Holding

A master is not a seaman for the purpose of compensation under the Merchant Shipping Act, 1958 and is entitled only to three months' wages on termination, not a full year's wages.

Summary

Capt. S. M. Rebello was appointed as master of the vessel M.V. Anastasia for a one‑year term. The ship was sold as scrap and his services were terminated on 20 December 1980. He claimed full‑year wages, arguing that under the Merchant Shipping Act, 1958 a master is treated as a seaman and is entitled to compensation on discharge. The High Court held he was entitled to a full year’s wages, but the Supreme Court examined the statutory definitions and held that a master is distinct from a seaman and is only entitled to three months’ wages under s.143 read with s.148. The Court also affirmed that the contract of personal service between a master and shipowner cannot be specifically enforced. Consequently, the Supreme Court set aside the High Court judgment, restored the Magistrate’s order of three months’ wages, allowed criminal appeal No. 240/82 and dismissed criminal appeal No. 661/82, directing the excess amount to be refunded.

Issues considered

Whether a master of a ship is deemed a 'seaman' for purposes of compensation under the Merchant Shipping Act, 1958.
Whether a master terminated before the expiry of a fixed‑term appointment is entitled to full‑year wages or only the statutory notice pay.
Whether the contract between a master and shipowner is a contract of personal service that can be specifically enforced.

Legislation cited

Merchant Shipping Act, 1958s. 101, s. 103, s. 108, s. 119, s. 120, s. 125, s. 143, s. 148, s. 178, s. 179, s. 180, s. 181, s. 182, s. 183, s. 199, s. 3(22), s. 3(42), s. 89
Specific Relief Acts. 21

Subjects

Merchant Shipping Actmaster of shipseamantermination of servicecompensationcontract of personal servicespecific reliefnotice pay

Judgment

I

A STEEL INDUSTRIALS KERALA LTD.

v.
;
CAPT. S. M. REBELLO & ORS.

B 26th February, 1985

S. M'l!ll.TAZA FAZAL ALI, A. VAllDAllAJAN, JJ.

c
T1r• appointmtnt for a fixed period -Pre-m4/ure termination of services
of• Uaster of the ship-Whither the "master of a ~hip" Is a ''seaman"
wftli• tilt ..ra•fng of tilt provlslM• of the Mirchtlllt Shipping Act, 19J8 for
tte purpose3 o/ entitlement to git /1111 compensation on the termination of his
11rvitt•, for th• entlrt period of hi• contraet-Sectlons 3 f22), 3 (42), 89,
-
101, 103, ilB, )'20, 125, 143, 148, 178 to 183 of the Merchant Shipping Aet,
1958-Whtther the contract of appointment of a master of a ship and rhe
own1r Is In the nature of a contract of personal a1rrlc1 and therefore eannot be
specificall1 enforced.
D The respondent was appointed on October U, 1980 ror a period of
one year as a "master" or the ship called "M. V. Anastasia" in torms of the
appointment order under which he was entitled to two months' wages, if the
was discharged before the completion of bis term. The said ship on
December II, 1980, touched the harbour and thereafter proceeded to Bey.
pore, Calicut, where the respondent was informed that the ship having been
sold as a scrap to the appellant company, Steel Industries, Kera la, be should
E handover the ship to the company. Consequent upon the sale of the ship,
by an order dated 20. 12. 80 the services of the.respondent were terminated.
On December 22, 1980 the respondent wrote a l~tter to the previous owner
of the ship of having handed over the ship to the appellant company On
24. 12. 80 the respondent moved the Magistrate under section 145 of the
Merchant Shipping Act, 1958 for payment of necessary wages. The Magis·
trate after considering all the pros and cons of the matter felt that the
F respondent was entitled to get compensation at least equivalent to three
months' pay calculated at $1800 per month, In appeal the High Court of
Kerala increased the compensation equivalent to one year's wages.
'
Allowing the companys' criminal appeal No. 240/82 and dismissing
0 the Ma5ter'• appeal No. 6' l /82, the Court

HELD : 1. The Hiah Court has misconstrued the various 1ectio11 of
tfto Merchant Shipping Act. 1958 and by a strange proceas of reasoning •
arrived at the conclusion that the respondent was entitled to full compen-
sation of one years' wages even if his services were terminated before the
expiry of bis actual termJ when in fact th.e ship having been treated as a
H
STBEL INDUSTRl.BS v. S. 1'1. REBELLO 999
I -1, scrap was no longer required and therefore his services had to be dispensed
with and whea the respondent himself rightly understood the termi of his
A
appointment and put bis claim at two months' wages only. (1006H; 1007]

