TaxTMI 
TaxTMI 
2025 (8) TMI 797
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....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. 3. The issue pertains to fixation of tariff by the Paradip Port Authority Earlier Paradip Port Trust. There were two Writ Petitions WP (C) No.732 of 2012 and WP (C) No.11 of 2010 decided by the High Court by a common order Dated 11.01.2023. 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 di....
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....er 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 Suit Original Suit No.115 of 2000 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. 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....
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....ll 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 Rs.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. 15.2 Challenging the aforesaid communication dated 02.06.2009, the Respondent filed Writ Petition WP (C) No. 86509 of 2009 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 t....
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....owever, 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 r....
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....e 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 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 o....
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.... 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....
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....itional 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 belate....
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....e 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 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 regardin....
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....llate 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 ov....
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.... 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 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....
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....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. 38. It wa....
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....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 Petition W.P. (C) No.8509 of 2009 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 th....
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.... 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 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. ....
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.... 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 e....
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....r the Telecom Regulatory Authority of India Act, 1997. Relevant para 102 thereof is extracted below: "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....
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....al 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 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....