Supreme Court of India
PARADIP PORT AUTHORITYversusPARADEEP PHOSPHATES LTD.
- Citation
- 2025 INSC 971
- Decided
- 12 August 2025
- Bench
- M M SUNDRESH
Holding
The Supreme Court set aside the arbitration award, the appellate authority’s order, and the High Court judgment, and remitted the dispute to the Tariff Authority for Major Ports for fresh adjudication, while recommending the creation of an expert appellate body for appeals.
Summary
The Paradip Port Authority (formerly Paradip Port Trust) and Paradeep Phosphates Ltd. entered into a 1985 agreement for a captive berth, with tariff rates subject to periodic revision. Dispute arose when the Authority unilaterally increased rates in 1993, leading to arbitration, an appellate authority order, and a High Court judgment upholding the arbitration award that required the Authority to refund charges up to March 1999. The Supreme Court held that the issues of tariff revision were not properly considered and that an expert body, the Tariff Authority for Major Ports (TAMP), is the appropriate forum for such technical disputes. It set aside the arbitrator’s award, the appellate authority’s order, and the High Court judgment, and remitted the matter to TAMP for fresh adjudication of the tariff for the period October 1993 to 31 March 1999, also directing a review of the appellate structure. The Court further recommended constituting an expert appellate body to hear appeals from TAMP or the adjudicatory board under the 2021 Act.
Issues considered
- The appropriateness of fixing port tariffs by the Paradip Port Authority under the Major Port Trusts Act, 1963 and the Major Port Authorities Act, 2021
- Whether an expert appellate body should be constituted to hear appeals against orders of the Tariff Authority for Major Ports (TAMP) or the adjudicatory board
- Whether the arbitration award and subsequent appellate orders were legally sound and should be set aside
- Whether the High Court erred in upholding the arbitration award and appellate order
- Whether the period of tariff revision from October 1993 to 31 March 1999 requires fresh determination by TAMP
Legislation cited
- Arbitration and Conciliation Act, 1996s. 34
- Electricity Regulatory Commissions Act, 1998s. 16, s. 17
- Major Port Authorities Act, 2021s. 54, s. 60
- Major Port Trusts Act, 1963s. 47-A, s. 48, s. 49, s. 50, s. 51, s. 52, s. 55
Subjects
Fixation of tariffExpert appellate bodyConstitution of Appellate AuthorityRevision of rates applicableRevision of tariff
Judgment
[2025] 8 S.C.R. 1695 : 2025 INSC 971
Paradip Port Authority
v.
Paradeep Phosphates Ltd.
(Civil Appeal No. 10542 of 2025)
12 August 2025
[M.M. Sundresh and Rajesh Bindal,* JJ.]
Issue for Consideration
The issue pertains to fixation of tariff by the Paradip Port Authority
(Earlier Paradip Port Trust). Whether it would be appropriate if an
expert appellate body is constituted to hear appeals against the
orders passed by the adjudicatory board/Tariff Authority for Major
Ports (TAMP).
Headnotes†
Major Port Trusts Act, 1963 – Major Port Authorities Act,
2021 – In C.A. No.10542 of 2025, an agreement was executed
between the parties, namely appellant-Paradip Port Trust
and respondent-Paradeep Phosphates Ltd on 03.08.1985 for
use of ‘captive berth’ in terms of the conditions laid down in
the Agreement – Appellant revised scale of rates for use of
various facilities at the Ports – Respondent sought waiver of
interest for delayed payment of certain dues from October
1993 to January 1996 – Proposal rejected by the appellant –
Dispute arose between the parties – Arbitral award was
passed – The Arbitrator held the appellant liable to refund
the enhanced amount of port services from October 1993 till
31.03.1999 – As the period of dispute for determination for
the Arbitrator was from October 1993 till 31.10.2001, for the
period from 01.04.1999 till 31.10.2001, the parties were given
option to approach the TAMP for resolution of their dispute –
Appellate Authority upheld the arbitral award – The award and
appellate order were subject matter of challenge in the Writ
Petition – The High Court dismissed the petition, upholding
the impugned award and the appellate order – Correctness:
Held: The issues required to be considered for revision of rates
applicable to the respondent for use of various facilities, have
* Author
1696 [2025] 8 S.C.R.
Supreme Court Reports
not been considered in the manner these were required to be
considered – The TAMP being an independent authority consisting
of experts, will be the right authority for resolution of dispute between
the parties, which is pending for more than two decades – The
Award of the Arbitrator, the order of the Appellate Authority and
also the order passed by the High Court are set aside – Matter
remitted to TAMP for adjudication of the dispute regarding revision
of tariff applicable to the respondent for the period from October
1993 till 31.03.1999. [Paras 33 and 34]
Major Port Trusts Act, 1963 – Major Port Authorities Act,
2021 – In C.A. No. 10543 of 2025, the order dated 11.01.2023
passed by the High Court is under challenge – Before the High
Court, an order passed by TAMP on 22.11.2011 was the subject
matter of challenge – Vide aforesaid order, tariff proposal for
the financial year 1999-2000 to 2009-10 was determined:
Held: Further, once this Court set aside the award of the Arbitrator,
order of the Appellate Court and also of the High Court pertaining
to the revision of the tariff for the period from October 1993 to
31.03.1999, and remitted the matter to be decided by TAMP, in
opinion of this Court, even the order pertaining to the period in
question also deserves to be set aside as the base for revision
of tariff for subsequent periods is yet to be determined – The
impugned order passed by the TAMP and also the High Court are
set aside – The matter is remitted to the TAMP for decision afresh
along with the matter for the period prior thereto. [Paras 46, 47]
Major Port Authorities Act, 2021 – Constitution of Appellate
Authority:
Held: The process for fixation of tariff presently by the TAMP or
the adjudicatory board, as constituted and provided for under
the 2021 Act, is the job of experts in the field – Direct appeals
have been provided against the order passed by the TAMP or
the adjudicatory board to this Court – Section 60 of the 2021 Act
provides for remedy of appeal against the order passed by the
adjudicatory board to this Court – Meaning thereby, first appeal
against the order passed by the adjudicatory board and at present
in its absence the TAMP, would lie to this Court – It cannot be
denied that fixation of tariff would involve consideration of various
factual aspects, especially figures involved – This Court may
[2025] 8 S.C.R. 1697
Paradip Port Authority v. Paradeep Phosphates Ltd.
not have the expertise to examine the accounts in detail for the
purpose of fixation of tariff – While deciding appeal against an
order of an expert body, all issues of law and fact are required to
be considered – There are other similar expert bodies which are
headed by technically qualified persons along with persons with
knowledge of accounting and economics – Therefore, it would
be appropriate if an expert appellate body is constituted to hear
appeals against the orders passed by the adjudicatory board/
TAMP. [Paras 48, 52, 54, 58, 60]
Case Law Cited
Patiala Central Cooperative Bank Ltd. v. Patiala Central Cooperative
Bank Employees’ Union, 1996 INSC 1056 : [1996] Supp. 6 SCR
347 : (1996) 11 SCC 202; W.B. Electricity Regulatory Commission v.
CESC Ltd. (2002) 8 SCC 715; Rojer Mathew v. South Indian Bank
Limited, 2019 INSC 1236 : [2019] 16 SCR 1 : (2020) 6 SCC 1 –
referred to.
List of Acts
Major Port Trusts Act, 1963; Major Port Authorities Act, 2021.
