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Petitioner: FAISALABAD OIL REFINERY (PVT.) LTD. and others VS Respondent: M.T. GALAXY and others
Court Name: Sindh High Court Judge(s): Muhammad Tasnim Title: FAISALABAD OIL REFINERY (PVT.) LTD. and others vs M.T. GALAXY and others Case No.:Suits Nos. 2, 5, 6 and 7 of 2011 and C.M.As. Nos. 5, 26, 28, 30 of 2011 Suits Nos.
2, 5, 6 and 7 of 2011 Suits Nos. 2, 5, 6 and 7 of 2011 C.M.As. Nos. 5, 26, 28, 30 of 2011 M.As. Nos. 5, 26, 28, 30 of 2011 Date of Judgment:2011-02-18 Reported As: 2011 CLD 885 Result: Applications accepted Judgment ORDER C.M.As. NOS. 5, 26, 28 AND 30 OF 2011 ' MUHAMMAD TASNIM, J.---Since common facts and law are involved in Adm. Suits Nos. 2 of 2011, 5 of 2011, 6 of 2011 and 7 of 2011, pending applications under Rule 731 of Sindh Chief Court Rules (0.S) being CMA Nos.5 of 2011, 26 of 2011, 28 of 2011 and 30 of 2011 respectively are being disposed of by this order. ' FACTS OF SUIT NO,2 of 2011: 2. The case set out by the plaintiff in this suit is that Vessel M.T. GALAXY is registered in the name of defendant No,2 who are the wholly owned subsidiary of defendant No,3. It has been further stated that defendants Nos.2 and 3 are the registered owners/beneficial owners of above vessel. As per plaint a consignment of 5999.426 Metric Tons Crude Palm Oil was imported by the plaintiff under three bill of ladings from Malaysia for delivery at Port Qasim and the value of such consignment was US$ 43,99,583.85. The aforesaid vessel arrived at Karachi on 7-4-2010 and discharged the Crude Palm Oil from vessel to shore tanks. It is further case of the plaintiff that about 5911.131 Metric Tons of Crude Palm Oil was discharged and received from the vessel into the shore tanks as against the manifested quantity of 5999,426 Metric Tons, thus, there was a short landing of 88.295 Metric Tons. It is stated in the plaint that after discharge of the consignment survey was conducted which confirms the above short landing. The plaintiff has stated that due to non-delivery of 88.295 Metric Tons of Crude Palm Oil the plaintiff has suffered a loss of US$ 97,734.00. It is further case of the plaintiff that after noticing the above short landing the claim was lodged by the plaintiff but
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same was not honoured. In the circumstances the present suit has been filed. Along with the suit an application under Rule 731 of Sindh Chief Court Rules (0.S) for arrest of vessel was also filed. The matter was taken-up in Court for the first time on 12-1-2011 when learned counsel for the plaintiff pointed out that after discharge of cargo by the above vessel in the month of April 2010 the aforesaid vessel had gone and it has come to Karachi once again and same may be arrested. After hearing the learned counsel for the plaintiff following orders were passed on 12-1-2011:-- "It is, inter alia, contended by learned counsel for plaintiff that plaintiff had imported Crude Palm Oil from Malaysia through Vessel M.T. "GALAXY" at Karachi. On discharge, it was found that 88.295 Metric Tons Crude Oil was short landed. In the circumstances, claim was lodged by the plaintiff upon the Local Agent of the shipping Company, but their claim was withheld and was not responded to. Learned counsel for plaintiff says that the vessel through which above consignment was imported has once again arrived at the Port of Karachi and presently Berthed at Port Qasim Karachi. Learned counsel further says that for arrest of aforesaid vehicle the present application for interim relief under Rule 731 of the Sindh Chief Court Rules is made. ' Let notice be issued to the defendants for 14-1-2011. Till then concerned port authorities are directed to arrest the vehicle M.T. "GALAXY" and not to issue port clearance. However if the suit amount i.e., $97,734.00 is paid or solvent surety is furnished by the Shipping Company, the ship may be released." 