification
 mark is the sole method and source on the basis of

¶158

 which it can be identified which goods has been put
 up for auction by the plaintiff. The learned

¶159

:39:

¶160

 counsel for the second defendant insupport of the
 aforesaid argument has relied upon bye-law no.78
 bye-laws of B.P.T. which inter-alia provides that
 notwithstanding the provisions of of Bye-laws
 Nos.77,81 and 85, vessels discharging cargo in the
 Docks shall tender such cargo in separate lots as
 identified by applicable ocean bills of lading and
 marks. It has been thus contended by the learned
 counsel for the second defendant that the

¶161

 identification mark on the cargo is the must
 without which no cargo can be identified and thus
 cannot be placed for sale for the arrears of the
 demurrage charges. He has also relied upon a
 document which has been produced by him being
 Exh.D.1. The said Exh.D.2 is the shed register of

¶162

 inquiries regarding the goods available for
 delivery. By relying upon the said document and

¶163

 the markings and numbers given to the said

¶164

 consignment therein according to the defendant no.2
 the said godos were identified with mark as
 HSL/LALDEE Bombay. According to the learned

¶165

 counsel for the defendant no.2 this identification
 mark ought to have been provided for on the said

¶166

:40:

¶167

 notices in the newspaper and the Maharashtra
 Government Gazette so that people can identify
 which cargo has been put up for auction sale by the
 plaintiff.

¶168

 19. On the other hand the learned counsel for the

¶169

 plaintiff has contended that the goods can be
 identified not merely by the identification mark on
 the consignment which is placed on the goods before
 the same is landed on port byt once the goods are
 landed they are always identified by the Import
 General Manifest number which is given after
 landing. Learned counsel for the plaintiff has
 submitted that the plaintiff has able to establish
 that the import general Manifest number given to
 the sale goods is 1749/500.

¶170

 20. Considering the rival submissions of the
 parties I am of the opinion that the said
 contention of the defendant no.2 is devoid of any
 merits. The IGM number and the date is mentioned

¶171

 as well the item number mentioned on the goods all
 throughout once the goods are landed and entry is

¶172

:41:

¶173

 made in Import General Manifest. The consignment

¶174

 has been identified by the Import General Manifest
 number and the Item number placed therein. The
 said import general manifest number and the item
 number are mentioned in all the notices for sale
 which has been issued by the plaintiff. It is also
 mentioned in all the correspondence and the goods
 have been identified by the same. Even the summary
 of auction sale as well as the statement of
 unclaimed goods sold by public auction i.e.
 14.6.2002 are identified by bill entry number 1791
 and Item no.500 as noted in Import General
 Manifest. Learned counsel for the defendant no.2

¶175

 has however contended that, that it is irrelevant
 that the goods are so identified. According to him
 marking on the consignment can be the only source
 of identification of the said goods. He has in
 support of the same relied upon Ex.D.2 Infact the
 said exh.D.2 also identifies the goods by bill of
 entry no. being 1791 and Item No.500. When it was
 pointed out to the learned counsel for the second
 defendant that exh.D.2 is essentially based on the
 said consignment number and item number for the

¶176

:42:

¶177

 purpose of identification of the goods and

¶178

 therefore merely because there is a marking put on
 the consignment that could not be the only source
 of the identification, the learned counsel for the
 defendant contended that though the documents
 Exh.D.2 has been produced by the second defendant
 in the course of evidence itself still he contends

¶179

 that he is not aware of any IGM number and item
 number for the purpose of identifying the said
 goods. He has purportedly contended that Exh.D.2
 is in only partially admitted by him i.e. the
 lower portion of the document is admitted by him
 whereas the upper portion of the document he does
 not admit. Merely because the upper portion
 indicates the IGM number and item number the
 learned counsel has put forward a false argument
 that the document emancipated from his custody and
 produced by him in his evidence is admitted by him
 only in part and disputed by him in part. I am
 unable to subscribe to any such argument advanced
 by the learned counsel for the defendant no.2. The
 consignment in the present case in my opinion is
 duly identified by bill of entry/IGM number 1791

¶180

:43:

¶181

 and Item no.500. Merely because the public notice

¶182

 and or the government gazette issued by the
 plaintiff does not indicate the marking placed on
 the consignment it is not possible to accept that
 in absence of the same mark, the auction sale is
 invalid and or nonexistent. In the circumstances I
 reject the contention advanced by the learned
 counsel for defendant no.2.

