The State Government of Gujrat issued a notification on 18th January, 2016 under Section 5 of the Indian Ports Act, 1908. The Government expanded the port limits of Hazira Port. The Essar Bulk Terminal Limited filed the Special Leave Petition to quash the notification as they are affected because they have spent huge amount of money on lands reclaimed by them which would be directly affected by the expansion of the Port limits.
In 1994, the parent company of the Appellants entered into an agreement with the Gujarat Maritime Board (hereinafter referred to as “GMB”) for use of a captive jetty in Magdalla port. Pursuant to a Port Policy framed by the Government of Gujarat in 1995, and a Build, Own, Operate and Transfer (BOOT) Policy framed for private sector participation in development of the State’s ports in 1997, the GMB issued a Global Notice for Expression of Interest for Development of Green Field Site Port Facilities, inviting bids in the name of Hazira port project. A consortium led by Shell Gas B.V. was selected to develop, operate and maintain certain facilities on leased area in the port on a BOOT basis, together with related LNG facilities. Pursuant to the acceptance of its bid, Shell Gas B.V. created two subsidiaries in Gujarat, namely, Hazira Port Private Limited (HPPL) and Hazira LNG Private Limited. A concession agreement dated 22nd April, 2002 was entered into between the GMB, the State Government and HPPL for the purpose of development, operation and maintenance of Hazira port by HPPL. A notification dated 23rd June, 2004 was issued by the State Government notifying Hazira port and setting out its limits, in exercise of powers under Section 4(2) of the Indian Ports Act. This was carved out of the port limits of Magdalla port, which was so reduced as to exclude the aforesaid Hazira port.
The learned counsel on behalf of Essar, Shri Mihir Joshi argued that the step taken in haste by the government. He argued that various assurances were given and MOUs were entered into with the Appellants, on the basis of which huge investments were made. He stated that expansion was ultra vires Section 5 of the Indian Ports Act, which required public interest alone to be seen was held valid by the court. Mr. Harish Salve, the counsel on behalf of Gujrat government, urged that no permission was granted to Essar according to Section 35 of Gujrat Maritime Board Act, 1981.
The Court found nothing contrary to the law in the notification. It was held within the public interest because the number of vessels at Hazira port was expected to increase due to which adequate facilities for anchorage, custom, security etc. were to be made. The held that Essar has no ‘right’ to private property.
The Petition was rejected by Justice R.F. Nariman and Justice Navin Sinha.
Read the full Judgment: Essar Bulk Terminal Limited & Anr. V. State of Gujrat & Ors. http://www.supremecourtofindia.nic.in/supremecourt/2017/20954/20954_2017_Judgement_22-Feb-2018.pdf
