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Business News/ Politics / News/  SC declines JN port container terminals’s petitions over rate cuts
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SC declines JN port container terminals’s petitions over rate cuts

SC declines JN port container terminals’s petitions over rate cuts

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Bangalore: DP World Pvt. Ltd and APM Terminals Management BV, which operates container terminals at Jawaharlal Nehru (JN) port, will have to reduce tariffs after the Supreme Court declined to admit petitions seeking a stay on the rate cuts ordered by India’s port tariff regulator

On 8 February, the Tariff Authority for Major Ports (TAMP) notified a rate cut of 44.28% at the facility run by Gateway Terminals India Pvt. Ltd at JN port after the firm sought a rate increase of 8.72%. Gateway Terminals is majority owned by Denmark’s APM Terminals.

On 1 March, TAMP notified a rate cut of 27.85% at Nhava Sheva International Container Terminal Pvt. Ltd, the facility run by Dubai’s DP World at JN port, when the firm asked for a 30% raise.

JN port, India’s busiest container gateway located near Mumbai, loaded 4.32 million standard containers or 55.63% of India’s container cargo shipped through the 12 ports controlled by the union government in the year to March 2012.

DP World declined to comment. P.K. Agrawal, chief executive officer of Gateway Terminals, did not respond to calls and a text message sent to his mobile seeking comment.

The two private terminals at JN port have been trying to get the rate cuts stayed.

The operators filed separate petitions against the rate cuts in the Delhi high court but they were dismissed by the court on 23 March on jurisdictional grounds - the cases were filed in Delhi whereas the terminals are located in Mumbai.

The operators then approached the Supreme Court with special leave petitions which were not admitted by the court.

TAMP order, typically, takes effect 15 days after it is published in the gazette of India unless it is stayed by the courts. Since, the courts have not stayed the orders, the rate cuts came into force from 23 February in the case of Gateway Terminals and from 16 March for Nhava Sheva. But the two terminals are yet to implement the new (lower) rates. Mint reported the development on 7 April.

The tariff regulator does not have the powers to enforce its own orders, a spokesperson for TAMP said, adding that “only the courts have the powers to enforce or stay the orders of TAMP."

Earlier, the two container terminals had made a valiant attempt to prevent the rates cuts.

In December 2011, the two terminals under the banner of the Indian Private Ports and Terminals Association (IPPTA), a private port lobby group, had filed a petition in the Delhi high court seeking status quo on existing rates till the new guidelines for computing tariffs are finalized by the government. The existing tariff setting guidelines framed by the government in 2005 are due for revision after a five year run. These guidelines are followed by TAMP while setting rates.

IPPTA had approached the court on apprehensions that TAMP may lower the existing rates at their terminals that are due for revision.

But, on 9 January this year, the court declined to grant a stay on the rate revisions. And, the rate cuts followed.

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Published: 10 May 2012, 10:27 PM IST
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