PETITIONER: THE BOARD OF TRUSTEES OF THE PORT OF BOMBAY AND ORS. Vs. RESPONDENT: M/S SRIYANESH KNITTERS DATE OF JUDGMENT: 30/07/1999 BENCH: U.CBanerjee, B.N.Kripal JUDGMENT:
KIRPAL, J.
The common question involved in these appeals is
whether the appellant – Board of Trustees of the Port Trust
constituted under the Major Port Trusts Act, 1963 (for short
the MPT Act) have a general lien for their dues over the
present or future consignments imported by the importers at
the Bombay Port when the said dues are in respect of the
past imports made by the said importers.
The respondents in these appeals are importers who had
imported various consignments of woollen rags from time to
time. After the arrival of these consignments at the Bombay
Port a dispute arose between the respondents and the custom
authorities as to whether the imported goods were woollen
rags or woollen garments. After considerable period of time
the imported goods were confiscated by the custom
authorities but the importers secured orders to get the
goods released on payment of fine. During this period the
imported goods remained at the docks till the order of
confiscation was passed.
In respect of the period during which the goods
remained at the docks the appellants issued notices to the
respondents demanding demurrage charges. With the exporters
denying the liability the Port Trust authorities instituted
various suits to recover wharfage and demurrage charges. We
are in these appeals not concerned with the suits.
After the aforesaid suits had been instituted acrylic
fibre was imported by the respondents. When the consignment
arrived in Bombay Port the respondents filed bills of entry
for clearance of the goods for home consumption. When
necessary permission was granted by the custom authorities
the appellant Board was called upon to release the goods.
These goods were not released by the appellant as it
demanded payment in respect of wharfage and demurrage which
was due from these respondents in respect of earlier
consignments of woollen rags which had been imported by
them. This refusal of the appellants to allow the removal
of the goods was based on a circular dated 2nd October 1979
which had been issued by the appellants. The said circular,
inter alia, stated as follows:
The Board of Trustees of the Port of Bombay have
been advised that under Section 171 of the Indian Contract
Act, 1872, they have a general lien which they can exercise
on the goods which came into their custody of importers,
exporters, owners, consignee who have for any reason
whatsoever not paid the Port Trust charges such as wharfage,
crainage, storage demurrage or any other dues in respect of
any earlier consignment/s imported/exported or sought to be
exported by them.
In the circumstances this department will exercise a
lien for General Balance of account in respect of wharfage,
crainage, storage, demurrage and other dues of the Board of
Trustees of the Port of Bombay against the
importers/exporters, owners of consignees of the goods taken
charge of by the Board of the Trustees.
The respondents then filed writ petitions under
Article 226 of the Constitution of India in Bombay High
Court seeking a declaration that the aforesaid circular was
ultra virus of MPT Act and was violative of Articles 14, 19,
265 and 300A of the Constitution of India. The relief which
was sought was that the appellants herein should withdraw or
cancel the circular and deliver the consignments of goods
imported by the respondents and detained under the Circular.
During the pendency of the writ petition a single judge of
the High Court, by an interim order, directed the release of
the consignments of acrylic fibre on the undertaking of the
respondents to give a bank guarantee for an amount due which
may be claimed by the appellants in respect of the suits
filed in the court.
The contention of the respondents before the High
Court was that the appellants were not entitled to claim
general lien under Section 171 of the Contract Act, inter
alia, for the reason that there was no existing contractual
relationship between the appellants and the respondents.
They also contended that the MPT Act was a complete code in
itself and it was not permissible for the appellants to rely
on the provisions of the Contract Act so as to claim a
general lien. The appellants herein contended that they
were entitled to exercise general lien as provided by
Section 171 of the Contract Act as they were wharfingers to
whom acrylic fibre had been bailed.
The single judge by judgment dated 24th November, 1982
allowed the writ petition and granted the relief sought for.
The appellants were directed to withdraw or cancel the
circular dated 2nd October, 1979 and it was, inter alia,
held that the appellants herein could not in law claim
general lien under Section 171 of the Contract Act. The
appellants then filed LPA before the High Court, but without
any success. The Division Bench held as under:
(a) There is no right of general lien in favour of the
Port Trust under the provisions of the Port Trust Act.
(b) The Port Trust does not have a right of general
lien under Section 171 of the Indian Contract Act.
