NEW DELHI: In a major legal development surrounding the sinking of the container vessel 'MV MSC ELSA 3', a Supreme Court Bench comprising Justice K.V. Viswanathan and Justice Arun Palli has issued notice and ordered status quo on all further proceedings before the Kerala High Court.

The Apex Court issued the directive while hearing Special Leave Petitions filed by R. Saji Surendran, proprietor of Mangalath Cashews, and Sans Cashew India Pvt. Ltd., whose imported cashew consignments were on board the vessel when it sank.

The MSC Elsa 3 sank off the Kerala coast while sailing from Vizhinjam to Kochi, resulting in the loss of cargo, including consignments of raw cashew. The affected importers have challenged a Kerala High Court Division Bench ruling concerning the shipowners' attempt to limit their liability for the losses arising from the incident.

The dispute before the Supreme Court centres on how shipowners can seek limitation of liability through an Admiralty Suit under Admiralty Act 2017. The petitioners argue that such a claim cannot be brought as an independent admiralty suit under the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017. According to them, the remedy is governed by the statutory provisions of the Merchant Shipping Act, 1958 and cannot be treated as an independent maritime claim.

Earlier, the Single Judge as well as a Division Bench of the Kerala High Court had held that the shipowners' action for limitation of liability was maintainable as an Admiralty Suit. The Supreme Court's order means that the proceedings before the Kerala High Court will remain status quo while the apex court considers the challenge. The case could have wider implications for claims arising from maritime accidents, particularly where large-scale cargo losses are involved and shipowners seek to cap their financial liability.

Senior Advocates V. Chitambaresh and V.J. Mathew, Advocates Joy Thattil Ittoop, and Anu Bhuvanachandran appeared for the petitioners. Senior Advocates Neeraj Kishan Kaul and Prashant S. Pratap represented the shipping company.