2.1 The1 e is no pfovision in the Merchant Shipping Act, 1958 which
equates a seaman with a master of a ship in regard to the terms and
conditions or emoluments or mode of discharge or under which a master of
; I.
a ship can get a discharge certificate. But under section 143 read with B
section 148 a Master is entitled to three months' wages. [lOOSC-E]

2.2 A perusal of the relevant sections clearly reveali that the statute
mates a well knit distinction between a 'seaman' ctnd a 'Master' of the
ship. The definition of ~Master' in sub·section (22) of section 3 docs not
include a seaman. Sub:section 4 ~ of section 3 clearly shows that a 'seaman 1
cannot in the ordinary sense of the term be equated with a cMaster' but c
for certain specific purposes under sections 178 to 183 it includes a Mastor
In sub-section (1) of section 180, the word 'Master" has been used for the
first time but evea here the term has been used not to equate a seaman
with a master but in quite a different context and subserve a different
purpose. [1002B, D, E-F, 1003D]

2.3 There is no clear provision from which it can be inferred either D
directly or by necessary intendment that a master is also a seaman for the
purpose of getting compensation if his services were terminated. The

-
various aub·1ections of section 89 do not at all govern tha terms and condi·
tions of a 'master' but serve to carve out bis duties at various levels or
•!ages. Section• 101, 103, 108, 119, 120, 125. 132, 143 and 199 of the
)
Merchant Shipping Act-all those govern the trrms and conditions of a
1ervice of a seaman and the crew and ba.ve nothing to do with the master E
of a ship. It is true that sub-sections l and 2 of section 148 provide that
a master of a ship would have the same rights, liens and remedies for
recovery of his wages as a seaman either under the four corners of the-Act
or by any law or eustom. But there . is no provision in the Act under
which a discharge certificatt) can be given to a master of a ship or even
otherwise, a master cannot claim the rights and privileges of a seaman,
because a master of a ship is an officer of a higher rank than that of a
F
seaman. Therefore, his terms and conditions are boupd to be different
from that of a seaman. [1003E·F, 1004B, F, 1006A-B]

3. The contract between the master of a ship and the owne.r is in the
nature of a contract of personal service and cannot be specifically enforced.
[1006D] G
Dr. s. B. Dutt v. University of Delhi, [1959] S.C.R. 1236 referred to.

[The Court directed (i) that the excess amount which has been with·
d1awn by the 1cspondent shall be refunded to the appellant within four
months from 26. 2. SS either in instalments or in one Ju.mp-sum failing
which it will be open to the app~llant to recover the same by way of resti-
tution and (ii) that if the amount is not returned within fuur months then
• • %
tho recovery will be made with interest at the rate of 12 o per annum. l
[1007E·F}
8
1000 SUPRBMB i:OURT REPORTS (1985) 2 S.C.R.

A CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 240
of 1982

From the Judgment and Order dt. 2.3.1982 of the High Court
of Kerala at Ernakulam in Cr!. R.P. No. 435/81.

R Criminal Appeal No. 661 of 1982

From the Judgment and Order dt. 12.2.1982 of the High Court
ofKerala at Ernakulam in O.P. No. 6834/81.

G.L. Sangh!, G.N. Rao, A.S. Nambiar, Attar Singh for the
C Appellants in Cr!. A. No. 240/82 & Respondents in Cr!. A.
No. 661/82.

Govind Mukhoty, Mr. V. Maya Krishnan, A.N. Boraiyar for
the Respondents in Cr!. A. No. 240/82 and Appellants in Cr!. A.
No. 661/82.
D
S.M. Rebelo {In person).

The Judgment of the Court was delivered by,
i
FAZAL ALI, J. By our Order dated February 12, 1985 we
disposed of the above-mentioned two criminal appeals-dismissed
E criminal appeal No. 661/82 and allowed criminal appeal No. 240 of
1982. We now proceed to give the reasons for our Order.

The facts of the case lie withln a very narrow compass. The
appeal by special leave has been filed by the appellant.company
contending that the respondent was not entitled in law to get full
F compensation for one year as was granted by the High Court for
rremature termination of his services. The detailed facts ha Ye .been
given by the High Court and the criminal court and it is not
necessary to repeat the same.

