MAHESHWARY HANDLING AGENCY PRIVATE LIMITEDversusBOARD OF TRUSTEES OF KANDLA PORT TRUST AND OTHERS

                        [2019] 18 S.C.R. 969                             969


             MAHESHWARY HANDLING AGENCY                                  A
                   PRIVATE LIMITED
                                  v.
          BOARD OF TRUSTEES OF KANDLA PORT
                 TRUST AND OTHERS
                                                                         B
                   (Civil Appeal No. 5277 of 2010)
                       SEPTEMBER 17, 2019
      [INDU MALHOTRA AND SANJIV KHANNA, JJ.]
       Ports – Major Port Trusts Act, 1963 – ss.52 and 47A –
                                                                         C
Notification dated 4th November, 1993 published u/s.52 of the Act
fixing a schedule / scale of rates for storage of goods / cargo at the
Kandla Port – Act amended in 1997 whereby s.52 was omitted and
s.47A was inserted to constitute a Tariff Authority – Circular dated
31st August, 1998 issued by Traffic Manager of the Port, stipulated
levy of penalty for storage of goods beyond period of sixty days         D
treating the same as unauthorised occupation – Whether the 1998
circular was in conformity with the terms of the 1993 Notification
or had the effect of modifying or amending the same – Held: The
first portion of the Notification prescribing escalating rates for use
of open area and sheds did not vest any right to occupy such space
                                                                         E
for unlimited period of time – Prescribing different slabs or rates
for storage of cargo for different periods by the 1993 Notification
was meant to fix rates for the rent payable and not to deny or curtail
the power of the Traffic Manager to authorise and permit use of
sheds and space for storage of cargo / containers – The 1993
Notification had empowered and left it to the Traffic Manager to         F
deal with the question of unauthorised occupation, including the
time limits or period during which the goods could be authorised to
be stored – Levy of penalty for unauthorised occupation of space
for period beyond sixty days of storage as fixed vide the impugned
1998 circular was in conformity and in consonance with the 1993
                                                                         G
Notification and in particular Notes 1, 4 and 5 thereof, and was
hence not illegal or invalid.
      Ports – Kandla Port Regulations – Regns. 64 and 128 –
Power and authority of the Traffic Manager of the Port under the
Port Regulations – Notification dated 4th November, 1993 published
                                                                         H
                                 969
970            SUPREME COURT REPORTS                     [2019] 18 S.C.R.


A     u/s.52 of the Act fixing a schedule / scale of rates for storage of
      goods / cargo at the Kandla Port – Act amended in 1997 whereby
      s.52 was omitted and s.47A was inserted to constitute a Tariff
      Authority – Circular dated 31 st August, 1998 issued by Traffic
      Manager of the Port, stipulated levy of penalty for storage of goods
      beyond period of sixty days treating the same as unauthorised
B
      occupation – Whether the 1998 circular was beyond the powers
      available and entrusted to the Traffic Manager under the Port
      Regulations – Held: The contention that the Traffic Manager was
      not competent to fix time limit for storage, is unacceptable and
      contrary to the Notes to the said Notification and the powers vested
C     and given under the Regulations to the Traffic Manager – The Traffic
      Manager had authority and discretion for allotment of space for
      storage on rent and to withdraw allotment of space depending on
      the availability and to ensure that the port operations were not
      hindered and obstructed due to congestion and shortage of space
      – Major Port Trusts Act, 1963 – ss.52 and 47A.
D
             Ports – Storage of goods / cargo at the Kandla Port – Circular
      dated 31 st August, 1998 issued by Traffic Manager of the Port,
      stipulated levy of penalty for storage of goods beyond period of
      sixty days treating the same as unauthorised occupation – Whether
      the circular was unreasonable and violative of Art. 14 of the
E     Constitution – Held: The circular though issued on 31st August,
      1998 was made effective and applicable from 1st October, 1998 –
      Therefore, the parties were given time to take steps to avoid the
      usage of the storage facility from being declared as unauthorized –
      The impugned circular (which specifically recorded that there was
F     congestion at the Port which had necessitated issuance of the
      circular) brought about uniformity, clarity and transparency in the
      use of storage facilities at the Kandla Port – The circular ensured
      equal treatment without discretion as upper time limit of sixty days
      was prescribed for storage of goods failing which penalty was
      payable – Period of sixty days is sufficient and long and cannot be
G     termed as unreasonable and violating Art.14 of the Constitution –
      Constitution of India, 1950 – Art. 14.
            Dismissing the appeal, the Court
            HELD:1.1. The Notification dated 4th November, 1993 had
H     specified rent/usage charges for open space, covered space,
   MAHESHWARY HANDLING AGENCY PVT. LTD. v. BOARD OF                    971
          TRUSTEES OF KANDLA PORT TRUST