3. After notice of this application the defendants appeared and filed counter-affidavit to this application on 27-1-2011 wherein the defendants have denied that defendant No,3 is the beneficial owner of defendant No,1 vessel. It has further been stated that ex parte order for arrest of the vessel was obtained by the plaintiff by concealment of facts and misrepresentation. The defendants also stated in the counter-affidavit that plaintiff has made false allegation as to the shortage arising out of consignment of 5999.426 Metric Tons of Crude Palm Oil already imported by the plaintiff under three bill of ladings. The defendants have also challenged the validity of the documents filed by the plaintiff along with the plaint which have been down loaded by the plaintiff from the website. It has been stated by the defendants that defendant No,3 has been providing the management service to the vessels of different owners which is common in shipping business. The defendants have denied categorically that there was any short landing in the earlier consignment and its stand is that suit is frivolous and liable to be dismissed. Number of documents along with the counter-affidavit have been brought on record, more particularly, Annexure 'A/2' to the counter- affidavit which shows that vessel M.T. GALAXY is hundred per cent owned by Galaxy Maritime Limited S.A. Which is defendant No,2. Similarly, Annexure 'A/3' to the counter-affidavit, also shows that the aforesaid vessel is owned by defendant No,2. 4. After receipt of counter-affidavit of the defendant plaintiff side filed affidavit-in-rejoinder wherein the claim of the defendants in the counter-affidavit was refuted and plaintiff maintained its stand in the plaint. ' FACTS OF SUIT NO,5 of 2011: 5. The case set out by the plaintiff in this suit is that vessel M.T. GALAXY is registered in the name of defendant No,2 who are the wholly owned subsidiary of defendant No,3. It has been further stated that defendants Nos.2 and 3 are the registered owners/beneficial owners of above vessel. As per plaint a consignment of 2000.000 Metric Tons Crude Palm Oil was imported by the plaintiff under four bills of ladings from Malaysia for delivery at Port Qasim and the value of such consignment was US$ 15,94,000.00. The aforesaid vessel arrived at Karachi on 23-2-2010 and discharged the Crude Palm Oil from the vessel to shore tanks. It is further case of the plaintiff that about 1992.216 Metric Tons of Crude Palm Oil was discharged and received from the vessel into the shore tanks as against the manifested quantity of 2000.000 Metric Tons, thus, there was a short landing of 7.784 Metric Tons. It is stated in the plaint that after discharge of the consignment survey was conducted
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which confirms the above short landing. The plaintiff has stated that due to non-delivery of 7.784 Metric Tons of Crude Palm Oil the plaintiff has suffered a loss of US$ 9,889.00. It is further case of the plaintiff that after noticing the above short landing the claim was lodged by the plaintiff but same was not honoured. In the circumstances the present suit has been filed. Along with the suit an application under Rule 731 of Sindh Chief Court Rules (0.S) for arrest of vessel was also filed. The matter was taken-up in Court for the first time on 15-1-2011 when learned counsel for the plaintiff pointed out that after discharge of cargo by the above, vessel in the month of April 2010 the aforesaid vessel had gone and it has come to Karachi once again and same may be arrested. After hearing the learned counsel for the plaintiff following orders were passed on 15-1-2011:- "It is, inter alia contended by the learned counsel for the plaintiff that plaintiff had imported 2000.000 Metric Tons Crude Palm Oil from Malaysia which reached Karachi through M.T. GALAXY and on receipt of the consignment it was found by the plaintiff that consignment has been short by 7.784 Metric Tons value whereof as per plaintiffs assessment come to US $ 9889. Learned counsel says that after arrival of assignment joint surrey was also conducted and report whereof appears on record as Annexure 'E' to the plaint which verifies the quantum of short landing of Crude Palm Oil. Learned counsel say that presently M.T. GALAXY is berthed at Port Qasim and discharging the cargo. Learned counsel says that warrant of arrest of vessel M.T. GALAXY be ordered to be issued and concerned authorities may be directed not to issue