The Merchant Shipping Act, 2025
Administered Ministry: Ministry of Ports, Shipping and Waterways
Section
Section 181 Limitation of liability.
(1) The ship owner may limit his liability under this Chapter in respect of any incident, to an aggregate amount in accordance with Article V of the Civil Liability Convention.
(2) The ship owner shall not be entitled to limit his liability under this Chapter if it is proved that the pollution damage resulted from his personal act or omission, committed or made with the intent to cause such damage, or recklessly and with knowledge that such damage is likely to result.
(2) The ship owner shall not be entitled to limit his liability under this Chapter if it is proved that the pollution damage resulted from his personal act or omission, committed or made with the intent to cause such damage, or recklessly and with knowledge that such damage is likely to result.
Section 182 Constitution of limitation fund.
(1) Any ship owner, desiring to avail of the benefit of limitation of his liability under this Chapter, shall apply to the High Court having jurisdiction or the Central Government for constitution of a fund for the total sum representing his limits of liability, within such time and in such manner, as may be prescribed.
(2) Such fund may be constituted either by depositing the sum or by furnishing bank guarantee or such other security with the High Court or the Central Government.
(3) The insurer or any other person providing financial security to the ship owner may apply to the High Court or the Central Government for constitution of the fund under sub-section (1) and the fund so constituted shall have the same effect as if it were constituted by the ship owner.
(4) An application for constitution of the fund may be made by the insurer under this section even in cases where the ship owner is not entitled to limit his liability under sub-section (2) of section 181 and in any such event, constitution of the fund shall not prejudice the rights of any claimant against the ship owner for full compensation exceeding the amount deposited or secured in the fund.
(5) The amount in Special Drawing Rights to be deposited or secured in the fund under this section shall be converted in rupees on the basis of official value in rupees of the Special Drawing Rights as determined by the Reserve Bank of India on the date of constitution of the fund.
(6) Where a fund is established by the ship owner in relation to an incident of oil pollution before a High Court, all claims for compensation under this Chapter shall only be instituted in the High Court where the fund was constituted:
Provided that where claims arising out of the incident of oil pollution is made in High Courts other than the one where the fund was established, the ship owner may approach the Supreme Court in accordance with the Code of Civil Procedure, 1908 (5 of 1908) to transfer the claims to the High Court where such fund was established.
(2) Such fund may be constituted either by depositing the sum or by furnishing bank guarantee or such other security with the High Court or the Central Government.
(3) The insurer or any other person providing financial security to the ship owner may apply to the High Court or the Central Government for constitution of the fund under sub-section (1) and the fund so constituted shall have the same effect as if it were constituted by the ship owner.
(4) An application for constitution of the fund may be made by the insurer under this section even in cases where the ship owner is not entitled to limit his liability under sub-section (2) of section 181 and in any such event, constitution of the fund shall not prejudice the rights of any claimant against the ship owner for full compensation exceeding the amount deposited or secured in the fund.
(5) The amount in Special Drawing Rights to be deposited or secured in the fund under this section shall be converted in rupees on the basis of official value in rupees of the Special Drawing Rights as determined by the Reserve Bank of India on the date of constitution of the fund.
(6) Where a fund is established by the ship owner in relation to an incident of oil pollution before a High Court, all claims for compensation under this Chapter shall only be instituted in the High Court where the fund was constituted:
Provided that where claims arising out of the incident of oil pollution is made in High Courts other than the one where the fund was established, the ship owner may approach the Supreme Court in accordance with the Code of Civil Procedure, 1908 (5 of 1908) to transfer the claims to the High Court where such fund was established.
Section 183 Claims for compensation where fund is established.
(1) Upon constitution of the fund, the High Court or the Central Government shall issue a notice inviting claims against the fund arising from the particular incident of oil pollution, within such time and containing such other particulars as may be prescribed.
(2) Any person who has suffered pollution damage shall be entitled to claim compensation and may make an application for participation in the proceedings:
Provided that where such fund has not been established, the claimant may approach the High Court having jurisdiction or the Central Government under section 180.