containers, office accommodation, etc., which charges were             A
payable dependent upon the space and the length of time used
for storage. Note 1 to the Notification stated that a person wanting
to use the rental space was required to make an application for
storage of goods to the Traffic Manager. It was also specified
that any unauthorised occupation of rented space shall make the
                                                                       B
person liable to pay double the rent as penalty. Note 1 did not
specify when and in what circumstances occupation of the rented
space would be treated as unauthorised occupation. Note 2 had
specified that storage charges would be paid in advance and penal
interest @ 18% would be payable on the amount due and not
paid from the date when the amount had become due till the date        C
of actual payment. Note 4 had specified that the space cannot be
allotted without permission of the Traffic Manager of the Port.
Note 5 had stipulated that the space allotted would be vacated on
notice from the Traffic Manager or any other officer on his behalf,
failing which the occupation would be treated as unauthorised
                                                                       D
and the person in unauthorised occupation would be liable for
penalty rent under Note 1. Thus, for authorised occupation and
usage of space/area, permission from the Traffic Manager was
required. Further, the Traffic Manager or an officer appointed on
his behalf, was empowered to issue notice for vacation of space
allotted to a user, failing which the use of the space was to be       E
treated as unauthorised and the person in violation was liable to
pay double the rent as penalty. [Para 11][981-A-E]
       1.2. Regulation 128 of the Kandla Port Regulations provides
that “the quays, sheds, gates and the land within the Port
boundaries shall be in the charge of the Traffic Manager who           F
shall direct and manage all operations connected with the landing
and shipping of goods, and with their storage in the shed and in
the open. He shall have proper custody of all goods lying in the
Port and taken whatever steps he may consider necessary for
the proper maintenance of order.” The Traffic Manager of the
Port is obligated to control and manage the port operations, check     G
obstructions to traffic movement and remove hinderance for
efficient and proper use of berths, landing and shipping of goods
and storage in the sheds and open area. Regulation 64 stipulates
that loading and unloading of vessels was subject to control of
                                                                       H
972            SUPREME COURT REPORTS                    [2019] 18 S.C.R.


A     the Traffic Manager who had the discretion to prohibit discharge
      of goods which are likely to obstruct traffic, cause congestion or
      hinder convenient movement at the Port. [Para 12][981-F-H; 982-
      A-B]
            2.1. It is clear from the Notes that the Notification had
B     empowered and left it to the Traffic Manager to deal with the
      question of unauthorised occupation, including the time limits or
      period during which the goods could be authorised to be stored.
      The Notification had not specified when and in what circumstances
      use of the storage area would be treated as unauthorised as this
      was left to the wisdom of the Traffic Manager who was the person
C     in-charge and responsible for efficient and proper functioning of
      the port operations and mandated to take the need based decisions
      on the basis of prevalent facts and circumstances. This latitude
      was necessary as the schedule of rates fixed vide Notification
      dated 4th November, 1993 were applicable till a new Notification
D     or amendment was made by following the procedure prescribed
      vide Section 52 of the Port Trusts Act, which would require
      approval from the Central Government. [Para 13][982-B-D]
            2.2. Prescribing different slabs or rates for storage of cargo
      for different periods was meant to fix rates for the rent payable
E     and not to deny or curtail the power of the Traffic Manager to
      authorise and permit use of sheds and space for storage of cargo/
      containers. As per the Notes, the Traffic Manager, on an
      application by the owners or their agents was to grant permission
      for authorised storage. Storage without the permission or contrary
      to the permission was unauthorised. Further, the space allotted
F     was to be vacated on notice from the Traffic Manager. On failure
      to comply, and vacate the space, the use was treated as
      unauthorised occupation and the person in default was liable to
      pay double the rent for unauthorised use. [Para 14][982-E-F]
            2.3. The first portion of the Notification prescribing
G     escalating rates for use of open area and sheds did not vest any
      right to occupy such space for unlimited period of time. This is
      the exact purport of the Notes, which have been read
      harmoniously with the first portion of the Notification. The Traffic