port clearance to the aforesaid vessel. In the circumstances issue notice to the defendants for 18-1-2011. Till then Port Authorities are directed not to issue port clearance and not to allow the vessel to leave territorial limits. However, if defendants pay the suit amount to the plaintiff or furnish solvent surety of the equivalent amount of claim with the Nazir of this Court the ship in question may be allowed to sail." 6. After notice of this application the defendants appeared and filed counter-affidavit to this application on 2-2-2011 wherein the defendants have denied that defendant No,3 is the beneficial owner of defendant No,1 vessel. It has further been stated that ex parte order for arrest of the vessel was obtained by the plaintiff by concealment of facts and misrepresentation. The defendants also stated in the counter-affidavit that plaintiff has made false allegation as to the shortage arising out of consignment of 7.784 Metric Tons of Crude Palm Oil already imported by the plaintiff under four bill of ladings. The defendants have also challenged the validity of the documents filed by the plaintiff along with the plaint which have been down loaded by the plaintiff from the website. It has been stated by the defendants that defendant No,3 has been providing the management service to the vessels of different owners which is common in shipping business. The defendants have denied categorically that there was any short landing in the earlier consignment and its stand is that suit is frivolous and liable to be dismissed. Number of documents along with the counter- affidavit have been brought on record, more particularly, Annexure 'A/2' to the counter-affidavit which shows that Vessel M.T. GALAXY is hundred per cent owned by Galaxy Maritime Limited S.A. Which is defendant No,2. Similarly, Annexure 'A/3' to the counter-affidavit also shows that the aforesaid vessel is owned by defendant No,2. 7. After receipt of counter-affidavit of the defendant plaintiff side filed affidavit-in-rejoinder wherein the claim of the defendants in the counter-affidavit was refuted and plaintiff maintained its stand in the plaint. FACTS OF SUIT NO,6 of 2011: 8. The case set out by the plaintiff in this suit is that Vessel M.T. GALAXY is registered in the name of defendant No,2 who are the wholly owned subsidiary of defendant No,3. It has been further stated that defendants Nos.2 and 3 are the registered owners/beneficial owners of above vessel. As per plaint a consignment of 1999.966 Metric Tons Crude Palm Oil was imported by the plaintiff under two bill of ladings from Malaysia for delivery at Port Qasim and the value of such consignment was US$ 15,40,974.81. The aforesaid vessel arrived at Karachi on 23-2-2010 and discharged the Crude
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Palm Oil from the vessel to shore tanks. It is further case of the plaintiff that about 1992.183 Metric Tons of Crude Palm Oil was discharged and received from the vessel into the shore tanks as against the manifested quantity of 1999.966 Metric Tons, thus, there was a short landing of 7.783 Metric Tons. It is stated in the plaint that after discharge of the consignment survey was conducted which confirms the above short landing. The plaintiff has stated that due to non-delivery of 7.783 Metric Tons of Crude Palm Oil the plaintiff has suffered a loss of US$ 9,589,00. It is further case of the plaintiff that after noticing the above short landing the claim was lodged by the plaintiff but same was not honoured. In the circumstances the present suit has been filed. Along with the suit an application under Rule 731 of Sindh Chief Court Rules (0.S) for arrest of vessel was also filed. This matter was taken up in Court for the first time on 15-1-2011 when learned counsel for the plaintiff pointed out that after discharge of cargo by the above vessel in the month of April 2010 the aforesaid vessel had gone and it has come to Karachi once again and same may be arrested. After hearing the learned counsel for the plaintiff following orders were passed on 15-1-2011:-- "It is, inter alia, contended by the learned counsel for the plaintiff that plaintiff had imported 1999.966 Metric Tons Crude Palm Oil