Bombay High Court
North East Organised Floritech Private ... vs M. V. Cma Cgm Cendrillon (Imo 9449819) ... on 5 June, 2023
Author: N.J.Jamadar
Bench: N.J.Jamadar
2023:BHC-OS:4342
ial 31803 of 2022.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
INTERIM APPLICATION (L) NO.31803 OF 2022
IN
COMM. ADMIRALTY SUIT NO.8 OF 2022
North East Organized Floritech Pvt. Ltd. ... Applicant/Plaintiff
versus
M.V.CMA CGM Cendrillon (IMO No.9449819)
and Ors. ... Defendants
Mr. Biju Joseph with Ms. Bhoomika Markam, Ms. Taranjeet Phull, Ms. Ashly K.
Prakash for Applicant/Plaintiff.
Mr. Prathamesh Kamat with Mr. Vinod Kumar, Ms. Arpeeta Panvalkar, Ms. Ankita
Sen i/by Renata Partners for Defendant Nos.1 and 2.
CORAM : N.J.JAMADAR, J.
RESERVED ON : 14 MARCH 2023
PRONOUNCED ON : 5 JUNE 2023
ORDER :
1. The Applicant-Plaintiff has preferred this Application seeking an order to set the suit ex-parte against the Defendants. The Applicant has instituted the suit in Admiralty jurisdiction for recovery of a sum of Rs.1,36,88,852/- asserting that it has maritime claim inter alia under Section 4(1) (f ) and (g) of the Admiralty ( Jurisdiction and Settlement of Maritime Claims) Act, 2017 (the Admiralty Act, 2017).
2. On 17 November 2021, the Applicant moved for an ex-parte arrest of Defendant No.1 Vessel. By an order dated 17 November 2021 in Judge's Order No.200 of 2021 in Comm. Admiralty Suit (L) No.26638 of 2021, this Court ordered SSP 1/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc the arrest of the Defendant No.1 Vessel - M.V.CMA CGM Cendrillon (IMO No.9449819). Defendant No.2 is the registered owner of Defendant No.1. On 20 November 2021, the Defendant Nos1 and 2 secured the Plaintiff's claim of Rs.1,36,88,852/- by depositing the Manager's cheque of HDFC Bank. Thereupon, the Defendant No.1 Vessel came to be released from arrest. Writ of Summons was issued on 4 March 2022.
3. The Applicant asserts, it was duly served on Defendant No.2 on 21 March 2022. The Affidavit of Service came to be filed by the Bailiff attached to the office of the Sheriff of Mumbai to the effect that the postal envelope sent by registeed post was received undelivered with the remarks "Item on hold door locked and returned addressee cannot be located" on 16 March 2022. The Applicant asserts the writ of summons was thus duly served on Defendant Nos.1 and 2. The writ of summons was served on Defendant No.3, a freight forwarding / booking agent of the Plaintiff, on 11 March 2022. The Plaintiff asserts, Defendant Nos.1 and 2 chose not to appear before the Court and defend the suit. Hence, the suit be set ex-pare against the Defendants.
4. Defendant Nos.1 and 2 have resisted the application by filing an Affidavit in Reply. It is categorically contended that the Applicant-Plaintiff has not served the writ of summons on Defendant Nos.1 and 2 in conformity with the legal requirements. As regards the service of summons on first Defendant Vessel, the Defendants SSP 2/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc contended that the Plaintiff has failed to comply with the provisions contained in Rule 1071 of the Bombay High Court (Original Side) Rules, 2017 as the writ of summons has not been served on the master of the Defendant No.1 Vessel. The service of writ of summons on Defendant No.2 is also assailed on the ground that the process has not been served in accordance with the procedure prescribed in the Convention on the service Abroad of Judicial and Extra Judicial Documents in Civil or Commercial Matters, 1965 (Hague Convention) and Agreement on Mutual Legal Assistance and the Recognition and Enforcement of Judgments in Civil Matters between the Government of Republic of India and the Government of French Republic, as the Defendant No.2 is based at Marseille, France.
