The Merchant Shipping Act, 2025
Administered Ministry: Ministry of Ports, Shipping and Waterways
Section
Section 201 Determination of limitation of liability.
A ship owner who is alleged to have incurred a liability for bunker oil pollution under section 198 or his insurer may make an application to the High Court or the Central Government for determination of limitation of his liability in accordance with the provisions of Chapter II of this Part.
Section 202 Consolidation of claims and distribution of amount.
The High Court or the Central Government may consolidate all claims against the ship owner or his insurer who has deposited the amount under section 201 and may distribute the amount amongst the claimants in accordance with the provisions of section 170.
Section 203 Extinguishment of right to claim.
(1) The right to claim compensation under this Chapter shall be extinguished, if such claim is not made within a period of---
(a) three years from the date of occurrence of damage; and
(b) six years from the date of incident which caused such damage.
(2) Where the incident consists of a series of occurrences, the period of six years shall commence from the date of the first of such occurrence.
(a) three years from the date of occurrence of damage; and
(b) six years from the date of incident which caused such damage.
(2) Where the incident consists of a series of occurrences, the period of six years shall commence from the date of the first of such occurrence.
Section 204 Maintenance of compulsory insurance or other financial security.
Every registered owner of a ship having gross tonnage of more than one thousand tons shall, for the purpose of his liability for pollution damage under this Chapter, maintain compulsory insurance coverage or such other financial security, subject to such limits as may be specified under the Limitation of Liability for Maritime Claims Convention.
Section 205 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 also be liable along with the ship owner for any claim for compensation for such damage.
(2) The insurer or other person providing financial security may, if the ship owner is not entitled to limit his liability in accordance with the provisions of section 200, avail himself such limits of liability as may be prescribed.
(3) Any claim for compensation for pollution damage may be brought directly against the insurer or other person providing financial security for the registered ship owner's liability for pollution damage and in such case, the insurer or such person may invoke defences (other than bankruptcy or winding up of the company) which the ship owner would have been entitled to invoke, including limitation of liability under section 200:
Provided that the insurer or such person may invoke the defence that the pollution damage resulted from the wilful misconduct of the ship owner but shall not invoke any other defence which such insurer or person might have been entitled to invoke in proceedings brought by the ship owner against such insurer or person:
Provided further that the insurer or such person may make the ship owner a party to such proceedings.
(2) The insurer or other person providing financial security may, if the ship owner is not entitled to limit his liability in accordance with the provisions of section 200, avail himself such limits of liability as may be prescribed.
(3) Any claim for compensation for pollution damage may be brought directly against the insurer or other person providing financial security for the registered ship owner's liability for pollution damage and in such case, the insurer or such person may invoke defences (other than bankruptcy or winding up of the company) which the ship owner would have been entitled to invoke, including limitation of liability under section 200:
Provided that the insurer or such person may invoke the defence that the pollution damage resulted from the wilful misconduct of the ship owner but shall not invoke any other defence which such insurer or person might have been entitled to invoke in proceedings brought by the ship owner against such insurer or person:
Provided further that the insurer or such person may make the ship owner a party to such proceedings.
Section 206 Grant of certificate.
(1) The Central Government shall grant a certificate in respect of every ship which maintains insurance or other financial security, in such form, containing such particulars, subject to such conditions and on payment of such fee, as may be prescribed.
(2) Every certificate granted under sub-section (1) shall on expiry, be renewed in such manner and on payment of such fee as may be prescribed.
(2) Every certificate granted under sub-section (1) shall on expiry, be renewed in such manner and on payment of such fee as may be prescribed.
Section 207 Ban on entering or leaving port without clearance.
(1) No ship shall enter or leave or attempt to enter or leave any port or place to which this Chapter applies unless it carries onboard a certificate granted under section 206.
(2) Any certificate granted by a competent authority in any State outside India to a ship registered in that State or any certificate granted by a competent authority of any State which is a contracting party to the Bunker Convention to any ship wherever registered, shall be accepted at any port or place in India as if it were granted under this Act.