(3) The Central Government shall issue a notice of proceedings to the International Oil Pollution Compensation Fund which is entitled to participate in the proceedings in accordance with Chapter V of this Part.
(4) The Central Government may prescribe the procedure to be followed for establishment of the fund and adjudication of claims arising from an incident of oil pollution.
(2) Any person who has suffered pollution damage shall be entitled to claim compensation and may make an application for participation in the proceedings:
Provided that where such fund has not been established, the claimant may approach the High Court having jurisdiction or the Central Government under section 180.
(3) The Central Government shall issue a notice of proceedings to the International Oil Pollution Compensation Fund which is entitled to participate in the proceedings in accordance with Chapter V of this Part.
(4) The Central Government may prescribe the procedure to be followed for establishment of the fund and adjudication of claims arising from an incident of oil pollution.
Section 184 Acquisition of right for compensation by subrogation.
(1) Where, before the fund is distributed, the ship owner or any of his servants or agents or any person providing him insurance or other financial security has as a result of an incident paid compensation for pollution damage, such person shall upto the amount he has paid, acquire by subrogation the rights which the person so compensated may have enjoyed under this Chapter.
(2) Where the ship owner or any other person establishes that he may be compelled to pay at a later date in whole or in part any such amount of compensation with regard to which such person shall have enjoyed a right of subrogation under sub-section (1) had the compensation been paid before the fund was distributed, the High Court where the fund was constituted may order that a sufficient sum be provisionally set aside to enable such person to enforce his claim against the fund at such later date.
(2) Where the ship owner or any other person establishes that he may be compelled to pay at a later date in whole or in part any such amount of compensation with regard to which such person shall have enjoyed a right of subrogation under sub-section (1) had the compensation been paid before the fund was distributed, the High Court where the fund was constituted may order that a sufficient sum be provisionally set aside to enable such person to enforce his claim against the fund at such later date.
Section 185 Consolidation of claims and distribution of fund.
(1) The High Court or the Central Government shall consolidate all claims against the fund including those arising out of subrogation under section 184.
(2) Any claim in respect of expenses reasonably incurred or sacrifices reasonably made by the ship owner voluntarily to prevent or minimise pollution damage shall rank equally with other claims against the fund.
(3) Subject to the right of subrogation under section 184, the High Court or the Central Government shall distribute the amount in the fund among all claimants in proportion to their established claims.
(4) If the ship owner, insurer or other financial security holder has failed to establish a fund under this Chapter, the High Court shall make an order for compensation against such party to be payable within such period as may be specified in the order.
(2) Any claim in respect of expenses reasonably incurred or sacrifices reasonably made by the ship owner voluntarily to prevent or minimise pollution damage shall rank equally with other claims against the fund.
(3) Subject to the right of subrogation under section 184, the High Court or the Central Government shall distribute the amount in the fund among all claimants in proportion to their established claims.
(4) If the ship owner, insurer or other financial security holder has failed to establish a fund under this Chapter, the High Court shall make an order for compensation against such party to be payable within such period as may be specified in the order.
Section 186 Arrest and sale of ship if ship owner, etc., unable to satisfy claims for compensation.
(1) Where the High Court makes an order for compensation which the ship owner has not complied with and such owner has not established a fund, an application may be made by a person entitled to compensation to that court to arrest the ship responsible for the incident or any ship owned by such person.
(2) The High Court may direct the amount remaining unpaid after determination of liability of the International Oil Pollution Compensation Fund, in accordance with Chapter V of this Part, to be levied by distress and sale of the ship and her equipment in accordance with this Act.
(3) The High Court or the Central Government shall have the power to detain any ship involved in an incident of oil pollution, until the ship owner has established a fund in accordance with section 182, or has duly complied with the order for compensation under sub-section (4) of section 185, whichever is earlier.
(2) The High Court may direct the amount remaining unpaid after determination of liability of the International Oil Pollution Compensation Fund, in accordance with Chapter V of this Part, to be levied by distress and sale of the ship and her equipment in accordance with this Act.
