India is the leading maritime nation and maritime transportation caters to about 95% of its merchandise trade volume. After Independence there has been no change in laws regulating this sector. The Union Cabinet under the Chairmanship of Prime Minister Shri Narendra Modi has given its approval to the proposal of Ministry of Shipping to enact Admiralty (Jurisdiction and Settlement of Maritime Claims) Bill 2016 and to repeal five archaic admiralty statutes.
The Admiralty(Jurisdiction and Settlement of Maritime Claims) Bill, 2016 was introduced in Lok Sabha on November 21, 2016 by the Minister of State for Shipping, Mr. Mansukh Mandaviya. It seeks to consolidate the existing laws on civil matters of admiralty jurisdiction of courts, admiralty proceedings on maritime claims, and arrest of ships. Admiralty laws deal with cases of accidents in navigable waters or involve contracts related to commerce on such waters.
The earlier legislations came into force during the colonial era when India had only three major ports, Bombay, Calcutta and Madras. Therefore, at present, matters related to admiralty can be decided only by the High Courts of Bombay, Calcutta and Madras, even though there are 12 major ports and 205 minor ports in India.
This Bill seeks to repeal five British statues on admiralty jurisdiction in civil matters, namely, (a) the Admiralty Court Act, 1840 (b) the Admiralty Court Act, 1861, (c) Colonial Courts of Admiralty Act, 1890, (d) Colonial Courts of Admiralty (India) Act, 1891, and (e) the provisions of the Letters Patent, 1865 applicable to the admiralty jurisdiction of the Bombay, Calcutta and Madras High Courts.
Shipping industry is growing rapidly and investments to the tune of Rs 8 lakh crore are needed in the coming years to generate employment and boost India's shipping industry.
Object of the Bill
This Bill is introduced to consolidate the laws relating to admiralty jurisdiction, legal proceedings in connection with vessels, their arrest, detention, sale and other matters connected therewith or incidental thereto. It also aims to replace archaic laws which are hindering efficient governance. The Bill confers admiralty jurisdiction on High Courts located in coastal states of India and this jurisdiction extends upto territorial waters (i.e. 12 nautical miles).
Highlights of the Bill
- Admiralty jurisdiction: The jurisdiction with respect to maritime claims under the Bill shall be with the respective High Courts and will extend up to the territorial waters of their respective jurisdictions. The Bill exceeds the current jurisdiction of the High Court of Bombay, Calcutta and Madras extending now to the High Courts of Karnataka, Gujarat, Orissa, Kerala, Hyderabad, and any other High Court notified by the central government.
High Courts of all the coastal states shall exercise admiralty jurisdiction over maritime claims which include several aspects not limited to goods imported and chattel as earlier, but also other claims such as payment of wages of seamen, loss of life, salvages, mortgage, loss or damage, services and repairs, insurance, ownership and lien, threat of damage to environment etc.
- Maritime claims: The High Courts may exercise jurisdiction on maritime claims arising out of conditions including: (i) disputes regarding ownership of a vessel, (ii) disputes between co-owners of a vessel regarding employment or earnings of the vessel, (iii) mortgage on a vessel, (iv) construction, repair, or conversion of the vessel, (v) disputes arising out of the sale of a vessel, (vi) environmental damage caused by the vessel, etc.
- Priority of maritime claims: the bill provides for prioritization of Maritime Claims and maritime liens while providing protection to owners, operators, charterers, crew members and seafarers at the same time. The highest priority will be given to maritime claims, followed by mortgages on the vessel, and all other claims. Within maritime claims, the highest priority will be given to claims for wages due with regard to employment on the vessel and to payment of wages of the seafarers. The claims will have the same effect even when there is change of ownership of the vessel.
- Jurisdiction over a person: Courts may exercise admiralty jurisdiction against a person with regard to maritime claims. However, the courts will not entertain complaints against a person in certain cases. These include: (i) damage, or loss of life, or personal injury arising out of collision between vessels that was caused in India, or (ii) non-compliance with the collision regulations of the Merchant Shipping Act, 1958 by a person who does not reside or carry out business in India. Further, Courts will not entertain action against a person until any case against them with regard to the same incident in any court outside India has ended.
- Arrest of vessel: The courts may order for the arrest of any vessel within their jurisdiction for providing security against a maritime claim which is the subject of a proceeding. They may do so under various reasons such as: (i) owner of the vessel is liable for the claim, (ii) the claim is based on mortgage of the vessel, and (iii) the claim relates to ownership of the vessel, etc.
The Bill also provides for protection against wrongful and unjustified arrest and has provision for transfer of cases from one High Court to other High Court
- Appeals: Any judgments made by a single Judge of the High Court can be appealed against to a Division Bench of the High Court. Further, the Supreme Court may, on application by any party, transfer an admiralty proceeding at any stage from one High Court to any other High Court. The latter High Court will proceed with the matter from the stage where it stood at the time of the transfer.
- Assessors: The central government will appoint a list of assessors qualified and experienced in admiralty and maritime matters. The central government will also determine the duties of assessors, and their fee they will assist the judges in determining rates and claims in admiralty proceedings.
This bill will serve the long awaited enactment and regularize this branch of law i.e. laws relating to carriage of goods by sea, marine insurance, laws of ownership and registration of ships, ship sale and ship building contracts, ship financing, etc. the international characters of Maritime law, although heavily indebted to general principles of international law, is subject to local laws and thus it is vital for that the local laws to be more clear. By passing this bill, India is heading towards the potential direction of making maritime law regularized.