- (1.) The appellants, the Trustees of the Port of Madras, hereinafter called the Board, appeal against the order of the High Court of Madras allowing the writ petitions filed under Art. 226 of the Constitution by each of the respondents and issuing a writ of mandamus directing the appellants to forbear from enforcing the scale 'E' rates of the Madras Port Trust Scale of Rates and from requiring the signing of the Shore Labour Requisition Form from the steamer agent.
(2.) The respondents, who are either partnership firms or limited companies, carry on the business of steamer agents at Madras. The Board, with the sanction of the Central Government, made amendments to the Madras Port Trust Scale of Rates in 1958. By the amendment, scale 'E' was added under Chapter V. It was to come into force from March 1, 1958. The scale laid down charges to be paid by masters, owners or agents of vessels in respect of Port Trust labour requisitioned and supplied but not fully or properly utilised. The charges, for the sake of brevity, may be said to be on account of the labour of the Port Trust, Madras, rendered idle on account of some lapse on the part of the ship-owners or on account of extra payment to labour for the simultaneous working of more than one hook at the vessel's hatch. The labour requisition Form to be submitted by the steamer-agents was also modified and the new form contained an undertaking on the part of the steamer-agents for the payment of the charges laid down in the Board's scale of rates from time to time in respect of labour rendered idle or not properly utilised and also for working more than one hook simultaneously at the hatch. These amendments in the scale of rates were made by the Board in the exercise of its power under s. 42 of the Madras Port Trust Act, 1905 (Mad. Act II of 1905), hereinafter called the Act. This section empowers the Board to frame a scale of rates at which and a statement of the conditions under which any of the services specified in the various clauses of the section shall be performed by the Board or by a person to whom any service has been relinquished under s. 41-A of the Act. Thereafter, the respondents, viz., the streamer-agents, filed petitions under Art. 226 of the Constitution, in the High Court of Madras, and prayed for the issue of a writ of mandamus directing the Board not to enforce these rates and not to require the filling in of the new form. They contended that (1) the ship-owners and the steamer-agents cannot be made liable for charges for shore labour employed in the receiving or removal of cargo and such charges must be borne by the consignee; (II) s. 39 of the Act provided for the performance of services by the Board and the other sections provided for the imposition and recovery of rates for the services performed for the vessel and services performed for the goods. Services in the former category are to be paid for on behalf of the carrier i.e., by the master, ship-owner or the steamer-agent, and the services in the latter category constitute a liability on the consignee; (iii) the Board has power to impose and recover rates only for services rendered and that they have no right to impose charges by way of compensation for default or to collect charges from masters, owners or agents of vessels in respect of operations not properly falling under the head of discharge of cargo from the vessel; (iv) prior to 1914, the steamer-agents acted as landing-agents for removing cargo from ship to pier and collected for these services from the consignees a separate charge known as 'landing charge' in addition to the freight. When the quays were constructed and cargo came to be landed there, the Board took over the landing of goods and collected quay dues instead of 'landing charges' which were wholly paid by the consignees. These quay dues later on merged in the 'harbour dues' collected by the Board from the consignees; (v) usually, the steamer agent informs the Traffic Manager the probable date of arrival of the vessel under his agency, tonnage hatch-wise of cargo to be landed at Madras and the number of hatches proposed to be worked. Under the revised procedure adopted by the Board on August 1, 1957, before a ship has reached its berth, the steamer agent is required to make an application and a deposit in his current account to cover charges for the working of the vessel in respect of overtime, supply of cranes, water and appliances and from March 1, 1958, to meet the scale 'E' contingencies also; (vi) the operation which goes on at the quay is described thus : After the Port Trust pilot brings the vessel to the berth allotted to her : "The stevedore labour supplied by the Madras Dock Labour Board, a statutory body, board the vessel, prepare the slings in the holds or hatches, work the ship's winches and the cargo is hoisted on the quayside. When the sling rests on the shore or in the barge in the case of discharge at moorings, the shore labour unsling the cargo and the Trust's Tally Clerk notes the items in a tally sheet. As each sheet is closed a duplicate copy of the import tally sheet is given to the steamer agent's representative on the spot. This duplicate copy is the receipt prescribed under section 39(3) of the Madras Port Trust Act..... The shore labour remove the cargo from the point of landing to the shed or open for stacking and subsequent delivery of the goods from the Trust to the consignee. The consignee obtains delivery order from the Steamer agent and then files Harbour Import Application with the Trust for payment of Harbour dues and Bill of Entry with the Customs for the duty payable by him. On payment of the duty and the harbour dues by the consignee the cargo the is delivered to him by the Trust." (vii) The Board adopted the piece-rate scheme for the Dock workers in pursuance of the report of the Jeejeebhoy Committee and the new scale 'E' rates are a part of such a scheme. (viii) Prior to March 1, 1958, the cost of shore-labour was met entirely by the Port Trust. No distinction was made between the charges for shore labour in ordinary cases and charges for shore-labour in respect of idle time or additional work. (ix) Under the scheme which was brought into force on March 1, 1958, charges for shore labour in the contingencies covered by the scale 'E' have been excluded from Harbour dues. These charges are now treated as charges for which the steamer-agent is made responsible. (x) The compulsion imposed on steamer agents in the matter of payment of the scale 'E' rates and in respect of the signing of the requisition for shore labour is outside the authority conferred by law on the trustees of the Port of Madras and is illegal. Such an imposition whether as charges for services or as compensation for default of steamer agents is illegal and an unreasonable restriction on the fundamental right of the petitioners to carry on business as steamer agents and is inoperative in law. (xi) the Port Trust authorities receiving goods on the quay or in the barge at moorings, do so on behalf of the consignee.
