Section 168
Constitution of limitation fund.
The Merchant Shipping Act, 2025
About this Act
An Act to consolidate and amend the law relating to merchant shipping to ensure compliance with India's obligation under the maritime treaties and international instruments to which India is a party and also to ensure the development of Indian shipping and efficient maintenance of Indian mercantile marine in a manner best suited to serve the national interest and for matters connected therewith or incidental thereto.
(1) Any person alleged to be liable may constitute a fund with the Central Government or the High Court in which legal proceedings are instituted or expected to be instituted in respect of claims which can be limited under this Chapter.
(2) The fund shall be constituted in the sum of the amounts calculated in accordance with the provisions of section 165 or section 166, read with section 167, as are applicable to claims for which limitation of liability is invoked and which arise from the same distinct occasion, together with interest at such rate as may be notified by the Central Government thereon from the date of occurrence giving rise to the liability until the date of the constitution of the fund.
(3) The limitation fund of the value calculated in accordance with sub-section (2) or stipulated by the High Court or the Central Government, shall be constituted by—
(a) depositing the amount; or
(b) producing a guarantee acceptable under any law for the time being in force and considered to be adequate by the High Court or the Central Government.
(4) The fund so constituted shall be available only for the payment of claims in respect of which limitation of liability may be invoked.
(5) The fund constituted by one of the persons or ship owner or salvors referred to in section 167, or his insurer, shall be deemed to be constituted by all such persons or ship owners or salvors or their insurers.
(2) The fund shall be constituted in the sum of the amounts calculated in accordance with the provisions of section 165 or section 166, read with section 167, as are applicable to claims for which limitation of liability is invoked and which arise from the same distinct occasion, together with interest at such rate as may be notified by the Central Government thereon from the date of occurrence giving rise to the liability until the date of the constitution of the fund.
(3) The limitation fund of the value calculated in accordance with sub-section (2) or stipulated by the High Court or the Central Government, shall be constituted by—
(a) depositing the amount; or
(b) producing a guarantee acceptable under any law for the time being in force and considered to be adequate by the High Court or the Central Government.
(4) The fund so constituted shall be available only for the payment of claims in respect of which limitation of liability may be invoked.
(5) The fund constituted by one of the persons or ship owner or salvors referred to in section 167, or his insurer, shall be deemed to be constituted by all such persons or ship owners or salvors or their insurers.