Madhya Pradesh High Court
Maihar Cement vs Union Of India on 28 February, 2024
1
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE GAJENDRA SINGH
ON THE 28 th OF FEBRUARY, 2024
MISC. APPEAL No. 1802 of 2016
BETWEEN:-
ULTRA TECH CEMENT LIMITED
UNIT MAIHAR CEMENT WORKS
P.O SARLA NAGAR 485772 MAIHAR
DIST. SATNA (MADHYA PRADESH)
.....APPELLANT
(BY SHRI ADITYA ADHIKARI- SR. ADVOCATE WITH SHRI SATISH
CHATURVEDI- ADVOCATE)
AND
1. UNION OF INDIA
THR. GENERAL MANAGER COMMERCIAL WEST
CENTRAL RAILWAY JABALPUR (MADHYA
PRADESH)
2. CHIEF COMMERCIAL MANAGER
WEST CENTRAL RAILWAY
DIV. JABALPUR (MADHYA PRADESH)
.....RESPONDENTS
(BY SHRI PUSHPENDRA YADAV- DY. SOLICITOR GENERAL OF INDIA
WITH SHRI DEVESH BOJNE- ADVOCATE)
MISC. APPEAL No. 1800 of 2016
BETWEEN:-
ULTRA TECH CEMENT LIMITED
UNIT MAIHAR CEMENT WORKS
P.O SARLA NAGAR 485772 MAIHAR
DIST. SATNA (MADHYA PRADESH)
.....PETITIONER
(BY SHRI ADITYA ADHIKARI- SR. ADVOCATE WITH SHRI SATISH
CHATURVEDI- ADVOCATE) )
Signature Not Verified
Signed by: PARMESHWAR
GOPE
Signing time: 2/28/2024
7:09:32 PM
2
AND
1. UNION OF INDIA
THROUGH THE GENERAL MANAGER
(COMMERCIAL)
WEST CENTRAL RAILWAY JABALPUR (MADHYA
PRADESH)
2. CHIEF COMMERCIAL MANAGER
WEST CENTRAL RAILWAY
WEST CENTRAL RAILWAY
JABALPUR (MADHYA PRADESH)
.....RESPONDENTS
(BY SHRI PUSHPENDRA YADAV- DY. SOLICITOR GENERAL OF INDIA
WITH SHRI DEVESH BOJNE- ADVOCATE))
MISC. APPEAL No. 1804 of 2016
BETWEEN:-
ULTRA TECH CEMENT LIMITED
UNIT MAIHAR CEMENT WORKS
P.O SARLA NAGAR 485772 MAIHAR
DIST. SATNA (MADHYA PRADESH)
.....PETITIONER
(BY SHRI ADITYA ADHIKARI- SR. ADVOCATE WITH SHRI SATISH
CHATURVEDI- ADVOCATE) )
AND
1. UNION OF INDIA
THROUGH THE GENERAL MANAGER
(COMMERCIAL)
WEST CENTRAL RAILWAY
JABALPUR (MADHYA PRADESH)
2. CHIEF COMMERCIAL MANAGER
WEST CENTRAL RAILWAY
JABALPUR DIVISION,
JABALUR (MADHYA PRADESH)
.....RESPONDENTS
(BY SHRI PUSHPENDRA YADAV- DY. SOLICITOR GENERAL OF INDIA
WITH SHRI DEVESH BOJNE- ADVOCATE) )
MISC. APPEAL No. 1805 of 2016
Signature Not Verified
Signed by: PARMESHWAR
GOPE
Signing time: 2/28/2024
7:09:32 PM
3
BETWEEN:-
ULTRA TECH CEMENT LIMITED
UNIT MAIHAR CEMENT WORKS
P.O SARLA NAGAR 485772 MAIHAR
DIST. SATNA (MADHYA PRADESH))
.....PETITIONER
(BY SHRI ADITYA ADHIKARI- SR. ADVOCATE WITH SHRI SATISH
CHATURVEDI- ADVOCATE))
AND
1. UNION OF INDIA
THROUGH GENERAL MANAGER COMMERCIAL
WEST CENTRAL RAILWAY
JABALPUR (MADHYA PRADESH)
2. CHIEF COMMERCIAL MANAGER
WEST CENTRAL RAILWAY DIVISION JABALPUR
(MADHYA PRADESH)
.....RESPONDENTS
(BY SHRI PUSHPENDRA YADAV- DY. SOLICITOR GENERAL OF INDIA
WITH SHRI DEVESH BOJNE- ADVOCATE) )
MISC. APPEAL No. 1807 of 2016
BETWEEN:-
ULTRA TECH CEMENT LIMITED
UNIT MAIHAR CEMENT WORKS
P.O SARLA NAGAR 485772 MAIHAR
DIST. SATNA (MADHYA PRADESH)
.....PETITIONER
(BY SHRI ADITYA ADHIKARI- SR. ADVOCATE WITH SHRI SATISH
CHATURVEDI- ADVOCATE))
AND
1. UNION OF INDIA
THROUGH THE GENERAL MANAGER
(COMMERCIAL)
WEST CENTRAL RAILWAY
JABALPUR (MADHYA PRADESH)
2. CHIEF COMMERCIAL MANAGER
WEST CENTRAL RAILWAY
Signature Not Verified
Signed by: PARMESHWAR
GOPE
Signing time: 2/28/2024
7:09:32 PM
4
DIVIN. JABALPUR (MADHYA PRADESH)
.....RESPONDENTS
(BY SHRI PUSHPENDRA YADAV- DY. SOLICITOR GENERAL OF INDIA
WITH SHRI DEVESH BOJNE- ADVOCATE))
------------------------------------------------------------------------------------------------
