The appellant, Galaxy Marine Services Ltd, was the registered owner of the Liberian-flagged oil tanker MV Polaris Galaxy. The appellant entered into a charterparty with Profitable Wealth Inc (PW), a British Virgin Islands company operated by Wirana Shipping Corp Pte Ltd, a Singapore company. PW subchartered the vessel to Gulf Petroleum FZC (GP) for carriage of marine fuel oil. On 6 May 2020, GP entered into a contract for the purchase of 27,000-28,000 mt of oil from Indian Oil Corp Ltd (IOC), to be loaded at Kandla Port for discharge at Fujairah.

GP asked the respondent, Banque Cantonale de Geneve, to finance the purchase of the oil. GP informed the respondent that the oil had been sold to Aramco for delivery at Fujairah on open credit. The respondent issued a letter of credit (l/c) in favour of IOC for USD 6,050,000. The l/c provided that if original bills of lading (b/ls) were not available, payment under the l/c would be made against a letter of indemnity (LOI). The port of discharge was subsequently amended to Singapore, with delivery to Chevron Singapore Pte Ltd (Chevron) at the Horizon Terminal in Singapore. On 24 May 2020, PW issued an LOI to the appellant. GP in turn issued a counter-indemnity to PW. The respondent honoured the l/c and paid IOC.

Subsequently, news reports surfaced that GP Global Group had uncovered a massive fraud within GP. GP and its employees were engaged in defrauding and cheating various parties, including the appellant. The respondent advised the master of the vessel, its P&I Club, and the appellant, that the cargo should not be discharged without the consent of the respondent. However, the cargo had already been discharged and delivered to Chevron on the basis of instructions given by GP.

On 8 March 2021, the respondent filed a misdelivery claim in rem under s 4(1)(f) of the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act 2017 (the Admiralty Act) before the Commercial Division of the Madras High Court. On 9 March, the Commercial Division arrested the vessel. The respondent sought summary judgment. The appellant subsequently furnished security and the vessel was released. The Commercial Division held that GP, as the customer of the appellant, was a proper and necessary party in the suit. Unless the appellant impleaded GP as a party, the suit could not be adjudicated to render proper justice.

The respondent filed an appeal in the Commercial Appellate Division of the High Court (Division Bench). The Appellate Division allowed the appeal. The appellant then appealed to the Supreme Court.

Held: Appeal allowed. The decision of the Appellate Division is set aside.

The law governing b/ls is a combination of mandatory international rules and rules of common law, while charterparties are governed entirely by common law. The International Convention for the Unification of Certain Rules of Law relating to Bills of Lading framed in 1924, known as the Hague Rules, governs the liability of carriers in respect of cargo covered by b/ls. The Hague Rules, which are mandatory, impose certain non-derogable obligations on the shipowner, but in return confer an extensive list of immunities, a defence of limitation of liability, and a short time limit for the bringing of claims. In 1968, the Hague-Visby Rules introduced a modified version of the Hague Rules. The Hague-Visby Rules are enacted into English law by the Carriage of Goods by Sea Act 1971 (UK). The Hague/Hague Visby Rules were widely adopted internationally.

In 1978, the United Nations introduced a Convention on the Carriage of Goods by Sea. The Rules which emerged in the Convention, which are known as the Hamburg Rules, came into force in 1992. However, the Rules were not accepted by major trading nations of the world. There was a further attempt to replace the Hague/Hague-Visby settlement by the adoption in 2008 of the United Nations Convention on Contracts for the International Carriage of Goods Wholly or Partly by Sea, which is known as the Rotterdam Rules. The Rotterdam Rules have not been implemented.

An important question of law involved in these appeals is whether an appeal lies to the Appellate Division from an order of the Commercial Division of the same High Court for addition of a party in an Admiralty suit governed by the Admiralty Act. If the answer is 'yes', the question which follows is whether the Appellate Division should have allowed the appeal and set aside the order of the Commercial Division adding GP as a defendant in the suit?

Section 12 of the Admiralty Act provides that the Code of Civil Procedure 1908 (the CCP) shall apply to all proceedings before the High Court under the Admiralty Act, in so far as it is not inconsistent with, or contrary to, the provisions of the Admiralty Act or any rule made thereunder. There can thus be no doubt that the Commercial Division of the High Court has the power to add a party to an Admiralty suit, on its own, without any application having been made, if it is of the view that the presence of that party before the Court may be necessary to effectively and completely adjudicate upon and settle all the questions involved in the suit. The question is whether an order of the Commercial Court or the Commercial Division of the High Court adding a party to an Admiralty suit is appealable under s 13 of the Commercial Courts Act, read with s 14 of the Admiralty Act.

Both s 13 of the Commercial Courts Act and s 14 of the Admiralty Act contain non obstante clauses giving these provisions overriding effect. While s 14 of the Admiralty Act provides that, notwithstanding anything contained in any other law for the time being in force, an appeal shall lie from any judgment, decree, final order, or interim order under the Admiralty Act of a Single Judge of the High Court to a Division Bench of the High Court, s 13(2) of the Commercial Courts Act says that, notwithstanding anything contained in any other law for the time being in force, or the Letters Patent of the High Court, no appeal shall lie from any order or decree of a Commercial Division or Commercial Court otherwise than in accordance with the provisions of the Commercial Courts Act.

This Court holds that an order for addition of a party under O 1 r 10(2) of the CCP is not appealable under s 14 of the Admiralty Act. GP is a party to the dispute, the sales transaction, and the b/l, and hence is a necessary party. GP is also a proper party whose presence is necessary for a complete and final decision on questions in the suit. On a harmonious reading of ss 12 and 14 of the Admiralty Act with s 13 of the Commercial Courts Act, an intra-court appeal under the Admiralty Act to the Commercial Division of the High Court would lie from any judgment, decree, or final order under the Admiralty Act, or an interim order under the Admiralty Act relatable to the orders specified in O 43 r 1.

It could not possibly have been the legislative intent of the Admiralty Act to make all interim orders appealable. Such a wide interpretation of the expression 'interim order' would mean that any party would be able to delay the trial and final disposal by filing appeals even from inconsequential orders calling for affidavits and the like. An appeal does not lie to the Commercial Appellate Division of the High Court from an order of the Commercial Division (Single Bench) of the same High Court for addition of a party in an admiralty suit governed by the Admiralty Act.

In any event, the Division Bench erred in law in allowing the appeal from the order of the Commercial Division (Single Judge) adding GP as party defendant to the suit.