Supreme Court Revives Writ Petition and Remands Question of Liability for Wreck Removal to High Court

A bench of Justices Ahsanuddin Amanullah and Prashant Kumar Mishra heard an appeal by JSW Steel challenging the Bombay High Court's disposal of Writ Petition No.2127/1996. The dispute concerned whether the appellant was liable to pay charges for removal of a capsized barge (“Satyam”) that sank while ferrying iron ore to the Mumbai port and whether the High Court could treat the petition as infructuous after the passage of time.

The Court allowed the appeal, set aside the impugned order and revived the writ petition, directing the High Court to decide the legal issue on merits. The bench found that the High Court had erred in closing the lis without adjudicating the pure question of law as to on whom liability for clearing wreckage under Section 14 of the Indian Ports Act, 1908, fell. The Court observed that lapse of time alone could not justify denial of relief where the matter raised a legal question and systemic delay, not laches by the appellant, caused efflux of time. The Court, in its reasoning, observed: "Having considered the matter, we find merit in the submissions put forth by the appellant. The way the High Court approached the issue appears to be erroneous for the simple reason that the lis was very much alive, as a pure question of law stood raised i.e., on whom the liability for clearing the wreckage was to be fastened. The Impugned Order has not dealt with this fundamental issue. When on a purely legal issue, the appellant raised a legal objection, and also deposited the amount demanded by respondent no.1 in the High Court, in our considered view, the High Court was required to answer the question of law. In this analysis, no exercise was required involving disputed factual questions. Moreover, the efflux of time is a result of systemic delay, not due to any laches on the part of the appellant."

Background

The dispute arose when a barge belonging to respondent no.3 capsized while transferring iron ore from a mother vessel to the Mumbai Port. The Deputy Conservator of the Mumbai Port Trust issued a notice under Section 14(1) of the Indian Ports Act, 1908, calling upon the appellant (then Nippon Denro Ispat Ltd.) to deposit Rs.70 lakh as security to ensure removal of the wreck within a stipulated period. Though the barge owner was respondent no.3, the appellant deposited the demanded amount in the High Court and challenged the demand by way of a writ petition seeking prohibition and a permanent injunction against steps to remove the wreck or to require payment.

The Bombay High Court allowed the Mumbai Port Trust to withdraw the deposited amount, observed that disputed facts existed and deemed the petition rendered infructuous after long delay, and left open the parties' remedies to pursue recovery by suit. The appellant contended that the High Court should have decided the pure legal question of statutory liability and that the direction permitting encashment of the deposit was unjustified. The Port Trust submitted that the wreck had been cleared and that the appellant retained a remedy in civil proceedings.

The Supreme Court found that the High Court ought to have adjudicated the legal issue rather than closing the petition on account of delay. It relied on precedents affirming that Article 226 remained available to remedy injustice and that systemic delay did not bar relief: as the Court noted, “no litigant should have even an iota of doubt or an impression (rather, a misimpression) that just because of systemic delay or the matter not being taken up by the Courts resulting in efflux of time the cause would be defeated...” The Supreme Court set aside the impugned order, revived WP No.2127/1996 and remanded the matter to the Bombay High Court to consider all issues on merits with a direction to give priority and dispose of the matter expeditiously. The Court recorded that monies deposited had already been withdrawn by the Port Trust and observed that if the appellant ultimately succeeded it would be suitably compensated. Parties were left free to raise questions of law and fact; an application for impleadment was disposed with liberty to approach the High Court.

Case No.: Special Leave Petition (Civil) No.15490 of 2021 (Arising out of WP No.2127/1996) Case Title: JSW Steel Ltd. v. The Board of Trustees of the Mumbai Port Trust, Mumbai & Ors. Appearances: For the Petitioner(s): Huzefa Ahmadi, Sr. Adv.; Mahesh Agarwal, Adv.; Rishi Agrawala, Adv.; Aanchal Mullick, Adv.; Kamakshi Sehgal, Adv.; Rohan Sharma, Adv.; E. C. Agrawala, AoR For the Respondent(s): Abhishek Puri, Adv.; Surbhi Gupta, Adv.; Sahil Grewal, Adv.; Reeta Dewan Puri, Adv.; P. N. Puri, AoR; Apoorv Shukla, AoR; Puneet Chahar, Adv.; Prabhleen A. Shukla, Adv.