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SCHEDULE

Case No. TAMP/93/2001-CHPT

The Chennal Port Trutt (CHPT)

Applicant

(Passed on this 11 th day of March 2002)

This case relates to a proposal received from the Chennai Port Trust (CHPT) for

amendment of Its Scale of Rates (SOR) to allow rebate of crane hire charges for car carrier/RORO

vessels.

2.1.

The CHPT has made the following points In its proposal:

(I).

The existing SOR of the CHPT contains a provision at Note-IB(li) of Chapter XI

relating to berth hire charges that If general cargo vessels falling under group V to Vn

of Schedule-I are berthed at Inner Harbour or Jawahar Dock, a sum of Rs. 1837.50

(US $ 87.485) per 8 hours unit shall be added with the berth hire charges towards

wharf crane hire.

(II).

M/s. Parekh Marine Agencies Pvt. Ltd. (PMAPL) have requested for a lump sum

rebate of US$ 249.90 per day on account of crane hire charges leviable from RORO

vessels In line with a similar rebate allowed In the cases of ONGC / LASH / Naval /

Research / Passenger / Foreign Tourist vessels and Fishing Trawlers falling under

group I to IV of Schedule-l (under Note-1 F of Chapter XI) which do not use wharf

cranes.

(ill).

The vehicles are driven for the purpose of loading/unloading into/from RORO vessels;

and, therefore, the question of this category of vessels using the wharf crane does

not arise.

(Iv).

In view of the representation of the PMAPL, It is proposed to amend the SOR by

adding the following provision after Note 1B(li) of Chapter XI relating to berth hire

charges:

"Berth hire chaiyes of Rs.1837.50 (US$ 87.465) per 8 hour unit towards

wharf crane hire shall not be added for car carrier/RORO vessels in the

group V to VII of Schedule-l berthed at Inner Harbour or Jawahar docks, if

the vessels do not use the wharf crane"

(v).

Since the car carrier/RORO vessels having GRT less than 30,000 visits the CHPT In

lesser number In a year, it Is considered to allow lump sum rebate to these vessels as

applicable to the list of vessels under group I to IV of Schedule-! of Chapter XI.

(vi).

rt is also proposed to allow lump sum rebate to vessels only when the vessels do not

use any crane including ship derrick or any crane installed In the vessel during her

stay in the berth' Instead of earlier admisslbillty of rebate when wharf cranes are not

used. It Is, therefore proposed to amend the provision under Note-1 (F) of Chapter XI

as follows:

"A lump sum rebate of Rs.1837.50 (87.465 US Dollars) per 8 hour unit shall

be allowed on the charges mentioned In the above Schedule-l In respect of

ONGC Vessels, Lash Vessels, Naval Vessels, Research Vessels, Fishing

Trawlers, Passenger Vessels 'Foreign' Tourist Vessels and RORO Vessels/

Car Carrier Vessels In the Groups I to W of Schedule-I which do not use any

crane Including ships derrick or any crane Installed in the vessel during her

stay In the berth."

2.2.

In this backdrop, the CHPT has requested this Authority to approve the proposed

amendments In its SOR.

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART m—SEC. 4]

3.1.

In accordance with the procedure prescribed, a copy of the proposal of the CHPT

was sent to various concerned port users / representative bodies of port user for comments. The

comments received are summarised below:

Chennal St—mar Agents' Association (CSAA) -

(1).

It is a welcome amendment. The cranage shall not be charged on a vessel If the

wharf cranes are not used. The criteria for levy of crane hire charges must be

whether the service has been rendered or not, rather than the class of a ship. The

charges can be levied on a pro-rata basis of 8 hours for all vessels alongside the

berth.

(II).

It Is not proper to state that rebate Is allowed if the vessels do not use any crane

Including ship derrick or any crane installed In the vessel during the stay at the berth.

The cranage charges shall be delinked from the berth hire as it becomes difficult to

collect these charges from the importers / agents / stevedores for the cargo carried

on FIO basis. The cranage charges can be directly collected from the consignees.