H
   MAHESHWARY HANDLING AGENCY PVT. LTD. v. BOARD OF                     973
          TRUSTEES OF KANDLA PORT TRUST

Manager had authority and discretion for allotment of space for         A
storage on rent and to withdraw allotment of space depending on
the availability and to ensure that the port operations were not
hindered and obstructed due to congestion and shortage of space.
Therefore, the contention that the Traffic Manager was not
competent to fix time limit for storage, is unacceptable and
                                                                        B
contrary to the Notes and the powers vested and given under
the Regulations to the Traffic Manager. [Para 15][982-G-H; 983-
A]
       2.4. In this case, one is not required to examine whether
delegation of powers to the Traffic Manager in the Notification
was excess or invalid, for this issue or contention has not been        C
raised. The validity of the Notification is not questioned and under
challenge. Read in this manner, it cannot be said that levy of
penalty for unauthorised occupation of the space for period beyond
sixty days of storage as fixed vide the impugned circular would
be illegal and invalid. In fact, it would be in conformity and in       D
consonance with the Notification and in particular Notes 1, 4 and
5 thereof. The circular had brought about uniformity, clarity and
transparency in the use of storage facilities at the Kandla Port.
The circular though issued on 31 st August, 1998 was made
effective and applicable from 1st October, 1998. Therefore, the
parties were given time to take steps to avoid the usage of the         E
storage facility from being declared as unauthorised.
[Para 16][983-B-D]
       3. The impugned circular specifically recorded that there
was congestion at the Port which had necessitated issuance of
the circular stipulating that storage of goods beyond the period        F
of sixty days would be treated as unauthorised occupation. The
contention of the appellant as to absence of data indicating the
details of congestion is an afterthought as this contention was
not raised and argued before the High Court. The said circular
ensured uniformity and equal treatment without discretion as            G
upper time limit of sixty days was prescribed for storage of goods
failing which penalty was payable. Period of sixty days is sufficient
and long and cannot be termed as unreasonable and violating
Article 14 of the Constitution. [Para 17][983-E-F]

                                                                        H
974             SUPREME COURT REPORTS                          [2019] 18 S.C.R.


A           CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5277
      of 2010.
            From the Judgment and Order dated 15.07.2008 of the High Court
      of Gujarat at Ahmedabad in L.P.A. No. 1585 of 2007.

B           Nikhil Goel, Ms. Naveen Goel, Piyo Harald, Mrs. Sheela Goel,
      Advs. for the Appellant.
            Pravin H. Parekh, Sr. Adv., D. P. Mohanty, Abhiram Naik, Raghav
      Bansal, Paritosh Arora, Ms. Aashna Bhatnagar, M/S. Parekh & Co.,
      A. V. Rangam, Advs. for the Respondents.
C
            The Judgment of the Court was delivered by
            SANJIV KHANNA, J.
             1. The appellant, Maheshwary Handling Agency Private Limited,
      is a private limited company engaged in the business of clearing,
D     forwarding and transporting of cargo for import and export as a steamer
      agent.
              2. During the course of their business, the appellant had used
      facilities at the Kandla Port, Gujarat for storing imported/ exported cargo,
      for which it was liable to pay charges as per schedule/scales of rates
E
      framed by the Board of Trustees of Kandla Port Trust, the first respondent
      before us (“the Board”, for short) published in the Official Gazette in
      terms of Section 52 of the Major Port Trusts Act, 1963 (“Port Trusts
      Act”, for short), which prior to its omission in 1997 read as under:

F           “52. Prior sanction of Central Government to rates and
            conditions:- Every scale of rates and every statement of
            conditions framed by a Board under the foregoing provision of
            this Chapter shall be submitted to the Central Government for
            sanction and shall have effect when so sanctioned and published
            by the Board in the Official Gazette.”
G
             3. Notification dated 4th November, 1993 published under Section
      52 of the Port Trusts Act had fixed a schedule/scales of rates payable
      for storage of goods/cargo at the Kandla Port. Relevant portion of the
      Notification dated 4th November,1993, read as under:

H
MAHESHWARY HANDLING AGENCY PVT. LTD. v. BOARD OF    975
TRUSTEES OF KANDLA PORT TRUST [SANJIV KHANNA, J.]

