Union Of India vs M/S S.R. Ferro Alloys (A ...
2021 Latest Caselaw 2666 MP

                                                                    WA No.42/2021
                                         [1]

       THE HIGH COURT OF JUDICATURE FOR MADHYA
               PRADESH: BENCH AT INDORE

                               (Division Bench)

                              W.A. No.42/2021

UNION OF INDIA AND OTHERS                                    ...APPELLANTS
                                      Versus
M/S S.R. FERRO ALLOYS
(A REGISTERED PARTNERSHIP FIRM)
THROUGH ARJUN SINGH SACHAN                                   ...RESPONDENT
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Coram:
        Hon'ble Mr. Justice Mohammad Rafiq, Chief Justice
        Hon'ble Mr. Justice Sujoy Paul, Judge
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Presence:
       Mr. H.Y. Mehta, Advocate for the Appellants.
        Mr. R.S. Chhabra, Advocate for the Respondent.
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Whether approved for reporting: Yes
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Law Laid Down:

      Railways Act, 1989 - Sec. 73 (Punitive charge for overloading a wagon),
       Sec.74 (Passing of property in the goods covered by railway receipt), Sec.
       79 (Weighment of consignment on request of the consignee or endorsee);
       Railway (Punitive Charges for Overloading of Wagon) Rules, 2005 -
       Rule 3 (Punitive charges for overloading) - Questions (A) Whether the
       weighbridge at the point of re-weighment was defective at some point of
       time earlier and therefore, the claim of the Railways was misconceived,
       being a disputed question of fact and (B) whether the request for re-
       weighment could have been made only by the consignor and not by the
       consignee or his endorsee, could be agitated by the aggrieved party by
       way of statutory remedy provided under the Railways Act before the
       Railway Claims Tribunal or in a suit or before any other statutory forum.

      Section 73 of the Railways Act postulates punitive charges for overloading
       a wagon and proviso thereto amplifies its scope by stipulating 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
                                                                     WA No.42/2021
                                         [2]

       at any place before the destination station and to recover the cost of such
       unloading and any charge for the detention of any wagon on this account.
       Rule 3 of the Rules of 2005 also empowers the Railway administration to
       recover punitive charges on account of overloading of commodities from
       the consignor, the consignee or the endorsee, as the case may be, for the
       entire weight of the commodities loaded beyond the permissible carrying
       capacity for the entire distance to be travelled by train hauling the wagon
       from the originating station to the destination point, irrespective of the
       point of detection of overloading. Indisputably, the writ petitioner on being
       informed, shifted the goods in the underweight wagons and thereafter only
       the train could depart. It is for this reason of overloading in the wagons at
       the instance of the writ petitioner and detention of the train, the Station
       Manager (Goods) imposed a penalty, as provided under Section 73 of the
       Railways Act. Relied - Division Bench judgment of this Court in S.
       Goenka Lime & Chemicals Limited vs. Union of India and Another,
       AIR 2016 MP 70.

Significant Paras: 16 to 23
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Reserved/Heard through VC on: 10.06.2021
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                                 ORDER

(Passed on this 24th day of June, 2021)

Per: Mohammad Rafiq, Chief Justice:

This writ appeal under Section 2 of the Madhya Pradesh

Uchcha Nyayalaya (Khand Nyayapeeth Ko Appeal) Adhiniyam, 2005

has been filed by the appellants (hereinafter referred to as "the

appellants-Railways") assailing the order dated 06.02.2020 passed by

the learned Single Judge in W.P. No.1256/2018 (M/s S.R. Ferro Alloys

vs. Union of India and others) whereby the writ petition filed by the

present respondent (hereinafter referred to as "the writ petitioner") has

been allowed.

WA No.42/2021 [3]

2. The respondent-writ petitioner in the aforesaid writ petition

challenged the demand letter dated 15.05.2017 (Annexure P-10) and

calculation sheet dated 18.05.2017 (Annexure P-12) whereby demand

was made towards punitive charge for alleged overloading of loose

Manganese Ore transported through Railway from Meghnagar

(Madhya Pradesh) to Baraduar (Chhattisgarh).

3. According to the case set up by the writ petitioner in the

memorandum of writ petition, it was a Partnership Firm registered

under the Indian Partnership Act, 1932. The writ petitioner-Firm was

engaged in the business of mining and in that connection it has to

transport loose Manganese Ore throughout the country through

Railways. The writ petitioner received an order for supply of loose

Manganese Ore from M/s Chhattisgarh Steel and Power Limited,

Village Amjhar, Champa, District Janjgir (C.G.). The writ petitioner

submitted a forwarding note on 10.05.2017, as required under Section

64 of the Railways Act, 1989 (for short "the Railways Act") to the

Station Manager, Meghnagar mentioning therein the weight of loose

Manganese Ore i.e. 2800 Metric Ton (MT) along with other necessary

details for its transportation from Meghnagar to Baraduar Goods

Station. The respondent-writ petitioner was permitted to load the

goods in the Railway Rake by the Station Manager. The goods were

transported from the mines at Kajli Dungari to the Railway Station

Meghnagar from 10.05.2017 to 12.05.2017 for the purposes of

loading in the Railway Rake and transportation. According to the writ

petitioner, trucks were duly weighed by Tol Kanta installed at the site WA No.42/2021 [4]