List of Keywords
Fixation of tariff; Expert appellate body; Constitution of Appellate
Authority; Revision of rates applicable; Revision of tariff.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 10542 of 2025
From the Judgment and Order dated 11.01.2023 of the High Court
of Orissa at Cuttack in WP(C) No. 11 of 2010
With
Civil Appeal No. 10543 of 2025
Appearances for Parties
Advs. for the Appellant:
Jaideep Gupta, Sr. Adv., Dipak Kumar Jena, Pramod Kumar,
Ms. Smita Kumari, Pradeep Kumar Verma, Raj Shekhar Jena,
Sandip Munian, Ashutosh Singhdeo.
1698 [2025] 8 S.C.R.
Supreme Court Reports
Advs. for the Respondent:
Shyam Divan, Sr. Adv., Sanjeev K.kapoor, Ms. Anushka Sharda,
Ms. Raveena Rai, Arpith Jacob Varaprasad, Yajas Achal, M/s.
Khaitan & Co..
Judgment / Order of the Supreme Court
Judgment
Rajesh Bindal, J.
Table of Contents*
S. No. Heading Paras Page
I. Preliminary 1-3 2-3
II. C.A. No.____ of 2025
arising out of S.L.P.(C) No.9751 of 2023
1. Factual Aspects 4-16 3-9
2. Arguments for the Appellant 17 9-13
3. Arguments for the Respondent 18 13-17
4. Discussion 19-33 17-28
5. Conclusion 34 28-29
III. C.A. No.____ of 2025
arising out of S.L.P.(C) No.9870 of 2023
1. Factual Aspects 35 29-30
2. Arguments for the Appellant 36-38 30-32
3. Arguments for the Respondent 39 32
4. Discussion 40-46 33-35
5. Conclusion 47 35-36
IV. Constitution of Appellate Authority 48-58 36-47
V. Relief 61-62 47-48
1. Leave granted.
2. This order will dispose of two appeals.
* Ed. Note: Pagination as per the original Judgment.
[2025] 8 S.C.R. 1699
Paradip Port Authority v. Paradeep Phosphates Ltd.
3. The issue pertains to fixation of tariff by the Paradip Port Authority1.
There were two Writ Petitions2 decided by the High Court by a
common order3. Both were filed by the appellant herein. Though the
period involved is different, the High Court had decided both the writ
petitions by a common order. For this reason, both the appeals are
being taken up and decided together.
C.A. NO. ____ OF 2025
ARISING OUT OF S.L.P.(C) NO.9751 OF 2023
FACTUAL ASPECTS
4. The present appeal has been filed by the Appellant (formerly Paradip
Port Trust) challenging the common order of the High Court dated
11.01.2023 disposing of WP (C) No.11 of 2010.
5. The aforesaid petition was filed against order dated 19.10.2009
passed by the Appellate Authority in appeal4, which upheld the
arbitral award5 dated 27.12.2002. The Appellant was ordered to
refund the additional amount charged till 31.03.1999 along with
interest, holding the same to be unilaterally enhanced. As far as
refund from 01.04.1999 and interest is concerned, both the parties
were directed to file petition before Tariff Authority for Major Ports
(hereinafter referred to as the TAMP). The award and appellate order
were subject matter of challenge in the Writ Petition.
6. The High Court dismissed the petition, upholding the impugned
award and the appellate order.
7. The appellant is a major port authority, governed by the provisions of
the 1963 Act6, which is now renamed as Paradip Port Authority (PPA)
under the 2021 Act7. The 1963 Act was replaced by the 2021 Act.
1 Earlier Paradip Port Trust
2 WP (C) No.732 of 2012 and WP (C) No.11 of 2010
3 Dated 11.01.2023
4 Appeal No.5/L.S/2003
5 Case No.MA/NCJ/12/2001dated 27.12.2002
6 Major Port Trusts Act, 1963
7 Major Port Authorities Act, 2021
1700 [2025] 8 S.C.R.
Supreme Court Reports
8. The respondent herein was a public sector unit when it entered into
a bilateral agreement with the appellant/Authority on 03.08.1985. The
idea thereof, as is evident from the agreement, was that the appellant/
Authority agreed for construction of berth at Paradip Port, to be known
as Fertilizer Berth, to provide berthing facilities exclusively to the
respondent. The tariff to be paid by the respondent was prescribed in
the Agreement. The rates could be suitably enhanced at such intervals
as would be mutually agreed upon by the parties from time to time.
It was the responsibility of the respondent to make such construction
and install such equipments exclusively at their cost to ensure smooth
handling of its cargo. It was responsible for its maintenance as well.
Clause 19 of the Agreement provided that the respondent shall be
subjected to application of all relevant laws, rules and regulations
of the Paradip Port Trust, as may be applicable from time to time.
9. In exercise of power conferred under Sections 48 to 52 of the 1963
Act, Traffic Department of Paradip Port Trust issued Notification8 dated
05.10.1993 for revision of scale of rates for use of various facilities
at the Ports. It was conveyed to the respondent. The payments were
made by respondent to the Authority at revised rates.
10. Vide letter dated 11.05.2000, the Appellant/authority while rejecting
request made by the Respondent for waiver of interest on account
of delayed payment of revised port charges, offered the facility of
payment thereof in 3-4 installments. This was replied to by the
respondent vide its letter dated 18.05.2000 seeking waiver of interest
on account of financial condition of the respondent. The appellant/
Authority responded to the same vide letter dated 31.05.2000 again
requesting for deposit of interest by 30.06.2000, failing which services
to respondent’s incoming vessels would be stopped. The respondent
filed Civil Suit9 before the Civil Judge (Junior Division) praying for
declaration that appellant/Authority had no right to amend terms
and conditions of bilateral agreement dated 03.08.1985. Further,
the respondent prayed for injunction against appellant from giving
effect to the terms and conditions contained in the scale of rates
published on 05.10.1993, claiming that the same do not form part
of the bilateral agreement.
8 Notification No.1344
9 Original Suit No.115 of 2000
[2025] 8 S.C.R. 1701
Paradip Port Authority v. Paradeep Phosphates Ltd.
11. As the respondent on 15.09.2000 was still a public sector unit, the
Trial Court on that day directed the respondent to obtain clearance
certificate for litigation from the high power committee.
12. The Respondent being a public sector unit as on that date, a
supplementary agreement was signed between the parties on
10.08.2001 providing for resolution of dispute by arbitration. From
a reading of aforesaid supplementary agreement, it is evident that
the same was an informal mechanism for resolution of dispute as
the provisions of the Arbitration Act were strictly made inapplicable.
It may be relevant to add here that there was already a clause for
arbitration in the agreement signed between parties. The same was
not invoked.
13. The arbitrator was appointed. During the process of aforesaid
proceedings, by way of a share purchase agreement dated
28.02.2002, executed between the President of India and Zuari Maroc
Phosphates Private Limited, 76% shareholding of the Respondent
Company was transferred. As a result thereof, from 28.02.2002
onwards, the Respondent Company was a private sector entity.
14. The Arbitrator framed the following issues and answered them:
S. No. ISSUE ANSWER
I What was the scope and Clause 19 of the agreement
ambit of the agreement shall be applicable only for
entered into between the the other port charges and
parties? cannot provide any help
to unilaterally change the
terms of the agreement.
II Whether the tariff as provided No
in the contract can be revised
unilaterally without the
consent of the other party?
III Whether the rates revised No
were reasonable and the
respondent in the given
circumstances was justified
to enhance the rates?
1702 [2025] 8 S.C.R.
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IV Whether the interest claimed Yes
by the Port authorities for
delayed payment was
permissible under the contract
or under the statutory rules
and regulations, etc.?
V Whether the claims and Port Authorities should
counter claims filed by both refund the amount charged
the parties are tenable in law by them on the basis of
and on merit? unilateral enhancement
from the initial dated till
31.03.1999.