RESERVED ON :- 16.02.2024
PRONOUNCED ON :- 28.02.2024
-------------------------------------------------------------------------------------------------
These appeals having been heard and reserved for orders, coming on
for pronouncement this day, JUSTICE GAJENDRA SINGH passed the
following:
ORDER
As common questions are involved in these five appeals, they are heard
analogously and decided by this common order. For the sake of convenience,
pleadings and documents available in record of MA No. 1802/16 are being
referred to in this order.
2 . These appeals under Section 23 of Railways Claims Tribunal Act,
1987 have been preferred feeling aggrieved by the common order dated 20-04-
2016 of Railway Claims Tribunal, Bhopal Bench, Bhopal whereby claims to
refund illegal charges levied for freight have been rejected.
3. Facts in brief as mentioned in MA No. 1802/2016 are that appellant
Ultra Tech Cement Limited previously Maihar Cement is engaged in business of
manufacturing and sale of best quality of cement through out the country having
its Plant at P.O. Sarla Nagar, District Satna and offices in various States. During
the course of business, the appellant was sending its goods traffic towards
Jhansi and onwards via Manikpur and Ohan and freight was being charged
accordingly. For the purpose of reducing distance from Bansapahar to Ohan,
avoiding Manikpur, a chord line section was constructed on Satna-Jhansi
Section and this track has been Commissioned and opened for traffic on 16-02-
2008 and goods traffic were moving through this section. The appellant booked
consignment for this purpose and RR were issued.
4 . Since, the rate Circular was not notified, the freight charged to the
appellant was from a longer route while the goods were carried through the
shorter route which had become operational on 16-02-2008. The West Central
Railway ( in short "WCR') issued an amended WCR distance table on 10-06-
2009 with regard to Chord line between Bansapahar ( BNSP) to Ohan, which
came into force with immediate effect. The aforesaid distance table was again
amended by the respondent on 13-07-2009. The amendment was only to the
extent of the length of the chord line. The appellant on realizing that the goods
booked by it were carried through a shorter route and in fact, the freight of the
longer route was charged, applying the doctrine of quantum meruit issued a
notice under the provisions of Section 106(3) of Railways Act, 1989 and
prayed to refund of excess freight paid. The respondents most illegally rejected
the case of the appellant by recording reasons that the claims were time-barred
whereas the respondent No.1 could not have rejected the claim of the appellant
on the ground that it was beyond time prescribed under Section 106(3) of the
Railway Act, 1989.
5 . The Railway Board issued a Circular/Policy letter with regard to
delegation of powers for settlement of time barred cases on 11-06-1995.
Accordingly, the respondents could not have rejected the claim of refund of
excess freight charged on the ground of a time-barred claim. The aforesaid
policy was in effect upto 22-02-2010, when it was withdrawn by a subsequent
policy from the date of issue of that policy. The High Court of Madhya
Pradesh has also in M/s. Maihar Cement Vs Union of India in WP No.