of the mine. The writ petitioner produced on record a chart with the

dates, vehicle numbers, mineral, royalty books, slip number along

with the quantity of the loose Manganese Ore transported by the

vehicles. The Mining Officer, Jhabua permitted the petitioner to

transport 2800 MT loose Manganese Ore and issued a certificate

verifying the quantity of Manganese Ore i.e. 2800 MT with other

details before transportation. The writ petitioner raised an invoice

No.037(17-18) dated 12.05.2017 for sale of loose Manganese Ore

weighing 2800 MT in favour of Chhattisgarh Steel and Power Ltd.

(supra). Loading of 2800 MT goods was done in the wagons at

Meghnagar Railway Station as per the rules and the requirement

specified in that behalf by the Railways on 12.05.2017. The Station

Manager issued a Railway Receipt No.212000253, as required by

Section 65 of the Railways Act. According to the writ petitioner,

Section 65(2) of the Railways Act contemplates that the Railway

Receipt shall be prima facie evidence of the weight and the number of

packages stated therein. The respondent-writ petitioner paid freight to

the tune of Rs.39,66,177/- to the appellant for transportation of 2835

MT.

4. It was further stated by the respondent-writ petitioner that the

goods loaded at Meghnagar Railway Station were got weighed at

Katni In-Motion Rail weight. As per the allegation of the Railways,

the excess weight of 185.60 MT was found. The communication with

regard to excess weight was given to the representative of the writ

petitioner with instructions to unload the material from the alleged WA No.42/2021 [5]

overloaded wagons and shift the same in the underloaded wagons. The

writ petitioner arranged two labourers for shifting the goods in the

underweight wagons as directed by the Railways. The material was

accordingly adjusted and the train departed. The Station Manager

(Goods), Meghnagar vide order dated 15.05.2017 (Annexure P-10)

imposed penalty of Rs.25,43,179/- upon the respondent-writ petitioner

on account of alleged overloading in the wagons and detention of the

train. The respondent-writ petitioner by letter dated 16.05.2017

(Annexure P-11) resisted the demand raised by the appellants-

Railways and requested for re-weighment of the goods under Section

70 of the Railways Act, as its case was that there was no overloading

in the wagons and only 2800 MT was loaded. It was alleged that the

goods had not yet reached the destination at the time the letter was

addressed and the consignment could have been put to re-weighment.

However, no heed was paid to the request of the writ petitioner.

Baraduar Goods Station issued an under charges calculation sheet

without re-weighment of the goods and called upon the writ petitioner

to deposit a sum of Rs.26,11,800/-. Since the delivery of the goods

was to be received by Chhattisgarh Steel and Power Ltd. (supra), a

letter dated 18.05.2017 (Annexure P-13) was addressed to the

Commercial Supervisor, Baraduar (Mall Dhakka), South East Central

Railway, Janjgir (Champa) i.e. appellant No.3 herein, reiterating that

only 2800 MT loose Manganese Ore was loaded by the writ petitioner

from Meghnagar to Baraduar and on account of rake weighment at

Katni Station, overload weight of 185.60 MT was alleged to have WA No.42/2021 [6]

been found. A request was made for re-weighment of the rake by

Chhattisgarh Steel and Power Ltd. (supra) to the Senior Divisional

Commercial Manager, BSP Division, who, however, did not pay any

heed and levied punitive charges of Rs.25,43,179/-. The writ

petitioner then filed an application under the Right to Information Act,

2005 (in short "the RTI Act") seeking information with regard to

TARE weight of the wagon BVZC, a wagon used and meant for

guard, with other information. According to the writ petitioner, the

Divisional Rail Manager, WCR, Jabalpur provided information under

the RTI Act that TARE weight of the BVZC wagon is 13.803 MT,

however, it was taken to be 14.50 MT while making calculation for

the illegal demand. The case of the writ petitioner was, therefore, that

there is a marked difference between the actual TARE weight and the

TARE weight shown by the weighment machine at Katni, which

resulted into erroneous weighment of the consignment and

consequently levy of illegal punitive charges on the petitioner. The

writ petitioner, therefore, sent a notice dated 04.08.2017 (Annexure P-

15) to the Commercial Supervisor, Baraduar and Goods In-charge

Meghnagar and other officers of the Railways calling upon them to

waive off the demand raised towards overloading and also citing the

reason of defect in the weighing machine at Katni. The Senior

Divisional Commercial Manager, Bilaspur, SECR submitted reply

dated 06.09.2017 (Annexure P-16) refusing to waive off the demand.

Hence, the writ petition.