However, in order to understand the delicate and difficult
G
points raised by the respondent, it may be necessary to give a short
history of the circumstances in which the services of the respondent,
who was Master of the ship called 'M.V. Anastasis', were terminated.
It is common ground that the respondent was appointed on October
22, 1980 for a period of one year. It is not disputed that on •
H December 11, 1980 the said ship touched the harbour and thereafter
StBEL INDUSTRIES v. s M. REBELLO (Fazal Ali, J.) 1001

proceeded to Beypore, Calicut where the respondent received a A
message from the owner of the ship that the ship has been sold as
scrap to the appellant-company, Steel Industrials Kerala Ltd. Conse·
quent upon the sale of the ship, by an order dated 20.12.80 the ser-
vices of the respondent were terminated. On December 22, 1980, i.e,,
two days later, the respondent wrote a Jetter to the previous owner
intimating that, as directed, he had handed over the ship to the B
appellant-company. A little later on 24.12.80, the respondent moved
the Magistrate under s. 145 of the Merchant Shipping Act, 1958
(hereinafter referred to as the 'Act') for payment of necessay
wages,. ..... The Magistrate after considering all the pros and cons of
the matter felt that the respondent was entitled to get compensation c
at least equivalent to three months' pay. The respondent was,
however, not satisfied with the order of the Magistrate because he
claimed a much higher compensation as his services were terminated
before completion of one year for which he was appointed. It is
true that the salary of the respondent, calculated at the rate of
$1800 per month, amounts to a snbstantial sum of money if he were D
to get compensation on a full salary basis for the entire period,
which actually he had not served. We are, however, not concerned
with the quantam of the compensation which he could get, but the
• main point for consideration in this case is to whether or not his
) claim for compensation for the whole year could be entertained. In
one of the letters which he had written to the owner of the ship he E
had himself admitted that he was entitled to two months' notice pay
plus other emoluments. This would show that the contract between
the parties as understood by them was that if the services of the
respondent were terminated before completion of the term of one
year, he would be entitled to two months' notice. The Magistrate,
• .J, however, took a more liberal view in the matter and held that the F
respondent was e.ntitled to at least three months' notice and
consequently to the emoluments calculated at the rate of $1800 per
month, and accordingly ordered payment of three months' pay. This
is in accordance withs. 143 read withs. 148 of the Act.

It is manifest that under the contract the respondent was not
appointed to any permanent post which was to last until his retire- G
ment but his appointment was really a term appointment for a fixed
period.
The main contention of the respondent before us was that as
H
b,e did not get any d\scharge slip under the provisions of the Act, he
1002 SUPREMI! COURT REPORTS (198SJ 2 S.C.R.

A was entitled to full wages for the entire term of one year. In this
connection, he relied on certain provisions of the Act to which we
shall refer here after.

It appears that the respondent seems to have presumed that
B he was equal in status to that of a seaman and, therefore, unless a
discharge certificate was given to him he was entitled to compensa-
tion for the entire period of the contract. A perusal of the relevant
sections, clearly reveals that the statute makes a well knit distinction
between a seaman and a master of the ship.

C This now takes us to an analysis of the relevant provmons of
the Act on which reliance has been placed by the respondent. To
begin with, sub-section (22) of s. 3 defines a 'Master' thus :

"master" includes any person (except a pilot or
harbour master) having command or charge of a ship;"
D
It is pertinent to note that the definition of 'Master' does not
include a seaman and, therefore, the argument of the respondent
that he should be equated with a seaman or treated as such, cannot
be accepted and is in fact without any substance. Sub-section (42)
E of s. 3 defines a 'seaman' as every person (except a master, pilot or '
apprentice) employed or engaged as a member of the crew of a ship
but for certam specific purposes under sections 178 to 183 it includes
a master. An analysis of this sub-section shows that a seaman cannot
in the ·ordinary sense of the term be equated with a 'master'. Thus,
the second part of sub-section (42) on which great reliance was
F placed by the respondent clearly carves out a separate area where
for the purpose of this sub-section a seaman might include a master.
This limited area is to be found within the four corners of sections
1'78 to 183. This now brings us to a consideration of s. 178 which
may be extracted thus :-
0 "178. Meaning of serving seaman

