Case Summary: Bharat Petroleum Corporation Ltd vs. The Great Eastern Shipping Co. Ltd

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Court: Supreme Court of India

Full Case Name: Bharat Petroleum Corporation Ltd vs The Great Eastern Shipping Co. Ltd

Date Decided: 12 October, 2007

Citations: Appeal (civil)  4829 of 2007

Judges: Tarun Chatterjee, D.K. Jain

Appellant: Bharat Petroleum Corporation Limited Limited

Respondent: The Great Eastern Shipping Company Limited

Background: M/s. Bharat Petroleum Corporation Limited is a Government of India Undertaking, under the administrative control of the Ministry of Petroleum & Natural Gas and is engaged in refining, distributing and selling of petroleum products all over the country. The respondent  M/s. Great Eastern Shipping Company Limited is engaged in the business of shipping and allied activities and owns a fleet of tanker vessels for charter, including the vessel known as JAG PRAJA.

Facts: There was an agreement called the ‘Time Charter Party’ in legal parlance entered between Bharat Petroleum Corporation Ltd and The Great Eastern Shipping Co. Ltd. Dated 6th May, 1997 to 30th August, 1998 for letting on hire vessels for a period of two years on terms and conditions. The ‘Charter Party’ was later extended for further period, however there had been correspondence with regard to finalization of the hiring rates. No new agreement was signed between the parties. However the appellant continued to use the vessel even after 30th August, 1998.

Issues: 

1:- Whether there is any common practice that if the vessel is not re-delivered at the end of the period mentioned in the time charter the vessel would be governed by the charter party under which originally it was chartered?

2:- Whether the time charter party dated 6th May, 1997 came to an end by efflux of time on 30th August, 1998?

Judgement: It is, no doubt, true that the general rule is that an offer is not accepted by mere silence on the part of the offerree, yet it does not mean that an acceptance always has to be given in so many words. Under certain circumstances, offerrees silence, coupled with his conduct, which takes the form of a positive act, may constitute an acceptance an agreement sub silentio. Therefore, the terms of a contract between the parties can be proved not only by their words but also by their conduct.

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