WA No.42/2021 [7]

5. The appellants-Railways contested the writ petition and filed

reply thereto. It was contended that challenge to the calculation sheet

(Annexure P-12) is wholly misconceived, which in fact, was prepared

by the appellants-Railways on the basis of the undercharge

calculation made by the appellants as per letter dated 16.05.2017

(Annexure P-11) written by the writ petitioner itself to the Senior

Divisional Manager, Ratlam and Senior Divisional Commercial

Manager, Bilaspur, requesting for re-weighment of the rake. The

calculation sheet (Annexure P-12) contains the actual weighment and

it cannot be construed to be an order. It is denied that the calculation

sheet was prepared without the request of the writ petitioner. The

appellants-Railways have made calculation of the actual freight to be

recovered from the respondent-writ petitioner. The cause of action to

file writ petition arose at New Katni Junction wherein, the weight was

intercepted and it was found that petitioner had deliberately shown

lesser weight of the article in question. Since New Katni Junction

comes within the West Central Railway, its non-impleadment to the

writ petition as respondent would be fatal particularly when the

Western Central Railway is a different zone than Western Railway and

South East Central Railway.

6. The appellants-Railways further contended in the counter-

affidavit that weighment was made for the first time at New Katni

Junction. The procedure for weighment of wagons/rakes and issue of

RR Rules are applicable for the weighment of the consignment. As per

Railway Board Rates Circular No.86/2006 dated 13.10.2006 WA No.42/2021 [8]

(Annexure R-1), para No.1451(c) if the wagons are loaded in the

wagon without weighing it where there is no facility of weighment.

Thereafter, wherever for the first time the facility becomes available

within 24 hours from loading of consignment, weighment can be done

by the Railway authorities. Since the consignment was loaded from

Meghnagar and weighment of the consignment was done for the first

time at New Katni Junction, the first stop where such facility was

available, it was found that consignment was having more weight than

disclosed by the petitioner. Therefore, calculation sheet (Annexure P-

12) was prepared on the request of the writ petitioner himself as per

Annexure P-11 dated 16.05.2017. The appellants-Railways further

maintained that respondent-writ petitioner demanded 45 wagons of

BOST nomenclature. The permissible carrying capacity of one wagon

is 63 tons, therefore, total 45 wagons can carry 2835 Metric Ton

material. But when the weighment was done at New Katni Junction, it

was found that the writ petitioner has loaded 2893.80 tons, which was

more than the allowed weight of 2835 Metric Ton. Therefore, as per

Railway Board's Rates Circular No.19 of 2012 dated 23.07.2012, the

Railways was justified in raising additional demand of Rs.25,01,845/-

for additional weight of 185.60 tons.

7. The learned Single Judge by impugned order dated 06.02.2020

allowed the writ petition by holding that the Railway Receipt issued in

terms of Section 65 of the Railways Act is prima facie evidence of the

weight and the number of packets stated therein. Since there was no

weighment facility at Meghnagar, the weighment was taken at Katni WA No.42/2021 [9]

Goods Railway site. But, there is nothing on record to indicate that the

said weighment was done in the presence of any representative of the

petitioner or with due notice to it. Immediately after coming to know

about the stand of the Railways that overload weight of 185.60 MT

was found, the respondent-writ petitioner filed an application under

Section 79 of the Railways Act on 16.05.2017 demanding re-

weighment. The learned Single Judge noted that as per pleadings

contained in para-13 of the writ petition, at the stage of filing of the

application, the goods had not reached the destination, therefore, it

was possible for the appellants-Railways to put the goods to re-

weighment. The learned Single Judge also held that Section 79 of the

Railways Act provides for re-weighment of consignment on payment

of prescribed charges. The appellants-Railways did not dispute the

factum of filing of application for re-weighment (Annexure P-11) but

on that application no action was taken and re-weighment was not

done nor was any reason assigned therefor. The learned Single Judge

held that before imposing penalty and issuing demand vide impugned

orders Annexure P-10 and P-12, no opportunity of hearing was given

to the writ petitioner. Besides, the learned Single Judge also observed

that the Counsel for the petitioner has also pointed out that the

weighbridge at Katni was not functioning properly earlier. The learned

Single Judge relying on the judgment of Calcutta High Court reported

as Skylark Fiscal Service Pvt. Ltd. and Another vs. Union of India

and others, (2014) 2 High Court Cases (Cal) 457 and Gauhati High

Court decision in the case of Union of India vs. Salt Marketing WA No.42/2021 [10]

Centre reported in LAWS (GAU) 1995 818, set aside the impugned

demand contained in letter dated 15.05.2017 (Annexure P-10) and

calculation sheet dated 18.05.2017 (Annexure P-12).

8. We have heard Mr. H.Y. Mehta, learned counsel for the

appellants-Railways and Mr. R.S. Chhabra, learned counsel for the

respondent-writ petitioner.