                                                    A




                                                    B




                                                    C




                                                    D




                                                    E




                                                    F




                                                    G




                                                    H
976      SUPREME COURT REPORTS                         [2019] 18 S.C.R.


A




B




C




D
      Notes:
      1.   Application for rental space should be made before storage
           of goods to the Traffic Manager. Any unauthorised
           occupation of rented space shall be liable for payment of
E          double the rent as a penalty.
      2.   Storage charges should be paid in advance. Penal interest
           at the rate of 18% of the amount due but not paid from the
           date of which the amount becomes due to the date of actual
           payment shall be levied for genuine reasons and with
F          permissions of Port Authorities which shall in no case exceed
           7 days. If by any reason, payment is delayed beyond 7
           days from the date of the amount becoming due, otherwise
           occupation will be treated as unauthorised.
                         xx                xx               xx
G     4.   Space allotted cannot be subject (sic – allotted) without the
           permission of the Traffic Manager.
      5.   The space allotted should be vacated on notice from the
           Traffic Manager or other officer on his behalf failing which
           it will be treated as unauthorised occupation liable for penalty
           rent under Note-1.
H
MAHESHWARY HANDLING AGENCY PVT. LTD. v. BOARD OF                           977
TRUSTEES OF KANDLA PORT TRUST [SANJIV KHANNA, J.]

  6.   The Traffic Manager shall have the right to take over the           A
       spaces, allotted on rental basis, which are unoccupied/empty
       without any prior notice in the interest of the port operation,
       in such cases, proportionate reduction in rent shall be allowed
       at the discretion of the T.M.”
  4.   The Port Trusts Act was amended by the Port Laws                    B
       (Amendment) Act, 1997 (Act 15 of 1997) whereby Section
       52 was omitted and Section 47A was inserted to constitute
       Tariff Authority for Major Ports (‘Tariff Authority’, for
       short), a body corporate having perpetual succession and a
       common seal, consisting of Chairman and members with
       stipulations as to their term of office, conditions of service,     C
       etc contained under Sections 47B to 47H of the Port Trusts
       Act. In terms of the amended Section 49 of the Port Trusts
       Act, the Tariff Authority was empowered to fix different
       scales and conditions for different classes of goods and
       vessels and for use of any land, building, place, etc.              D
       belonging to or in possession or occupation of the Board.
  5.   The amended provisions came into force with effect from
       9th January, 1997. The Tariff Authority, however, had notified
       the new scale of rates for the Kandla Port vide notification
       dated 22nd June, 2001 which was applicable retrospectively
       and with effect from 29th January, 2001. The appellant and          E
       the first respondent, viz. Board of Trustees of Kandla Port
       Trust, are ad idem that the appellant and others who had
       used storage facility at the Kandla Port were liable to pay
       the rates stipulated in the Notification dated 4 th November,
       1993 till the new tariff fixed by the Tariff Authority was          F
       made applicable with effect from 29th January, 2001.
  6.   The issue raised by the appellant relates to validity of circular
       dated 31st August, 1998 issued by the Traffic Manager, the
       second respondent, made effective from 1st October, 1998
       and read as under:
                                                                           G
                    “KNDLA (sic – KANDLA) PORT TRUST
                                 PORT & CUSTOMS BUILDING
                                        NEW KANDLA (KUTCH)
                                                        PIN – 370210
                                                  DATE: 31.08.1998
                                               NO. TF/GB/3201/452          H
978            SUPREME COURT REPORTS                        [2019] 18 S.C.R.


A                                  CIRCULAR
            SUB: Past Clearance of import cargoes from Kandla Port
                   Due to over-style (sic – overstay) of Cargoes inside the
            port, the port is congested causing inconvenience to both import/
            export cargoes moving through the port which ultimately may result
B           in diversion of traffic from our port. Due to congestion, port is
            facing problems with regard to accounting, stacking and delivery
            of cargoes, etc. and non-availability of adequate storage space
            for export cargoes.
                   To overcome all the above problems now it has been decided
C           not to allow storage of cargoes for more than two months and
            auction such cargoes under the provisions of Customs Act as
            well as Major Port Trust Act. Further, no renewals will be
            considered for the areas allotted on rental/warehousing terms if
            the staya stayal (sic – stay) is more than 60 days.
D                  This will come into force w.e.f. 1st October, 1998.