(c) The right of the Port Trust flows only from the
provisions of the Port Trust Act and thus the claim for a
general lien by reason of a possessory bailment has been
negatived by the Learned Judges.
(d) The general lien in favour of the Port Trust is
excluded by the provisions of the Port Trust Act which is a
complete code itself and is comprehensive in respect of
collection and recovery of charges.
The learned Additional Solicitor General first
contended that the appellants had a general lien under the
provisions of the MPT Act on the acrylic fibre which had
been imported in respect of the earlier dues. For this
submission reliance was sought to be placed primarily on
Sections 59 and 61 of the MPT Act. Section 59 and
sub-section (1) of Section 61, which are relevant, read as
follows:
59. Boards lien for rates – [1] For the amount of
all rates (leviable under this Act) in respect of any goods,
and for the rent due to the Board for any buildings,
plinths, stacking areas, or other premises on or in which
any goods may have been placed, the Board shall have a lien
on such goods and may seize and detain the same until such
rates and rents are fully paid.
[2] Such lien shall have priority over all other liens
and claims, except for general average and for the
ship-owners lien upon the said goods for freight and other
charges where such lien exists and has been preserved in the
manner provided in sub-section (1) of Section 60, and for
money payable to the Central Government (under any law for
the time being in force relating to customs, other than by
way of penalty or fine.]
61. Sale of goods after two months if rates or rent
are not paid or lien for freight is not discharged – [1] A
Board may, after the expiry of two months from the time when
any goods have passed into its custody, or in the case of
animals and perishable or hazardous goods after the expiry
of such shorter period not being less than twenty-four hours
after the landing of the animals or goods as the Board may
think fit, sell by public auction (or in such case as the
Board considers it necessary so to do, for reasons to be
recorded in writing, sell by tender, private agreement or in
any other manner], such goods or so much thereof as, in the
opinion of the Board, may be necessary –
(a) if any rates payable to the Board in respect of
such goods have not been paid, or
(b) if any rent payable to the Board in respect of any
place on or in which such goods have been stored has not
been paid, or
( c) if any lien of any ship-owner for freight or
other charges of which notice has been given has not been
discharged and if the person claiming such lien for freight
or other charge has made to the Board an application for
such sale.
Plain reading of Section 59 shows that in respect of
any goods which are imported the Board has a lien for the
amount of all rates leviable under the Act and for the rent
due to it and it also has a lien on such goods and the Board
may seize and detain the same until such rates are paid. It
is clear that it is only in respect of the amount due qua
the goods imported and existing there that the Board has
alien under Section 59. Under Section 61 (1), in exercise
of its lien, the Board is empowered to sell the said goods
for realisation of the amount due to it. Reading the two
sections together it is clear that the goods which can be
sold in exercise of its lien are only those in respect of
which amount is due and payable to the Board. The words
such goods in Section 61 (1) has reference to those goods
in respect of which rates due to the Board have not been
fully paid.
Coming to the facts of the instant case the amount
which was claimed by the appellants was in respect of the
consignment of woollen rags. There can be little doubt that
in respect of the amount claimed by the Board the provisions
of Sections 59 and 61 (1) would have been applicable with
regard to the said consignment of woollen rags. But the
contention now is that it is in respect of the said dues,
relatable to woollen rags, that the Board has a general lien
on the subsequent consignment of acrylic fibre. This
contention is clearly untenable because, as we have already
observed, Sections 59 and 61(1) give a lien on those goods
in respect of which amount is claimed or due under Section
59. The Board was not demanding or claiming lien on acrylic
fibre on the ground that any amount in respect of acrylic
fibre was due. Once it appears that the lien referred to in
Sections 59 and 61(1) is only those goods in respect of
which amount is due it is clear that the said provisions do
not contemplate a general lien as contended by the
appellants. The High Court, in our opinion, was right in
coming to the conclusion that the lien conferred on the
Board under Section 59 of the MPT Act was not a general lien
but was a lien on specific goods.
It was then contended on behalf of the appellants that
as wharfingers they are entitled to a general lien under
Section 171 of the Contract Act. In this connection it was
submitted that the High Court erred in coming to the
conclusion that the MPT Act was a complete code in itself
and that Section 171 of the Contract Act was not applicable.