9. Mr. H.Y. Mehta, learned counsel for the appellants has argued

that the learned Single Judge failed to appreciate that Section 79 of the

Railways Act gives the right to make a request for re-weighment only

to the consignee or his endorsee. In the present case, the request for

re-weighment was made by the writ petitioner, who was consignor

and therefore, since he had no right to demand re-weighment, there

was no question of acceding to his prayer. It was argued that under

Section 79 of the Railways Act, the payment of the charges for re-

weighment is a pre-requisite condition and since the writ petitioner

did not deposit any charges for re-weighment nor furnished any proof

therefor, the respondent-writ petitioner therefore, did not have any

right to demand re-weighment. Learned counsel for the appellants

further argued that as per the law in question, there was no need for

giving notice to the consignor before weighment was done at the first

instance at New Katni Junction. On checking done at New Katni

Junction, it was found that there was overloading done by the

consignor. Learned counsel also argued that a Division Bench of this

Court in S. Goenka Lime & Chemicals Limited vs. Union of India

and Another, AIR 2016 MP 70 has held that the Railway WA No.42/2021 [11]

administration is empowered to check weight of wagons at any point

before delivery of goods and that giving of prior notice in such a

situation would be counterproductive. The Division Bench also held

that imposition of penalty is not only intended to recover extra charges

but it is also aimed at discouraging consignor from overloading.

10. Learned counsel for the appellants also relied on a Division

Bench judgment of Calcutta High Court in Suresh Kumar Agarwal

vs. Union of India, AIR 2010 (Cal.) 90 (DB) and Division Bench

judgment of Allahabad High Court in Durgesh Coal and others vs.

Northern Railway, New Delhi and others, 2000 (2) AWC 1682 All:

Manu/UP/0347/2000: 2000 All LJ 2529. Learned counsel argued that

in these cases it was held that Railway Receipt is issued on the basis

of forwarding note. If the consignor loaded the consignment from its

own siding, the Railway administration cannot be held responsible for

overloading. Reference was made to the endorsement on Railway

Receipt at Annexure P-7.

11. It was submitted that the respondent-writ petitioner wrongly

contended that weighing-bridge was not functioning properly at New

Katni Junction. Such allegation is missing in the pleadings of the writ

petition. Therefore, the appellants-Railways cannot be taken by

surprise by such argument for the first time directly before the

Division Bench. Moreover, the writ petition involves several disputed

questions of fact, which cannot be looked into in exercise of

extraordinary jurisdiction by the High Court. Again relying on the

judgment of the Division Bench in S. Goenka Lime & Chemicals WA No.42/2021 [12]

Limited (supra), learned counsel submitted that this Court in that

case has held that for such a plea, the aggrieved party had a statutory

remedy to raise a dispute before the Tribunal on merits. It is therefore

prayed that the impugned judgment be set aside and writ petition be

dismissed.

12. Per contra, Mr. R.S. Chhabra, learned counsel for the

respondent-writ petitioner argued that the learned Single Judge has

rightly set aside the impugned demand, as the appellants-Railways

failed to take any action on the application of the writ petitioner for

re-weighment nor they gave any reason for not taking any such action.

It is argued that despite application for re-weighment dated

16.05.2017 filed by the consignor, re-weighment was not carried out

by the Railways inasmuch as no reason was assigned for not doing so.

The application for re-weighment not only was not responded but was

also not dismissed on the ground now raised in the appeal. The

statutory authorities cannot be permitted to supplement reasons by

raising fresh grounds at the appellate stage. Moreover, the appellants-

Railways also did not offer any opportunity of hearing to the writ

petitioner before imposing penalty and issuing demand. Besides that,

weighbridge at New Katni Junction was not functioning properly,

which was evident from the difference in TARE weight of BVZC

wagon as was revealed from the information gathered by the writ

petitioner under the RTI Act. While the actual weight of BVZC wagon

was 13.803 MT whereas the weighment machine at Katni depicted it

14.50 MT. It is argued that the Railways did not dispute the WA No.42/2021 [13]

discrepancy of weighment of wagon BVZC in their reply to writ

petition. Therefore, it cannot be said that the petition involves any

disputed question of fact. The appellants-Railways, for the first time,

have raised the issue about Section 79 of the Railways Act. It is

disputed that Section 79 of the Railways Act does not permit re-

weighment at the instance of the consignor. The Railways also for the

first time raised this argument that consignee by letter dated

18.05.2017 had agreed to pay demurrage and penalty charges. It was

also wrongly contended on behalf of the Railways that weighment can

take place in the absence of the consignor and no notice or

opportunity of hearing is required to be given. Reliance in this regard

was wrongly placed by the Railways on the Division Bench judgment

of this Court in S. Goenka Lime & Chemicals Limited (supra).

13. Mr. R.S. Chhabra, learned counsel for the respondent-writ

petitioner placed heavy reliance upon the decision of the Supreme

Court in Jagjit Cotton Textile Mills vs. Chief Commercial

Superintendent N.R. & Others, (1998) 5 SCC 126, to argue that

Section 73 of the Railways Act gives power to the Railways to collect

the penal charges from the consignor, consignee or the endorsee if the

goods are overloaded beyond the permissible carrying capacity.

