Statutory refund cannot be set off unilaterally against dues unless the statute expressly authorises such adjustment.

A port trust cannot unilaterally set off a statutory refund against alleged dues unless the governing statute expressly permits such adjustment. The Major Port Trusts Act, 1963 provided specific recovery mechanisms, including detention and sale of goods and recovery of any shortfall by suit, which left no implied power of unilateral appropriation. A refund sanctioned by the competent authority under Section 53 retained its statutory character and could not be absorbed through general lien principles under the Indian Contract Act, 1872 or implied contract reasoning. The impugned adjustment was therefore unauthorised, and the sanctioned refund, with interest, had to be released.

---

---

Issues: Whether the Bombay Port Trust had authority under the Major Port Trusts Act, 1963 or the Indian Contract Act, 1872 to unilaterally adjust a statutory refund sanctioned in favour of the petitioner against an alleged outstanding deficit.

Analysis: The statutory scheme provided distinct modes for recovery of dues, including detention of goods, sale of goods, application of sale proceeds, and recovery by suit. The adjustment in question was not made pursuant to a sale under Sections 61 and 62 of the Major Port Trusts Act, 1963, and therefore Section 63(1)(e) did not apply. Section 131 specifically contemplated recovery of any balance by suit when sale proceeds were insufficient, which indicated that the Legislature did not confer a power of unilateral adjustment. The refund had been granted by the competent authority under Section 53 as a statutory order, and such a refund could not be appropriated by invoking a general lien under Section 171 of the Indian Contract Act, 1872 or an implied contract under Section 42 of the Major Port Trusts Act, 1963.

Conclusion: The adjustment was unauthorised in law, and the statutory refund could not be set off unilaterally against the alleged dues.

Final Conclusion: The impugned adjustment was quashed and the petitioner was held entitled to receive the sanctioned refund with interest.

Ratio Decidendi: Where a statute provides specific modes for recovery of port dues and separately requires recovery of any balance by suit, unilateral adjustment of a statutory refund is impermissible unless the statute expressly authorises such set-off.

---