As far as the refund and
interest from 1.04.1999 to
till date is concerned, both
the parties should make a
petition to the TAMP.
Finally, vide award dated 27.12.2002, the Arbitrator held the appellant
liable to refund the enhanced amount of port services from October
1993 till 31.03.1999. As the period of dispute for determination for
the Arbitrator was from October 1993 till 31.10.2001, for the period
from 01.04.1999 till 31.10.2001, the parties were given option to
approach the TAMP for resolution of their dispute.
15. As per the procedure agreed upon by the parties, the appellant/
Authority preferred an appeal against the aforesaid Award. After
filing of the appeal, there was lot of litigation between the parties,
which is not relevant for the purpose of the issues raised in the
present appeal, except that on 30.05.2009, resolution was passed
by the Appellant-Authority to withdraw easementary rights given
to the Respondent. A proposal to recover a sum of ₹40.36 Crores
from the Respondent was also approved as arrears towards revision
of tariff in line with IFFCO tariff for the period from March 2002 till
January 2009.
15.1 On 02.06.2009, the aforesaid resolution was communicated
to Respondent invoking clause 21 of the agreement dated
03.08.1985.
[2025] 8 S.C.R. 1703
Paradip Port Authority v. Paradeep Phosphates Ltd.
15.2 Challenging the aforesaid communication dated 02.06.2009,
the Respondent filed Writ Petition10 in the High Court. Noticing
the fact that on the same issue, a Civil Suit No.55/2009 was
pending in court of Civil Judge Junior Division Kujang, which
the Respondent offered to withdraw, and noticing the fact
that proceedings were also pending before TAMP for fixation
of tariff for the earlier periods, matter was left open to be
decided by TAMP.
15.3 Vide order dated 19.10.2009, the Appellate Authority rejected
the appeal filed by the Appellant against the award of Arbitrator
dated 27.12.2002.
15.4 Aggrieved against the order passed by the Appellate Authority,
the Appellant/Authority preferred Writ Petition11 before the High
Court which was dismissed
16. In the Writ Petition filed by Appellant/Authority, the award of the
arbitrator and Appellate Authority was upheld. The order of High
Court is under challenged in this Appeal.
ARGUMENTS FOR THE APPELLANT
17. Mr. Jaideep Gupta, learned senior counsel appearing for the appellant/
Authority, submitted that Clause 1 of the Agreement provides that the
captive berth shall be exclusively used by the respondent, subject
to payment of tariff as mentioned in the Schedule annexed to the
Agreement. The rate was subject to enhancement at such intervals
as would be mutually agreed upon by the parties. Clause 19 of the
Agreement clearly provides that the respondent shall be subjected
to the application of all relevant laws, rules and regulations of the
Authority as may be enforced from time to time. In the case in hand,
certain tariff was fixed when the Agreement was entered into between
the parties on 03.08.1985. That cannot be said to be an Agreement
providing for the tariff fixed for all times to come. That is the reason
why an enabling provision was provided for revision of tariff. The
Agreement clearly envisages application of laws, rules and regulations
to the respondent. In case the parties failed to agree to mutually
settled terms for revision of tariff, the law will take its own course
10 WP (C) No. 86509 of 2009
11 Writ Petition (C) No.11 of 2010
1704 [2025] 8 S.C.R.
Supreme Court Reports
17.1 Learned senior counsel also referred to the pleadings by the
respondent in the civil suit filed. It is the admitted case of the
respondent therein that in the year 1993-94 a proposal was
made by the appellant/Authority for revision of tariff, to which
the respondent objected vide letter dated 16.03.1993. Still, the
appellant/Authority forcibly enhanced the tariff unilaterally from
October 1993. The aforesaid admitted fact in the suit filed by the
respondent clearly establishes that initially an effort was made
for revision of tariff by mutual consent, however, respondent
having not agreed to the same, the Appellant/Authority did not
have any other option but to proceed in terms of provisions of
Sections 48 to 52 of the 1963 Act. A notification was issued
on 05.10.1993. After issuance of the aforesaid notification,
the respondent continued to pay the revised tariff without any
objection till the time the aforesaid civil suit dated 30.06.2000
was filed. The same being cleverly drafted, had only sought
the relief of declaration and permanent injunction. The relief
being that the appellant/Authority could not amend the terms
of the Agreement dated 03.08.1985; the appellant/Authority
could not give effect to the revised rates as published in the
year 1993 and permanently injuncting the appellant/Authority
from giving effect to 1993 Notification. No relief was claimed for
any refund of the amount already deposited by the respondent
in terms of rates revised vide Notification dated 05.10.1993.
17.2 It was further submitted that the aforesaid arguments were
specifically raised before the Arbitrator, in appeal against the
Award and in the Writ Petition before the High Court, however,
the same were not considered. The same goes to the root of
the case and needs examination by this Court. The arbitration
could be in terms of the claim made by the respondent in the
civil suit and not beyond that. In fact, from the conduct of the
respondent, it did not have right to challenge the revised tariff
as notified on 05.10.1993 as without any objection the same
was paid till the filing of the suit dated 30.06.2000. Referring
to Section 55 of the 1963 Act, it was submitted that though no
claim for refund of any amount was made in the civil suit on
the basis of which the arbitration proceedings were conducted,
any claim of refund could be filed within six months only. In the
case in hand, the refund was never claimed by the respondent.
[2025] 8 S.C.R. 1705
Paradip Port Authority v. Paradeep Phosphates Ltd.
It was further argued that there is basic error in the Award of
the Arbitrator because refund was claimed for the period from
October 1993 till 31.03.1999. The issue for revision of tariff was
not considered any further either in appeal or in writ petition.
It was held that the provisions of the Act will not apply even
if there was failure on the part of the parties to agree upon
for revised tariff. Whereas, for the period from 01.04.1999,
the finding given is that TAMP constituted under Section 47A
of the 1963 Act will have jurisdiction to determine the tariff.
In the Award of the Arbitrator the period so mentioned was
from 01.04.1999 to 31.10.2001. In addition to the aforesaid
period vide an order passed by the High Court on 08.07.2009
in Writ Petition No.8509 of 2009, a direction was given for
consideration of such an issue by TAMP even for the period
subsequent thereto.
17.3 Further argument was raised that even otherwise, the claim
made by the respondent, even though it may be considered
admissible for the argument’s sake, shall be time-barred as
the suit for raising an issue regarding tariff from October 1993
onwards was filed in June/July 2000.
ARGUMENTS FOR THE RESPONDENT
18. On the other hand, Mr. Shyam Divan, learned senior counsel
appearing for the respondents, submitted that the case in hand does
not call for any interference by this Court. The issue has already been
examined at three different levels, namely, Arbitrator, the Appellate
Authority and thereafter in a Writ Petition by the High Court. There
are concurrent findings of fact. Hence, the scope of interference
by this Court is minimal unless there is grave error, and the views
expressed by the authorities or the court are not plausible.
18.1 The disputed period from the year 1993 to 1999, has been
dealt with in the Award of the Arbitrator. There is no issue after
01.04.1999 as TAMP has been constituted. Even otherwise,
in the factual matrix, specially which are to be dealt with by
the Expert Bodies, the courts adopt a hands-off approach.
Referring to the provisions of the Agreement entered between
the parties on 03.08.1985, the submission is that Clause I
thereof in fact is a primary clause. The tariff rates have been
1706 [2025] 8 S.C.R.