(3) No proper officer shall permit inward entry or outward clearance to any ship to which sub-section (1) or sub-section (2) applies unless the master of the ship produces the certificate required in respect of such ship.
(2) Any certificate granted by a competent authority in any State outside India to a ship registered in that State or any certificate granted by a competent authority of any State which is a contracting party to the Bunker Convention to any ship wherever registered, shall be accepted at any port or place in India as if it were granted under this Act.
(3) No proper officer shall permit inward entry or outward clearance to any ship to which sub-section (1) or sub-section (2) applies unless the master of the ship produces the certificate required in respect of such ship.
Section 208 Right of recourse.
Nothing contained in this Chapter shall prejudice the right of recourse that the ship owner may have against any other person in respect of his liability.
Section 209 Recognition of judgment of court of contracting parties to Bunker Convention.
(1) Any judgment passed by a competent court of a contracting party under the Bunker 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 210 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 limits of liability of the insurer or other person providing financial security under sub-section (2) of section 205;
(b) the form of certificate, particulars, conditions and fee for issuance of certificate under sub-section (1) of section 206;
(c) the manner of renewal of certificate and fees under sub-section (2) of section 206;
(d) the procedure for enforcement of a judgment under sub-section (2) of section 209;
(e) 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 limits of liability of the insurer or other person providing financial security under sub-section (2) of section 205;
(b) the form of certificate, particulars, conditions and fee for issuance of certificate under sub-section (1) of section 206;
(c) the manner of renewal of certificate and fees under sub-section (2) of section 206;
(d) the procedure for enforcement of a judgment under sub-section (2) of section 209;
(e) any other matter which is required to be or may be prescribed.
Section 211 Application of this Chapter.
This Chapter shall apply to pollution damage caused in the territory of India, including the coastal waters, not extending more than two hundred nautical miles from the baseline and to preventive measures, wherever taken, to prevent or minimise such pollution damage.
Section 212 Definitions.
(1) In this Chapter, unless the context otherwise requires,---
(a) "associated person" includes any subsidiary or commonly controlled entity or such person as may be prescribed;
(b) "contributing oil" means crude oil and fuel oil.
Explanation.---For the purposes of this clause,---
(i) "crude oil" means any liquid hydrocarbon mixture occurring naturally in the earth whether or not treated to render it suitable for transportation and includes crude oils from which certain distillate fractions are removed (sometimes referred to as topped crudes) or to which certain distillate fractions are added (sometimes referred to as spiked or reconstituted crudes);
(ii) "fuel oil" means heavy distillates or residues from crude oil or blends of such materials intended for use as a fuel for the production of heat or power of a quality equivalent to the "American Society for Testing and Materials' Specification for Number Four Fuel Oil (Designation D 396-69)", or heavier;
(c) "Fund" means the International Oil Pollution Compensation Fund, 1992 established under Article 2 of the Fund Convention;
(d) "Fund Convention" means the International Convention on the establishment of an International Fund for Compensation for Oil Pollution Damage, 1992, including protocols, if any, to which India is a party;
(e) "guarantor" means any person providing insurance or other financial security to cover the owner's liability;
(f) "ton", in relation to oil, means a metric ton.
(2) The words or expressions used in this Chapter but not defined shall have the meanings respectively assigned to them in the Civil Liability Convention.
(a) "associated person" includes any subsidiary or commonly controlled entity or such person as may be prescribed;
(b) "contributing oil" means crude oil and fuel oil.
