Anchorage charges after admiralty sale remain payable where they accrue post-sale, not as pre-sale encumbrances.

Anchorage charges accruing after confirmation of an admiralty sale were not treated as pre-sale encumbrances within the expression "free from all encumbrances". The Supreme Court held that section 8 of the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017 vested the vessel in the purchaser free of encumbrances, liens, attachments, registered mortgages and similar charges, but the sale terms also required the purchaser to bear charges, dues, tariffs and taxes from the date of sanction of sale. As the anchorage charges arose on a post-sale day-count basis, they remained payable by the purchaser, and the challenge to the Port Trust demand failed.

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Issues: Whether anchorage charges levied after confirmation of the admiralty sale could be treated as encumbrances falling within the expression "free from all encumbrances", and whether the purchaser could avoid liability for such charges on the ground that they related to the vessel's prior anchorage.

Analysis: Section 8 of the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017 vests the vessel in the purchaser free from encumbrances, liens, attachments, registered mortgages and charges of the same nature. The sale conditions also provided that the vessel was sold on an "as is where is" basis, while the purchaser would bear charges, dues, tariffs and taxes in respect of the vessel from the date of sanction of sale. The Court held that anchorage charges were not pre-sale encumbrances but charges accruing after sale on the basis of the number of days for which the vessel continued to remain at anchorage. The argument that the pre-sale anchorage rate itself constituted an encumbrance was rejected as untenable.

Conclusion: The purchaser was liable for the anchorage charges levied after the sale, and the challenge to the Port Trust's demand failed.

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