Supreme Court Reports
agreed upon. It further provides that the increase, if any, in
future can only be with mutual agreement. In case the parties
failed to mutually agree upon revision of tariff, the issue may
have to be resolved by an independent third party. It can be
by way of arbitration or may be by any other remedy. Schedule
attached to the agreement was referred to. It was highlighted
from there that some of the rates as agreed upon were fixed
minimum charges whereas some were variable. Clause II of
the Schedule is also relevant in that context which deals with
additional charges payable by respondent, namely, tug hire,
pilotage and port dues only as per the scale of rates and no
other charges like berth hire, warping, mooring or immuring
charges are payable.
18.2 Further, reference was made to Clause 20 of the agreement
which specifies that if there is any dispute arising out of and
in relation to clauses of Agreement or for interpretation of
any terms of the Agreement, the matter shall be referred to
arbitration. Clause 2 of the Agreement clearly specifies that the
entire construction had to be raised by the Respondent. Once
rates have clearly been defined in the agreement as agreed
upon between the parties, there is no need for invocation of
Clause 19 of the Agreement. The rates which have been agreed
upon between the parties are not the normal rates which may
be applicable for any other importer. In the business world,
such types of agreement are entered into which are for mutual
benefit with an idea to promote business.
18.3 In response to the arguments raised by Mr. Jaideep Gupta,
learned senior counsel appearing for the appellant that the
respondents had paid the revised charges from 1993 to 1999
without raising any objection, reference was made to various
correspondence between the parties starting from 16.03.1993.
It was at the stage when there was proposal for revision of
rates as was notified on 05.10.1993. The suit had to be filed
in June 2000 when Respondent was requested to deposit
the net outstanding interest amounting to ₹38,58,718/- latest
by 30.06.2000, failing which Appellant would have stopped
services to the incoming vessels. It was during the pendency
of the suit that on agreed terms the matter was referred to
arbitration on 10.08.2001. It was during the pendency of the
[2025] 8 S.C.R. 1707
Paradip Port Authority v. Paradeep Phosphates Ltd.
arbitration proceedings that Respondent, which was a public
sector unit, was sold off to a private player on 28.02.2002.
18.4 To buttress the argument that the Award of the Arbitrator,
which was upheld by the Appellate Authority and thereafter
by the High Court, has dealt with all the issue threadbare, it
was submitted that firstly, the Arbitrator framed issues with
the consent of both the parties. Insofar as the main issue is
concerned regarding justification of revision of rates, despite
opportunity granted to the respondents no material was placed
before the Arbitrator which could justify revision of rates as
sought by the Appellant/Authority. As far as the enabling
provision in the Agreement regarding revision of the rates by
mutual agreement is concerned, the finding recorded by the
Arbitrator was not disputed.
18.5 Reference was made to the order passed by the Appellate
Authority which again examined the Award of the Arbitrator and
has recorded categoric finding that there was no error therein.
The issue was thereafter considered by the High Court which
also upheld the same. There are limited grounds on which an
award of the Arbitrator can be interfered with.
18.6. He further argued that reliance on the revision of rates by
the Wage Board in 1994, could not be the basis for revision
of tariff in 1993.
DISCUSSION
19. We have heard learned counsel for the parties and perused the
relevant referred record.
20. The facts of the case are not in dispute that an agreement was
executed between the parties, namely Paradip Port Trust and
Paradeep Phosphates Ltd on 03.08.1985 for use of ‘captive berth’ in
terms of the conditions laid down in the Agreement. At the time when
the aforesaid agreement was executed, the respondent/Paradeep
Phosphates Ltd. was a public sector unit. Clause 1 and 19 of the
Agreement which are relevant for consideration of the issues in
question are extracted below:
“1. That the said Captive berth shall be exclusively
provided for use of the Paradeep Phosphates Ltd., subject
1708 [2025] 8 S.C.R.
Supreme Court Reports
to payment of the Rate mentioned in the schedule of rates;
annexed to the agreement and will become payable one
calendar month after the berthing of the Ist vessel at this
berth. The rates now charged can be suitably enhanced
at such intervals as would be mutually agreed upon by
the parties from time to time.
xxxx
19. That the Paradip Phosphates, shall be subjected to
the application of all relevant laws, rules and regulations
of the Paradip Port Trust that are for the time being in
force and that would be framed and enforced from time
to time.”
20.1. Along with the Agreement a Schedule was annexed which
provided for tariff for different facilities to be used by the
respondent. Part of the same were fixed whereas other charges
namely tug hire, pilotage and port dues were to be paid as
per the scale of rates.
20.2. A perusal of Clause 1 of the Agreement shows that the facilities
could be used subject to payment of the rate mentioned in
the schedule of rates, and the rates charged can be suitably
enhanced at such intervals as would be mutually agreed upon
between the parties from time to time.
20.3. Clause 19 provides that the respondent shall be subjected to
the application of all relevant laws, rules and regulations of
the Paradip Port Trust.
21. Merely because an Agreement was entered into between the parties,
the same cannot override the provisions of law. The terms of the
Agreement only provides for creation of facilities and certain tariff to
be charged from the respondent, which could be revised from time
to time as agreed. In case the parties do not agree with the revision
of tariff the same will not remain in abeyance as some authority
has to resolve this issue. Even the counsel for the respondent did
not dispute this fact. After the aforesaid Agreement was executed,
as cost and overheads on many aspects had increased, vide
communication dated 08.04.1993, the appellant had written to the
respondent mentioning that ever since the agreement was entered
into, the port charges had increased by 50% during 1989, whereas
[2025] 8 S.C.R. 1709
Paradip Port Authority v. Paradeep Phosphates Ltd.
no revision of tariff was made for the respondent. Though, as per
the proposed rates, the increase in tariff for others may be in the
range of 40 to 50%, whereas for the respondent the additional tariff
will be only 25%. Option was given to the respondent in case any
discussion was required. From the record before this Court there
was nothing to show that any reply was given by the respondent to
the aforesaid communication.
21.1. Vide Notification dated 05.10.1993, in exercise of power
conferred with the competent authority under Sections 48 to
52 of the 1963 Act, new scale of rates were notified for use
of port facilities. The aforesaid notification in Clause 3.1.1
provided for separate rates for the respondent, as compared
to the normal rates for other users of the port facilities. The
respondent continued paying the revised rates without any
objection.
21.2. A communication dated 11.05.2000 from the appellant to the
respondent has been referred to, which talks about rejection of
the proposal of the respondent for waiver of interest for delayed
payment of certain dues from October 1993 to January 1996
and request for payment of the outstanding amount of interest.
Opportunity was given to pay the arrears in 3-4 installments. In
response to the aforesaid communication, the respondent vide
letter dated 18.05.2000, on the subject of waiver of interest
for belated payment, submitted that the respondent had been
requesting for revision of existing agreement in the present
day context. To dispute payment of interest, it was submitted
that there was no provision in the Agreement for the purpose.
Request for waiver of interest was rejected by the appellant
vide communication dated 31.05.2000. Time was granted up
to 30.06.2000 for payment of the outstanding interest, failing
which the appellant may be constrained to stop the facilities
provided for.
22. The respondent filed a civil suit praying for the following reliefs:
“a) To declare that the Defendants and their agents
have no right to amend the terms and conditions of
the bilateral agreement dated 3.8.1985, unilaterally.
1710 [2025] 8 S.C.R.
Supreme Court Reports
b) To declare that the defendant and their agents have
no right to give effect to the terms and conditions
contained in the Scale of Rates published by them in
the year 1993 which do not form part of the bilateral
agreement dated 3.8.1985.
c) To permanently injunct the defendants their agents
and officers from giving effect to the terms and
conditions contained in the scale of Rates published
by the Defendants in the year 1993. To allow any
other relief(s) as it may deem proper in the facts
and circumstances of the case. And for which act of
kindness the Plaintiff shall ever pray as in duty bound.”