Explanation.---For the purposes of this clause,---
(i) "crude oil" means any liquid hydrocarbon mixture occurring naturally in the earth whether or not treated to render it suitable for transportation and includes crude oils from which certain distillate fractions are removed (sometimes referred to as topped crudes) or to which certain distillate fractions are added (sometimes referred to as spiked or reconstituted crudes);
(ii) "fuel oil" means heavy distillates or residues from crude oil or blends of such materials intended for use as a fuel for the production of heat or power of a quality equivalent to the "American Society for Testing and Materials' Specification for Number Four Fuel Oil (Designation D 396-69)", or heavier;
(c) "Fund" means the International Oil Pollution Compensation Fund, 1992 established under Article 2 of the Fund Convention;
(d) "Fund Convention" means the International Convention on the establishment of an International Fund for Compensation for Oil Pollution Damage, 1992, including protocols, if any, to which India is a party;
(e) "guarantor" means any person providing insurance or other financial security to cover the owner's liability;
(f) "ton", in relation to oil, means a metric ton.
(2) The words or expressions used in this Chapter but not defined shall have the meanings respectively assigned to them in the Civil Liability Convention.
Section 213 Contribution to Fund.
(1) All contributions to the Fund in respect of contributing oil carried by sea to ports or terminal installations in India shall be payable in accordance with Articles 10 and 12 of the Fund Convention.
(2) The provisions of sub-section (1) shall apply---
(a) whether or not the contributing oil is imported; and
(b) notwithstanding that contributions are payable to the Fund in respect of carriage of the same contributing oil on a previous voyage.
(3) The person liable to pay contributions to the Fund shall be---
(a) in case of contributing oil which is being imported into India, the importer; and
(b) in any other case, the person by whom the oil is received in India.
(4) A person shall not be liable to pay contributions to the Fund in respect of the contributing oil imported or received by him in any year, if the aggregate quantity of contributing oil so imported or received in a year by him and any associated person does not exceed one lakh fifty thousand tons, or as may be specified from time to time in the Fund Convention.
Explanation.---For the purposes of this section, "terminal installation" means any site for the storage of oil in bulk which is capable of receiving oil from waterborne transportation, including any facility situated offshore and linked to such site.
(2) The provisions of sub-section (1) shall apply---
(a) whether or not the contributing oil is imported; and
(b) notwithstanding that contributions are payable to the Fund in respect of carriage of the same contributing oil on a previous voyage.
(3) The person liable to pay contributions to the Fund shall be---
(a) in case of contributing oil which is being imported into India, the importer; and
(b) in any other case, the person by whom the oil is received in India.
(4) A person shall not be liable to pay contributions to the Fund in respect of the contributing oil imported or received by him in any year, if the aggregate quantity of contributing oil so imported or received in a year by him and any associated person does not exceed one lakh fifty thousand tons, or as may be specified from time to time in the Fund Convention.
Explanation.---For the purposes of this section, "terminal installation" means any site for the storage of oil in bulk which is capable of receiving oil from waterborne transportation, including any facility situated offshore and linked to such site.
Section 214 Contribution payable by persons to Fund.
(1) The contributions payable to the Fund by a person for any year shall be, ---
(a) such amount as may be determined under Article 12 of the Fund Convention;
(b) in such instalments, becoming due at such dates,
as may be notified under the Fund Convention and any amount due shall be payable along with interest at a rate determined under Article 13 of the Fund Convention.
(2) The Central Government may require persons who are or may be liable to pay contributions to the Fund under this Chapter to give financial security for payment of contributions to the Central Government or the Fund.
(a) such amount as may be determined under Article 12 of the Fund Convention;
(b) in such instalments, becoming due at such dates,
as may be notified under the Fund Convention and any amount due shall be payable along with interest at a rate determined under Article 13 of the Fund Convention.
(2) The Central Government may require persons who are or may be liable to pay contributions to the Fund under this Chapter to give financial security for payment of contributions to the Central Government or the Fund.
Section 215 Liability of Fund.
(1) Where any person suffering pollution damage is unable to obtain full and adequate compensation for the damage under the Civil Liability Convention, the Fund shall be liable to pay compensation to such person, if,---
(a) no liability for the damage arises under the provisions of the Civil Liability Convention; or
(b) the ship owner liable for the damage under the provisions of the Civil Liability Convention is financially incapable of meeting his obligations in full and any financial security that may be provided under that Convention does not cover or is insufficient to satisfy the claims for compensation for the damage and the person suffering damage has taken all reasonable steps to pursue the legal remedies available to him; or
(c) the damage exceeds the ship owner's liability under the Civil Liability Convention.