However, Section 74 of the said Act provides that the property in the

consignment covered by a Railway receipt shall pass to the consignee

or the endorsee, as the case may be, on the delivery of such railway

receipt to him and he shall have all the rights and liabilities of the

consignor. Therefore, the respondent-writ petitioner could very much WA No.42/2021 [14]

file the application for re-weighment under Section 79 of the Railways

Act. Learned counsel further argued that Sections 73 and 74 of the

Railways Act clearly state that penal charges can be collected from the

consignor, consignee or the endorsee, as the case may be. Therefore,

the consignor shall be liable for penal charges even at the stage of

delivery of goods at the destination if he has booked the goods for

self. It was also held by the Supreme Court that the endorsee would be

liable if the delivery is applied for at the destination by the endorsee.

The consignee would be liable if the delivery is applied for at the

destination by the consignee. Section 73 of the Railways Act thus,

expressly permits these penal charges to be collected from the

consignee also. However, when the Railway Receipt is delivered to

the consignee as per Section 74 of the Railways Act, not only the

rights of the consignor but also the liabilities of the consignor pass on

to the consignee. It is, therefore argued that Section 79 of the

Railways Act has to be seen in consonance with Sections 73 and 74 of

the said Act or else any other interpretation would lead to absurdity or

arbitrariness thereby defeating the intent of the legislation. The

Railways have not placed correct interpretation of Sections 73 and 74

of the Railways Act and the law propounded by the Supreme Court in

Jagjit Cotton Textile Mills (supra).

14. As regards the Division Bench judgment in S. Goenka Lime &

Chemicals Limited (supra), it was argued by learned counsel for the

writ petitioner that this judgment only deals with opportunity of

hearing at the time of weighment whereas the judgment of the WA No.42/2021 [15]

Calcutta High Court in Skylark Fiscal Service Pvt. Ltd. (supra) and

decision of Gauhati High Court in the case of Salt Marketing Centre

(supra) deals with opportunity of hearing before levying punitive

charges whereas, the weighment of goods is the first step, levy of

punitive charges is second. Even though the principles of natural

justice may not be required to be adhered to at the first stage but the

same have to be mandatorily followed before the second stage i.e.

before levying punitive charges. It is argued that the Division Bench

in S. Goenka Lime & Chemicals Limited (supra) has not correctly

analysed the ratio of the judgment of the Supreme Court in Jagjit

Cotton Textile Mills (supra) and read it only for a limited purpose of

challenge made to the Constitutional validity of Section 73 of the

Railways Act read with Rule 3 of the Railway (Punitive Charges for

Overloading of Wagon) Rules, 2005 (for short "the Rules of 2005"). It

was argued that during the course of transportation of the goods,

shipment was weighed at Katni In-Motion Rail weight on 14.05.2017

and allegedly an excess weight of 185.60 MT was found but this

weighment was defective as demonstrated by TARE weight of empty

BVZC wagon, which was mentioned as 14.50 MT at serial No.46 at

page No.46 of weighment slip. The information received by the writ

petitioner from the Railway authorities under the RTI Act reveals that

TARE weight of BVZC wagon is 13.803 MT as against the weight

depicted in wagon slip as 14.50 MT at page No.46. In these

circumstances, there was material difference to the extent of 0.7 MT

(700 kg) shown at the weighing machine at Katni. It was argued that WA No.42/2021 [16]

as the other wagons i.e. BOST were filled with goods, the authorities

could not have measured the actual TARE weight and used the

standard TARE weight. The defect in the machine can be ascertained

only from BVZC wagon as the same was empty and the TARE weight

was wrongly measured by the Railway authorities. The claim of the

appellants-respondents is on the basis of the calculation derived out of

a defective weighing machine. The claim as such was not disputed by

the appellants-Railways in their reply before the writ court.

15. Learned counsel for the respondent-writ petitioner further

argued that the Railways ought to have exercised their right under

Section 78 of the Railways Act before delivery of goods to the

consignee, which empowers them to re-measure, re-weigh or re-

classify any consignment before its delivery. Even if Section 75(b) of

the Railways Act is made applicable to the present case, the Railways

would only have a right to recover freight from the consignor and not

punitive charges. The punitive charges are to be recovered from the

consignee in terms of Section 74 of the Railways Act. It is, therefore

prayed that the appeal be dismissed.

16. The learned Single Judge in the impugned order has upheld the

arguments of the writ petitioner that: (i) the re-weighment at New

Katni Junction ought to have been done in the presence of the

respondent-writ petitioner or with due notice to the writ petitioner; (ii)

the application filed by the consignor under Section 79 of the

Railways Act for re-weighment ought to have been decided, as it was

made before the goods had reached the destination and (iii) the WA No.42/2021 [17]

counsel for the writ petitioner has also pointed out that the

weighbridge at Katni was not functioning properly earlier, by referring

to documents enclosed with the petition. All these arguments raised by

the writ petitioner, which have found favour with the learned Single

Judge in the impugned order, are covered by the Division Bench

judgment of this Court in S. Goenka Lime & Chemicals Limited

(supra). However, since the said judgment was not cited before the

learned Single Judge, it could not be considered.