23. Interim stay was granted on 30.06.2000. Vide order dated 15.09.2000,
the Trial Court in the aforesaid suit directed the respondent/plaintiff
in the civil suit to obtain clearance from the High Power Committee
as two public sector units were party to the litigation.
24. It may be out of place if not mentioned here that in the Agreement
signed between the parties, Clause 20 provided for reference of
any dispute, arising out of or in relation to any of the clause of the
agreement, to arbitration. The parties agreed for resolution of disputes
by adopting an informal mechanism and an agreement was signed
on 10.08.2000 in that regard. It provided for the reference of dispute
to the Arbitrator as mentioned in the clause, and in case any of the
parties was aggrieved of the award, the remedy of appeal was also
provided. The clause specifically mentioned that the Arbitration Act
shall not be applicable to the arbitration under this clause. The terms
agreed on 10.08.2000 are extracted below:
“In the event of any dispute or differences relating to the
interpretation and application of the provisions of the
contracts, such dispute or difference shall be referred by
either party to the Arbitration of one of the Arbitrators in
the Department of Public Enterprises to be nominated by
the Secretary to the Government of India in charge of the
Bureau of Public Enterprises. The Arbitration Act, 1940 shall
not be applicable to the arbitration under this clause. The
award of the Arbitrator shall be binding upon the parties
to the dispute, provided however, any party aggrieved by
such award may make a further reference for setting aside
[2025] 8 S.C.R. 1711
Paradip Port Authority v. Paradeep Phosphates Ltd.
or revision of the award to the Law Secretary, Department
of Legal Affairs, Ministry of Law & Justice, Government of
India. Upon such reference the dispute shall be decided
by the Law Secretary or the Special Secretary/Additional
Secretary when so authorised by the Law Secretary, whose
decision shall bind the Parties finally and conclusively.
The parties to the dispute will share equally the cost of
arbitration as intimated by the Arbitrator.”
25. We deem it appropriate to deal with the argument raised by the learned
senior counsel for the respondent at this stage regarding challenge
to the award of the Arbitrator on limited ground as enumerated
under Section 34 of the Arbitration and Conciliation Act, 199612. As
it was agreed upon between the parties that the Arbitration Act will
not be applicable, it was an informal in-house procedure adopted
by the parties for resolution of the dispute where public sector units
were involved, hence, the principles laid down for the examination
of award given under the 1996 Act will not be applicable.
26. On 30.11.2001, a statement of claim was filed before the Arbitrator.
While the matter was at the stage of completion of pleadings, vide
Agreement dated 28.02.2022, the President of India transferred 74%
shares in the respondent company to Zuari Maroc Phosphates Private
Limited. As a result of which the respondent became a private entity
and was no longer a public sector unit. The Arbitrator passed an
award on 27.12.2002 recording certain findings, which were contrary
to law and anomalous.
26.1. The Award held that only Clause ‘1’ of the Agreement will apply
and not Clause ‘19’. The aforesaid finding goes against the
very basic principle that the entire agreement has to be read
as a whole and not different clauses in isolation.
26.2. On the second issue as to whether the tariff provided in the
agreement could be revised unilaterally by the appellant
without the consent of the respondent, it was opined that the
appellant should have sought consent of the respondent. If the
consent is not received, the appellant could have terminated
the Agreement or referred the matter to an arbitrator to decide
12 Hereinafter referred to as ‘the 1996 Act’
1712 [2025] 8 S.C.R.
Supreme Court Reports
the question of such enhancement. The enhancement of
rates from October 1993 was quashed. For the period from
01.04.1999 onwards, the parties were given liberty to approach
the TAMP. This was done while referring to the instance of
M/s Oswal Chemicals and Fertilizers Ltd.
26.3. On the issue of whether the rates revised were reasonable,
the claim was rejected. But the issue regarding levy of interest
for delayed payments was decided in favour of the appellant
by referring to the regulations framed by the appellant. In that
regard, reference was made to Clause 19 of the Agreement.
27. Further, it was argued that since the exercise had already been
undertaken, no interference was warranted. It is a little surprising to
note that the Arbitrator, Appellate Authority and also the High Court
did not find any justification for revision of rates which were fixed
way back in the year 1985 till 1999. The fact remains that during
the interregnum, periodically the port charges were revised from
time to time vide notifications issued in years 2000, 2005, 2007 and
2011. It cannot be disputed that during the interregnum the cost
of many inputs and services being provided by the appellant must
have increased manifold; even the salaries of the employees and
the wages of the workmen. Calculations in such cases cannot be
with mathematical precision.
28. A perusal of the order passed by the Appellate Authority shows
that the same is totally cryptic. Being the first Appellate Authority, it
was incumbent upon it to re-examine the facts in terms of the law
applicable. The Appellate Authority had merely re-written some of
the findings of the Arbitrator, barely stating that the sole arbitrator
had correctly decided the issue. The Appellate Authority has not
considered the factual aspect of the matter regarding revision of rates.
29. The High Court while considering the issue has totally misdirected
itself by holding that the Agreement will override the provisions of
the 1963 Act. Reliance by Respondent on a judgment in Patiala
Central Cooperative Bank Ltd. vs Patiala Central Cooperative Bank
Employees’ Union13 under the Industrial Disputes Act, 1948 was
13 1996 INSC 1056 : (1996) 11 SCC 202
[2025] 8 S.C.R. 1713
Paradip Port Authority v. Paradeep Phosphates Ltd.
totally misplaced. The issues, though required to be dealt with in
detail, were not discussed.
30. It is not in dispute that from time to time tariff has been revised
by the appellant in terms of the provisions of the 1963 Act. Three
different notifications have been issued on 27.04.2000, 12.01.2005,
31.10.2007 and 23.05.2011 as pointed out at the time of hearing.
31. A fact that cannot be lost sight of is that by ignoring the arbitration
clause in the Agreement signed between the parties, an informal
mechanism was agreed upon, as both parties were public sector
units. The idea was to resolve the issue. However, the fact remains
that after the informal arbitration process started, with the transfer
of 74% shares of the respondent to a private sector company, the
dispute had taken the shape of contested litigation, which was
required to be adjudged by an expert body and not in the manner
it had been dealt with.
32. It is important to note that the 1963 Act was replaced by the 2021
Act. In the 1963 Act, Chapter V-A, consisting of Sections 47-A to
47-H, was added w.e.f. 09.01.1997. It provides for the constitution
of a ‘Tariff Authority’ for fixation of scales of units for using various
facilities provided at the port. The authority consisted of a Chairman,
from amongst persons who is or who has been a Secretary to the
Government of India or has held any equivalent post in the Central
Government and two other Members who have expertise in the
subject; one Member from amongst economists having experience
of not less than fifteen years in the field of transport or foreign trade
and another Member from amongst persons having experience
of not less than fifteen years in the field of finance with special
reference to investment or cost analysis in the Government or in
any financial institution or industrial or service sector. Even in the
informal arbitration, the Arbitrator, while deciding the dispute for part
of the period, namely, October 1993 to 31.03.1999 had referred the
parties to invoke the jurisdiction of TAMP for the period subsequent
thereto, namely, 01.04.1999 to 31.10.2001. The reason for this
was that TAMP came into existence on 01.04.1999, even though
the amendment to the 1963 Act had been made earlier in 1997.
The 1963 Act has been replaced by the 2021 Act with effect from
03.11.2021. Section 54 thereof provides for the constitution of an
‘Adjudicatory Board’ for the purpose of fixation of tariff. Hence, as
1714 [2025] 8 S.C.R.