(2) The expenses incurred or sacrifices made by the ship owner voluntarily to prevent or minimise pollution damage shall be treated as pollution damage for the purposes of this section.
(3) The Fund shall incur no obligation under sub-section (1) if,---
(a) it is proved that the pollution damage resulted from an act of war, hostilities, civil war or insurrection or was caused by oil which has escaped or been discharged from a warship or other ship owned or operated by a State and used at the time of the incident, only on Government noncommercial service; or
(b) the claimant fails to prove that the damage resulted from an incident involving one or more ship.
(4) If the Fund proves that the pollution damage resulted wholly or partly either from an act or omission done with the intent to cause damage by the person who suffered the damage or from the negligence of that person, the Fund may be exonerated wholly or partly from its obligation to pay compensation to such person.
(5) The Fund shall in any event (except in respect of preventive measures), be exonerated to the extent the ship owner may have been exonerated under the Civil Liability Convention.
(a) no liability for the damage arises under the provisions of the Civil Liability Convention; or
(b) the ship owner liable for the damage under the provisions of the Civil Liability Convention is financially incapable of meeting his obligations in full and any financial security that may be provided under that Convention does not cover or is insufficient to satisfy the claims for compensation for the damage and the person suffering damage has taken all reasonable steps to pursue the legal remedies available to him; or
(c) the damage exceeds the ship owner's liability under the Civil Liability Convention.
(2) The expenses incurred or sacrifices made by the ship owner voluntarily to prevent or minimise pollution damage shall be treated as pollution damage for the purposes of this section.
(3) The Fund shall incur no obligation under sub-section (1) if,---
(a) it is proved that the pollution damage resulted from an act of war, hostilities, civil war or insurrection or was caused by oil which has escaped or been discharged from a warship or other ship owned or operated by a State and used at the time of the incident, only on Government noncommercial service; or
(b) the claimant fails to prove that the damage resulted from an incident involving one or more ship.
(4) If the Fund proves that the pollution damage resulted wholly or partly either from an act or omission done with the intent to cause damage by the person who suffered the damage or from the negligence of that person, the Fund may be exonerated wholly or partly from its obligation to pay compensation to such person.
(5) The Fund shall in any event (except in respect of preventive measures), be exonerated to the extent the ship owner may have been exonerated under the Civil Liability Convention.
Section 216 Limitation of liability of Fund.
(1) The liability of the Fund under section 215 shall be subject to the limits specified in Article 4 of the Fund Convention.
(2) Upon institution of a claim for compensation under this Chapter, the High Court shall issue notice to the Fund and such Fund shall be entitled to participate in the proceedings.
(3) No order shall be passed against the Fund by the High Court until the Fund notifies the High Court that the amount of the claim may,---
(a) not be reduced; or
(b) be reduced to a specified amount and the liability of the Fund shall be enforceable only for the reduced amount.
(4) The amount for which the Fund is liable under this Chapter shall be paid in rupees and the mode and manner of converting such amount from Special Drawing Rights into rupees shall be such as may be prescribed.
(2) Upon institution of a claim for compensation under this Chapter, the High Court shall issue notice to the Fund and such Fund shall be entitled to participate in the proceedings.
(3) No order shall be passed against the Fund by the High Court until the Fund notifies the High Court that the amount of the claim may,---
(a) not be reduced; or
(b) be reduced to a specified amount and the liability of the Fund shall be enforceable only for the reduced amount.
(4) The amount for which the Fund is liable under this Chapter shall be paid in rupees and the mode and manner of converting such amount from Special Drawing Rights into rupees shall be such as may be prescribed.
Section 217 Power to call for information.