5. Defendant Nos.1 and 2 also assailed the claim of due service on the ground that the writ of summons by way of registered post was not sent at the correct address of Defendant No.2. Since the Plaintiff failed to duly serve writ of summons in compliance with the provisions of the Code of Civil Procedure read with the Rules, 2017, time to file written statement cannot be said to have been lawfully commenced and, thus, the suit cannot be set ex-parte.
6. In Rejoinder, the Plaintiff asserts, it is not the case of the Plaintiff that the writ of summons was served on 1 st Defendant Vessel. Instead it is the case of the Plaintiff that the warrant of arrest was duly served on Defendant No.1 Vessel and the writ of summons has been served on Defendant No.2. Moreover, Defendant Nos.1 SSP 3/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc and 2 have deposited security and got the Defendant No.1 Vessel released, which amounts to waiver of service of writ of summons under Rule 1071 of the Rules, 2017. It was denied that either the writ of summons was required to be served in accordance with the mode prescribed under Hague Convention or the writ of summons was sent on an incorrect address.
7. I have heard Mr. Joseph, learned Counsel for the Plaintiff and Mr. Prathamesh Kamat, learned Counsel for Defendant Nos.1 and 2. I have also perused the material on record.
8. Mr. Joseph, learned Counsel for the Plaintiff would submit that the instant suit is governed by the provisions contained in Commercial Courts Act, 2015. Under the provisions contained in Order VIII Rule 1 of CPC, as amended by the Commercial Courts Act, 2015, on the expiry of 120 days from the date of service of summons, the Defendants' right to file written statement stands foreclosed. In the case at hand, according to Mr. Joseph, one the one hand, there is material to show that the writ of summons was duly served on the Defendant No.2 on 21 March 2022 and, on the other hand, the act of furnishing the security constitutes a waiver of the writ of summons, there is no other go but to proceed the suit ex-parte for beyond 120 days of the service of the writ of summons, the Court cannot grant permission to the Defendants to file written statement.
9. Mr. Joseph would urge that the ground of non-service of the writ of SSP 4/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc summons on Defendant No.2 on account of alleged discrepancy in the address of Defendant No.2 at France, is belied by the address on the documents on which reliance is placed on behalf of the Defendants. It was further submitted that the Defendants cannot draw mileage from the Hague Convention as the said treaty obligation has not been made applicable under domestic law in the manner known to law. Thus the Municipal Law prevails over the treaty obligation, if any.
10. Per contra, the learned Counsel for Defendant Nos.1 and 2 submitted that neither the writ of summons nor the warrant of arrest has been served on the first Defendant Vessel. Even the service of the writ of summons on Defendant No.2 is completely infirm. First, the writ of summons was not served in the manner ordained by the procedure delineated in the Hague Convention. Second and even otherwise, the writ of summons was not sent on the correct address of Defendant No.2. It was further submitted that the submission sought to be canvassed on behalf of the Plaintiffs that the Hague Convention has not been adopted in India is against the wright of the material on record.
11. To start with the Affidavit of service on the strength of which due service of the writ of summons is sought to be established. In the Affidavit of service, the process server has categorically asserted that the envelope containing the writ of summons addressed to the Defendant No.1 Vessel was returned with the remarks "Item on hold door locked and returned addressee cannot be located" on 16 March SSP 5/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc 2022. In fact, in the Affidavit in Rejoinder, the Plaintiff affirmed that it is not the case of the Plaintiff that the writ of summons was served on the 1 st Defendant.
12. As regards the service of writ of summons on Defendant Nos.2, the process server affirmed that the writ of summons was sent by registered post and the tracking report confirms that the items were duly delivered. Indisputably, the address of Defendant No.2 in the cause title is shown as "4, Quai D' Arenc - 13002, Marseille, France". The Plaintiff asserts, the service of writ of summons on Defendant No.2 by registered post acknowledgment due constitutes a valid service.
13. In view of the aforesaid facts, two questions crop up for consideration. First, whether the service of the warrant of arrest on the 1 st Defendant Vessel constitutes due service of writ of summons ? Second, whether there has been a legal and valid service of the writ of summons on Defendant No.2 at France ?