The MPT Act is not, in our opinion, an exhaustive and
comprehensive code and the said Act has to be read together
with other acts wherever the MPT Act is silent in respect of
any matter. The MPT Act itself refers to other enactments
which would clearly indicate that the MPT Act is not a
complete code in itself which ousts the applicability of
other acts. The preamble of the Act does not show that it
is a codifying Act so as to exclude the applicability of
other laws of the land. Even if it is a codifying Act
unless a contrary intention appears it is presumed not to be
intended to change the law. [See Bennions Statutory
Interpretation, Second Edition page 444] Furthermore where
codifying statute is silent on a point then it is
permissible to look at other laws. In this connection it
will be useful to refer to the following observation of the
House of Lords in Pioneer Aggregates (UK) Ltd. Vs.
Secretary of State for the Environment and others [(1984)] 2
All ER 358 at page 363]:
Planning law, though a comprehensive code imposed in
the public interest, is, of course, based on land law.
Where the code is silent or ambiguous, resort to the
principles of private law (especially property and contract
law) may be necessary so that the courts may resolve
difficulties by application of common law or equitable
principles. But such cases will be exceptional. And, if
the statute law covers the situation, it will be an
impermissible exercise of the judicial function to go beyond
the statutory provision by applying such principles merely
because they may appear to achieve a fairer solution to the
problem being considered. As ever in the field of statute
law it is the duty of the courts to give effect to the
intention of Parliament as evinced by the statute, or
statutory code, considered as a whole.
In J.K. Steel Ltd. Vs. Union of India ([1969] 2 SCR
481 ) it was held that cognate and pari -materia legislation
should be read together as forming one system and as
interpreting and enforcing each other. In B.C. Shukla vs.
Khubchand ([1964] 6 SCR 129} it was held that Code of Civil
Procedure has to be read along with the Limitation Act. In
State of Madras Vs. V. Iyer ( 1958 SCR 580) at page 590 it
was held that Prevention of Corruption Act should be read
along with the Evidence Act. In Mannan Lal Vs. Mst.
Chhotaka Bibi ([1971] 1 SCR 253) it was held that the Code
of Civil Procedure has to be read along with the Court Fees
Act. In V.R. Shelat Vs. Pranlal ([1975) 1 SCR 534) this
Court observed that the Companies Act should be read along
with the Transfer of Property Act.
From the aforesaid decisions it clearly follows that
it is permissible to read the provisions of the two Acts
together when the same are complementary to each other. In
fact some provisions of the MPT Act themselves show that
other laws are applicable.
It is an Act which makes provision for the
constitution of port authorities and vests the
administrative control and management of such ports in such
authorities and provides for matters connected therewith.
To the extent provisions of the said Act are applicable,
there can be little doubt that any provision which is in
conflict therewith contained in any other Act would not
apply. The enactment of MPT Act does not ipso facto exclude
the operation of other laws which may be applicable.
Wherever a departure from the general law has to be made the
Act specifically provides for the same. This is evident
from the following provisions:
{a} Section 29 (2) provides that the provisions of the
Industrial Act 1947 or any other law for the time being in
force will not apply to the claim for compensation made by
an employee whose services are transferred to the Board.
{b} Section 47 of the MPT Act provides for
compensation payable in certain cases where use of any
private wharf etc. is rendered unlawful. Sub-section (3)
provides for the manner in which the compensation is to be
determined and in the absence of agreement arbitration is
contemplated. Clause (i) of Section 47(3), however,
specifically states that the Arbitration and Conciliation
Act, 1996 shall not apply to the arbitrations under the said
section. The said provision makes the general law of
arbitration contained in the Arbitration and Conciliation
Act inapplicable.
{c } Section 68 of the MPT Act is important as it
provides that notwithstanding the provisions contained in
Section 45 of the Indian Contract Act, 1872 in case of Port
Trust security payment would be made to joint promise in
accordance with the provisions contained in Section 68 of
the MPT Act and not in accordance with Section 45 of the
Indian Contract Act. Thus Section 68 makes a specific
departure from the provisions of Section 45 of the Indian
Contract Act.
{d} Sections 70 and 71 of the MPT Act make specific
departure of the provisions contained in the Negotiable
Instruments Act, 1881 regarding endorsements to be made on
Port Trust security and the effect thereof.