17. As regards the argument that the Railway administration could

not have unilaterally taken re-weighment of the goods at New Katni

Junction and that the weighbridge thereat was defective at some point

of time earlier, it may be noted that no specific finding has been given

by the learned Single Judge in this regard. Though the learned counsel

for the writ petitioner on the basis of the information obtained under

the RTI Act sought to argue that the weighbridge at some point of time

in the past was defective and on that basis, tried to lead an inference

that computation of excess load made by the Railways was incorrect

but the impugned order does not indicate that the learned Single Judge

has given any specific finding to that effect and has merely recorded

the argument of the learned counsel for the writ petitioner at the

bottom of page-3 of the impugned order in the following terms:

"...........Counsel for the petitioner has also pointed out that the weighbridge at Katni was not functioning properly earlier, by referring to the documents enclosed with the petition."

18. Both the arguments: whether the Railways could have taken the

re-weighment at New Katni Junction or whether the weighbridge WA No.42/2021 [18]

thereat was defective, were specifically taken note of by the Division

Bench of this Court in S. Goenka Lime & Chemicals Limited

(supra) and were rejected in paras 11 to 13 in the following terms:

"11. As regards the argument that the Railway Administration could not have taken the goods to Katni Junction and the weighbridge thereat was defective, it is stated that the weighbridge at New Katni Junction is periodically checked by the Measurement Department. As per Rule 1422 of the Indian Railways Commercial Manual Volume II, the rake could be weighed at New Katni Junction weighbridge.

The said rule reads thus:

"1422. Weighment of outward goods.-- (a) Outward goods should be weighed as indicated below, the particulars of weighment being entered on the forwarding note in the place provided for the purpose--

(i) Consignments in small lots. - All consignments should be weighed in full at the forwarding station.

(ii) Consignments in wagon loads. - (1) In the case of consignments of grain, salt, seeds, sugar, pressed cotton or other staples, in bags or bales of uniform size and weight, the weight declared by the consignor may be checked by weighing a proportion of the number of bags or bales of uniform size and averaging their weight. If the bags or bales are not of uniform size and weight, those of uniform size and weight, should be grouped separately, each lot being treated for the purpose of weighment as a separate consignment and weighed as such.

The remainder of the consignment of bags or bales or other commodities not of uniform size should be weighed in full. The proportion weighed should not be less than 10 per cent at stations where the traffic is large and 20 per cent at other stations.

(2) Goods loose, bulky goods or goods in bulk such as sand, stone, timber, etc., which cannot be weighed on the ordinary weighing machine provided at stations should be WA No.42/2021 [19]

weighed on a wagon weighbridge at the forwarding station, if one is provided there. If there is no weighbridge at the starting station, the wagon may be weighed at a convenient weighbridge station en route, which should as far as possible, be the first weigh bridge station. In case there is no weighbridge en route the wagon may be weighed at destination, if a weighbridge is available there."

12. According to the respondents, the onus is on the owner of the goods as per the scheme of the Act and the Rules regarding loading or unloading. The Volumetric method adopted is the responsibility of the consigner. The weighment done at the weighbridge is meant to be authentic and any action of overloading arising in, is the responsibility of the consigner. As per section 87 of the Railways Act, the Rules of 2005 have been framed. Rule 3 of the Rules of 2005 provides for punitive charges for overloading the wagon. This provision is to prevent any foul play being committed by the consigner/owner. For that reason, the Railway Administration, scrupulously checks all railway wagons to detect any mischief. If the weighment is done at the originating Station and if overloading is noticed, the owner/consigner can be given option to unload the excess weight. However, when such weighing facility is not available at the originating Station, the responsibility is that of the consigner/owner to ensure that no overloading takes place and if such overloading is detected en route or at the destination Station the consigner/owner is made liable to pay punitive charges and other charges as the case may be.

13. On facts of the present case, it is stated that the grievance of the petitioner is founded on surmises and conjectures. Whereas, the punitive charges and other charges levied on the petitioner are on the basis of the actual weight detected en route, in accordance with the prescribed norms. The action of the Railways is strictly in conformity with the provisions of the Act and Rules made thereunder. The respondents have prayed for dismissal of the writ petition."

Still further, with regard to the contention of the writ petitioner

that the weighbridge at the point of re-weighment at Katni was WA No.42/2021 [20]

defective at some point of time earlier and therefore, the claim of the

Railways was misconceived, the Division Bench categorically held

that this being a disputed question of fact, could be agitated by the

aggrieved party by way of statutory remedy provided under the

Railways Act or by filing a suit asking for appropriate relief. The

relevant extract of the judgment in S. Goenka Lime & Chemicals

Limited (supra), reads as under:

"25. It was argued that the weighing machine at NKJ, Katni was defective and could not have projected the correct weight of the goods or aggregate weight along with the wagon weight. This being a disputed question of fact can be agitated by the petitioner by way of statutory remedy provided under the Railways Act or by filing a suit and ask for appropriate relief, if so advised. We do not intend to examine that controversy in the present petition."

