Madras High Court has ordered the arrest of a Panama-flagged vessel at Chennai port following a maritime dispute involving unpaid dues of over $2.6 million linked to a charter agreement breach.
Madras High Court Orders Arrest Of Panama-Flagged Vessel
Chennai: The Madras High Court has directed the arrest of Panama-flagged vessel MV Zhong Peng You Yi at Chennai port in connection with a maritime dispute over alleged unpaid dues.
The interim order was passed by Justice Senthilkumar Ramamoorthy on March 18, following an urgent plea filed by two companies.
The case relates to a time charter agreement signed in 2023 between a Russian firm, Eurotrans Limited, and the ship’s owners. Under the agreement, the vessel was hired for 12 months, with an option for extension.
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The Russian company later assigned its rights to a Dubai-based entity, Ship Fuels & Trade DMCC, which joined the legal proceedings as a co-plaintiff.
The plaintiffs alleged that the ship’s owners unlawfully withdrew the vessel under the pretext of sending it for repairs to China. According to the plea, the vessel was declared off-hire from May 26, 2024, but the owners subsequently raised additional charges beyond that date.
They further claimed that the vessel was later offered to other parties at higher charter rates, potentially taking advantage of rising market demand.
The companies have sought dues amounting to approximately $2.6 million, which includes unpaid hire charges, damages for breach of contract, a security deposit, fuel costs, and legal expenses.
The rise in global shipping rates, partly linked to disruptions in the Red Sea region, was also cited as a factor in the dispute.
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The Court observed that the case qualifies as a maritime claim under the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017. It also noted the risk of the vessel leaving Indian jurisdiction, warranting immediate action. A warrant for the vessel’s arrest was issued to prevent it from sailing out of Chennai port.
The Court has directed the ship’s owners to respond to the plea by April 1. The matter will be taken up for further hearing after submissions from both sides.
