VO Chidambaranar port, which is a major port in Tamil Nadu, appealed against the stay order of Tuticorin district court on the revision of royalty with the Madurai bench of the Madras high court.
PSA International, which operates PSA-Sical Terminal at the port, secured a stay order from the district court in Tuticorin on the revision of the royalty it pays to the port authority.
The stay order denied royalty income for the port from the terminal operator. Therefore, the port authority appealed against the stay.
PSA-Sical Terminals, the firm running the container terminal at VO Chidambaranar port (formerly known as Tuticorin port), is 62.5 percent owned by PSA International, a unit of Temasek Holdings, the sovereign wealth fund of Singapore.
According to the terms of the PSA contract, the royalty per container was Rs 102 in the first year of operations. In the 30th year of operations in 2028, it would reach Rs 5,178 per container. The royalty rises by about 20 percent every year in July till the end of the contract.
PSA currently charges its customers some Rs 2,100 for handling a standard container. As a result of the Tuticorin district court order of June last year, PSA is paying a royalty of Rs 1,969 per container to VO Chidambaranar port.
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