(3) The High Court or the Central Government shall have the power to detain any ship involved in an incident of oil pollution, until the ship owner has established a fund in accordance with section 182, or has duly complied with the order for compensation under sub-section (4) of section 185, whichever is earlier.
Section 187 Restriction on enforcement of claims after establishment of fund.
Where the ship owner after an incident has constituted a fund in accordance with this Chapter and is entitled to limit his liability,---
(a) no person having a claim for pollution damage arising out of that incident shall be entitled to exercise any right against any other ship and property of the ship owner in respect of such claim;
(b) the High Court or the Central Government shall order the release of any ship or other property belonging to the ship owner which has been detained in respect of a claim for pollution damage arising out of that incident and shall similarly release any bail or other security furnished to avoid any arrest:
Provided that this section shall apply only if the sum paid into the High Court or to the Central Government, or such part thereof as corresponds to the claim, is actually available to the claimant.
(a) no person having a claim for pollution damage arising out of that incident shall be entitled to exercise any right against any other ship and property of the ship owner in respect of such claim;
(b) the High Court or the Central Government shall order the release of any ship or other property belonging to the ship owner which has been detained in respect of a claim for pollution damage arising out of that incident and shall similarly release any bail or other security furnished to avoid any arrest:
Provided that this section shall apply only if the sum paid into the High Court or to the Central Government, or such part thereof as corresponds to the claim, is actually available to the claimant.
Section 188 Compulsory insurance or other financial security.
(1) The owner of every ship carrying more than two thousand tons of oil in bulk as cargo shall in respect of such ship maintain an insurance or other financial security to cover his liability for pollution damage under this Chapter for the amount specified under the provisions of the Civil Liability Convention:
Provided that the Central Government may require the owner of a ship carrying such tons of oil in bulk, to maintain insurance or other financial security to cover his liability for pollution damage upto such limits, as may be prescribed.
(2) In respect of every Indian vessel which maintains insurance or other financial security under sub-section (1), there shall be granted by the Central Government a certificate in such form and giving such particulars, subject to payment of such fee, as may be prescribed.
(3) The Central Government may, on an application by the owner or agent of any foreign ship, grant a certificate under sub-section (2) in respect of such foreign ship on production of satisfactory evidence relating to maintenance of insurance or other financial security in accordance with the provisions of the Civil Liability Convention.
Provided that the Central Government may require the owner of a ship carrying such tons of oil in bulk, to maintain insurance or other financial security to cover his liability for pollution damage upto such limits, as may be prescribed.
(2) In respect of every Indian vessel which maintains insurance or other financial security under sub-section (1), there shall be granted by the Central Government a certificate in such form and giving such particulars, subject to payment of such fee, as may be prescribed.
(3) The Central Government may, on an application by the owner or agent of any foreign ship, grant a certificate under sub-section (2) in respect of such foreign ship on production of satisfactory evidence relating to maintenance of insurance or other financial security in accordance with the provisions of the Civil Liability Convention.
Section 189 Acceptance of certificate granted outside India.
Any certificate granted by a competent authority in a State outside India to a ship registered in that State or any certificate granted by a competent authority of a State which is a contracting party to the Civil Liability Convention to any ship wherever it is registered, shall be accepted at any port or place in India, as if it were granted under this Act.
Section 190 Ban on entering or leaving an Indian port without certificate.
(1) No Indian vessel which has onboard more than two thousand tons of oil in bulk as cargo shall enter or leave or attempt to enter or leave any port or place in India unless it carries onboard a certificate granted under sub-section (2) of section 188 or a certificate accepted under section 189.
(2) No ship other than an Indian vessel carrying more than two thousand tons of oil in bulk as cargo, wherever registered, shall enter or leave or attempt to enter or leave any port or place in India unless it carries onboard a certificate granted under sub-section (2) of section 188 or a certificate accepted under section 189.
(3) No proper officer shall grant inward entry or outward clearance to any ship to which sub-section (1) or sub-section (2) applies, unless its master produces a certificate required in respect of such ship.