¶183

 21. Now turning to the contention of the third
 defendant the learned counsel has contended that

¶184

 the third defendant is not liable to make payment
 of the dues to the plaintiff being the port trust
 authority. He has contended that the third
 defendant has already discharged the cargo and has
 endorsed the bill of lading in favour of the
 defendant no.1 and thus the defendant no.1 is the

¶185

 only person who is liable and the defendant no.3
 being a shipper or a shippers agent cannot be held
 liable in the matter. However the learned counsel
 for the plaintiff has relied upon a judgment of the

¶186

 apex court in the case of Trustees of the Port of
Madras through its chairman of Vs. M/s. K.P.V.

¶187

:44:

¶188

Sheikh Mohd. Rowther and Co.P.Ltd and Ors reported

¶189

in AIR 1995 SC 1922 and has contended that in view

¶190

 of the aforesaid judgment unless the defendant no.3
 shows that infact there was an endorsement on the
 bill of lading of the defendant no.3 in favour of
 the third party, he continues to be liable and thus
 cannot be stated that the defendant no.3 is not
 liable inrespect of the claim of demurrage and port
 trust charges. It has been contended that the
 defendant no.3 has failed to establish that the
 said bill of lading has already been endorsed to
 third party. It is contended that till and untill
 the said Bill of Lading is endorsed the defendant
 no.3 continues to be the owner of the goods and
 thus liable for payment of the aforesaid charges.
 Insupport of the aforesaid contention the learned
 counsel has relied upon the following para of the
 aforesaid judgment :

¶191

 . The obligation to deliver the goods to
 the consignee has been taken over by the port
 trust under the provisions of the statute and
 the shipowner is relieved of the liabililty
 for lioss or damage to the goods from the
 moment the goods are taken charge of by the
 port trust as per section 39 of the act. Once

¶192

:45:

¶193

 the goods are handed over to the Port Trust by
 the steamer and the steamer agents have duly
 endorsed the bill of lading or issued the
 delivery order, their obligation to deliver
 the goods personaly to the owner or the
 endorsee comes to an end. The subsequent
 detention of the goods by the Port Trust as a
 result of the intervention by the customs
 authorities cannot be said to be on behalf of
 or for the authorities cannot be said to be on
 behalf of or for th e benefit of the steamer
 agents. Generally, if there is a delay int
 aking delviery of the goods by the consignee
 withina reasonable time, the steamer or its
 signee within reaonable time the steamer or
 its agent can warehouse the goods. In such an
 event the warehouseman has an independent
 claim against the consignee or endorsee for
 teh demurrge charges. The positonc annot be
 different merelyu because the customs
 authorities have intervened. The position of
 the Port trust is the same as that of a
 warehouse man whose responsibilty for the
 custody of the goods after the transit has
 come to an end and after the bill of lading
 has been duly endorsed or a delivery order
 issued."

¶194

 22. On the other hand the learned counsel for the

¶195

 defendant no.3 has contended that the shipping
 agent is not liable once for the delivery of the
 goods the bill of lading is handed over to the
 defendant no.2. He has pointed out the evidence in
 the present matter and has contended that the goods
 once landed comes in the custody of the port trust

¶196

:46:

¶197

 authority and even before filing of the bill of
 entry the bill of lading is required to be handed
 over by way of transfer to the defendant no.1. It
 is also established on evidence that infact the
 said bill of entry was filed both with the customs
 authority as well as the Port Trust Authority by
 the defendant no.1 and thus he has contended that
 he is no more liable to make payment of any
 demurrage charges. Learned counsel for the
 defendant no.3 has insupport of the aforesaid
 argument relied upon the judgment of the apex court
 in the case of The Board of Trustees of the Port of
Bombay and Ors Vs. M/s. Sriyanesh Knitters etc
reported in 1999(4) Bom.C.R. 830 particularly
 para-25 of the said judgment which reads as under :

¶198

 25 Section 2(o) contains the definition
 of ‘owner’. In relation to goodsthe said
 section states that the word ‘owner’ includes
 any consignor, consignee, shipper or agent for
 the sale, custodya, loading or unloading of
 such goods. By referrring to this sub-section
 this court in (Sun Export corporation and
 another v. Board of Trustees of the Port of
 Bombay) 1998(1) SC.C. 142 held that in the
 case of imports the liability to pay
 demurrage, on the endorsement being made on te
 bill of lading, would be that of the
 consigneee. This is in consonance with the
 provisions of the Bills of Lading Act, 1856.

