Gauhati High Court
MFA/55/2012 on 23 August, 2022
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GAHC010006342012
THE GAUHATI HIGH COURT
(HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
MFA No. 55/2012
The Union of India, represented by
The General Manager, N.F. Railway,
Maligaon, Guwahati - 11 (Assam)
.....................Appellant.
-Vs-
M/s Fuel Sources (India) Pvt. Limited,
R K Plaza Market, 1st Floor, Chatribari Road,
A T Road, Guwahati - 1 (Assam)
...............Respondent.
Advocates for the appellant: Ms U Chakraborty, SC, NF Rly..
Advocate for the respondent: Ms M Sharma
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BEFORE
HON'BLE MRS. JUSTICE MALASRI NANDI
Date of hearing : 04.08.2022.
Date of judgment : 23.08.2022
JUDGEMENT AND ORDER (CAV)
Heard Ms. U Chakraborty, learned Standing Counsel, N F Railway, appearing for the
appellant and Ms. M Sharma, learned counsel appearing on behalf of the respondent.
2. This appeal has been filed under Section 23 of the Railway Claims Tribunal Act, 1987,
(hereinafter stated to be 'RCT') against the Judgment and Award dated 20.09.2011, passed
by the Railway Claims Tribunal, Guwahati Bench, Guwahati, in Claim Application No. OA
III/GHY/2009/0007 (Old number) OAIII07/2009), awarding compensation of Rs. 6,22,560
(Rupees Six Lacs Twenty-Two Thousand Five Hundred and Sixty Only ) with interest @ 6%
per annum from the date of application till the date of order, failing which the amount shall
carry interest @ 12 % per annum, till realization. The appellant was also asked to pay
proportionate cost of application fee of Rs. 5,630/- (Rupees Five Thousand Six Hundred and
Thirty Only) and legal practitioner's fee of Rs. 3,000/- (Rupees Three Thousand) Only.
3. The brief facts of the case is that five train load consignment of coal rakes was booked
from Rangiya Junction to Orissa Cement Limited, Rajgangpur, on 23.12.2007, 18.01.2008,
15.02.2008 and 10.04.2008, 07.05.2008 and the goods were delivered to the destination on
26.07.2007, 22.01.2008, 19.02.2008, 14.04.2008 and 12.05.2008 respectively. The Railway
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collected freight overcharge amounting to Rs. 6,25,560 (Rupees Six Lacs Twenty Five
Thousand Five Hundred and Sixty Only) in the above coal rakes against under Charges on the
allegation of overloading found enroute and collected at the destination much after the
delivery of goods.
4. According to the applicant/respondent, demand of freight overcharge after delivery of
goods is illegal and claimed refund of the same and stated that the respondent is fully liable
for the said loss. Subsequently, notice of the said application was given to the
appellant/Railways and on receipt of the notice, the appellant/Railway filed written reply
stating that the refund application, made by the respondent/applicant was not maintainable
as the same was not verified by proper person having authority. The appellant/Railways has
not admitted that the applicant was entitled for refund of the freight over charge as the
applicant was unable to prove that. Hence, the question of payment did not arise and prayed
for dismissal of the case.
5. On the pleadings of the parties, the Tribunal has framed the following issues:-
1) Whether notice under Section 106 of the Railway Act is valid or not!
2) Whether the respondent has proved that the applicant has overloaded consignment
beyond the prescribed limit!
3) Whether total number of bags loaded and unloaded is same!
4) Whether the claim of the penal charges demanded by the Railways after delivery of the
consignment is valid!
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5) Relief and order!
6. After hearing both sides and having gone through the documents available in the
record, the learned Member, RCT, delivered the Judgment awarding compensation as
aforesaid.
7. Being aggrieved by the said order, the appellant/Railways has preferred this appeal, on
the ground that the Tribunal has failed to consider that as per Section 106(3) of Railways Act,
a person shall not be entitled to a refund of an overcharge in respect of goods carried by
Railways, unless a notice, therefore, has been served by him or on his behalf, to the Railway
administration, to which the overcharge has been paid within 6 (six) months from the date of
such payment or the date of delivery of the goods at the destination station, whichever is
later. The Tribunal has erroneously applied the principle of unjust enrichment. Thus, it has
resulted in miscarriage of justice.
8. It was urged by the learned counsel for the appellant that the RCT has failed to consider
that overall 5 (five) rakes of coal enroute at New Bongaigaon and Rajgangpur and raised
punitive charges under Sections 73 and 78 of the Railways Act, 1989, at destination station to
the extent of Rs. 6,25,560/- by the consignee OCL India Limited and the said amount of Rs.
6,25,560/- was paid by the consignee/OCL India Limited to the appellant, much after taking
delivery of the goods.
9. It is also the submission for the learned counsel for the appellant that neither the
consignee, M/s OCL India Limited nor the applicant/respondent made any request to the
railway administration for re-weighment of the consignment as provided under Section 79 of
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the Railways Act, 1989 at the time of making payment on 19.08.2008. It is also stated that
the freight was realized on the basis of weight shown in forwarding note and weighment was
done by the Railway enroute. As such, excess load was detected as per weighment of the
wagons at New Bongaigaon and Rajgangpur. However, neither the consignor nor the
consignee or the respondent could establish that there was no excess load in weight as
alleged by the respondent/applicant. The respondent applicant through his own revelation
has expressly admitted the facts of overweight in the claim application. In view of the above,
the collection of penal charges by Railways is not illegal, unjustified and violation of principles
of natural justice as alleged by the respondent/applicant.
10. In support of her submission, learned counsel for the appellant has cited one case law
of Gauhati High Court in MFA No. 61/2016 (Union of India -Vs- M/s Sri Shiv Sai Steel
Industries).