(2) No ship other than an Indian vessel carrying more than two thousand tons of oil in bulk as cargo, wherever registered, shall enter or leave or attempt to enter or leave any port or place in India unless it carries onboard a certificate granted under sub-section (2) of section 188 or a certificate accepted under section 189.
(3) No proper officer shall grant inward entry or outward clearance to any ship to which sub-section (1) or sub-section (2) applies, unless its master produces a certificate required in respect of such ship.
Section 191 Direct action against insurer or other person providing financial security.
(1) The insurer or other person providing financial security for the ship owner's liability for pollution damage may be directly liable for any claim for compensation for such damage which may be brought directly against such insurer or other person.
(2) The insurer or other person providing financial security against whom a claim is made directly may, even if the owner is not entitled to limit his liability under section 181, avail himself of* such limits of liability as specified in the said section.
(3) The insurer or other person providing financial security may further avail himself of the defences (other than the bankruptcy or winding up of the company) which the ship owner himself would have been entitled to invoke and such insurer or other person may avail himself of the defence that the pollution damage resulted from the wilful misconduct of the ship owner himself but such insurer or other person shall not avail himself of any other defence which he might have been entitled to invoke in the proceedings brought by the ship owner against him.
(4) The insurer or other person providing financial security shall in any case have the right to require the ship owner to be joined in the proceedings.
(5) Any sum provided by insurance or by other financial security maintained in accordance with section 188 shall be available exclusively for the satisfaction of claims under this Chapter.
(2) The insurer or other person providing financial security against whom a claim is made directly may, even if the owner is not entitled to limit his liability under section 181, avail himself of* such limits of liability as specified in the said section.
(3) The insurer or other person providing financial security may further avail himself of the defences (other than the bankruptcy or winding up of the company) which the ship owner himself would have been entitled to invoke and such insurer or other person may avail himself of the defence that the pollution damage resulted from the wilful misconduct of the ship owner himself but such insurer or other person shall not avail himself of any other defence which he might have been entitled to invoke in the proceedings brought by the ship owner against him.
(4) The insurer or other person providing financial security shall in any case have the right to require the ship owner to be joined in the proceedings.
(5) Any sum provided by insurance or by other financial security maintained in accordance with section 188 shall be available exclusively for the satisfaction of claims under this Chapter.
* by corrigenda
Section 192 Recognition of judgment of court of contracting parties to Civil Liability Convention.
(1) Any judgment passed by a competent court of contracting party under the Civil Liability Convention shall be recognised in India, except where,
(a) the judgment was obtained by fraud; or
(b) the ship owner or the insurer or the person providing financial security who is a party to the proceedings was not given reasonable notice and a fair opportunity to present his case.
(2) Any judgment recognised under sub-section (1) shall be enforceable in India in accordance with such procedure as may be prescribed:
Provided that such procedure shall not permit the merits of the case to be re-opened.
(a) the judgment was obtained by fraud; or
(b) the ship owner or the insurer or the person providing financial security who is a party to the proceedings was not given reasonable notice and a fair opportunity to present his case.
(2) Any judgment recognised under sub-section (1) shall be enforceable in India in accordance with such procedure as may be prescribed:
Provided that such procedure shall not permit the merits of the case to be re-opened.
Section 193 Limitation period.
(1) The rights of compensation under this Chapter shall be extinguished unless action is brought within a period of---
(a) three years from the date of occurrence of pollution damage; and
(b) six years from the date of the incident which caused pollution damage.
(2) If the incident consists of a series of occurrences, the period of six years shall commence from the date of the first occurrence.
(a) three years from the date of occurrence of pollution damage; and
(b) six years from the date of the incident which caused pollution damage.
(2) If the incident consists of a series of occurrences, the period of six years shall commence from the date of the first occurrence.
Section 194 Government ships.
Nothing in this Chapter shall apply to any warship or any ship for the time being used by the Government of any State for purposes other than commercial purposes.
Section 195 Power to make rules.
