Section 215
Liability of 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) Where any person suffering pollution damage is unable to obtain full and adequate compensation for the damage under the Civil Liability Convention, the Fund shall be liable to pay compensation to such person, if,—
(a) no liability for the damage arises under the provisions of the Civil Liability Convention; or
(b) the ship owner liable for the damage under the provisions of the Civil Liability Convention is financially incapable of meeting his obligations in full and any financial security that may be provided under that Convention does not cover or is insufficient to satisfy the claims for compensation for the damage and the person suffering damage has taken all reasonable steps to pursue the legal remedies available to him; or
(c) the damage exceeds the ship owner’s liability under the Civil Liability Convention.
(2) The expenses incurred or sacrifices made by the ship owner voluntarily to prevent or minimise pollution damage shall be treated as pollution damage for the purposes of this section.
(3) The Fund shall incur no obligation under sub-section (1) if,—
(a) it is proved that the pollution damage resulted from an act of war, hostilities, civil war or insurrection or was caused by oil which has escaped or been discharged from a warship or other ship owned or operated by a State and used at the time of the incident, only on Government non-commercial service; or
(b) the claimant fails to prove that the damage resulted from an incident involving one or more ship.
(4) If the Fund proves that the pollution damage resulted wholly or partly either from an act or omission done with the intent to cause damage by the person who suffered the damage or from the negligence of that person, the Fund may be exonerated wholly or partly from its obligation to pay compensation to such person.
(5) The Fund shall in any event (except in respect of preventive measures), be exonerated to the extent the ship owner may have been exonerated under the Civil Liability Convention.
(a) no liability for the damage arises under the provisions of the Civil Liability Convention; or
(b) the ship owner liable for the damage under the provisions of the Civil Liability Convention is financially incapable of meeting his obligations in full and any financial security that may be provided under that Convention does not cover or is insufficient to satisfy the claims for compensation for the damage and the person suffering damage has taken all reasonable steps to pursue the legal remedies available to him; or
(c) the damage exceeds the ship owner’s liability under the Civil Liability Convention.
(2) The expenses incurred or sacrifices made by the ship owner voluntarily to prevent or minimise pollution damage shall be treated as pollution damage for the purposes of this section.
(3) The Fund shall incur no obligation under sub-section (1) if,—
(a) it is proved that the pollution damage resulted from an act of war, hostilities, civil war or insurrection or was caused by oil which has escaped or been discharged from a warship or other ship owned or operated by a State and used at the time of the incident, only on Government non-commercial service; or
(b) the claimant fails to prove that the damage resulted from an incident involving one or more ship.
(4) If the Fund proves that the pollution damage resulted wholly or partly either from an act or omission done with the intent to cause damage by the person who suffered the damage or from the negligence of that person, the Fund may be exonerated wholly or partly from its obligation to pay compensation to such person.
(5) The Fund shall in any event (except in respect of preventive measures), be exonerated to the extent the ship owner may have been exonerated under the Civil Liability Convention.