                                                                         Sd/-
                                                             Traffic Manager
                                                           Kandla Port Trust”
E            The impugned circular stated that due to congestion and over
      stacking at the Kandla Port, problems had cropped up with regard to
      accounting, stacking and delivery of cargoes etc. and non-availability of
      adequate storage space for export cargoes. To overcome this problem,
      storage of cargoes would not be allowed for more than two months and
      auction of such cargoes would be made under the Customs Act, 1962
F
      and the Port Trusts Act. Further, no renewals would be considered for
      the areas allotted on rental/warehousing terms if the cargo had remained
      stored for more than sixty days.
             7. The effect of the above circular can be understood if we refer
      to Notes 1, 4, 5 and 6 of the Notification dated 4th November, 1993,
G     which have been quoted above. The said circular read with the aforesaid
      Notes meant that any person using the storage facility for more than
      sixty days would be in unauthorised occupation and thereby liable to pay
      penalty rent under Note 1, which was double the rent otherwise payable.
            8. Aggrieved and challenging the circular dated 31st August, 1998,
H     the appellant had approached the High Court of Gujarat by filing Special
   MAHESHWARY HANDLING AGENCY PVT. LTD. v. BOARD OF                            979
   TRUSTEES OF KANDLA PORT TRUST [SANJIV KHANNA, J.]

Civil Application No. 12954 of 2000 with the prayer that the first             A
respondent should refund the amount collected as penalty rent in terms
of the impugned circular. The Civil Application was dismissed by the
Single Judge vide judgment dated 14th June, 2007 and the appellant also
did not succeed before the Division Bench which had dismissed the
Letters Patent Appeal vide impugned judgment dated 15th July, 2008.
                                                                               B
        9. The contentions raised by the appellant are that after the
amendment vide Act 15 of 1997, applicable with effect from 9th January,
1997, in terms of Section 47A read with Sections 48 and 49 of the Port
Trusts Act, only the Tariff Authority could have fixed the tariff/rent and
the Traffic Manager could not have directly or indirectly fixed the said
tariff, which the latter did by way of issuance of the impugned circular       C
dated 31st August, 1998. Secondly, the circular issued by the Traffic
Manager in garb of regulating traffic had the effect of interfering with
the scales of rates prescribed vide Notification dated 4th November,
1993 which had not only fixed the rates but had also prescribed an
escalating schedule of rates depending upon the period for which the           D
space, whether open or covered or as containers, was used. The schedule
of rates, reproduced above, were applicable for the period of storage/
use beyond sixty days and, therefore, the Traffic Manager had directly
interfered with the notified scales of rates by prescribing that any storage
beyond a period of sixty days would be treated as unauthorised. Thirdly,
there could be several reasons for storage of goods at the Port for a          E
period over sixty days, which could be well beyond the control of the
person storing the goods. The impugned circular did not give any
concessions in this regard and did not consider that delays could be on
account of customs clearance, inability to load or unload due to external
factors or refusal of the shipping company, etc. Therefore, the circular       F
was an attempt by the first respondent to collect higher monetary charges
or rentals for use of the port area/facilities. Fourthly, it was submitted
that there was not a shred of data or evidence to show that the restriction
with regard to duration of storage was justified and necessary for the
object and reasons stated. The Port Trust, having monopoly, was required
to act in a reasonable manner. Hence, there was a violation of Article 14      G
of the Constitution of India. Our attention was drawn to the withdrawal
of the impugned circular after the issuance of higher rate of scales in
2001 by the Tariff Authority. Fifthly, and lastly, it was submitted that the
power of Traffic Manager to issue the impugned circular could not be
traced to Regulation 64, which specifically dealt with controlling the goods   H
980             SUPREME COURT REPORTS                          [2019] 18 S.C.R.


