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In a recent case before the Bombay High Court, a Single Judge of the Bombay High Court has upheld the arrest of an inland vessel which was plying in the non-inland waters. The judgement has the prospect of expanding the scope of the Admiralty Act if the same is upheld in appeal.

Facts in Brief

Coastal Marine Constructions and Engineering Ltd (hereinafter referred to as “Plaintiff”), the Plaintiff in the matter filed an admiralty suit against m.v Lima V for its maritime claim of INR 1,77,21,679.27 inclusive of costs. As per the case of the Plaintiff, the Plaintiff and the Owners of the Defendant Vessel entered into a contract under which the Defendant had to provide a vessel for Plaintiff’s project site in Dwarka, Gujarat. As per the conditions of the contract, the vessel was to be provided by the Defendants within 15 days of the advance payment being received by it. It was the case of the Plaintiff that the Defendant had breached the terms of the contract by a) not providing the vessel within 15 days from the payment being received by the Defendant; b) the vessel provided by the Defendant was not of the specifications as agreed between the parties. Due to the vessel not being of the contractual specification, the Plaintiff had to tow the vessel to the project site. Due to these reasons, the Plaintiff had to incur additional costs to make the vessel operational.

In the admiralty suit, the Plaintiff claimed a) Loss of Hire due to the delayed delivery of the Vessel; b) amounts expended towards the hire of tugs to tow the Vessel c) refund of hire paid. The Plaintiff was granted an ex-parte order of arrest by the Ld. Judge as he was of the view that the Plaintiff has prima facie made a case for arrest of the vessel and that the balance of convenience lies in favour of the Plaintiff.

The Defendant entered appearance after depositing the decretal amount and filed an application for setting aside the ex-parte order of arrest. In the said application, the Defendant also claimed compensation to the tune of Rs 15,00,000 towards loss and damages sustained by the Defendant on account of the unjust arrest of the Defendant vessel.

Arguments canvassed by the parties

Inter alia the Defendant tried to argue that the vessel being registered under section 19F of the Inland Vessels Act, 1917 (hereinafter referred to as “Inland Vessel Act”), was outside the scope and purview of the Admiralty (Jurisdiction and Settlement of Marine Claims) Act, 2017 (hereinafter referred to as “Admiralty Act”) under which the Plaintiff has arrested the vessel. The Defendant submitted that the Admiralty Act is very clear in its applicability and clearly takes an inland vessel out of its purview. In support of these, the Defendant produced the registration certificate of the Vessel under the Inland Vessels Act.

In counter to the argument raised by the Defendant regarding the vessel being registered under the Inland Vessel Act and hence it being outside the purview of the Admiralty Act, the Plaintiff put forth the argument that the mere registration of the vessel under the Inland Vessel Act would not take it out of the purview of the Admiralty Act and it is upon the Defendant to show that the vessel ordinary plied on inland waters. The Plaintiff also tried to show that they employed the said vessel to perform in non-inland waters only and that too on the representation of the Defendant.