19. The argument of the learned counsel for the writ petitioner that

the judgment of the Supreme Court in Jagjit Cotton Textile Mills

(supra) was not correctly analysed by the Division Bench in S.

Goenka Lime & Chemicals Limited (supra) is noted to be rejected.

The aforesaid judgment of the Supreme Court was thoroughly

considered and was in fact, relied upon by the Division Bench to repel

the challenge to the validity of Section 73 of the Railways Act and

Rule 3 of the Rules of 2005, by quoting para-42 of the aforementioned

judgment of the Supreme Court, as would be evident from para-15 of

the report in S. Goenka Lime & Chemicals Ltd. (supra), which

reads, thus:

"15. Having considered the rival submissions, we may first deal with the challenge to the validity of section 73 of the Act WA No.42/2021 [21]

and Rule 3 of the Rules of 2005. The purport of section 73 of the Act of 1989 has been considered by the Supreme Court in the case of Jagjit Cotton Textile Mills (AIR 1998 SC 1959) (supra). The Supreme Court has opined that the provisions of the Act and the Rules made thereunder, empower the Central Government to fix the maximum and minimum rates. The expression "rate" is wide enough to encompass the amount towards penal charges, being other payment. The stipulation in section 73 was earlier engrafted in Rule 161-A of IRCA Rules.

The Supreme Court further noted that section 73 of the Act gives power to the Railways to levy and collect penal charges from the consignor, consignee or the endorsee, as the case may be, if the goods are overloaded beyond the "permissible carrying capacity". The provisions in question, not only prohibit the "consignors" from exceeding the permissible carrying capacity of the wagon, but, also empower the Railway Administration to recover penal charges in the event of discovery of overweight at the booking point or en route or at the destination station, for the entire distance from the booking point to the destination station. It is held that the second part of the provision is quite wide and unrestricted and can be treated as permitting recovery of the penal charge from the consignor or consignee or the endorsee as the case may be, though these words are not expressly used in Rule 161-A. In para 42 of the judgment while specifically dealing with the challenge to the relevant provisions including section 73 of the Act, the court observed thus:

"42. In our view, these contentions are not tenable. As has been noticed in our discussion on Points 1 and 2, the railway statutes define "maximum carrying capacity", "normal carrying capacity" (to be marked on the wagon); and the "permissible carrying capacity". No wagon can be loaded beyond the maximum carrying capacity. The wagon could not ordinarily be loaded beyond the normal carrying capacity or upto any upward variation thereof and this limit is called the permissible carrying capacity. Section 73 of the new Act and Rule 161-A of the old Rules permit loading in excess of the permissible carrying capacity without any penal charges, now upto a limit of 2 WA No.42/2021 [22]

tonnes. (Earlier it was upto 1 tonne). What is now subjected to a penal charge is the excess over and above the permissible level above stated which is always below the maximum limit. In our view, this levy under Sec. 73 of the new Act and the old Rule 161-A is intended for dual purposes - one is to see that the gross weight at the axles is not unduly heavy so that accidents on account of the axles breaking down, could be prevented. The other reason behind the collection is that, inasmuch as the wagon has carried such excess load upto the destination point at the other end, the replacement cost of the coaches, engines or rails or of repairs to be bridges be covered. In our view, the extra rate is a higher rate i.e., something like a surcharge for the excess load, to meet the said expense. Therefore, we do not think that any principle of "delinquency" is ingrained in this levy as in the case of breach of civil obligations under the FERA or Customs Act or the Employees Provident Fund Act. Those cases involved penalties for breach of the Acts and were not concerned with charging a person for services rendered nor with an extra charge for services which involved extra strain to the property of the bailee who had rendered the service. Obviously the Railway Board has kept these aspects in mind while collecting these charges. There is therefore no violation of Article 14. Further, the question of reasonableness of the quantum of any such extra rate cannot be challenged before us and the appropriate forum therefor is the Railway Rates Tribunal. Rule 161-A can therefore, be resorted to for collecting these penal charges from the consignee also. After all, the consignee had received delivery of the overloaded goods and used the same for their business, commercial or industrial purposes. For the above reasons, a statutory provision like Sec. 73 or Rule 161-A which permits levy on such a consignee cannot, in our view, be said to be arbitrary or unreasonable in the context of Article 14."