The aforesaid sections of the MPT Act clearly show
that the said Act is not exhaustive or comprehensive code
and it envisages joint reading with other relevant statutes.
Whenever any departure has to be made from other laws
specific provision to that effect has been made in the MPT
Act.
The High Court has rightly come to the conclusion that
the MPT Act and Sections 59 and 61 in particular do not give
to the appellants the general lien which it is claiming. In
other words it is because the MPT Act does not provide for a
general lien that the appellants are relying on the
provisions of Section 171 of the Contract Act. This, in our
opinion, is permissible. It is not possible to hold that
the MPT Act ousts the applicability of the provisions of
Section 171 of the Contract Act under which the Board is
claiming a right of general lien as a wharfinger. The
general lien of the type contemplated by Section 171 in
respect of the past dues is not provided for by the MPT Act.
There is another aspect which is relevant. Section
171 of the Contract Act only enables the retention of goods
as security. On the other hand in respect of current dues
in respect of existing goods in their possession the Board
not only has a lien under Section 59 of the MPT Act but it
also has the power to sell the said goods and realise its
dues by virtue of Section 61 of the MPT Act. The procedure
for exercising this power of sale of the goods in respect of
which the Board has lien is contained in the said section.
Before selling the goods no order of any court or other
judicial authority is required. On the other hand the
general lien contemplated by Section 171 of the Contract Act
only enables the retention of the bailed goods as a
security. Their retention does not give any power to sell
the goods, unlike the power contained in Section 61 of the
MPT Act. If payment is not made by the consignee to the
wharfinger, in a case where Section 171 of the Contract Act
applies, the wharfinger can only retain the goods bailed as
security and will have to take recourse to other proceedings
in accordance with law for securing an order which would
then enable the goods to be sold for realisation of the
amounts due to it. It may in this connection, be necessary
for the wharfinger to file a suit for the recovery of the
amount due to it and Section 131 of the MPT Act clearly
provides that such a remedy of filing a suit is available to
the Board. The added advantage of sale given by Section 61
of MPT Act in respect of current dues cannot be regarded as
whittling down the right of general lien contained in
Section 171 of Contract Act in respect of old dues.
Having come to the conclusion that the MPT Act does
not oust the provisions of Section 171 of the Contract Act
what we have now to see is whether the appellants can claim
any relief or benefit under the said section. Section 171
of the Indian Contract Act, 1872, reads as follows:
171 General lien of bankers, factors, wharfingers,
attorneys, and policy-brokers – Bankers, factors,
wharfingers, attorneys of a High Court and policy-brokers
may, in the absence of a contract to the contrary, retain as
a security for a general balance of account, any goods
bailed to them; but no other persons have a right to
retain, as a security for such balance, goods bailed to
them, unless there is an express contract to that effect.
This section is in two parts. The first part gives
statutory right of lien to four categories only, namely,
bankers, factors, wharfingers and attorneys of High Court
and policy-brokers subject to their contracting out of
Section 171. The second part of Section 171 applies to
persons other than aforesaid five categories and to them
Section 171 does not give a statutory right of lien. It
provides that they will have no right to retain as
securities bailed to them unless there is an express
contract to that effect. Whereas in respect of the first
category of person mentioned in Section 171 section itself
enables them to retain the goods as security in the absence
of a contract to the contrary but in respect of any other
person to whom goods are bailed the right of retaining them
as securities can be exercised only if there is an express
contract to that effect.
The appellants in the present case are contending that
they are wharfingers and the goods which were imported and
off loaded at the port were with them as bailee. The
submission of the learned counsel for the appellants was
that in the absence of a contract to the contrary as bailee
of the goods now imported, namely, acrylic fibre the said
consignment could be retained by the appellants as security
for the amount due to them towards wharfage and demurrage
charges in respect of the earlier consignment of woollen
rags. While considering this contention we have also to
examine whether the claim for wharfage and demurrage could
be covered by the expression general balance of account
occurring in Section 171 of the Contract Act.
Wharf is defined in Jowitts dictionary of English,
Second Edition, as being a broad plain place, near some
creek or haven, to lay goods and wares on that are brought
to on from the water. In Webster dictionary wharf is
defined as a structure of masonry or timber erected on the
shore of a harbor, river, or the like, alongside which
vessels may lie to load or unload cargo, passengers etc.;
also, any landing place for vessels, as a pier or quay.