¶199

:47:

¶200

 The preamble of this Act provides that by
 custom of mercvhants a bill of lading of goods
 beiong transferable by endorsement, the
 property in the goods may thereby pass to the
 endorsee, but nevertheless all rights in
 respect of the contract contained in thebill
 of lading continue in the original shipper or
 owner and, therefore, it is epedient that such
 rights should pass with a property. Section 1
 of the Bills of Lading Act provides that
 rights under bills of lading vest in the
 consignee or endorsee and reads as under :

¶201

 1. Rights uinder bills of
 lading to vest in consignee or
 endorsee...Every consigneee of
 goods named in a bnill of
 landing andn every endorsee of
 a bill of ladiong to whom the
 property in the goods herein
 mentioned shall pass, upon by
 reason of such consignment or
 endrosemetn, shall have
 teransferredt o and vested in
 him all rights of suit, and be
 subject to the same
 liabilities in respect opf
 such goosd as if the contract
 contained in the bill of
 lading had been made with
 himself."

¶202

 The provisions of section 2(o) of the
 M.OP.T. Act regards, in relation to
 goods, the consignee as the owner
 thereof. Reading the same along with
 the bills of lading Act the consigneee
 of the goods named in the bill of
 lading or every endorsee of the bill
 of lading, for the purpose of M.P.T.
 Act is regarded as the owner of the
 goods and it is from that owner that

¶203

:48:

¶204

 the appellant is entitled to recover
 charges under the M.P.T. Act
 inrespect of the said goods. The High
 Court was not right in holding that
 the contract was between the ship
 owner and the port Trust. The correct
 position is that the contract is
 between the Port Trust and the holder
 of the bill of lading which, in this
 case, would be the consignee. It is
 the consignee which is the bailor with
 the Port Trust being the consignee."

¶205

 23. Learned counsel for the defendant no.3 has
 also relied upon a judgment of the Madras High
 Court in the case of Board of Trustees of the Port
of Madras Vs. M/s. Southern Shipping Corporation
Private Ltd reported in AIR 2001 Madras 43 in
 particular para-11, 12 and 13 of the said judgment
 which reads as under:

¶206

 11. In the above decision, this court has
 clearly laid down that by the endorsement of
 the bill of lading or the issue of the
 delivery order by the steamer agent, the
 property in the goods vests in consignee or
 endorsee and the steamer or its agents are not
 responsible for the custody of the goods after
 the property in the goods passes to the
 consignee. As already seen, in the present
 case, the second defendant has made Ex.B.2
 endorsement on the original bill of lading
 viz. Ex.B.1 and handed it over to the first
 defendant and on the basis of it, the first
 defendant claims to have issued the delivery

¶207

:49:

¶208

 order. Hence, it is clear that the custody of
 the goods has passed on to the consignee
 namely the second defendant and he is alone
 liable to pay the demurrage charges.

¶209

 12. The learned counsel for the first
 respondent drew the attention of the court to
 a recent decision of the Apex Court and
 contended that the plaintiff-port trust is
 entitled to recover charges under the Major
 Port Trusts Act in respect of the goods from
 the owner of the goods only. The relevant
 decision is Board of Trustees of the Port of
 Bombay v. Sriyanesh Knitters, reported in
 (1999) 7 SCC 359: (AIR 1999 SC 2947) and it
 is held as follows :

¶210

 :25. section 2(o) contains the
 definition of ‘owner’. In relation to
 goods the said section states that the
 word ‘owner’ includes any consignor,
 consignee, shipper or agent for the
 sale, custody, loading or unloading of
 such goods. By referring to this
 section this court in Sun Export
 Corpn. vs. Board of Trustees of the
 port of Bombay AIR 1998 SC 92 held
 that in the case of exports the
 liability to pay demurrage, on
 endorsement being made on the bill of
 lading, would be that of the
 consignee. This is in consonance with
 the provisions of the Bills of lading
 act, 1856. The preamble of this act
 provides that by the custom of
 merchants a bill of lading of goods
 being transferable by endorsement the
 property and the goods may thereby
 pass to the endorser, but nevertheless
 all rights in respect of a contract
 contained in the bill of lading
 continue in the original shipper or
 owner and, therefore, it is expedient
 that such rights should pass with a
 property. Section of the bills of
 lading Act provides that rights under