14. On the first question, Mr. Joseph submitted that the facts that the 1 st Defendant Vessel came to be arrested on 17 November 2021 and it was released by an order dated 20 November 2021 upon the Defendant Nos.1 and 2 furnishing security, are rather incontrovertible. Therefore, the service of warrant of arrest on the 1 st Defendant Vessel can hardly be put in contest. It was further submitted that, in any event, the act of furnishing of the security constitutes a waiver of the service of writ of summons under Rule 1071 (b) of the Rules, 2017.
15. Mr Kamat joined the issue by canvassing a submission that the SSP 6/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc controversy sought to be raised is no longer res integra and stands settled by a judgment of this Court in the case of CMOG Fuel DMCC V/s. OSS Altus Uber (IMO No.9385300)1. According to Mr Kamat, this Court in the said case ruled in emphatic terms that the service of writ of summons on a party is mandatory for the period of 120 days to file written statement to commence unless the service of writ of summons is waived.
16. It was further submitted that in the case at hand, even the warrant of arrest was not served on the 1st Defendant Vessel. To this end, reliance was placed on a communication dated 16 January 2023 addressed by the Deputy Sheriff of Mumbai to the Advocate for the Defendants that the office of the Sheriff of Mumbai had not received warrant of arrest to execute the same on the master of 1 st Defendant Vessel or to affix a copy of the warrant of arrest on the conspicuous part of the 1 st Defendant Vessel.
17. To appreciate the aforesaid submissions, it may be necessary to note the provisions contained in Rules 1070 and 1071 of the Rules, 2017. Under Rule 1071, which essentially prescribes the mode of service of the writ of summons and the warrant of arrest or order of arrest, the service is required to be effected by serving the original writ of summons or warrant of arrest or order of arrest on the master of the ship or otherwise as directed by the Judge. In the case at hand, the Plaintiff does not 1 IA 169 of 2019 dt. 16 June 2022 SSP 7/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc profess to have served writ of summons on 1 st Defendant Vessel. The Sheriff through whom the warrant of arrest was to be served on the master of the 1 st Defendant has clarified that the Sheriff had not received any warrant of arrest for service on the master of the 1st Defendant Vessel. Thus, on facts, there is no service of the writ of summons or warrant of arrest on the 1 st Defendant Vessel in the manner ordained by Rule 1071 of Rules, 2017.
18. The endeavour of the Plaintiff to serve the writ of summons on 1 st Defendant vessel by registered post is of no significance. In any event, the postal envelope was returned with the remarks '1 st Defendant Vessel could not be located"; which was rather inevitable. Mr. Joseph would, however, urge that the act of furnishing security to obtain the release of 1 st Defendant Vessel constituted the waiver of writ of summons.
19. Again, on facts, the aforesaid submission appears unsustainable. Vakalatnama was not filed on behalf of Defendant Nos.1 and 2 either on 20 November 2021 or thereafter, till 28 November 2022. Nor the Court has recorded that the Advocate who appeared for Defendant Nos.1 and 2 waived service of the writ of summons either on 20 November 2021 or thereafter. In the absence of such material, it would be rather hazardous to draw an inference that the service of the writ of summons was waived on behalf of Defendant Nos.1 and 2.
20. In the case of CMOG Fuel DMCC V/s. OSS Altus Uber (supra) this SSP 8/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc Court was confronted with the question as to whether it was obligatory for the Plaintiff to serve the writ of summons upon the Defendants in a commercial admiralty suit in rem, so that the period of 120 days for filing the written statement would commence only from the date of the service of the writ of summons. After an elaborate analysis, this Court held that in cases where the written statement is necessary to be filed, time to file written statement cannot commence till the writ of summons is served on the Vessel/its Master and the service of warrant of arrest or order of arrest was not sufficient for the commencement of the period of 120 days, unless the order of arrest specified that the written statement was required to be filed within the time specified as required by law.