(1) The Central Government may make rules to carry out the provisions of this Chapter.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely: ---
(a) the time and manner of constitution of the limitation fund under sub-section (1) of section 182;
(b) the time and other particulars of the notice under sub-section (1) of section 183;
(c) the procedure for establishment of fund and adjudication of claims arising from incidents of oil pollution under sub-section (4) of section 183;
(d) the threshold limit of tonnage of oil to be carried in bulk and the limit of liability for pollution damage under the proviso to sub-section (1) of section 188;
(e) the form, particulars and fee to be paid for the grant of a certificate under sub-section (2) of section 188;
(f) the procedure for enforcement of judgement under sub-section (2) of section 192;
(g) any other matter which is required to be or may be prescribed.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely: ---
(a) the time and manner of constitution of the limitation fund under sub-section (1) of section 182;
(b) the time and other particulars of the notice under sub-section (1) of section 183;
(c) the procedure for establishment of fund and adjudication of claims arising from incidents of oil pollution under sub-section (4) of section 183;
(d) the threshold limit of tonnage of oil to be carried in bulk and the limit of liability for pollution damage under the proviso to sub-section (1) of section 188;
(e) the form, particulars and fee to be paid for the grant of a certificate under sub-section (2) of section 188;
(f) the procedure for enforcement of judgement under sub-section (2) of section 192;
(g) any other matter which is required to be or may be prescribed.
Section 196 Application of this Chapter.
This Chapter shall apply to,---
(a) pollution damage caused due to escape or discharge of bunker oil from every Indian vessel and from every ship other than an Indian vessel while it is,---
(i) within the territory of India including territorial waters;or
(ii) at a port or a place in India or within the coastal waters, not extending more than two hundred nautical miles from the baseline;
(b) preventive measures for preventing or minimising the pollution damage,
but shall not apply to---
(a) warships, naval auxiliary or other vessels owned or operated by the Government and used for the time being, only for non-commercial purposes;
(b) pollution damage specified in Chapter III of this Part.
(a) pollution damage caused due to escape or discharge of bunker oil from every Indian vessel and from every ship other than an Indian vessel while it is,---
(i) within the territory of India including territorial waters;or
(ii) at a port or a place in India or within the coastal waters, not extending more than two hundred nautical miles from the baseline;
(b) preventive measures for preventing or minimising the pollution damage,
but shall not apply to---
(a) warships, naval auxiliary or other vessels owned or operated by the Government and used for the time being, only for non-commercial purposes;
(b) pollution damage specified in Chapter III of this Part.
Section 197 Definitions.
In this Chapter, unless the context otherwise requires, ---
(a) "Bunker Convention" means the International Convention on Civil Liability for Bunker Oil Pollution Damage, 2001;
(b) "bunker oil" means any hydrocarbon mineral oil, including lubricating oil, used or intended to be used for the operation or propulsion of the ship, and any residues of such oil;
(c) "incident", "person", "pollution damage" and "preventive measures" shall have the meanings respectively assigned to them in clauses (a), (c), (d) and (e), of section 176;
(d) "registered owner" means the person or persons registered as the owner of the ship or, in the absence of registration, the person or persons owning the ship, and in the case of a ship owned by a State and operated by a company which in that State is registered as the ship's operator, "registered owner" shall mean such company;
(e) "ship" means any sea-going vessel and seaborne* craft of any type whatsoever;
(f) "ship owner" means the owner, including the registered owner, bareboat charterer, manager and operator of the ship.
(a) "Bunker Convention" means the International Convention on Civil Liability for Bunker Oil Pollution Damage, 2001;
(b) "bunker oil" means any hydrocarbon mineral oil, including lubricating oil, used or intended to be used for the operation or propulsion of the ship, and any residues of such oil;
(c) "incident", "person", "pollution damage" and "preventive measures" shall have the meanings respectively assigned to them in clauses (a), (c), (d) and (e), of section 176;
(d) "registered owner" means the person or persons registered as the owner of the ship or, in the absence of registration, the person or persons owning the ship, and in the case of a ship owned by a State and operated by a company which in that State is registered as the ship's operator, "registered owner" shall mean such company;
(e) "ship" means any sea-going vessel and seaborne* craft of any type whatsoever;
(f) "ship owner" means the owner, including the registered owner, bareboat charterer, manager and operator of the ship.