A     at the time of loading and unloading of vessels. Regulation 64 reads as
      under:
             “64. Work in port under the control of Traffic Manager.—
             The loading and unloading of vessels shall be subject to the control
             of the Traffic Manager, who may at his discretion, prohibit the
B            discharge of such goods which in his opinion are likely to obstruct
             traffic or cause congestion or hinder the convenient use of the
             berths.
             Notwithstanding the provisions of Regulation No. 113, the Traffic
             Manager may at his discretion also remove to the other areas as
C            under his jurisdiction, any goods upon landing in the port or soon
             thereafter, the storage of which on port premises is likely to
             obstruct traffic or cause congestion. The apportionment of Quay
             space to be occupied by each vessel shall similarly be determined
             by the Traffic Manager.”
D             This power under Regulation 64 was regarding goods that were
      likely to cause traffic congestion and not regarding the rate of storage
      for a particular period. Therefore, the impugned circular was beyond
      the powers available and entrusted to the Traffic Manager under
      Regulation 64. The Traffic Manager, in this manner, had illegally extracted
      huge amount of over Rs. 52 lakhs for over-stay of cargo without any
E     justification and reason.
             10. We have already quoted the scales fixed by the Notification
      dated 4th November, 1993 as well as the Notes in the Notification. This
      Notification was not under challenge in the Special Civil Application or
      in appeal filed before the High Court. The Notification is not under
F     challenge before us. The appellant also accepts that they were liable to
      pay the scales specified in the Notification till the new tariff was notified
      pursuant to the constitution of the Tariff Authority, which it is accepted
      was notified and applicable with effect from 29 th January, 2001.
      Therefore, for the period prior to 29th January, 2001, the appellant would
G     be liable to pay tariff as per the scales and terms of the Notification
      dated 4th November, 1993. The issue that arises for consideration is
      whether the impugned circular dated 31st August, 1998 was in conformity
      with the terms of the Notification or had the effect of modifying or
      amending the Notification dated 4th November, 1993.

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   MAHESHWARY HANDLING AGENCY PVT. LTD. v. BOARD OF                           981
   TRUSTEES OF KANDLA PORT TRUST [SANJIV KHANNA, J.]

        11. In our opinion, the answer to the question would be in favour     A
of the first and second respondents. The Notification dated 4th November,
1993 had specified rent/usage charges for open space, covered space,
containers, office accommodation, etc., which charges were payable
dependent upon the space and the length of time used for storage. Note
1 to the Notification stated that a person wanting to use the rental space
                                                                              B
was required to make an application for storage of goods to the Traffic
Manager. It was also specified that any unauthorised occupation of rented
space shall make the person liable to pay double the rent as penalty.
Note 1 did not specify when and in what circumstances occupation of
the rented space would be treated as unauthorised occupation. Note 2
had specified that storage charges would be paid in advance and penal         C
interest @ 18% would be payable on the amount due and not paid from
the date when the amount had become due till the date of actual payment.
Note 4 had specified that the space cannot be allotted without permission
of the Traffic Manager of the Port. Note 5 had stipulated that the space
allotted would be vacated on notice from the Traffic Manager or any
                                                                              D
other officer on his behalf, failing which the occupation would be treated
as unauthorised and the person in unauthorised occupation would be
liable for penalty rent under Note 1. Thus, for authorised occupation and
usage of space/area, permission from the Traffic Manager was required.
Further, the Traffic Manager or an officer appointed on his behalf, was
empowered to issue notice for vacation of space allotted to a user, failing   E
which the use of the space was to be treated as unauthorised and the
person in violation was liable to pay double the rent as penalty.
      12. Regulation 128 reads as follows:
      “128. Quays, etc. to be under the authority of the Traffic
      Manager:                                                                F

      The quays, sheds, gates and the land within the Port boundaries
      shall be in the charge of the Traffic Manager who shall direct and
      manage all operations connected with the landing and shipping of
      goods, and with their storage in the shed and in the open. He shall
      have proper custody of all goods lying in the Port and taken            G
      whatever steps he may consider necessary for the proper
      maintenance of order.”
      The Traffic Manager of the Port is obligated to control and manage
the port operations, check obstructions to traffic movement and remove
hinderance for efficient and proper use of berths, landing and shipping       H
982             SUPREME COURT REPORTS                            [2019] 18 S.C.R.