Madras Chamber of Commerce and Industry (MCCI)

(i).

The Chamber supports the proposal of the CHPT. Since the vessels load and

discharge cargo by driving the vehicles up the ramp, the question of using port trust

cranes does not arise. It Is, therefore, logical not to levy any crane hire charges.

(II).

Many of these vessels are fitted with provision cranes, which are used for lifting

provisions and ship spares; but, are not capable of being used for any cargo

operations. The proposed draft amendment shall, therefore, be modified by addition

of the following words at the end of the proposed amendment, which will eliminate

any possibility of use of such provision cranes being Interpreted as aiding the cargo

operations and thereby avoiding levying of crane hire charges:

for crane including ships' derrick or any crane installed in the

vessel for cargo operations during her stay In the berth."

M/s. Parekh Marine Agencies Pvt Ltd. (PMAPL)

(I).

The loading/unloading from/onto vessels is done by driving of the assembled

vehicles; and hence, the car carrier vessels do not require any port equipment like

wharf cranes for loading/unloading operation.

(ii).

Since the existing SOR does not contain any provision for rebate for the car

carrier/RORO vessels under Note-1F of Chapter XI, (which was introduced before the

commencement of car carrier vessels from the CHPT) additional charges are levied

by the CHPT towards usage of wharf cranes Including the priority berth hire charges

as prescribed under Note 1B (il) of Chapter XI.

(iii).

It is, therefore, requested to include car carrier / RORO vessels In the SOR of the

CHPT with suitable amendments as suggested by the CHPT; and, the amendments

be made effective from January 2000.

Shipping Corporation of India (SO)

(I).

The proposal of the CHPT is a welcome step; and, may be considered favourably.

Society of Indian Automobile Manufacturers (SIAM)

(i).

Wherever the wharf cranes or ship's derrick or any crane installed In the vessel are

not used as in the case of car carrier/RORO vessels, levy of crane hire charges is

meaningless; therefore, the proposal of the CHPT Is justified and acceptable.

Tamil Chamber of Commerce rrcci

Th« Chamber fuHy endorses the proposal of the CHPT; and the same can be

accepted subject to the approval of the Authority.

Southern. India Gnambar of Commaroa and industry (SICCO

(i).

Levy of crane him charges in mspact of oar carrietfRORO vessels is unjustified, • •

the cranes art not utiltaad at all.

3.2.

A copy each of the comment! received w n tent to the CHPT at feedback

information.

4.1.

On a preliminary examination of tha proposal It wow found that lump sum rebate,

which was earlier allowed to vessels (under Note 1F of Chapter XT) when the 'wharf cranes are not

used' clause was replaced a.)d substituted by 'any crane Including ships derrick or any crane installed

in the vessels during her stay at the berth*. The CHPT was requested to explain the rationale behind

inadmissibility of rebate when ships use their own derrick/crane.

4.2.

In addition to reiterating the points made by it earlier, the CHPT has explained that

rebate of Rs. 1837.50 allowed on wharf crane is inadmissible when ships use their own derricks or

cranes from other agencies since the port has incurred capital expenditure to provide facilities to the

users which should be availed of by the vessels as and when required. If the vessel uses it from some

other source, the Infrastructure facility created by the Port remains idle; and, hence it has proposed

not to allow rebate of crane hire charges to the vessels, when ships use their own derricks or crane

from other agencies.

A joint hearing in this case was held on 18 December 2001 in Chennai. At the Joint

hearing, the following submissions were made:

Chennal Port Trust <CHPD

(i).

Our formulation plus MCCI suggestion about adding "for crane including ships'

derrick or any crane Installed in the vessel for cargo operations during her stay in the

berth" should be O.K.

(ii).

We also agree that levy of wharfage on ad-vatanwn shall be charged to unit rate. We

will rationalise at the next general revision.

PartKh Marine Aoenotea Private Limited fPMAPLI

(i).

Please give retrospective effect to the proposed amendments. We have been paying

more.