* by corrigenda
Section 198 Liability for bunker oil pollution.
(1) Save as otherwise provided in section 200,---
(a) where pollution damage is caused due to discharge or escape of bunker oil onboard or originating from the ship, the ship owner shall be liable for, ---
(i) any pollution damage;
(ii) the cost of any reasonable measures taken for preventing or minimising any pollution damage so caused or likely to be caused; and
(iii) any damage caused by any such preventive measure so taken:
Provided that where an incident consists of a series of occurrences having the same origin, the ship owner shall be liable from the first of such occurrences and where more than one person is liable, their liability shall be joint and several;
(b) where there is a grave and imminent threat of damage being caused outside a ship, the ship owner shall be liable for the cost of any measures reasonably taken to prevent or minimise any such damage.
(2) Where any incident involving two or more ships occurs resulting in pollution damage, the ship owners of all ships involved in such incident shall, unless the damage is reasonably separable, be jointly and severally liable for such damage.
(a) where pollution damage is caused due to discharge or escape of bunker oil onboard or originating from the ship, the ship owner shall be liable for, ---
(i) any pollution damage;
(ii) the cost of any reasonable measures taken for preventing or minimising any pollution damage so caused or likely to be caused; and
(iii) any damage caused by any such preventive measure so taken:
Provided that where an incident consists of a series of occurrences having the same origin, the ship owner shall be liable from the first of such occurrences and where more than one person is liable, their liability shall be joint and several;
(b) where there is a grave and imminent threat of damage being caused outside a ship, the ship owner shall be liable for the cost of any measures reasonably taken to prevent or minimise any such damage.
(2) Where any incident involving two or more ships occurs resulting in pollution damage, the ship owners of all ships involved in such incident shall, unless the damage is reasonably separable, be jointly and severally liable for such damage.
Section 199 Exemption from liability.
(1) No liability for pollution damage shall be incurred by the ship owner under this Chapter, if he proves that such damage,---
(a) resulted from an act of war, hostilities, civil war, insurrection or a natural phenomenon of an exceptional, inevitable and irresistible character; or
(b) was wholly caused by any act or omission done with an intent to cause such damage by any person other than an employee or agent of the ship owner; or
(c) was wholly caused by the negligence or other wrongful act of any Government or other authority responsible for the maintenance of lights or other navigational aids in the exercise of that function.
(2) If the ship owner proves that the pollution damage resulted wholly or partially either from an act or omission done with intent to cause damage by the person who suffered the damage or from the negligence of that person, then, he shall be wholly or partially exonerated from his liability to such person.
(a) resulted from an act of war, hostilities, civil war, insurrection or a natural phenomenon of an exceptional, inevitable and irresistible character; or
(b) was wholly caused by any act or omission done with an intent to cause such damage by any person other than an employee or agent of the ship owner; or
(c) was wholly caused by the negligence or other wrongful act of any Government or other authority responsible for the maintenance of lights or other navigational aids in the exercise of that function.
(2) If the ship owner proves that the pollution damage resulted wholly or partially either from an act or omission done with intent to cause damage by the person who suffered the damage or from the negligence of that person, then, he shall be wholly or partially exonerated from his liability to such person.
Section 200 Right of ship owner to limitation of liability.
(1) The ship owner and the person providing insurance or other financial security shall be entitled to limit his liability under this Chapter in respect of any one or more incidents in accordance with the provisions of Chapter II of this Part.
(2) The ship owner shall not be entitled to limit his liability, if it is proved that the incident causing pollution damage occurred as a result of his personal act or omission, committed or made with intent to cause such damage, or committed recklessly and with knowledge that such damage is likely to result.
(2) The ship owner shall not be entitled to limit his liability, if it is proved that the incident causing pollution damage occurred as a result of his personal act or omission, committed or made with intent to cause such damage, or committed recklessly and with knowledge that such damage is likely to result.