Supreme Court Reports
on today, it should be the board which should have adjudicated this
dispute. However, as was pointed out and is evident from the first
proviso to Section 54 of the 2021 Act, no adjudicatory board has
been constituted under the 2021 Act, hence, it is the TAMP which
has jurisdiction to adjudicate the issue.
33. In our view, the issues required to be considered for revision of rates
applicable to the respondent for use of various facilities, have not
been considered in the manner these were required to be considered.
The TAMP being an independent authority consisting of experts, will
be the right authority for resolution of dispute between the parties,
which is pending for more than two decades.
CONCLUSION
34. For the reasons mentioned above, we set aside the Award of
the Arbitrator, the order of the Appellate Authority and also the
order passed by the High Court. We remit the matter to TAMP for
adjudication of the dispute regarding revision of tariff applicable to
the respondent for the period from October 1993 till 31.03.1999.
As we are remitting the matter, we have not dealt with other issues
raised in the appeal. Needless to add that all the issues, including
limitation, shall be considered by the TAMP.
C.A. NO.___ OF 2025
ARISING OUT OF S.L.P.(C) NO.9870 OF 2023
FACTUAL ASPECTS
35. In the present appeal, the order dated 11.01.2023 passed by the High
Court is under challenge. Before the High Court, an order passed
by TAMP on 22.11.2011 was the subject matter of challenge. Vide
aforesaid order, tariff proposal for the financial year 1999-2000 to
2009-10 was determined. The claim of appellant for revision of the
rates was rejected. It may be out of place, if not mentioned here,
that before the TAMP, part of the period of 01.04.1999 till 31.10.2001
was the subject matter before the Arbitrator who had granted liberty
to the parties to get the same decided by the TAMP. For the period
prior thereto, he had adjudicated the dispute, and from 01.11.2001
onwards, matter was considered by the TAMP in view of the order
dated 08.07.2009 passed by the High Court in WP (C) No.8509 of
[2025] 8 S.C.R. 1715
Paradip Port Authority v. Paradeep Phosphates Ltd.
2009. In the said Writ Petition, the High Court was called upon to
adjudicate the validity of the communication dated 02.06.2009 by
which the Appellant raised a demand of ₹40.36 crores from the
Respondent, for the period March 2002-January 2009, by computing
rates applicable for Oswal Chemicals & Fertilizers and IFFCO. The
High Court vide order dated 08.07.2009 left the matter to be decided
by TAMP as the parties had already approached TAMP.
ARGUMENTS FOR THE APPELLANT
36. Mr. Jaideep Gupta, Senior Counsel appearing for the Appellant,
submitted that TAMP was called upon to decide the tariff firstly
for the period 01.04.1999 to 31.10.2001 which was referred to
by the Arbitrator. It was for the reason that TAMP had come into
existence w.e.f. 01.04.1999. For the period subsequent thereto
i.e., from 01.11.2001 till 31.03.2010, determination was in view of
a reference made by the High Court vide order dated 08.07.2009
passed in WP (C) No. 8509 of 2009. It is not a matter of dispute that
fixation of tariffs is a highly complicated arena which is the job of
experts. In fact, TAMP has failed to exercise the jurisdiction vested
in it entirely on a wrong premise. Firstly, there was a clear violation
of the principle of natural justice in the case in hand. Number of
documents, account statements and other details were filed by both
the parties. The Appellant had given a Powerpoint Presentation,
however, still the TAMP had the audacity to mention in the order
dated 22.11.2011 that no opportunity of hearing was required to be
given. Such complicated issues could not be adjudicated merely
by reading the documents wherein lot of figures and a past period
was involved.
37. Secondly, on a wrong premise, the TAMP wished to enter in the
wrong arena of making an effort to find out as to how tariff was
agreed upon between the parties vide agreement dated 03.08.1985.
That was not the issue to be considered. The only issue before
the TAMP was to consider revision of tariff on account of various
factors which had evolved during the interregnum. The cost is not to
be calculated only pertaining to the area which was to be captively
used by Respondent. Rather, there are number of other common
facilities created, it is not simply the cost of the appellant which had
to be reimbursed, as was evident from the approach of the TAMP.
1716 [2025] 8 S.C.R.
Supreme Court Reports
38. It was further argued that in the matter of revision of tariff for the
period October 1993 to 31.03.1999 where also the claim for revision
was rejected. One of the arguments is for examination of the issue
by the expert body as the arbitrator or appellate authority having not
considered the issues in this light, these should have been, and the
prayer is for referring the matter back. In case the aforesaid prayer is
accepted for the period mentioned above, the matter for the period
in question will have to be remitted back for the reason that in case
there is revision of tariff for the previous period, the same will certainly
have bearing on period subsequent thereto. It was further argued
that the approach of the TAMP could not be appreciated simply for
the reason that no case for increase of tariff was made out though
the period in question before TAMP was more than a decade. The
cost of various inputs and overheads had increased manifold during
this period, on account of various services provided by the Appellant
to the Respondent. In fact, the TAMP had totally misdirected in its
approach.
ARGUMENTS FOR THE RESPONDENT
39. In response, Mr. Shyam Diwan Learned Senior Counsel for
Respondent submitted that the expert body namely the TAMP,
considered the claim made by Appellant. Thereafter, the High Court
has also examined the issue. Once two authorities have already
considered the issues threadbare and despite adequate opportunity
given to the appellant to place relevant material on record to justify
revision of tariff, nothing could be produced, this Court should not enter
into an arena of tariff revision which is the job of the expert bodies.
The facts in detail cannot possibly be examined and appreciated.
DISCUSSION
40. We have heard learned counsel for the parties.
41. The issue required to be considered by the TAMP in the case in
hand was regarding proposed revision of tariff by the Appellant for
facilities provided to Respondent. At the cost of repetition, we need
to add that an agreement was executed between Appellant and
Respondent on 03.08.1985, fixing a certain tariff for captive use of
berth known as ‘fertilizer berth’. The tariff initially fixed was revised
by the Appellant to which issue was raised by Respondent. As at
[2025] 8 S.C.R. 1717
Paradip Port Authority v. Paradeep Phosphates Ltd.
relevant point of time the Respondent was Public Sector Unit, the
matter was referred for informal arbitration to Joint Secretary and
Legal Advisor to the Government of India, Ministry of Law, Justice
and Company Affairs and even remedy of appeal was provided to
the Law Secretary, Department of Legal Affairs, Ministry of Law &
Justice, Government of India. Period involved was October 1993 to
31.10.2001. The arbitrator considered the matter while and rejected
the claim for any revision of tariff from October 1993 to 31.03.1999.
TAMP having come into existence w.e.f. 01.04.1999, for the period
subsequent thereto, parties were given liberty to approach the TAMP.
This is how the matter for revision of tariff for the aforesaid period was
before the TAMP. As even for the period subsequent thereto namely
01.11.2001 onwards, there was dispute regarding tariff between
the parties, in a Writ Petition14 filed by Respondent, the High Court
vide order dt. 08.07.2009 directed TAMP to expeditiously dispose
of the matter already pending before it. This is how the TAMP had
considered the matter pertaining to the revision of the tariff from
01.04.1999 to 31.10.2010.
42. It looks a little surprising that TAMP did not find any justification for
revision of tariff even for a time gap of more than 10 years. The
costs, overheads on many aspects must have increased manifold
during the interregnum.
43. Insofar as the opportunity of hearing is concerned, the High Court
has also failed to appreciate this aspect of the matter while referring
that both the parties underwent a process of mutual agreement,
hence it cannot be said to be a case of non-affording of opportunity
of hearing. The High Court lost sight of the fact that TAMP was
called upon to decide the dispute as the parties had failed to agree
to any terms. In that eventuality, on the basis of the material placed
on record of both parties, an opportunity of hearing was required to
be given, where complicated issues of facts were involved, which
could be explained by the parties at the time of hearing. It is a clear
case of violation of principles of natural justice.