Ramanatha Aiyars The Law Lexicon, Second Edition, defines
wharf as a landing stage built especially along the shore
for loading or unloading vessels. The MPT Act contains an
inclusive definition of wharf in Section 2 (za) and provides
that wharf includes any wall or stage and any part of the
land or foreshore that may be used for loading or unloading
goods, or for the embarkation or disembarkation of
passengers and any wall enclosing or adjoining the same.
Wharfinger is not defined in the Act but in Jowitts
dictionary of English Law wharfinger is defined as the
occupier of wharf and it is further stated that as a rule,
wharfingers have a general lien for the balance of their
account. In Ramanatha Aiyars The law Lexicon wharfinger
is defined as meaning the occupier of a wharf or a
person who owns a wharf.
The appellants are the owners of the wharf at Bombay
where the consignments of the respondents were discharged.
The services which are provided by the appellants in respect
thereof as wharfingers are, inter alia, contained in Section
42 of the MPT Act which reads as follows:
42. Performance of services by Board or other person
– [1] A Board shall have power to undertake the following
services –
[a] landing, shipping or transshipping passengers and
goods between vessels in the port and the wharves, piers,
quays or docks belonging to or in the possession of the
Board;
[b] receiving, removing, shifting, transporting,
storing or delivering goods brought within the Boards
premises;
[c] carrying passengers by rail or by other means
within the limits of the port or port approaches, subject to
such restrictions and conditions as the Central Government
may think fit to impose;
[d] receiving and delivering, transporting and booking
and despatching goods originating in the vessels in the port
and intended for carriage by the neighbouring railways, or
vice versa, as a railway administration under the Indian
Railways Act 1890 (9 of 1890); (and)
[e] piloting, hauling, mooring, remorring, hooking, or
measuring of vessels or any other service in respect of
vessels.
[2] A Board may, if so requested by the owner, take
charge of the goods for the purpose of performing the
service or services and shall give a receipt in such form as
the Board may specify.
[3] Notwithstanding anything contained in this
section, the Board may, with the previous sanction of the
Central Government, authorise any person to perform any of
the services mentioned in sub-section (1) on such terms and
conditions as may be agreed upon.
[4] No person authorised under sub-section (3) shall
charge or recover for such service any sum in excess of the
amount {specified by the Authority, by notification in the
Official Gazette}.
[5] Any such person shall, if so required by the
owner, perform in respect of goods any of the said services
and for that purpose take charge of the goods and give a
receipt in such form as the Board may specify.
[6] The responsibility of any such person for the
loss, destruction or deterioration of goods of which he has
taken charge shall, subject to the other provisions of this
Act, be that of a bailee under sections 151, 152 and 161 of
the Indian Contract Act, 1872 (9 of 1872).
[7] After any goods have been taken charge of and a
receipt given for them under this section, no liability for
any loss or damage which may occur to them shall attach to
any person to whom a receipt has been given or to the master
or owner of the vessel from which the goods have been landed
or transhipped.
Reading of the aforesaid section shows that the
services required to be performed by the Board is not only
of loading and unloading of the cargo but would also include
storing and delivering of goods. Under sub-section (2) if
the Board is requested by the owner to take charge of the
goods then it is required to give a receipt in such form as
the Board may specify. Sub-section (6), inter alia, states
that responsibility of any such person who takes charge of
such goods shall be that of a bailee under Sections 151, 152
and 161 of the Contract Act. Sub-section (7) absolves the
person to whom receipt is given of any liability for any
loss or damage which may occur to the goods. The
responsibility of the Board for the loss of goods is
provided for in Section 43 of the MPT Act which reads as
follows:
43. Responsibility of Board for loss, etc. of goods
– [1] Subject to the provisions of this Act, the
responsibility of any Board for the loss, destruction or
deterioration of goods of which it has taken charge shall, –
(i) in the case of goods received for carriage by
railway, be governed by the provisions of the Indian
Railways Act, 1890 (9 of 1890); and (ii) in other cases, be
that of a bailee under sections 151, 152 and 161 of the
Indian Contract Act, 1872 (9 of 1872), omitting the words
in the absence of any special contract in section 152 of
that Act;
{Provided that no responsibility under this section
shall attach to the Board –
(a) until a receipt mentioned in sub-section (2) of
section 42 is given by the Board; and
(b) after the expiry of such period as may be
prescribed by regulations from the date of taking charge of
such goods by the Board.}
[2] A Board shall not be in any way responsible for
the loss, destruction or deterioration of, or damage to,
goods of which it has taken charge, unless notice of such
loss or damage has been given within such period as may be
prescribed by regulations made in this behalf {from the date
of taking charge of such goods by the Board} under
sub-section (2) of section 42.
