Quick Summary: The Bombay High Court decided against the National Iranian Tanker Company (NITC) in a disagreement with Bharat Petroleum Corporation Ltd. (BPCL) over extra charges due to delays. The court said the claim was made too late, missing the deadline.
In 2010, NITC rented out a ship, MT Sima, to BPCL. The ship was supposed to unload goods in Gujarat and Mumbai, but delays at Mumbai Port caused by a ship accident led to extra charges called demurrage. NITC billed BPCL for 233 hours of delay, but BPCL disagreed with 192.5 hours, saying it was due to an unavoidable accident.
"BPCL argued that the port closure due to a collision was something they couldn't control."
NITC and BPCL couldn't agree on the extra charges, so they went to arbitration. NITC said BPCL owed them $224,823.97, but BPCL only agreed to $41,406.67. The arbitration started in June 2014 after NITC sent a formal notice in February 2014, which BPCL said was too late.
Judge Somasekhar Sundaresan looked into whether BPCL's actions in 2011, like asking for a revised bill, restarted the time limit for making a claim. The court found that BPCL's request didn't accept the extra charges and didn't extend the deadline.
"The arbitration claim was filed well past the three-year limit, starting from September 29, 2010."
The court highlighted that the time limit started when BPCL first disagreed with the claim in 2010. The court couldn't change the arbitration's reasonable decision without clear proof of BPCL accepting the debt.
The court agreed with the arbitration's decision that NITC's claim was too late. In short, NITC's effort to get back the extra charges was unsuccessful because they didn't act within the allowed time.