(3.) The Board, by the common counter-affidavit filed on its behalf by the Deputy Traffic Manager of the Madras Port Trust, admitted the directed arrangements between the ship-owner, master, or agent with the stevedores but did not accept the allegations about the nature of the various rates and duties levied and the legal position as stated in the petitions. According to the Board, (i) the Harbour dues on the import cargo under scale A, Chapter II of the Scale of Rates, are payable on tonnage and include, beside overhead, a nominal rent for storage for a specified period etc., and the item of charges for porterage involved in moving the goods from the landing point to the storage or stacking point. (ii) It is not correct that the ship-owner has nothing to do with the import cargo after it has been landed by the stevedores at the landing point on the quay, as the ship-owner in each case by the bill of lading has to deliver the goods to the consignee named in the bill of lading or his nominee and he remains liable under his contract until he has delivered the goods to the person who is entitled to take delivery of the goods. (iii) Under s. 39 of the Act the Port Trust gives facilities and undertakes certain services. One of such services is the moving of the goods from the landing point to the storage or stacking point and thereafter delivering the goods to the persons entitled under the bill of lading. The Board does not undertake the unloading of the goods from the ship to the quay. The ship-owner makes his own arrangements through the stevedores, though the Board is authorised to undertake such services on behalf of the ship-owner. It is a service to the ship-owner by the Board to give the ship-owner a receipt for the goods to keep them in custody and deliver to the consignee. The services undertaken in respect of the import cargo till they have been moved to the storage or stacking point are services to the ship-owner for which the ship-owner or master or steamer agent is primarily liable and the charges may properly and legally be levied from them. (iv) The Board collects the harbour dues from the consignee at the time of giving delivery, but in fact makes that collection as agent of the ship-owner, master, steamer agent who are primarily the persons liable for the dues. (v) The Board is entitled to collect the harbour dues from the ship-owner, master or steamer agent. (vi) The issuance of a receipt to the master at the landing point is a mere matter of convenience for betokening the fact that the goods have been handed over to the Port Trust for removal, storage and delivery and does not in any way detract from the fact that the subsequent services are facilities and services rendered to the ship-owner in respect of the goods which are the subject of contract of carriage by the ship-owner. (vii) The past practice had been for the agents to inform the Board about the shore labour which would be necessary for moving the goods in respect of each steamer. Prior to 1956, this was done orally and then the Form was introduced which contains the same particulars except the undertaking to pay the scale 'E' charges as the impugned Form now contains. Since the enforcement of the new piece-rate scheme, the payment to labour was not based on tonnage but a daily wage was fixed along with a provision for payment for idle time and hook allowance for working two or three hooks simultaneously at a vessel's hatch. (viii) The proper utilisation of the time of the labour depends upon the steamer agents first giving a proper anticipation and shift at which they were to be put on the job being the time when the cargo will be ready for removal and, secondly, there giving a continuous supply of cargo for removal so that there is no gap in the work. (ix) The levy of multiple hook allowance against the steamer agents is a facility to the ship to discharge fast and sail quicker. When two or more hooks work in a ship's hatch, the gangs handling cargo will not be in a position to handle more cargo and therefore the approval of Board was obtained for payment of an allowance to compensate such loss in their earnings. As working of additional hooks in a vessel's hatch benefits the ship, the recovery of hook allowance from the steamer agents under scale 'E' is legitimate. (x) The additional charge made under scale 'E' is a charge in respect of facilities afforded to and services undertaken on behalf of the ship-owner, master, agent by the Board in relation to the cargo which is under contract of carriage by them, in the same way as harbour dues.;