Section 45 stipulates that all rates and other charges
payable under the MPT Act for storage of goods shall be
payable to the Board or to such person or persons appointed
by the Board. Section 48 enables the authority to issue
notification, from time to time, providing for scales of
rates for services performed by Board or other person and
the same reads as follows:
48. Scales of rates for services performed by Boards
or other person – {[1] The Authority shall from time to
time, by notification in the Official Gazette, frame a scale
of rates at which, and a statement of conditions under
which, any of the services specified hereunder shall be
performed by a Board or any other person authorised under
Section 42 at or in relation to the port or port approaches
– }
(a) transhipping of passengers or goods between
vessels in the port or port approaches; (b) landing and
shipping of passengers or goods from or to such vessels to
or from any wharf, quay, jetty, pier, dock, berth, mooring,
stage or erection, land or building in the possession or
occupation of the Board or at any place within the limits of
the port or port approaches; (c) cranage or portage of
goods or any such place; (d) wharfage, storage or demurrage
of goods on any such place; (e) any other service in
respect of vessels, passengers or goods,
[2] Different scales and conditions may be framed for
different classes of goods and vessels.
For the use of property belonging to Board including
for leasing of land or sheds by owners of goods imported or
intended for export or for any other use of land, building
etc. Section 49 enables the authority to fix the scale of
rates in respect thereof.
Reading the aforesaid and other provisions of the MPT
Act it is abundantly clear that the appellants are
wharfingers who not only provide space at the port for the
loading and unloading of the goods but also provide for the
storage of the goods till the same are removed. We may here
notice that in exercise of the powers conferred by Section
126 read with Sections 42 and 43 of the MPT Act the Central
Government issued a notification dated 1st February 1975
notifying the Port of Bombay (Responsibility for Goods)
Regulations, 1975. The said regulations, inter alia,
provide that a receipt referred to in sub-section (2) of
Section 42 shall be given in the form annexed to the said
regulations. The said form, which is a receipt contemplated
by Section 42 (2), gives particulars of the goods which are
unloaded and stored in a shed or open area of berth or a
warehouse.
Whether the issuance of such a receipt would amount to
an agreement or concluded contract coming into being between
the appellants and the respondents is wholly immaterial
because the receipt evidences the goods coming into the
possession of the appellants and under Section 42 (6) the
appellants would be regarded as a bailee thereof to whom the
provisions of Sections 151, 152 and 161 of the Contract Act
become applicable. It is because of this the relationship
of bailor and bailee comes into existence when the Board is
required to store the imported goods.
At this juncture it is appropriate to deal with the
conclusion of the High Court to the effect that with the
issuance of the receipt under Section 42 (2) the contract,
if any, is between the ship owner and the port trust and not
between the consignee who is true owner of the goods and
the Port Trust. In coming to this conclusion the High Court
has placed reliance on the decision of this Court in The
Trustees of the Port of Madras by its Chairman Vs. K.P.V.
Sheik Mohamed Rowther & Co. and Ors. ([1963] Supp. 2 SCR
915). In that case the question which arose was as to who
was responsible for idle labour charges. Labour was
supplied by the Port Trust authorities but their services
were not fully utilised and the question arose as to whether
it was the consignee or the ship owner who was liable to pay
the said charges. This Court held that the Port Trust took
charge of the goods on behalf of the ship owner and not on
behalf of the consignee and whatever services were performed
at the time of landing of the goods or on their removal were
rendered to the ship owner and, therefore, the charges were
rightly leviable not on the consignee but on the streamer
agents. The service of providing the labour was, in that
case, therefore, to the owners of the streamer and not to
the consignee and it is for that reason the liability was
held not to be that of the latter. This decision has no
relevance to the point in issue which has to be decided in
the present case.
