CSC settles dispute between GRSE and CIWTC Ship’s crew

The Conciliation and Settlement Committee (CSC) for major government-owned ports has settled a 16-year trade dispute between Central Inland Water Transport Corporation Ltd (CIWTC) and Garden Reach Shipbuilders and Engineers Ltd (GRSE).

“The resolution of the long-standing dispute between two Central Public Sector Enterprises (CPSEs) under the control of two different departments demonstrates that this mechanism is useful for resolving inter-departmental and departmental disputes, even without the usual to strain government machinery,” said Gopal Krishna, Chairman of the Conciliation and Settlement Committee (CSC).

CIWTC is a Department of Ports, Shipping and Waterways CPSE while GRSE is a Department of Defense CPSE.

The dispute, which has been pending since 2006, was settled within nine months under the auspices of CSC, added Gopal Krishna, a former secretary at the Ministry of Ports, Shipping and Waterways.

The dispute concerned the resolution of GRSE’s outstanding claims arising from the transfer of the Rajabagan Dockyard (RBD) from CIWTC to GRSE on an outright purchase basis.

In November 2005, the Union Government decided to reorganize CIWTC whereby the Kolkata-based Rajabagan Dockyard along with its manpower, assets and liabilities was transferred to GRSE on an outright purchase basis under an agreement signed between the parties in June 2006.

CIWTC had statutory excise duties payable to the Central Excise at the time of RBD’s purchase by GRSE.

Likewise, there were several vessels, cranes and other equipment that were not part of the sale and had to be removed per CIWTC’s sale agreement. The trade dispute between the parties also involved the removal and disposal of these ships, cranes and equipment.

GRSE withheld from the purchase price the amount to be paid due to the consumption tax and ground rent.

The trade dispute between the parties continued from 2006 and could not be resolved until 2016 when the Department of Ports, Shipping and Waterways decided to close/wind up CIWTC.

Subsequently, the company’s fixed assets were transferred to other successor organizations.

CIWTC was originally brought into voluntary liquidation through NCLT and in a public notice from the official liquidator, GRSE had provided a list of claims against CIWTC.

In this proceeding, an amount of Rs.24,22,62,206 claimed by GRSE from CIWTC was disputed by CIWTC.

To resolve the dispute, the Department of Ports, Shipping and Waterways convened a joint meeting of both parties in July 2019, but no agreement was reached and the dispute remained unresolved.

MoPSW was willing to settle the dispute at just 37,000 rupees.

The dispute was then referred by the MoPSW to the Conciliation and Settlement Committee (CSC).

According to the Settlement Plan prepared by the CSC and accepted by the two parties, CIWTC will reimburse Rs payable by RBD to Central Excise.

In addition, CIWTC will pay 59.10.300 rupees (only fifty-nine rupees, ten thousand three hundred) as a lump sum for ground rent and disposal costs.

GRSE will divest the 6 cranes owned by CIWTC but in RBD since RBD was transferred to GRSE in 2006. Since 2006, GRSE has retained the sale price less the costs of the sale until the sale as a nominal ground rent for the cranes. according to the settlement plan.

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