6.1.

After the joint hearing the PMAPL has requested this Authority to give a retrospective

approval to the proposal of the CHPT from 1 January 2000 onwards.

6.2.

The PMAPL has made the following points in support of its request

(0-

The CHPT could have proposed Ihe inclusion of oar oarrier/RORO vessels at the time

of entry of these vessels in the International Shipping Industry In earty 1990s by way

of an amendment to the rule applicable to vessels of group I to IV of Scheduie-I.

00.

It had represented the CHPT for refund of amount charged towards the wharf crane

hire within sbt months from the date of receipt of the bin; however, the CHPT had

taken time to submit the proposal to the Authority.

(Hi).

Giving retrospective effect to the proposal does not Involve any toss of revenue to the

port trust; but, shall do justice to the owners of the vessel from whom the additional

amount should not have been collected In the first Instance. If given a prospective

approval, the owners of the vessel will be put to loss to the extent they had paid the

money to the CHPT not really due from them.

CffQ ci;/*"^ ^>

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART HI—SEC. 4]

With reference to the totality of information collected during the processing of this

case, and bearing in mind the arguments advanced at the joint hearing, the following position

emerges:

(I).

The CHPT levies composite berth hire charges which include charges for wharf

cranes. The system of including charges for wharf cranes in berth hire charges has

come Into being based on a recommendation made by the Directing Group on

rationalisation of Port tariffs. The existing Scale of Rates of the CHPT for berth hire

charges Includes the charges for wharf cranes in the case of vessels falling under

group I to IV (I.e., upto 30,000 GRT) and provides for levy of wharf crane charges at

the prescribed rate In addition to berth hire charges in the case of vessels falling

under group V to vn (I.e., above 30,000 GRT).

(li).

The CHPT has now proposed to allow rebate to the tune of the prescribed cranage

charges In the case of car carriers/RORO vessels which fall under group I to IV and

not to levy wharf crane chargea on the same category of vessels which fall under

group v to vn. By design, the car caniers/RORO vessels do not require use of wharf

cranes for their cargo operations. In realisation of this position, the CHPT has come

up with the instant proposal to exempt payment of wharf crane charges by car

carrlers/RORO vessels. This proposal has been generally accepted by the concerned

users/user-organlsatlons.

(iii).

The Chennai Steamer Agents' Association has suggested that the cranage charges

shall be de-linked from the berth hire charges in view of the difficulties faced by the

Shipping

Lines/agents to collect

this component of charge from the

importers/stevedores in the case of cargo carried on FIO basis. As has already been

mentioned, the berth hire charges prescribed not only In the CHPT but In other Major

Ports also are composite In nature. This arrangement has been adopted since 1964

based on the recommendations of the Directing Group to simplify and rationalise Port

tariff structure. This Authority has already advised all Major Ports to review the

existing composite berth hire charges with reference to the facilities provided at

individual/group of berths. When this exercise is completed, the composite berth hire

charges applicable for different berths will be commensurate with the facilities

provided. In any case, It appears that it may not be necessary to veer away from the

established practice of including charges for provision of wharf cranes in the berth

hire charges. Berth hire being a vessel related charge will continue to be levied from

the vessel. It may be relevant here to mention that this position has already been

settled in the case relating to composite berth hire charges levied by the Mumbai Port

Trust which was taken up for adjudication by this Authority based on a representation

filed by the Mumbai and Nhava Sheva Ship Agents Association.

(Iv).

The CHPT has proposed that the rebate in/exemption of charges for wharf cranes, as

the case may be, is applicable only if the vessels do not use any cranes for cargo

operation. This stipulation is understandable as the Port wants to protect its

investments made to provide wharf cranes; and, does not want Idling of these facility.

This stipulation may not be applicable in the case of car carriers / RORO vessels as

these vessels do not require the services of a wharf crane. Nevertheless, eince the

proposed clause in the SOR for allowing rebate of crane hire charges will apply not

only to car carriers / RORO vessels but also to other categories of vessels which may

require wharf cranes for loading / unloading, the stipulation needs to be Included in

the Scale of Rates.