11. Per contra, learned counsel for the respondent/applicant has submitted that in view of
Section 73 of the Railways Act, 1989, the impugned demand can be made only before the
delivery of the goods, but in the instant case, demand has been made after the delivery of
the goods and as such, the respondent/applicants are not liable to pay penalty charges so
imposed upon them. Thus, the Railway Claims Tribunal has rightly come to the conclusion
that the respondent Company was entitled for refund of excess charges.
12. In view of the rival contentions, the only question that arises for consideration is
whether the learned RCT has committed error in allowing the claim for refund of excess
charges.
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13. It is an admitted fact that the respondent/Company had transported the coal rakes
through the railways for the period 23.12.2007 to 07.05.2008 at the rates fixed by the
Railways. The main controversy was in respect of refund of excess freight charges said to
have been collected by the Railways than the prescribed rates fixed on the allegation of
overloading. The applicant in his application has mentioned that five train load consignment
of coal was booked from Rangiya to GP/OCL siding. But the Railway collected total Rs.
6,25,560/- vide money receipt No. 036173 dated 19.08.2008, for five coal rakes against
under charges on the allegation of overloading, which was detected enroute from New
Bongaigaon and Rajgangpur and collected the said amount at destination, much after the
date of delivery of goods. After going through the record, it cannot be ascertained whether
the applicant was informed regarding re-weighment of their consignment, which is against
the principles of natural justice and the appellant realized the said amount as excess charge
on the allegation of overloading.
14. Section 106 (3) of the Railways Act, 1989, deals with the refund of overcharge, which
reads as follows:-
"A person shall not be entitled to a refund of an overcharge in respect of goods carried
by railway unless a notice therefor has been served by him or on his behalf to the railway
administration to which the overcharge has been paid within six months from the date of
such payment or the date of delivery of such goods at the destination station, whichever is
later."
15. It is not in dispute that Section 106 creates a bar to claim compensation against the
railway administration for refund of charges within six months from the date of such payment
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or the date of delivery of goods at the destination station. Section 106 of the Indian Railways
Act creates a bar for claim for refund of over charges, if it is not noticed, within a period of
six months from the date of such payment or date of delivery of goods at the destination
station, whichever is later. To meet out any difficulty in respect of refund of the overcharge,
the Railway Board had issued notification dated 11.01.1995, delegating the powers to the
general manager to settle time-barred compensation claims in respect of refund of
overcharges. This power was exercised by the Railway Board under the provision of Indian
Railway Board Act, 1905, to meet out the exigencies for refund of the overcharges.
16. Admittedly, in the case in hand, none of the parties has raised any objection on the
ground of limitation for filing of the refund claim after the statutory period of six months. So,
that point is not discussed in the Judgment.
17. Section 73 of the Railways Act, 1989 states that-
"73. Punitive charge for overloading a wagon.--Where a person loads goods in a
wagon beyond its permissible carrying capacity as exhibited under sub-section (2) or sub-
section (3), or notified under sub-section (4), of section 72, a railway administration may, in
addition to the freight and other charges, recover from the consignor, the consignee or the
endorsee, as the case may be, charges by way of penalty at such rates, as may be
prescribed, before the delivery of the goods:
Provided that it shall be lawful for the railway administration to unload the goods
loaded beyond the capacity of the wagon, if detected at the forwarding station or at any
place before the destination station and to recover the cost of such unloading and any charge
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for the detention of any wagon on this account."
18. In the case in hand, the learned counsel for the appellant/Railways, at the time of
making her submission admitted that overloading of five rakes of coal detected enroute from
New Bongaigaon and Rajgangpur and punitive charges were fixed by the Railways at
destination station to the extent Rs. 6,25,560/- to the consignee, OCL India Limited and the
said amount was paid by the consignee, OCL to the appellant Railways, much after taking
delivery of the goods, which is against the provision of law, as it is clearly stated in Section 73
of the Railways Act that the charges for overloading is to be refixed before the delivery of the
goods.
19. It appears from the documents available on record that the demand of overcharge was
made on the first instance on 10.05.2008 and the date of delivery was done on 26.12.2007.
Second demand was made on 20.05.2008, and the delivery was done on 22.01.2008 and
then overcharge was demanded on 15.05.2008 against the delivery on 19.02.2008 and
14.04.2008 and the last demand was made on 16.05.2008 against the delivery on
12.05.2008. It transpires that the demand of overcharge was made after substantial period of
delivery of goods, which is not permissible as per provision of Section 73 of the Railways Act,
1989.
20. The learned RCT, at the time of delivering the judgment, has referred some case laws
of the Gauhati High Court on the issue of refund of overcharge in Railways, vide the decisions
cited in 1995 (3) GLT 548, 1999 (3) GLT 80 and (2003) 2 GLR 429. In all the aforesaid cases,
it was decided that the Railways must satisfy the Court that the weighment taken is correct
and the penalty can be only if overloading is proved. Mere fact that the weighment has been
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taken at the weighbridge, cannot be a reason for penalty, without giving an opportunity to
show cause to the person concerned.
21. In the case in hand, it is an admitted fact that the applicant was not informed that their
consignment would be re-weighed and the admitted position of law is that punitive measure
of resulting the actual penalty can be exercised by the authority only after following the
principles of natural justice.
22. In view of the above, I do not find any error in the Order dated 20.09.2011, passed by
the Railway Claims Tribunal, Guwahati Bench, Guwahati, in Claim Application No. OA
III/GHY/2009/0007 (Old number OAIII07/2009). Hence, the appeal is dismissed.
23. There is no order as to cost(s) .
24. Return the LCR.
JUDGE
Comparing Assistant