(emphasis supplied) WA No.42/2021 [23]

20. Section 73 of the Railways Act postulates punitive charges for

overloading a wagon and provides that where a person loads goods in

a wagon beyond its permissible carrying capacity, the 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. The proviso to Section 73 of the said

Act amplifies the scope of the main provision by stipulating 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 for the detention of any wagon

on this account. It has come on record that the representative of the

writ petitioner was sent a communication to unload the excess

material from the alleged overloaded wagons and shift the same in the

underloaded wagons. Indisputably, the writ petitioner arranged two

labourers for shifting the goods in the underweight wagons. The

material was accordingly adjusted and thereafter only the train could

depart. It is for this reason of overloading in the wagons at the

instance of the writ petitioner and detention of the train, the Station

Manager (Goods), Meghnagar vide order dated 15.05.2017 (Annexure

P-10) had imposed a penalty upon the respondent-writ petitioner, as

provided under Section 73 of the Railways Act.

21. The punitive charges have also been prescribed under Rule 3 of

the Rules of 2005. According to the same, where the commodities are WA No.42/2021 [24]

overloaded in a eight wheeled wagon, the Railway administration

shall recover punitive charges as provided in parts I, II and III of the

situations 'A' and 'B' of the Schedule, from the consignor, the

consignee or the endorsee as the case may be, for the entire weight of

the commodities loaded beyond the permissible carrying capacity for

the entire distance to be travelled by train hauling the wagon from the

originating station to the destination point, irrespective of the point of

detection of overloading. The only exception, however is that if the

customer carries out load adjustment at the originating station itself in

case of detection of overloading at originating point, he may not be

liable to pay punitive charges. Reliance on this aspect may be placed

on the observations in para-20 of the Division Bench judgment in S.

Goenka Lime & Chemicals Ltd. (supra), which reads as under:-

"20. The argument then proceeds that if the overloaded goods were removed after being detected en route, the Railway Administration cannot be allowed to recover any amount in the name of penalty for the distance between the originating station and the destination station. This argument though attractive at the first blush, deserves to be stated to be rejected. Section 73 empowers the Railway Administration to collect penalty charges at the prescribed rate and as per Rule 3, the person becomes liable to pay such rates for the entire weight of the commodities loaded beyond the permissible carrying capacity for the entire distance to be travelled by train hauling the wagon from the originating station to the destination point, irrespective of the point of detection of overloading. This provision may appear to be harsh for levy of penalty charges, after the unloading of the wagon at the point en route where the overloading was detected. However, keeping in mind the purpose underlying Section 73 - is not only to recover extra charges for dual purposes, but, also to discourage the consignor from overloading the wagons beyond permissible limits which WA No.42/2021 [25]

inevitably results in damage to the coaches, engines or rails or of repairs to the bridges. It cannot be overlooked that damage is bound to be caused due to overloading of wagons; and any accident on that account inevitably affects the rolling stock of the Railways. The fact that such accident in fact did not take place, can be no argument to extricate the consignor/owner. For, the damage due to overloading is inevitable. Further, the cascading effect of any such damage in the given situation, may be much more than the amount of the prescribed penalty to be recovered because of the overloading of wagons."

22. The contention that the Railways should have provided

opportunity of hearing to the writ petitioner before re-weighment at

New Katni Junction and at least, before levying of the punitive

charges, was also categorically considered and repelled by the

Division Bench in para-23 of its judgment in S. Goenka Lime &

Chemicals Ltd. (supra), in the following terms:

"23. The next contention of the petitioner that no opportunity of hearing was given to the petitioner nor any notice was given before the wagon was taken to NKJ Kami and the wagon was weighed in the absence of petitioner, also does not commend to us. The provision of Section 73 of the Act read with Rule 3 of the Rules, on the other hand, empowers the Railway Administration to check the weight of wagon at any point before the delivery of the goods to ascertain whether the loading of goods was within the permissible limits. Giving prior notice before taking such surprise action, would be counterproductive. If the aggrieved person has any dispute about the correctness of the weighment done by the Railway Administration en route before delivery of goods to the consignee, is free to question the same by way of appropriate proceedings including statutory remedy provided under the Railways Act. The aggrieved person must substantiate his claim in the said proceedings to succeed in questioning the assessment made by the Railway Administration."

WA No.42/2021 [26]

23. In view of the above discussion, it must be held that the

impugned order passed by the learned Single Judge having been

passed under ignorance of the binding decision of the Division Bench

in S. Goenka Lime & Chemicals Ltd. (supra), besides being per

incuriam, is also liable to be set aside on the law propounded by the

Division Bench, as discussed hereinabove. We, however, leave it open

for the writ petitioner to pursue the statutory remedy before the

Railway Claims Tribunal or in a suit or before any other statutory

forum, as may be advised to it, and raise all the permissible arguments

including the argument whether the request for re-weighment could

have been made only by the consignor and not by the consignee or his

endorsee, which shall be decided on its own merits in accordance with

law. On this aspect, this Court may not be understood to have

expressed any opinion, one way or the other.

24. Resultantly, the impugned order passed by the learned Single

Judge is set aside. The present appeal succeeds and is allowed,

however, with aforementioned observation.

                                    (Mohammad Rafiq)                       (Sujoy Paul)
                                      Chief Justice                           Judge

      S/


Digitally signed by SACHIN
CHAUDHARY
Date: 2021.06.24 13:37:45 +05'30'