21. While arriving at the aforesaid conclusion, this Court, inter alia, observed as under :
"55. A fair reading of Rule 1071 reveals that it deals with the mode of service of a writ of summons or mode of service of a warrant of arrest or an order of arrest in a suit in rem. It does not provide options or alternatives to service of writ of summons. Therefore service of a warrant of arrest is not in the alternative to service of writ of summons nor is service of an order of arrest in the alternative to service of writ of summons. As between a warrant of arrest and an order of arrest there seems to be little doubt that service of either one would be sufficient but as between writ of summons and warrant of arrest or an order of arrest it is fairly clear that the Rule does not provide alternatives to service of all three or any of these.
56. What Rule 1071 specifies is that in a suit in rem any one of the processes viz. writ of summons or a warrant of arrest or an order of arrest shall be served on the defendant ship and shall be served on the Master of SSP 9/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc the ship or as directed by the Judge who passes the order of arrest. Moreover the plaintiff is also obliged to serve a copy of the plaint and proceedings and documents if an Advocate claims to represent the ship or the owner and provided the Advocate gives an undertaking to enter appearance on behalf of the ship or its owner. Such undertaking would have to be provided to the court or communicated to the plaintiff and the subsequently filed in court. In view of the above, the plaintiff's contention that if a warrant of arrest is served on the ship it is not necessary to serve a Writ of Summons in order for the period of filing the written statement to commence cannot be accepted.
57. All of these read together clearly indicates that in the Admiralty jurisdiction under the Admiralty Division of this Court service of a writ of summons for the purposes of a Commercial Suit in rem or in personam is not optional. It is thus mandatory in order for the 120 days to commence. Non filing of a written statement within 120 days has serious consequences and will result in forfeiture of the right to file a defence. Clearly that cannot be the intention of Rule 1070. One must bear in mind that the new Rules have been framed after the 2017 enactment and in the light of the Commercial Courts Act being in force. The manner in which the plaintiff's wish to read 1070 is clearly incorrect. It is not as if service of an order of arrest in a Commercial Admiralty Suit in rem would exempt the plaintiff from the obligation to have a writ of summons issued and served upon a defendant in an action in rem. Rules 1070 and 1071 clearly refer to an action in rem and and service of a Writ of Summons. In the event it was not necessary to serve a Writ of Summons in an action in rem there would have been no occasion to incorporate reference to the writ of summons in Rules 1070 and 1071. There may be suits in rem wherein no arrest is ordered.
58. Issuance of Writ of Summons is not dispensed with. Thus in the Admiralty Jurisdiction and Rules which provide for issuance of a warrant, the only exception to the requirement of service of a writ of summons for the period of 120 days to run would be an order of arrest which clearly directs SSP 10/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc that a written statement would have to be filed as per law viz Order V Rule 1(1) or otherwise specifying that time to file the written statement commences from the date of service of the order upon the defendant vessel. If that were to be the case clearly the service of a writ of summons need not be served for time to commence."
22. Finally the Court concluded as under :
82. Provisions of Section 16(3) of the Commercial Courts Act read with the amendment of Order V Rule (1) Sub Rule (1) is of writ of summons is mandatory in an action in rem as well and such writ of summons must be served upon the vessel and not its owners. In this view of the matter I hold that in a Commercial Admiralty Suit service of Warrant of Arrest upon the Master and acceptance of Warrant of Arrest by the Master will not obviate the need to file / serve the Writ of Summons. The issue is answered accordingly."
23. The aforesaid enunciation indicates that the service of the writ of summons on the Vessel in a suit in rem is not optional, unless the warrant of arrest is served on the Vessel with a clear stipulation to file written statement within a specified period. It may not, therefore, be justifiable to draw an inference on the basis of act of furnishing security itself that the writ of summons is duly served so as to commence the period of 120 days for filing the written statement, unless there is a clear and unequivocal waiver of service of the writ of summons. Lest such a course has the propensity to cause irretrievable prejudice to a party as after expiry of 120 days even the Court is precluded from accepting the written statement. A definite date of SSP 11/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc commencement of the period for filing the written statement is of decisive significance as it cannot be a matter of inference based on act of furnishing security, unaccompanied by waiver of service and delivery of the copies of the plaint and the accompanying documents by the Plaintiff to the Defendant.