from Malaysia which reached Karachi through M.T. GALAXY and on receipt of the consignment it was found by the plaintiff that consignment has been short by 7.783 Metric Tons value whereof as per plaintiffs assessment come to US$ 9589. Learned counsel says that after arrival of consignment joint survey was also conducted and report whereof appears on record as Annexure 'E' to the plaint which verifies the quantum of short landing of Crude Palm Oil. Learned counsel say that presently M.T. GALAXY is berthed at Port Qasim and discharging the cargo. Learned counsel says that warrant of arrest of vessel M.T. GALAXY be ordered to be issued and concerned authorities may be directed not to issue port clearance to the aforesaid vessel. In the circumstances issue notice to the defendants for 18-1- 2011. Till then Port Authorities are directed not to issue port clearance and not to allow the vessel to leave territorial limits. However, if defendants pay the suit amount to the plaintiff or furnish solvent surety of the equivalent amount of claim with the Nazir of this Court the ship in question may be allowed to sail." 9. After notice of this application the defendants appeared and filed counter-affidavit to this application on 2-2-2011 wherein the defendants have denied that defendant No,3 is the beneficial owner of defendant No,1 vessel. It has further been stated that ex parte order for arrest of the vessel was obtained by the plaintiff by concealment of facts and misrepresentation. The defendants also stated in the counter- affidavit that plaintiff has made false allegation as to the shortage arising out of consignment of 7.783 Metric Tons of Crude Palm Oil already imported by the plaintiff under two bills of ladings. The defendants have also challenged the validity of the documents filed by the plaintiff along with the plaint which have been down loaded by the plaintiff from the website. It has been stated by the defendants that defendant No,3 has been providing the management service to the vessels of different owners which is common in shipping business. The defendants have denied categorically that there was any short landing in the earlier consignment and its stand is that suit is frivolous and liable to be dismissed. Number of documents along with the counter- affidavit, have been brought on record, more particularly, Annexure 'A/2' to the counter-affidavit which shows that Vessel M.T. GALAXY is hundred per cent owned by Galaxy Maritime Limited S.A. Which is defendant No,2. Similarly, Annexure 'A/3' to the counter-affidavit also shows that the aforesaid, vessel is owned by defendant No,2. 10. After receipt of counter-affidavit of the defendant plaintiff side filed affidavit-in-rejoinder wherein the claim of the defendants in the counter-affidavit was refuted and plaintiff maintained its stand in the plaint. ' FACTS OF SUIT NO,7 of 2011:
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11. The case set out by the plaintiff in this suit is that Vessel M.T. GALAXY is registered in the name of defendant No,2 who are the wholly owned subsidiary of defendant No,3. It has been further stated that defendants Nos.2 and 3 are the registered owners/beneficial owners of above vessel. As per plaint a consignment of 999.134 Metric Tons Crude Palm Oil was imported by the plaintiff under two bills of ladings from Malaysia for delivery at Port Qasim and the value of such consignment was US$ 7,59,341.84. The aforesaid vessel arrived at Karachi on 23-2-2010 and discharged the Crude Palm Oil from the vessel to shore tanks. It is further case of the plaintiff that about 995.278 Metric Tons of Crude Palm Oil was discharged and received from the vessel into the shore tanks as against the manifested quantity of 999.134 Metric Tons, thus, there was a short landing of 3.856 Metric Tons. It is stated in the plaint that after discharge of the consignment survey was conducted which confirms the above short landing. The plaintiff has stated that due to no delivery of 3.856 Metric Tons of Crude Palm Oil the plaintiff has suffered a loss of US$ 4,695.00. It is further case of the plaintiff that after noticing the above short landing the claim was lodged by the plaintiff but same was not