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Tuesday, August 4, 2020

Maritime Logistics Professional

Light dues collection likely at all ports

Posted to Light dues collection likely at all ports (by on May 14, 2012

Trade upset over move to levy duty for ‘on deck cargo’

The trade appears to have lost all hopes of getting exempted from payment of ‘light dues’ for ‘on deck cargo’ including containers as applicable to all ships engaged in international trade arriving at or departing from any Indian Port. Their efforts to prevail on the customs for exemption have come to naught. Thus, the customs are likely to go ahead and collect light-dues @ $ 0.15 per ton as empowered under section 13 of the Light House Act, 1927. This would be made applicable at all ports on containers and heavy lift cargo.

A decision in this regard was taken based on the earlier notification of the Shipping Ministry directing that ships engaged in international trade arriving at or departing from any Indian Ports are required to pay light dues at the rate of $ 0.15 NRT (net registered tonnage) of the ship.

Under section 12 (1) of the Light House Act, ships that utilize open space upon deck for carrying containers or any other cargo including the cargo at any other space utilized in addition to NRT shall pay light dues for all such spaces utilized for carrying cargo.

It was also pointed out that it was a statutory requirement in terms of the Light House Act and no port clearance would be granted until the amount of all light dues have been paid.

The Container Shipping Lines Association’s (CSLA)  had pointed out that the Light House Act was framed way back in 1927 at a time when there were no container ships and that the first box movement in Indian ports took place only in 1956. CSLA emphasized the fact that a container ship is designed to carry cargo on its deck. Unlike general cargo ships, container ships carry 2/3 of its cargo on the deck and 1/3 below the deck. Hence, it would be wrong for customs to charge extra on the containers on deck and by doing so it would be adding an extra burden on the Indian trade.

Earlier in 2007, the customs at Mumbai and Nhava Sheva issued public notices 52 of 2007 and 09 of 2008 informing about the levy required to be collected according to the Light House Act. The Mumbai and Nhava Sheva Ship Agent Association (MANSA) opposed the implementation as they contended the implementation being unfair and frivolous. The customs put the notices in abeyance and referred the matter to the Office of the Director General Shipping for their expert opinion who in turn held that the arguments advanced by MANSA did not hold water.

A spokesman of the CSLA informed, “The levy is made effective only at the Mumbai, Nhava Seva (JNPT), Kandla and Mundra. In our meeting with the customs our argument was not accepted. We have taken up the matter with the Ministry of Shipping, Government of India. Custom stations at other ports are now likely to follow suit and collect the light dues.”

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