24. The service of the summons on Defendant No.2 through registered post A.D. is admittedly not in conformity with the Hague Convention. An endeavour was made to draw home the point that the service in the manner prescribed by Hague Convention is not obligatory as the same has not been ingrained in the domestic law. I am afraid to accede to this submission that the Hague Convention, 1965, on the service Abroad of Judicial and Extra Judicial Documents has not been adopted in India by issue of executive instructions. For instance, under the Office Memorandum dated 18 August 2011 issued by the Department of Legal Affairs, Judicial Section, Ministry of Law and Justice, Government of India, a request is made to all the Registrar Generals of the Supreme Court and the High Courts to circulate the information to the Courts within their jurisdiction with a direction to ensure the particulars of the documents before sending process to the said Department for service abroad.
25. A judicial notice of the procedure of effecting service in conformity with Hague Convention has been taken in a number of judgments. A Division Bench of this Court in the case of Nimesh Harkisandas Topiwala V/s. Deepal Dalpatram SSP 12/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc Topiwala and Anr.2 adverted to the Circulars issued for service of the process abroad as per the Hague Convention, 1965. Having regard to the large number of notices/processes sent by this Court to foreign countries, certain directions were issued by this Court to ensure timely service of processes and notices. The observations in paragraph No.15 reads as under :
"15. We find that in large number of matters notices/processes are sent by this Court to foreign countries either through the Ministry of Home Affairs or through the Ministry of Law and Justice However, there is no arrangement made by the said Ministries to communicate to the respective Registrar of the High Courts about the progress made in service of notices/orders. We, therefore, propose to direct both the Ministries to appoint Nodal Officer so that the Registrars or Courts can contact the said Nodal Officer to get the requisite information about the service of process/notice."
26. Mr. Kamat was justified in placing reliance on a Division Bench judgment of Kerala High Court in the case of Mollykutty V/s. Nicey Jacob and Ors.3 wherein an identical question of validity of service effected on a party residing abroad by registered post, arose for consideration and after finding that the service was not effected in conformity with the procedure delineated under the Hague Convention, it was held that the summons was not duly served. Paragraph No.23 reads as under :
"23. To sum up, whenever service of notice / summons to the Defendant residing in a foreign country comes for consideration, it is incumbent upon the Court below to ascertain whether the country is a party to the Hague Convention, by resorting to the website referred to above and 2 2017 SCC Online Bom 740 3 2018 SCC Online Ker 20657 SSP 13/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc follow the method of service prescribed in the aforesaid guideline. Declaration of deemed service, where the certificate of service has not been received back, can be made on satisfaction of the condition stipulated in Article 15 of the Hague Convention only."
27. Both the aforesaid judgments were followed by the Delhi High Court in the case of Microsoft Corporation and Anr. V/s. Tech Hercacles Opc Pvt. Ltd. And Ors.4
28. It would be, thus, too late in the day to urge that the Hague Convention has not been adopted. Having taken the aforesaid view, I do not deem it necessary to delve into the question as to whether the writ of summons by registered post was sent on the correct address of Defendant No.2. Even if it is assumed that the service was made at the correct address, that will not render the service valid.
29. The conspectus of aforesaid consideration is that the writ of summons cannot be said to have been duly served on Defendant Nos.1 and 2 so as to commence the period for filing the written statement. Resultantly, the suit against Defendant Nos.1 and 2 cannot be set ex-parte. Since the Vakalatnama have been entered on behalf of Defendant Nos.1 and 2 and Mr. Kamat volunteered to now waive service of summons on behalf of Defendant Nos.1 and 2, it may be appropriate to direct Defendant Nos.1 and 2 to file written statement within a period of 30 days from the date of this order.
4 CS(Comm) 276 of 2021 SSP 14/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 ::: ial 31803 of 2022.doc
30. Hence, the following order :
ORDER
(i) The Interim Application stands rejected.
(ii) Defendant Nos.1 and 2 shall file their Written Statement within a period of 30 days from the date of this order.
(iii) No order as to costs.
( N.J.JAMADAR, J. ) SSP 15/15 ::: Uploaded on - 05/06/2023 ::: Downloaded on - 08/06/2023 08:59:27 :::