(1) The Central Government may, for the purpose of transmitting to the Fund, the names and addresses of the persons who under this Chapter are liable to make contributions to the Fund every year and the quantity of contributing oil in respect of which they are so liable, by notice, require any such person to furnish such information, in such manner and within such time, as may be specified therein.
(2) In proceedings by the Fund against any person for the recovery of any contribution due to the Fund under section 214, the particulars contained in any list transmitted by the Central Government to the Fund shall, so far as those particulars are based on information obtained under this section, be admissible as evidence of the facts stated therein, and so far as particulars which are so admissible are based on information given by the person against whom the proceedings are brought, shall be presumed to be accurate until the contrary is proved.
(3) No person shall disclose any information which was furnished to or obtained by him under this section unless the disclosure is made,---
(a) with the consent of the person from whom the information was obtained;
(b) in connection with the compliance of this section;
(c) for the purpose of any legal proceedings arising out of this section or of any report of such proceedings.
(4) A person who, ---
(a) refuses or wilfully neglects to comply with a notice under this section; or
(b) makes, while furnishing any information in compliance with a notice under this section, any statement which he knows to be false in a material particular, or recklessly makes any statement which is false in a material particular,
shall be liable to penalty under this Act.
(2) In proceedings by the Fund against any person for the recovery of any contribution due to the Fund under section 214, the particulars contained in any list transmitted by the Central Government to the Fund shall, so far as those particulars are based on information obtained under this section, be admissible as evidence of the facts stated therein, and so far as particulars which are so admissible are based on information given by the person against whom the proceedings are brought, shall be presumed to be accurate until the contrary is proved.
(3) No person shall disclose any information which was furnished to or obtained by him under this section unless the disclosure is made,---
(a) with the consent of the person from whom the information was obtained;
(b) in connection with the compliance of this section;
(c) for the purpose of any legal proceedings arising out of this section or of any report of such proceedings.
(4) A person who, ---
(a) refuses or wilfully neglects to comply with a notice under this section; or
(b) makes, while furnishing any information in compliance with a notice under this section, any statement which he knows to be false in a material particular, or recklessly makes any statement which is false in a material particular,
shall be liable to penalty under this Act.
Section 218 Claims against Fund and jurisdiction of courts.
(1) Any claim against the Fund for compensation under this Chapter shall be brought before the High Court.
(2) The Fund shall have the right to intervene as a party to any legal proceedings instituted in the High Court against the ship owner or his guarantor.
(3) Where a notice of proceedings is given to the Fund by the High Court, any judgment given in the proceedings shall, after it has become final and enforceable, become binding upon the Fund to the effect that the facts and evidence in that judgment may not be disputed by the Fund on the ground that it has not intervened in the proceedings.
(2) The Fund shall have the right to intervene as a party to any legal proceedings instituted in the High Court against the ship owner or his guarantor.
(3) Where a notice of proceedings is given to the Fund by the High Court, any judgment given in the proceedings shall, after it has become final and enforceable, become binding upon the Fund to the effect that the facts and evidence in that judgment may not be disputed by the Fund on the ground that it has not intervened in the proceedings.
Section 219 Extinguishment of claims.
Notwithstanding anything contained in any other law for the time being in force, no action to enforce a claim against the Fund under this Chapter shall be entertained by a High Court, unless---
(a) the action to enforce is commenced; or
(b) notice of action to enforce a claim against the ship owner or his guarantor in respect of the pollution damage is given to the Fund,
within three years from the date when the damage occurred and six years from the date of the incident that caused such damage.
(a) the action to enforce is commenced; or
(b) notice of action to enforce a claim against the ship owner or his guarantor in respect of the pollution damage is given to the Fund,
within three years from the date when the damage occurred and six years from the date of the incident that caused such damage.
Section 220 Subrogation and right of recourse.
In respect of any sum paid by a public authority in India or by the Fund as compensation for pollution damage, that authority or the Fund shall acquire by subrogation any rights which the person so compensated would have enjoyed under the Fund Convention.