A seaman shall, for the purposes of these prov1s10ns, I
be deemed to be a serving seaman during any period com- '
mencing on the date of the agreement with the crew and
ending thirty days after the date on which the seaman is
finally discharged from such agreement."
"
STEEL INDUSTRIES v. s. M. REEELLO (Faza /Ali, J.) 100~

There is nothing in this section to indicate that a seaman can A
in any sense of the term be equated with a 'master'. Evens. 179
refers only to a serving seaman and not a Master. The relevant
provisions of s. 180 may be extracted thus:

"180. Nottce to be given in case of unrepresented
seaman B

(ll Ifa collector has certified under sub-section (2) of
section 179, or if a court has reason to believe that a
seaman who is a party to any proceeding before the court,
is unable to appear therein or is a serving seaman, the
Court shall suspend the proceeding, and shall give notice
c
thereof to the shipping master :"

This section merely provides that if a court has reason to
believe that a seaman was a party to any proceeding and does not
appear therein, the court shall postpone the proceeding and give D
notice thereof to the shipping master. In this sub-section, the word
'master' has been used fo~ the first time but the term has been used
not to equate a seaman with a master but in quite a different context
and subservea different purpose. The other sections also, particularly
s. 183, merely provide that a serving seaman mayreferthe question to
the shipping master whose certificate shall be conclusive evidence on
the question whether a seaman was a serving seaman or not at any E
particular time or period. There is no clear provision from which it
can be inferred either directly or by necessary intendment that &
master is also a seaman for the purpose of getting co·'pensation if
his services were terminated. Section 89 defines the duties of ship.
ping masters which may be extracted thus :
F
"It shall be duty of shipping masters --

(a) to superintend and facilitate the engagement and
discharge of seamen in the manner provided in this Act :

G
(b) to provide means for securing the presence on
board at the proper times of the seamen who are so
engaged;

(c) to facilitate the making of apprenticeship to the
sea service ;
1004 BlJPRl!MJl COURT REPORTS [198S) 2 s.c.a.
A
(d) to hear and decide disputes under section 132 bet-
ween a master, owner or agent of a ship and any of the
crew of the ship;

(e) to perform such other duties relating to seaman,
apprentices and merchant ships as are for the time being
B committed to them by or under this Act."
The various sub-sections of s. 89 do not at all govern the terms '
and conditions of a 'master' but serve to carve out his duties at
various levels or stages. Similarly, s. 101 refers only to the question
that there should be an agreement with the crew in a prescribed
c form. There is no reference to the terms and conditions of a
master in any of the sub-sections. Section 103 is a general section
which governs the terms and conditions of a seaman and there is
no reference to a master of the ship. Reliance was then placed on
s. 118, the relevant portion of which may be extracted thus :
•
D "ll8. Discharge before shipping master

(!) When a seaman serving in a foreign-going ship is,
on the termination of his engagement, discharged in India,
he shall, whether the agieement with the crew be an agree-
E ment for the voyage or a running agreement, be discharged
in the manner provided by this Act in the presence of
a shipping master."

This sub-section taken together with the other sub-sections
also governs the terms and conditions of a seaman and not those
of a master of the ship. Section 119 merely provides that the master
F shall sign and give to seaman who is discharged, a discharge certi-
ficate either on his discharge or on payment of his wages specifying
the period of his service and the time and place of his discharge.
This section also governs the terms and conditions of a seaman and
has nothing to do with the terms and conditions of a master of a
ship. Similarly, s. 120 relates to the consequences where a seaman
G is discharged.
I
Some reliance was also placed on sub-section (I) of s.125 r
which may be extracted below :

fl '.'125. Master to deliver account of wages
STEEL INDUSTRIES v. S.M. REBELLO (Fazal Ali, J.) lOOS

(1) The master of every ship shall, before paying off A
or discharging a seaman under this Act, deliver at the time
and in the manner provided by this Act a full and true
account in the form prescribed of the seaman's wages .and
of all deductions to be made therefrom on any account
whatever."
B
This again defines the duties of a master in respect of a
seaman who is discharged. Section 132 provides the procedure to
be followed in case any dispute arises, under the agreement with the
crew, between the master, owner or agent of a ship and lays down
that the same should be submitted for decision to the shipping
master.
c
Section 143, on which some reliance was placed by counsel
for the respondent, refers only to the circumstances under which a
seaman could be discharged aud the consequences ensuing there·
from. D
It is apparent from the facts narrated and the analysis of the
sections made by us that there is no provision in the Act which
equates a seaman with a master of a ship in regard to the terms and
• conditions or emoluments or mode of discharge. In fact, there is
j no provision under which a master of a ship can get a discharge E
certificate. But under s. 143 read withs. 148 a Master is entitled
to three months' wages in case of discharge or termination in the
same manner as a seaman is entitled to three months' wages.

