In an application filed by the Axis Trustee Services Ltd. seeking a stay to the trial in a suit between the State Bank of India against MT Prem Mala (IMO 9209927) and others.
The ground for which the stay is sought is that the plaintiff has sought the same and/or similar reliefs, not only in the proceedings before the National Company Law Tribunal against Section 7 of the Code but also before the Debt Recovery Tribunal under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993, No order has been passed in the said recovery suit.
The applicant contended that the provisions of Section 10 of the Code of Civil Procedure, 1908 would clearly be attracted as the issues in the plaintiff’s present Commercial Admiralty Suit, are directly and substantially the same, in previously instituted suits (the NCLT, Mumbai, and DRT, Mumbai), between the same parties and therefore, the present suit cannot proceed and should be stayed.
Justice B.P. Collabawalla disagreeing with the applicant’s submission quoted Section 10 of the CPC, 1908 which deals with the stay of the suits and stipulates that,
"no court shall proceed with the trial of any suit in which matter any issue is also directly & substantially in issue in a previously instituted suit between the same parties, or between parties under whom they or any of them claim litigating under the same title where such suit is pending in the same or any other Court in India having jurisdiction to grant the relief claimed."
But, in the present case, the proceedings initiated before the DRT and the NCLT by the plaintiff are not amongst the same parties. The 1st defendant vessel is made a party in the present suit as in Admiralty Jurisdiction the vessel itself is treated as an entity and can be proceeded against, without reference to its owner.
The court in this case observed that the present suit is in relation to an action in Rem against the vessel to enforce a maritime claim against the vessel and to recover the amount of the claim from the vessel by an admiralty sale of the vessel and for “payment out” of the sale proceeds.It is the vessel that is liable to pay the claim which is the fundamental basis of an action in Rem.
The court dismissing the petition and relying on the judgements of the Supreme Court in M.V. Elisabeth and Ors. Vs. Harwan Investments and Trading Pvt. Ltd., and in Raj Shipping Agencies Vs. Barge Madhwa and Anr. held that for the purposes of the action in Rem under Admiralty jurisdiction, the ship is treated as a separate judicial personality, an almost corporate capacity, having not only rights but liabilities which are sometimes distinct from those of the owner.