¶211

:50:

¶212

 bills of lading invest in the
 consignee or endorsee and reads as
 under :

¶213

 1. Rights under bills of lading
 to vest in consignee or endorsee-
 Every consignee of goods named in a
 bill of lading and every endorsee of a
 bill of lading to whom the property in
 the goods therein mentioned shall
 pass, upon or by reason of such
 consignment or endorsement, shall have
 transferred to and vested in him all
 rights of suit, and be subject to the
 same liabilities in respect of such
 goods as if the contract obtained in
 the bill of lading had been made with
 himself."

¶214

 The provision of Section 2(o) of the
 M.P.T. Act regards, in relation to
 goods, the consignee as the owner
 thereof. Reading the same alongwith
 the bills of lading Act the consignee
 of the goods named in the bill of
 lading or every endorsee of the bill
 of lading g, or the purpose of the MPT
 Act is regarded as owner of the goods
 and it is from that owner that the
 appellant is entitled to recover
 charges under the MPT Act in respect
 of the said goods. The High Court was
 not right in holding that the contract
 was between the ship-owner and the
 Port Trust. The correct position is
 that the contract is between the Port
 Trust and the holder of the bill of
 lading which, in this case, would be
 the consignee. It is the consignee
 which is the bailor with the Port
 Trust being the consignee (sic
 bailee)."

¶215

:51:

¶216

 13. The contract is between the Port of
 Trust and the holder of the bill of lading
 viz. the consignee. The consignee is the
 bailor and the Port Trust is the bailee and
 the consignee of the goods, named in the bill
 of lading for the purpose of their port Trusts
 Act, as regarded as owner of the goods
 irrespective of the endorsement on the bill of
 lading or issue of the delivery order by the
 steamer agent. The Port Trust is entitled to
 recover charges under the Major Port Trusts
 Acts in respect of the goods from the owner,
 viz. the consignee. In the present case, the
 plaintiff is entitled to recover demurrage
 charges in respect of the goods namely the
 second defendant and the first defendant is
 not liable for the same."

¶217

 24. In my opinion in view of the aforesaid
 judgments of the apex court and Madras High Court
 there is no matter of doubt that the defendant no.3
 is not liable to make payment of any demurrage
 charges. It is an admitted position that the
 defendant no.3 is only sued in his capacity as a
 shipper and/or as an agent of the shipper. The
 defendant no.3 is neither the consignee nor the
 importer of the said goods. The defendant no.3
 though can be termed as ‘owner’ within the
 definition under s.2(o) of the Act but once he has
 discharged the cargo from the ship and handed over
 the bill of lading to importer duly endorsed his

¶218

:52:

¶219

 liability ceased to exist. However the defendant
 no.3 in my opinion has been able to establish that
 the said goods are landed in the port and thus they
 have handed over the Bill of Lading to the
 defendant no.1 for clearance of the said goods.
 Thus they are not liable for any claims of
 demurrage or other charges of the plaintiff. In
 the aforesaid circumstances I pass the following
 decree :

¶220

 . There shall be decree in favour of the
 plaintiff and against the defendant no.1 and 2
 for the sum Rs.22,40,000/- with interest. at
 the rate of 9% p.a. from the date of the suit
 till payment and/or realisation. Suit as
 against defendant no.3 is dismissed. However
 there shall be no order as to costs.

¶221

 sd/-

¶222

 *********

The B.P.T. of Bombay v. Laldee Pvt. Ltd. and Ors.

Case brief

What is this about?

What did the court decide?

The B.P.T. of Bombay v. Laldee Pvt. Ltd. and Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Hindustan Everest Tools Ltd. Vs New Standard Eng. Co.Ltd.

The Malwa Vanaspati and Chem. and Co.Ltd. Vs the State Trading Corpn. of Ltd.

B.D.Jaisingh Vs Sushilabai B.Jaisingh

M/S.Maniklal Commodities P.Ltd. Vs the Oriental Fire and General Insurance Co.Ltd.

M/S.Hasmukhrai Chandan Vs the Oriental Fine and General Industries Co.Ltd

State Bank of India Vs Pramiladevi R Mehra and Ors.