The Kobe Queen I, a Panamanian registered vessel with Ukrainian crew members, was spotted by officers of the Customs Department in Indian territorial waters. Customs seized the vessel and its cargo and arranged to have it sold. The appellant Konavalov, who was the Chief Officer, claimed wages from the sale proceeds of the ship.

The Single Judge of the High Court directed the Coast Guard authorities and the Customs authorities to pay the wages lawfully due to the crew on board the ship and ordered that the crew should be deported to their country and that the expenses should be met by the Government agencies out of the funds retained by them after selling the cargo. The respondents appealed to the Division Bench of the High Court. The Division Bench compared this situation with the category where a Government claims sovereign immunity and held that the appellant's maritime lien for wages on the ship was extinguished on the ship being confiscated by the Government. The appellant appealed to the Supreme Court.

Held: Appeal allowed. The decision of the Division Bench of the Madras High Court is set aside.

The view taken by the Division Bench that consequent upon the confiscation of the ship, the property in the ship including all interests attached to the ship are forfeited does not admit of any exception, is not tenable. The Division Bench of the High Court reaches this conclusion on the basis of the proposition that the confiscation of the goods are proceedings in rem and that once an order of confiscation is passed, it operates against all even if they are not parties to the proceedings.

The MLM Convention 1993 does not define maritime liens but lists them under art 4, namely: master and crew wages including costs of repatriation and social insurance contributions; claims for loss of life or personal injury in direct connection with the operation of the vessel; salvage; claims for port, canal and other watering dues and pilotage dues; and claims based on tort arising out of physical loss or damage caused.

Therefore, in this case, the crew definitely, by virtue of them being crew, have a lien on the vessel and are entitled to claim such wages that are due to them. The rationale for this is that the wage lien arises from service rendered to the ship. Thus it can be said that the order of the single Judge which ordered the payment of wages for the crewmen from the proceeds from the sale of cargo is wrong, but again the order of the Division Bench saying that, once the order of confiscation of the vessel is passed the crewmen cannot exercise any lien on the vessel even to get their wages, is also wrong.

In our view, the impugned judgment is contrary to the principles of law laid down by this Court in MV Al Quamar and MV Elisabeth (CMI883). In these cases, this Court has held that a maritime lien is a right which continues even if the ship is taken legally from an owner by requisition. The argument advanced by counsel for the first respondent that the maritime lien is extinguished by confiscation has no force and is without any merit. The Courts have recognised and upheld the welfare of citizens and have always recognised the rights of those who are in the lowest strata of the society, especially when it comes to workers and their wages.

All the seafarers who were on board the vessel Kobe Queen I also known as the Gloria Kopp are entitled to their full wages and perks.