Great reliance was, however, placed by the counsel for the
respondent on sub-sections (I) and (2) of s. 148 which provide that F
a master of a ship would have the same rights, liens and remedies for
recovery of his wages as a seaman either under the four corners of
the Act or by any law or custom. Sub-s.(2) may be extracted thus :

"(2) The master of a ship and every person lawfully
acting as master of a ship by reason of the decease or in- G
capacity from illness of the master of the ship shall, so far
as the case permits, have the same rights, liens and remedies
for the recovery of disbursements or liabilities properly
made or incurred by him on account of the ship as a master
has for the recovery of his wages." H
1006 SUPREME COURT REPORTS [1985] 2 S.C.lL

A Hence, it is manifest that since there is no provision in the
Act nnder which a discharge certificate can be given to a master of
a ship or even otherwise, he cannot claim the rights and privileges
of a seaman. This is obviously so because a master of a ship is an
officer of a higher rank than that of a seaman and therefore his
B
terms and conditions arc bound to be different from that of .a •
seaman.

Reliance was also placed on s. 199 of the Act which also deals
not with the conditions of service of a master but of the forfeiture
of wages of a seaman or apprentice on desertion from a sliip.
c
It was contended on behalf of the appellant that the contract
between the master of a ship and the owner was in the nature of a
contract of personal service and could not be specifically enforced·.
This view is supported by a decision of this Court in Dr. S.B. Dutt
v. University of Delhi(1 ) where Sarkar, J., observed thus :
D
· "The High Court had held that it was not open to the
arbitrator "to grant Dr. Dutt a declaration that he was still
a professor i!Whe Univer>ity which no Court could or
would give him". The High Court felt that this declara-
tion amounted to specific enforcement of a contract of
E per5onal service which was forbidden by s. 21 of the
Specific Relief Act and therefore disclosed an error on the
face of the award.

We are in entire agreement with the view expressed by
the High Court. There is no doubt that a contract of
F per1onal service cannot be specifically enforced."

Thn1, the appellant rightly pointed out that Annexure I
appearing at page 64 of the paper book in criminal appeal No. 240 of
1982, clearly defines the terms of the appointment of Capt. Rebello,
master of the ship. It is true thats. 148 provides that a master ofa
ship shall have the same rights and remedies as a seaman but that
G is only for a particular purpose.

In these circumstances, the High Court has misconstrued the
various sections of the Act and by a strange process of reasoning
arrived at the conclusion that the respondent was entitled to full

ff (1) [1,1') 11.C.R. 1236.
STEEL INDUSTRIES v. s. M. REBELLO (Fazal Ali, J.) 1007

compensation of one year's wages even if his services were termi- A
nated before expiry of his actual term but there does not appear to
be any warrant for this view.

Thus, having regard to the various provisions of the Act which
we have analysed fully, there can be no doubt that the High Court
was not at all legally justified in holding that the respondent was B
entitled to wages for one year when in fact the 1hip having been
treated as a scrap was no longer required and, therefore, the services
of the respondent had to be dispensed with. The respondent him-
self understood the terms of his appointment (mentioned at page
64 of the paperbook) and has therefore rightly put his claim at two
months' wages if he was discharged before completion of his term.
c
A1 already indicated, the Magistrate has awarded the compensation
for three months' wages instead of two months' wages a[\d we
entirely agree witll his view.

The result is that we allow criminal appeal No. 240 of 1982, D
set aside the judgment of the High Court and restore that of the
Magistrate. Criminal appeal No. 661 of 1982, is dismissed but in
the circumstances of the case there will be no order as to costs.

The excess amount which has been withdrawn by the respon-
E
dent shall be refunded to the appellant within four months from
today either in imtalments or in one lump-sum, failing which it
will be open to the appellant to recover the same by way of resti-
tution. If the amount is n~t returned within four months, then the
recovery will be made with interest at the rate of 12% per annum.
F

S.R. C.A. No. 240/82 allowed.
C.A. No. 661 /82 dismissed.