Insofar as allowing rebate for crane hire is concerned, it Is reasonable to allow such

rebates If the vessels use other cranes when the CHPT wharf cranes are

requisitioned by them but are not made available by the Port for reasons like repair,

maintenance, etc. That being so, the proposed conditionality Is to be elaborated to

Include such eventualities. It is noteworthy that a similar condition has been

stipulated by this Authority for cases of exemption from heavy lift charges and

Intercartlng of iron-ore after unloading at Royapuram Railway yard.

(v).

The MCCI has suggested elaboration of the proposed draft amendment to specifically

mention about use of wharf cranes for cargo operations so that the cases of use of

crane* for lifting ships provision/spares can be excluded from the proposed exclusion

clause. The suggestion has been made to eliminate any ambiguity in applying the

Scale of Rates for allowing refund of wharf crane hire charges. The draft amendment

proposed by the CHPT for approval is, therefore, corrected to include the suggestion

made by the MCCI.

(vi).

M/s. Parekh Marine Agencies Private Limited

(PMAPL) neve requested for a

retrospective approval of the proposed amendment arguing that the car

carrlers/RORO vessels have started calling at the CHPT since January 2000; and,

they have not used the wharf cranes. It is to be recognised that the Orders of this

Authority ordinarily take effect only prospectlvely. In exceptional circumstances, this

Authority oonsiderc giving retrospective effect to its Orders. Delay in submission of a

proposal by the CHPT or a long pending representation made by the PMAPL cannot

be an exceptional circumstance warranting retrospective revision of the CHPT Scale

of Rates. If these grounds are accepted to allow retrospective amendment of Scale of

Rates, there can be a demand for similar relief in almost all cases where the SOR is

to be amended to provide rebates/concessions or to Include new provisions aiming at

providing relief to Port users.

This Authority has already decided to prescribe a lead period of 30 days for vessels-

relatod charges and 15 days for cargo-related charges for implementation of the

revised/amended prescription. Even though the request of the PMAPL is not

considered for retrospective revision of the CHPT Scale of Rates, this Authority finds

it reasonable to waive the 30 day lead period for Implementation of the proposed

amendment in the instant case and order amendment of the CHPT Scale of Rates

with immediate effect from the date of notification of this Order in the Gazette of India.

8.1.

In the result and for the reasons given above, and based on a collective application of

mind, this Authority approves the following amendments to the Scale of Rates of the CHPT:

(i).

The following provision is added after the existing Note KA).(ii) in Chapter XI of

Book-I:

• (til). Crane h'm charges of Rs. 1637.50 (US$ 87.465) per B hour unit shall

not be added In the Bert hire charges for car carriers /RORO vessels falling

under Groups V to VII of Schedule I berthed et the Inner Harbour or Jawahar

Docks, if the vessels do not use the wharf cranes for cargo operations'¹

(ii).

The following provision is substituted in place of Note 1 .(F). in Chapter X) of Book I:

"(F). A lump sum rebate of Hs.1837.50 (US Dollars 87.465) per 8 hour unit

sheM be allowed on ffw charges mentioned in the Schedule I in respect of

ONGC vessels, Lash vessels, Navel vessels, Research vessels, Fishing

trawhra, Passenger vessels, Foreign tourist vessels and RORO veasels/Cer

carrier vessels fatting under Croups (to IV of Schedule I which do not use

any crane including ships derrick or any crane installed in the vessel for

cargo operations during her stay in the berth. The rebate will, however, be

allowed If these vessels use their own cranes or hire private cnnes when the

wharf oranefs) required oannot be spared by toe Port for reasons like

maintenance, overhaul and repairs or non-avaitabittty because of being hired

by another party.¹¹

8.2.

This Order will come into effect from the date of its notMlcatten in the Oazetts of India.

S. SATHYAM, Chairman

[ADVT./143/m/TV-2002]

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