44. One of the reasons assigned was that the basis for fixation of tariff at
the time of entering into the initial agreement could not be deciphered.
The same, in our opinion, prima facie was not the material fact for
14 W.P. (C) No.8509 of 2009
1718 [2025] 8 S.C.R.
Supreme Court Reports
consideration for revision of tariff. The tariff was to be revised keeping
in view the base point and not the basis for fixation thereof.
45. One of the principles on which we are unable to agree is the
reimbursement of the cost principle. Even under the normal tariff
fixation regime, the cost-plus return approach is the principle to be
followed.
46. Further, once we have set aside the award of the Arbitrator, order
of the Appellate Court and also of the High Court pertaining to the
revision of the tariff for the period from October 1993 to 31.03.1999,
and remitted the matter to be decided by TAMP, in our opinion, even
the order pertaining to the period in question also deserves to be
set aside as the base for revision of tariff for subsequent periods is
yet to be determined.
CONCLUSION
47. For the reasons mentioned above, the impugned order passed by the
TAMP and also the High Court are set aside. The matter is remitted
to the TAMP for decision afresh along with the matter for the period
prior thereto. Needless to add that in the process of adjudication
both the parties should be given due opportunity of hearing.
CONSTITUTION OF APPELLATE AUTHORITY
48. During the course of arguments and at the time of examination of
issues in detail, it transpired that the process for fixation of tariff
presently by the TAMP or the adjudicatory board, as constituted and
provided for under the 2021 Act, is the job of experts in the field.
Direct appeals have been provided against the order passed by the
TAMP or the adjudicatory board to this Court. To take the views of
the counsel for the parties, we had again listed the matter on July
30, 2025, for direction. Thereafter, brief notes have been received
from the learned counsel for the appellants and respondent.
49. The 1963 Act provided for the constitution of Tariff Authority i.e. TAMP
for fixation of tariff applicable for any port. The authority consists
of a Chairman, from amongst persons who is or who has been a
Secretary to the Government of India or have held any equivalent
post in the Central Government and two other Members who have
expertise in the subject, one Member from amongst economists having
[2025] 8 S.C.R. 1719
Paradip Port Authority v. Paradeep Phosphates Ltd.
experience of not less than fifteen years in the field of transport or
foreign trade and another Member from amongst persons having
experience of not less than fifteen years in the field of finance with
special reference to investment or cost analysis in the Government
or in any financial institution or industrial or service sector.
50. Under the provisions of the 1963 Act, no statutory remedy was
provided against any order passed by the TAMP.
51. As the position stands today, the 1963 Act has been replaced by the
2021 Act with effect from 03.11.2021. In the 2021 Act, an adjudicatory
board has been constituted under Section 54 thereof. The function
of the board is fixation of tariff. First proviso to Section 54 of the
2021 Act provides that till such time the board is constituted, TAMP
as constituted under the 1963 Act will continue to function.
52. Section 60 of the 2021 Act provides for remedy of appeal against
the order passed by the adjudicatory board to this Court. Meaning
thereby, first appeal against the order passed by the adjudicatory
board and at present in its absence the TAMP, would lie to this Court.
The relevant provisions as referred to above are extracted below:
“54. Constitution of Adjudicatory Board.—
(1) The Central Government shall, by notification, constitute,
with effect from such date as may be specified therein, a
Board to be known as the Adjudicatory Board to exercise
the jurisdiction, powers and authority conferred on such
Adjudicatory Board by or under this Act:
Provided that until the constitution of the Adjudicatory
Board, the Tariff Authority for Major Ports constituted
under Section 47-A of the Major Port Trusts Act,
1963 (38 of 1963) shall discharge the functions of the
Adjudicatory Board under this Act and shall cease to
exist immediately after the constitution of the Adjudicatory
Board under this Act:
xxxx
60. Review and appeal.—
(1) Any party aggrieved by any decision or order of the
Adjudicatory Board under this Act, from which an appeal
1720 [2025] 8 S.C.R.
Supreme Court Reports
is allowed under sub-section (2), but from which no appeal
has been preferred, may apply for a review of such decision
before the Adjudicatory Board, in such form and manner
and within such time, as may be prescribed, and the said
Board may make such order thereon, as it thinks fit.
(2) Any party aggrieved by any decision or order of
the Adjudicatory Board, may file an appeal to the
Supreme Court of India, within sixty days from the date
of communication of such decision or order to him:
Provided that no appeal shall lie from a decision or order
passed by the Adjudicatory Board with the consent of
parties:
Provided further that the Supreme Court may, entertain
any appeal after the expiry of sixty days, if it is satisfied
that the appellant was prevented by sufficient cause from
preferring the appeal.”
53. If we examine the authority vested in the adjudicatory board under the
2021 Act, apart from tariff setting it has various other functions like-
a. functions to be carried out by the erstwhile TAMP arising from
the Tariff Guidelines of 2005, 2008, 2013, 2018 and 2019 and
tariffs orders issued by the TAMP;
b. receive and adjudicate reference on any dispute or differences
or claims;
c. appraise, review the stressed Public Private Partnership projects
and suggest measures to revive such projects;
d. look into the complaints received from port users against the
services and terms of service rendered by the Major Ports or
the private operators and to pass necessary orders after hearing
the parties concerned; and
e. look into any other matter relating to the operations of the
Major Port.
54. It cannot be denied that fixation of tariff would involve consideration
of various factual aspects, especially figures involved. This Court
may not have the expertise to examine the accounts in detail for
the purpose of fixation of tariff. While deciding appeal against an
[2025] 8 S.C.R. 1721
Paradip Port Authority v. Paradeep Phosphates Ltd.
order of an expert body, all issues of law and fact are required to
be considered. Whether the process providing for the first appeal
against the order of the adjudicatory board is reasonable, is an issue.
55. Similar issue with reference to fixation of tariff under the Electricity
Regulatory Commissions Act, 199815 came up for consideration
before this Court in W.B. Electricity Regulatory Commission v.
CESC Ltd16. Under the aforesaid Act, a Central Electricity Regulatory
Commission17 was constituted for discharge of various functions
assigned thereof under Section 13 thereto. It was with reference to
fixation of tariff. Section 16 of the 1998 Act provided for an appeal
to the High Court against an order passed by the Central Electricity
Regulatory Commission. Section 17 of the aforesaid Act provided for
the establishment of the State Electricity Regulatory Commission to
discharge functions for the fixation of tariff for intra-State transmission
of power. Section 27 of the 1998 Act provided for appeal to the High
Court against an order passed by the State Commission.
56. In the aforesaid judgment, the matter came up for consideration
before this Court against the judgement of the High Court in an
appeal against an order passed by the State Electricity Regulatory
Commission. Noticing the fact that the CERC consists of technically
qualified persons and is an expert body for determination of tariff
which is required to consider lot of factual position, this Court observed
that it would be more appropriate and effective if a statutory appeal
is provided to a similar expert body so that various questions, which
are factual and technical in nature could be considered at the first
appellate stage. It was further observed that, neither the High Court
nor this Court would in reality be an appropriate forum to deal with
this type of factual and technical matters. It was recommended that
the appellate jurisdiction, against the order of the State Commission
under the 1998 Act, should be conferred either on the CERC or a
similar body. Reference was also made to the appellate tribunal
constituted to hear appeals against the order passed by the Telecom
Regulatory Authority under the Telecom Regulatory Authority of India
Act, 1997. Relevant para 102 thereof is extracted below:
15 Hereinafter referred to as the 1998 Act
16 (2002) 8 SCC 715
17 Hereinafter referred to as the ‘CERC’
1722 [2025] 8 S.C.R.