honoured. In the circumstances the present suit has been filed. Along with the suit an application under Rule 731 of Sindh Chief Court Rules (0.S) for arrest of vessel was also filed. This, after was taken-up for the first time on 15-1-2011 when learned counsel for the plaintiff pointed out that after discharge of cargo by the above vessel in the month of April 2010 the aforesaid vessel come to Karachi once again and same may be arrested. After hearing the learned counsel for the plaintiff following orders were passed on 15-1-2011:- "It is, inter alia, contended by the learned counsel for the plaintiff that plaintiff had imported 999.134 Metric Tons Crude Palm Oil from Malaysia which reached Karachi through M.T. GALAXY and on receipt of the consignment it was found by the plaintiff that consignment has been short by 3.856 Metric Tons value whereof as per plaintiffs assessment come to US $ 4695. Learned counsel says that after arrival of consignment joint survey was also conducted and report whereof appears on record as Annexure 'E' to the plaint which verifies the quantum of short landing of Crude Palm Oil. Learned counsel says that presently M.T. GALAXY is berthed at Port Qasim and discharging the cargo. Learned counsel says that warrant of arrest of vessel M.T. GALAXY be ordered to be issued and concerned authorities may be directed not to issue port clearance to the aforesaid vessel. In the circumstances issue notice to the defendants for 18-1-2011. Till then Port Authorities are directed not to issue port clearance and not to allow the vessel to leave territorial limits. However, if defendants pay the suit amount to the plaintiff or furnish solvent surety of the equivalent amount of claim with the Nazir of this Court the ship in question may be allowed to sail." 12. After notice of this application the defendants appeared and filed counter-affidavit to this application on 2-2-2011 wherein the defendants have denied that defendant No,3 is the beneficial owner of defendant No,1 vessel. It has further been stated that ex parte order for arrest of the vessel was obtained by the plaintiff by concealment of facts and misrepresentation.. The defendants also stated in the counter-affidavit that plaintiff has made false allegation as to the shortage arising out of consignment of 3.856 Metric Tons of Crude Palm Oil already imported by the plaintiff under two bills of ladings. The defendants have also challenged the validity of the documents filed by the plaintiff along with the plaint which have been down loaded by the plaintiff from the website. It has been stated by the defendants that defendant No,3 has been providing the management service to the vessels of different owners which is common in shipping business. The defendants have denied categorically that there was any short landing in the earlier consignment and its stand is that suit is frivolous and liable to be dismissed. Number of documents along with the counter- affidavit have been brought on record, more particularly, Annexure 'A/ 2' to the counter-affidavit which shows that Vessel M.T. GALAXY is hundred per cent owned by Galaxy Maritime Limited S.A.
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Which is defendant No,2. Similarly, Annexure 'A/ 3' to the counter-affidavit also shows that the aforesaid vessel is owned by defendant No,2. 13. After receipt of counter-affidavit of the defendant plaintiff side filed affidavit-in-rejoinder wherein the claim of the defendants in the counter-affidavit was refuted and plaintiff maintained its stand in the plaint. 14. Mr. Mazhar Imtiaz Lari, learned counsel for the plaintiff, has submitted that claim of the plaintiff pertains to last visit of M.T. GALAXY on 23-2-2010. He submitted that claim in the above mentioned suits have been made for the short landed consignment of Crude Palm Oil. Learned counsel for the plaintiff has referred to bill of ladings which appear on record which reflects the consignment which ought to have delivered by defendant No,1 vessel at Karachi. In support of his contention learned counsel for the plaintiff has invited my attention to the bill of ladings, commercial invoices, marine survey report, arrival village report, dry certificate (after discharging Annexure 'D'), joint dip statement (Annexure 'El, marine certificate report dated 30th March, 2010, discharge report sheet and cargo quantity discrepancy letter of protest to substantiate that short landing mentioned and further submitted that above short landing has taken place and claim of the plaintiff is just and proper. He submitted that in all fairness after having the knowledge of short landing the defendants should have paid the claim amount to the plaintiff but instead they avoided and forced the plaintiff to file the present suits. Learned, counsel for the plaintiff submitted that if arrest order earlier passed is recalled the plaintiff shall not be able to recover the claim amounts as after recall of arrest order the vessel will sail. He submitted that earlier orders for arrest of vessel be confined and application be granted as prayed. 15. Learned counsel for the plaintiff submitted that defendant No,1 vessel is registered in the name of defendant No,2 which is wholly owned subsidiary of defendant No,3, who are in fact beneficial owner/manager of defendant No,1, hence defendant No,3 is also liable to pay the suit amount. In support of his contention learned counsel for the plaintiff has placed reliance on the following cases:-- (1) YUKONG LTD. V. M.T. EASTERN NAVIGATOR (PLD 2001 SC 57) (2) V.N. LAKHANI & CO. V. M.V. LAKATOI EXPRESS (PLD 1994 SC 894) (3) UNION COUNCIL V. ASSOCIATED CEMENT (PVT.) LTD. (1983 SCMR 468) (4) M/S. MARATOS AND CO. V. RICE TRADER (PLD 1989 Karachi 94) (5) CENTRAL INSURANCE CO. V. M.T. TASMAN SPIRIT (2004 CLD 695) (6) NAZAR MUHAMMAD V. ALI AKBAR (PLD 1989 KARACHI 635) 16. Conversely, Mr. Khalid A. Rehman, learned counsel for the defendants, has seriously disputed the claim of the plaintiff and has submitted that suit in its present form is not maintainable on the ground that suit in rem and in personam cannot be filed together in view of provisions of Admiralty Jurisdiction of High Court Ordinance, 1980 (hereinafter called Ordinance 1980). He has further submitted that no short landing whatsoever has taken place and the claim of the plaintiff is frivolous and the main suit along with listed application is liable to be dismissed. Learned counsel for the defendants says that interim order for arrest of ship has been obtained by the plaintiff by misrepresentation of facts and the same may be recalled. Learned counsel for the defendants in support of his contention has placed reliance on the following cases:-- (1) PAK AMERICAN FERTILIZERS LTD. MIANWALI V. AMIR ABDULLAH KHAN AND ANOTHER (1984 CLC 2170) (2) ATLANTIC STEAMER'S SUPPLY COMPANY V. M.V. TITISEE AND OTHERS (PLD 1993 SC 88) (3) M/S. V.N. LAKHANI AND COMPANY V. M.V. LAKATOI EXPRESS AND OTHERS (PLD 1994 SC 894) (4) CENTRAL INSURANCE COMPANY LTD. AND OTHERS V. M.T. TASMAN SPIRIT AND OTHERS (2004 CLD 695) (5) M.V. SEA SUCCESS I V. LIVER POOL AND LONDON STEAMSHIP ROTECTION AND INDEMNITY ASSOCIATION LTD. (AIR 2002 Bombay 151)
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(6) M/S. MARATOS AND CO. V. TRICE TRADER AND OTHERS (PLD 1989 Karachi 94) (7) PROCEEDING IN REM AGAINST THE VESSEL M.T. PORTOFINO AND ANOTHER V. M.T. PORTOFINO (2003 CLD 1655) (8) GLOBAL TRADEWAYS LTD. V. TSAVLIRIS RUSS (WORLD SALVAGE AND TOWAGE) LIMITED AND ANOTHER (2004 YLR 2581) 17. I have heard the learned counsel for the parties and have perused the record with their assistance and the case law cited at the bar. 18. Now taking up the first contention of learned counsel for defendants that action in rem and personam cannot be joined together and the present proceedings are defective and liable to be dismissed. This particular point has come up for consideration in case of Messrs MSC Textiles (Private) Limited v. Asian Pollux and others (2007 CLD 1465), wherein learned Single Judge of this Court (Now the honourable Chief Justice) while dealing with the above issue has held as under:-- ' The jurisdiction in rem is invoked, against offending vessel, when one proceeds in rem, the purpose is to draw out the owner or charterer, or any person who claims to be interested or in possession or in control of the offending vessel. In…
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