TARIFF AUTHORITY FORMAJOR PORTS

NOTIFICATION

New Delhi, the 17th Apnl, 2002

No. TAMP/8/2000-Genl.—In exercise of the powers conferred by Sections 48, 49 and 50 of the NfcyorPort Trusts

Act, 1963 (38 of 1963), the Tariff Authority for Major Ports hereby approves the request of the Jawaharlal Nehru Port Trust

for exemption from implementing the Orders relating to levy of penal interest for the period 23 March, 2000 to

30 September ,2001 as in the Order apended hereto.

SCHEDULE

Case No. TAMP/8/2000-Genl,

The Jawaharlal Nehru Port Trust

Applicant

(Passed on this 8th day of April 2002)

This case relates to a proposal from the Jawaharlal Nehru Port

Trust (JNPT) for grant of exemption from implementation of this Authority's

Orders relating to levy of penal interest for the period 23 March 2000 to 30

September 2001.

Emphasizing the principle of level playing ground, this Authority

had passed an Order on 4 February 2000 prescribing payment of penal interest

on delayed payments both ways i.e. by Port users as well as by the Port Trusts.

Retaining the underlining principle envisaged, this Order was subsequently

amended on a few occasions to modify the rate of penal interest and grace

period in consideration of the requests made by some of the Major Port Trusts.

The last such amendment was made on 5 November 2001 by considering the

proposal made by the Indian Ports Association.

In this backdrop, the JNPT ha,s forwarded the proposal in

reference wherein it has brought out the following points:-

(i).

The Port has not been able to implement the orders of the

Authority from 23 March 2000 to 30 September 2001.

(ii).

On receipt of the initial Order" of .the Authority, the JNPT has

expressed its difficulties in implementing the order. The Authority

has, however, advised all the Major Ports to take up this matter

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART IE—SEC. 4]

with the Indian Port Association to formulate a coordinated view

about adoption of a uniform interest rate as also the time limit

beyond which the penalty will apply.

(iii).

The intention behind the Order of the Authority was to provide a

level playing ground. Till 30 September 2001, the JNPT neither

levied nor paid any penal interest.

(iv).

.If it is decided to implement the Orders of the Authority

retrospectively, it will become difficult to identify the cases where

delays occurred and to recover the dues from users. The entire

matter will lead to confusion and protests from port users. In the

event, retrospective billing will cause hardships and difficulties.

The JNPT has also informed that the position mentioned above

was considered by its Board of Trustees in its meeting held on 22 February

2002 and it was decided to approach the Authority with the request to exempt

the JNPT from the implementation of the Orders for levy of penal interest from

23 March 2000 till 30 September 2001.

5.1

The Order in reference was passed by this Authority exercising its

statutory powers. It has the effect of modifying the Scale of Rates of the Major

Port Trusts; and, the Major Port Trusts are legally tiound to follow the rates and

conditionalities prescribed in their Scales of Rates. It is noteworthy that this

Authority's Order in reference has not been set aside by any higher judicial

forum. The difficulties earlier expressed by the JNPT in implementation of the

Order were adequately dealt with and suitable advice was given to the JNPT.

That being so, the approach earlier adopted by the JNPT about not

implementing this Authority's Order cannot be said to be in conformity with the

tariff setting arrangements envisaged in the Major Port Trust Act.

5.2

Notwithstanding the position discussed above, it is noteworthy

that the JNPT has already implemented the Order from 1 October 2001. The

problems now expressed by the JNPT in implementation of the order

1 retrospectively appear to be genuine and worthy of admission.

5.3

As has already been clarified in various related Orders, the

intention behind the prescription of penal interest is to allow a level playing

ground and to provide for uniformity in the matter of payment of interest on

delayed payments by the Port users as well as delayed refunds made by the

Port Trust. In other words, if the Port applies the penal interest provision for

delayed payments from users, the same condition shall be applicable to

delayed refunds made by it. In the case in hand, the JNPT has clarified that

penal interest provisions have not been enforced either way till 30 September

2001.

5.4

Bearing in mind the fact that the governing principle of 'level

playing ground' has not been violated, and recognising the legal and

accounting difficulties in enforcing the prescription retrospectively, this Authority

is Inclined to accede to the request now made by the JNPT.

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

collective application of mind, this Authority grants exemption to the JNPT from

implementation of the Orders relating to levy of penal interest for the period 23

March 2000 to 30 September 2001.

S. SATHYAM, Chairman

[ADVT m/IV/143/2002/Extyl

Printed by the Maniger, Govt. of India Press, Ring Ro«d. Mayapuri, Now De(hi-110064

and Published by the Controller of Publications, Delhi-110054.

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