Supreme Court Reports
“Re: An effective appellate forum
102. We notice that the Commission constituted under
Section 17 of the 1998 Act is an expert body and the
determination of tariff which has to be made by the
Commission involves a very highly technical procedure,
requiring working knowledge of law, engineering, finance,
commerce, economics and management. A perusal of
the report of ASCI as well as that of the Commission
abundantly proves this fact. Therefore, we think it would
be more appropriate and effective if a statutory appeal
is provided to a similar expert body, so that the various
questions which are factual and technical that arise
in such an appeal, get appropriate consideration in
the first appellate stage also. From Section 4 of the
1998 Act, we notice that the Central Electricity Regulatory
Commission which has a judicial member as also a
number of other members having varied qualifications,
is better equipped to appreciate the technical and factual
questions involved in the appeals arising from the orders
of the Commission. Without meaning any disrespect
to the Judges of the High Court, we think neither the
High Court nor the Supreme Court would in reality be
appropriate appellate forums in dealing with this type of
factual and technical matters. Therefore, we recommend
that the appellate power against an order of the State
Commission under the 1998 Act should be conferred
either on the Central Electricity Regulatory Commission
or on a similar body. We notice that under the Telecom
Regulatory Authority of India Act, 1997 in Chapter IV,
a similar provision is made for an appeal to a Special
Appellate Tribunal and thereafter a further appeal to the
Supreme Court on questions of law only. We think a similar
appellate provision may be considered to make the relief
of appeal more effective.”
(emphasis supplied)
57. It is important to emphasise that the workload of Major Ports in
India has doubled, registering a 7.5% Compound Annual Growth
[2025] 8 S.C.R. 1723
Paradip Port Authority v. Paradeep Phosphates Ltd.
Rate over 10 years and handled 819.227 million tonnes of cargo
in Financial Year 2023-24. When the Major Port Trusts Act, 1963
was first enacted in the year 1964, there were 7 major ports18 in
the country. With the growth in business, 5 more major ports19 have
been created. Recently, in 2024, Union Cabinet approved setting up
of another major port at Vadhavan, Maharashtra. Considering the
rise in business at the major ports, the importance of the TAMP in
resolving the equally rising number of disputes cannot be undermined.
Disputes related to such a technical area of importance can be better
dealt with by a specialised expert body. Appeals therefrom should
also be maintainable before specialised appellate body.
58. Besides this, we take note of the fact that there are other similar expert
bodies which are headed by technically qualified persons along with
persons with knowledge of accounting and economics. Specialised
expert appellate body has also been constituted to entertain appeal
against orders of such expert bodies. Reference can be made to-
a. Securities and Exchange Board of India Act, 1992- Securities
Appellate Tribunal has been created to entertain appeals against
orders of the Securities Exchange Board of India.
b. Telecom Regulatory Authority of India Act, 1997- Telecom
Disputes Settlement and Appellate Tribunal was constituted
to hear appeals against the orders of the Telecom Regulatory
Authority of India. TDSAT has also been conferred powers
of the Appellate Tribunal under Section 17 of the Airports
Economic Regulatory Authority of India, 2008 with reference
to the jurisdiction vested therein.
c. Competition Commission Act, 2002- Competition Appellate
Tribunal [now merged with National Company Law Appellate
Tribunal] was constituted to hear appeals against the orders
of Competition Commission of India.
d. Electricity Act, 2003- Appellate Tribunal for Electricity
(APTEL) constituted to hear appeals against the orders of the
adjudicating officer or the Central and State Electricity Regulatory
18 Namely Vizag, Chennai, Cochin, Mumbai,Vishakapatnam, Mormugao and Kandla
19 Namely Kolkata, Paradip, Tuticorin, New Mangalore, and JNPT
1724 [2025] 8 S.C.R.
Supreme Court Reports
Commissions. APTEL has also been given powers to hear
appeals under the Petroleum and Natural Gas Regulatory Board
Act, 2006 against the orders passed by Petroleum and Natural
Gas Regulatory Board, in the absence of a regular mechanism
created under aforesaid Act.
e. Companies Act, 2013- National Company Law Appellate
Tribunal has been constituted to hear appeals against the orders
of National Company Law Tribunal.
59. Reference can also be made to the judgment of this Court in Rojer
Mathew vs. South Indian Bank Limited20 where one of the issues
considered by this Court was ‘as to whether direct statutory appeals
from Tribunals to the Supreme Court ought to be detoured’. After
examination of the matter, by referring to the various statutes wherein
direct appeals have been provided to this Court, the direction as
given in para ‘218’ of the judgment, is extract below:
“218. It is apparent that the legislature has not been
provided with desired assistance so that it may rectify
the anomalies which arise from provisions of direct
appeal to the Supreme Court. Considering that such
direct appeals have become serious impediments in the
discharge of constitutional functions by this Court and
also affects access to justice for citizens, it is high time
that the Union of India, in consultation with either the
Law Commission or any other expert body, revisit such
provisions under various enactments providing for direct
appeals to the Supreme Court against orders of tribunals,
and instead provide appeals to Division Benches of High
Courts, if at all necessary. Doing so would have myriad
benefits. In addition to increasing affordability of justice
and more effective constitutional adjudication by this
Court, it would also provide an avenue for High Court
Judges to keep pace with contemporaneous evolutions
in law, and hence enrich them with adequate experience
before they come to this Court. We direct that the Union
20 2019 INSC 1236 : (2020) 6 SCC 1
[2025] 8 S.C.R. 1725
Paradip Port Authority v. Paradeep Phosphates Ltd.
undertake such an exercise expeditiously, preferably
within a period of six months at the maximum, and place
the findings before Parliament for appropriate action as
may be deemed fit.”
59.1. It may be out of place if not added here that the 2021 Act is
not mentioned in the list of Acts referred to in the aforesaid
judgment in para 200 as the same was delivered on 13.11.2019
whereas the 2021 Act came into force thereafter on 03.11.2021.
60. In view of our above observations, we recommend to make the
remedy of appeal more effective and meaningful without disrespect
to any authority. It would be appropriate if an expert appellate body
is constituted to hear appeals against the orders passed by the
adjudicatory board/TAMP.
RELIEF
61. On merits
C.A. No.____ of 2025
arising out of S.L.P.(C) No.9751 of 2023
61.1. We set aside the order of the Arbitrator, the order of the
Appellate Authority and also the order passed by the High
Court. The matter is remitted back to the TAMP for adjudication
of the dispute regarding revision of tariff applicable to the
respondent for the period from October 1993 till 31.03.1999.
C.A. No.____ of 2025
arising out of S.L.P.(C) No.9870 of 2023
61.2. Impugned order passed by the TAMP and also the High Court
are set aside. The matter is remitted to the TAMP for decision
afresh along with the matter for the period prior thereto.
Regarding constitution of Appellate Authority
61.3. In view of our above observations, we recommend to make
the remedy of appeal more effective and meaningful without
disrespect to any authority. It would be appropriate if an expert
1726 [2025] 8 S.C.R.
Supreme Court Reports
appellate body is constituted to hear appeals against the orders
passed by the adjudicatory board/TAMP.
62. The Registry of this Court shall forthwith send a copy of this order to
the Secretary, Legislative Department, Ministry of Law and Justice,
Government of India to examine the issue and take appropriate steps.
Result of the case: Matters are remitted to the TAMP.
†
Headnotes prepared by: Ankit Gyan
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