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 sub-section this Court in Sun Export
Corporation and Anr. Vs. Board of Trustees of the Port of
Bombay ([1998] 1 SCC 142) held that in the case of imports
the liability to pay demurrage, on the 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
custom of merchants a bill of lading of goods being
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 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 1 of the Bills of Lading Act provides that rights
under bills of lading vest in the consignee or endorsee and
reads as under:
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 herein 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 contained in the bill of lading had been
made with himself.
The provisions of Section 2 (o) of the MPT Act
regards, in relation to goods, the consignee as the owner
thereof. Reading the same along with the Bills of Lading
Act the consignee of the goods named in the bill of lading
or every endorsee of the bill of lading, for the purpose of
MPT Act is regarded as the 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.
It was then argued by Sh. Pramod Aggarwal that under
Section 171 of the Contract Act the lien is available only
in the absence of a contract to the contrary. He contended
that the MPT Act was a special statute which provides not
only the services of wharfingers to be provided by the Board
but also for various other services to be provided by it.
In respect of these services the Board is entitled to impose
and recover rates/charges for the services rendered.
Chapter VI provides for the scale of rates and the matters
connected therewith including the exercise by the Board for
its lien and for recovery of the charges due to it by sale
of goods. In this context it was submitted that Chapter VI
of the MPT Act is a contract to the contrary between the
parties.
We are unable to accept this submission. As has
already been held earlier the general lien contained in
Section 171 of the Contract Act is not covered by the
provisions of Chapter VI of the MPT Act. The MPT Act no
doubt deals with lien in respect, inter alia, of the goods
imported but it does not deal with the general lien of the
type we are concerned with in this case, namely, amounts due
in respect of earlier consignments for which payment has not
been made. The contract to the contrary as envisaged in
Section 171 of the Contract Act has to be specific. The MPT
Act including Chapter VI no where provides that the general
lien under Section 171 of the Contract Act would not be
available to the wharfingers in case where the MPT Act is
applicable. It was also contended on behalf of the
respondents that even if Section 171 of the Contract Act
applies the appellants can exercise their lien under Section
171 of the Contract Act for the recovery of their dues for
the services rendered by them as wharfingers only and not
for any other services provided by them as detailed in the
MPT Act. It was contended that wharfage is the money paid
for landing goods at a wharf or for shipping and taking
goods into a boat or barge. The general lien of wharfinger
as understood under Section 171 of the Contract Act would
limit to the charges due to a wharfinger for the services
rendered as a wharfinger and not otherwise. On this premise
it was submitted that once the appellant takes charges of
the goods from the ship owner it does not act as a
wharfinger but acts in another capacity which may be that of
warehouse owner, bailee etc. and, therefore, lien cannot be
claimed in respect of demurrage etc. but, at best, can be
claimed only for wharfage charges.
Attractive as it may appear, we do not find any merit
in the aforesaid submission. The first part of Section 171
of the Contract Act identifies five categories of persons
who can have a general lien and retain the goods bailed to
them. Wharfinger is one of them. The submission of the
learned counsel for the respondents does not take into
account the fact that Section 171 of the Contract Act
enables these five categories to retain as security the
goods bailed to them in respect of general balance of
account. The general balance of account has to be of the
amount legally due to bankers, factors, wharfingers,
attorneys and policy brokers. The appellants come in the
category of wharfingers, namely, the owners of the wharf.
The duties which they are required to perform are provided
in the statute itself, namely, Section 42 of the MPT Act.
In other words the services which are undertaken under
Section 42 have to be paid for and any amount due in respect
thereof will be regarded as general balance of account
There is no reason to give a restricted meaning to the
expression general balance of account to mean only
wharfage charges which, according to the respondents, would
imply the charges for loading or unloading of goods, and
would not include demurrage. Once goods are taken charge of
by the appellants as a wharfingers then in respect of the
services rendered, as contemplated by Section 42, if there
is any amount which is due and payable to it the same would
be regarded as general balance of account in respect of
which it has a general lien over the goods bailed to it.
In our opinion the circular dated 2nd October, 1979
issued by the appellants was valid and the appellants could
retain the goods which were in their possession as bailees
as security for realisation of the amount of wharfage,
demurrage and other charges which were due to them. We
accordingly allow these appeals and set aside the judgment
of the High Court with the result that the writ petitions
filed by the respondents in the High Court stand dismissed.
The appeals are allowed with costs throughout.