M.T. MAHARSHI VISHWAMITRA 

  • Chief Engineer of tanker vessel m.t. Amba Bhavanee gets order of arrest of vessel m.t. Maharshi Vishwamitra at Sikka from the Bombay High Court

    Chief Engineer, Mr. Satish Chandra Tiwari who was employed by Varun Shipping Co Ltd filed an admiralty action in the Bombay High Court and have obtained an order of arrest of a tanker vessel m.t. Maharshi Vishwamitra owned by Varun that had arrived Sikka port for discharge of oil, for his unpaid wages. The arrest order was obtained at Judges chamber on a non-working Saturday evening time.

     

    In the Chairman's speech on the 41st Annual General Meeting Mr. Yudhishthir D. Khatau stated that '..for the 18 months period ended 30th September, 2012 the Company's freight and charter hire income for the 18 months period ended 30th September, 2012 was Rs.4,655.02 million and the net profit after tax was Rs.383.65 million and the Board of Directors has recommended dividend of 5 per cent, i.e. Re.0.50 per equity share for the 18 months period ended 30th September, 2012. I am pleased to state that your Company holds an impressive track record of earning profits and declaring dividends uninterruptedly to its shareholders for the past 28 years'...'During the period under review, Varun Gas Infrastructure Limited, Varun Global Private Limited, Varun Resources Private Limited and Varun Cyprus Limited became wholly owned subsidiary companies of your Company. Further, Varun Asia Pte. Ltd., Singapore was a wholly owned subsidiary of your Company for the period from 3rd April, 2012 to 28th September, 2012 and is now an associate of your Company...'Your Company presently owns and/or operates a well diversified fleet of 20 vessels comprising 10 LPG carriers, 3 double hull aframax crude oil tankers and 7 AHTS vessels'...'With a view to realign businesses and increase focus on individual growth strategies of each business, your Company together with other companies has proposed to rearrange its businesses by segregating its traditional shipping business, ship management (technical and commercial management) Varun Shipping Company Limited.. and shipping investment business (presently confined to holding investment in group companies) into separate entities through a Composite Scheme of Arrangement and Amalgamation (the "Scheme") under the provisions of the Companies Act, 1956 which would create focussed entities thereby resulting in enhancement of business prospects and shareholder's value. This would also allow greater flexibility to shareholders in their investment decisions in future...' At the Court Convened Meeting of the Equity Shareholders of the Company held as per the directions of the Hon'ble High Court of Judicature at Bombay on 8th January, 2013, the shareholders approved the Scheme with overwhelming majority. Your Company has filed petition before the Hon'ble High Court of Judicature at Bombay for approval of the Scheme'.

    The Amalgamation petition is pending hearing in the Bombay High Court.

    Varun Shipping is one of the oldest shipping companies in India,  the company had been struggling to pay its employees and creditors in recent years, the company have recently defaulted in payment of service tax to the tune of 7 crores,  since last year the companies ships are getting arrested by order of court but are paying up after orders of arrest of their vessels are obtained.

    T
    he shipping industry is passing through a bad phase but the sector appears to be improving and this could have affected their liquidity.

    In January this year, Varun's vessel Maharshi Bharadwaj was arrested by the Bombay High Court after its US based supplier Drew Marine approached the court over non-payment of dues. In November this year, Lisnave Estaleiros Navais, another lender, filed a suit against the company for non-payment of dues amounting to Rs 4 crore, a matter which was later settled out of court. There was another legal action by a  Singapore-based Avalontec,  after they filed a suit in the Bombay High Court, they paid. "After the vessel was arrested in these cases, the company paid within a weeks time, but only after we approached the court," said Binita Hathi, partner at Brus Chambers, a law firm representing Drew Marine.

    It appears that
    the management has paid all its dues to the shipping staff until December, but close to 20 per cent of its ground staff have not been paid salaries for the past few months. It appears that they have paid salaries to their floating staff until December. But, we had some difficulty paying some of our ground staff.

    According to Brus Chambers, the law firm that had represented Drew Marine, Varun Shipping has also been hiving off their vessels into separate subsidiaries and associate companies of the group to escape the lenders. "They have been hiving off the vessels into separate subsidiaries and associate companies. When we approached them for the dues, we found out that the vessel for which the claims were made are no longer registered under Varun Shipping, but a subsidiary." added Hathi.

     

    Chief Engineer, Mr. Satish Chandra Tiwari is also represented by the law firm Brus Chambers. Dr. Shrikant Hathi of the law firm is relunctant to divulge information if there are other crew who are unpaid and intends to initiate legal action against any vessel owned by the company, as he has duty towards his client to protect their interest.

     

    In the meanwhile the existing crew on board the vessel m.t. Maharshi Vishwamitra at port Sikka have resorted to protest and are refusing to work as their wages too are unpaid therefore the vessels berthing programme was cancelled by the port authorities and is waiting at anchorage.

     

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