A     of goods and storage in the sheds and open area. Regulation 64 quoted
      in paragraph 9 above stipulates that loading and unloading of vessels
      was subject to control of the Traffic Manager who had the discretion to
      prohibit discharge of goods which are likely to obstruct traffic, cause
      congestion or hinder convenient movement at the Port.
B            13. It is clear from the Notes that the Notification had empowered
      and left it to the Traffic Manager to deal with the question of unauthorised
      occupation, including the time limits or period during which the goods
      could be authorised to be stored. The Notification had not specified when
      and in what circumstances use of the storage area would be treated as
      unauthorised as this was left to the wisdom of the Traffic Manager who
C     was the person in-charge and responsible for efficient and proper
      functioning of the port operations and mandated to take the need based
      decisions on the basis of prevalent facts and circumstances. This latitude
      was necessary as the schedule of rates fixed vide Notification dated 4th
      November, 1993 were applicable till a new Notification or amendment
D     was made by following the procedure prescribed vide Section 52 of the
      Port Trusts Act, which would require approval from the Central
      Government.
             14. Prescribing different slabs or rates for storage of cargo for
      different periods was meant to fix rates for the rent payable and not to
E     deny or curtail the power of the Traffic Manager to authorise and permit
      use of sheds and space for storage of cargo/containers. As per the Notes,
      the Traffic Manager, on an application by the owners or their agents
      was to grant permission for authorised storage. Storage without the
      permission or contrary to the permission was unauthorised. Further, the
      space allotted was to be vacated on notice from the Traffic Manager.
F     On failure to comply, and vacate the space, the use was treated as
      unauthorised occupation and the person in default was liable to pay double
      the rent for unauthorised use.
             15. It is obvious that the first portion of the Notification prescribing
      escalating rates for use of open area and sheds did not vest any right to
G     occupy such space for unlimited period of time. This, we hold, is the
      exact purport of the Notes, which have been read harmoniously with the
      first portion of the Notification. The Traffic Manager had authority and
      discretion for allotment of space for storage on rent and to withdraw
      allotment of space depending on the availability and to ensure that the
H     port operations were not hindered and obstructed due to congestion and
   MAHESHWARY HANDLING AGENCY PVT. LTD. v. BOARD OF                             983
   TRUSTEES OF KANDLA PORT TRUST [SANJIV KHANNA, J.]

shortage of space. We, therefore, would reject the contention that the          A
Traffic Manager was not competent to fix time limit for storage. The
contention is unacceptable and would be contrary to the Notes and the
powers vested and given under the Regulations to the Traffic Manager.
        16. We are in this case not required to examine whether delegation
of powers to the Traffic Manager in the Notification was excess or              B
invalid, for this issue or contention has not been raised. As noted earlier,
validity of the Notification is not questioned and under challenge. Read
in this manner, we do not think levy of penalty for unauthorised occupation
of the space for period beyond sixty days of storage as fixed vide the
impugned circular would be illegal and invalid. In fact, it would be in
conformity and in consonance with the Notification and in particular            C
Notes 1, 4 and 5 thereof. The circular had brought about uniformity,
clarity and transparency in the use of storage facilities at the Kandla
Port. The circular though issued on 31st August, 1998 was made effective
and applicable from 1st October, 1998. Therefore, the parties were given
time to take steps to avoid the usage of the storage facility from being        D
declared as unauthorised.
        17. Other contention of the appellant as to absence of data
indicating the details of congestion is an afterthought as this contention
was not raised and argued before the High Court. The impugned circular
specifically recorded that there was congestion at the Port which had           E
necessitated issuance of the circular stipulating that storage of goods
beyond the period of sixty days would be treated as unauthorised
occupation. The said circular ensured uniformity and equal treatment
without discretion as upper time limit of sixty days was prescribed for
storage of goods failing which penalty was payable. Period of sixty days
is sufficient and long and cannot be termed as unreasonable and violating       F
Article 14 of the Constitution. The aforesaid reasoning would take care
of the other arguments raised by the appellants, which we would reiterate
were not argued before the High Court.
      18. For all the foregoing reasons, the appeal fails and is dismissed.
There would be no order as to costs.                                            G


Bibhuti Bhushan Bose                                        Appeal dismissed.



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