469/2009 vide order dated 25-04-2012 held that Circular dated 22-02-2010 is
prospective and that judgment has attained finality. The appellant filed an
application under Section 13(1)(b) of Railway Claims Tribunal Act, 1987 for
refund of excess charges of freight within three years of the date on which the
freight is paid to the Railways in terms of Section 17(1)(c) of Railway Claims
Tribunal Act, 1987. Since, the application before the Railway Claims Tribunal
was already delayed, a separate application for condonation of delay was also
filed in terms of Section 17(2) of the Railway Claims Tribunal Act, 1987 but,
the Railway Claims Tribunal dismissed the claim of the appellant by a common
judgment/order dated 20-04-2016.
6. MA No. 1802/16 is preferred feeling aggrieved by rejection of 14
claim applications for refund of a total sum of Rs. 3, 61,680/- by common
order dated 20-04-2016. MA No. 1800/16 is preferred feeling aggrieved by
rejection of 5 claim applications for refund of a total sum of Rs.1,90,027/- by
common order dated 20-04-2016. MA No. 1804/16 is preferred feeling
aggrieved by rejection of 6 claim applications for refund of a total sum of Rs.
1,44,379/- by common order dated 20-04-2016. MA No. 1805/16 is preferred
feeling aggrieved by rejection of 11 claim applications for refund of a total sum
of Rs.2, 65, 356/- by common order dated 20-04-2016 and MA No. 1807/16 is
preferred feeling aggrieved by rejection of 6 claim applications for refund of a
total sum of Rs. 1,53,965/- by common order dated 20-04-2016.
7. Feeling aggrieved by common judgment/orders dated 20-04-2016,
these appeals have been preferred on the grounds that:
A . The rejection order has been passed on a fallacious ground that the
claim was beyond time as per Section 106(3) of the Railway Act whereas the
respondents were empowered to decide time barred cases in terms of Policy
letter of the Railway Board dated 11-01-1995.
B . The respondents are not interpreting the directions of the Railway
Board in any manner. The respondents are bound to comply with the same
because such instructions has the force of law. The respondents are also duty
bound to follow and implement the order of the Railway Board dated 11-01-
1995 in the light of Section 3 of the Railway Board Act, 1905.
C. Railway Board could not behaved like a private entrepreneur deriving
super profits by overcharging its customers and not refunding the excess
charged on some technical pretext. Railway is controlled by the Government of
India and is as such bound to deal fairly with the citizens of the
country/customers. The State cannot resort to profiteering while dealing in
commercial activities. The doctrine of quantum meruit is squarely applicable to
the respondents.
D . The respondents are duty bound to follow the judgments of this
Hon'ble Court which hold the field as the challenge to the judgment has failed
before the Hon'ble Supreme Court of India.
8(i). Learned counsel for the respondents opposed the appeal referring
to the Annexure- A/1(i) and Annexure-A/7 and the uncontroverted affidavit of
Senior Divisional Commercial Manager, West Central Railway, Jabalpur dated
19-12-2023 on the ground that the route was not opened for goods traffic upto
10-06-2019 and the same has been opened vide ARN No. 79/09 dated 10-06-
2009 and the goods mentioned in RR were transported through Manikpur only
and appellant was fully satisfied with the same hence, did not give any notice
even for more than six months. Annexure- R/1 authorises use of shorter route
for passenger purposes only. All the goods train going towards Banda from
Satna are being run by Chord line issuing ARN 79/09 dated 10-06-2009. The
appellant has misinterpreted Annexure-A/1.
8(ii). A bare perusal of Annexure-A/1 reveals that the authorisation dated
19-02-2008 is in respect of passenger traffic and not goods traffic. The
appellant has tried to distort the facts of the case.
8(iii). The case no doubt was time barred but, it was also rejected on
merits as stated in Annexure-A/7 as well i.e. on the ground that all the claims of
the appellants are prior to 10-06-2009 and therefore, shorter route itself not
opened for the goods traffic. So, the question for shorter route is for
transportation for the goods of the appellant did not arise. The only route
available prior to 10-06-2009 was the longer one via Manikpur for goods
traffic. The shorter route of Bansapahar ( BNSP) to Ohan, opened for goods
traffic on 10-06-2009. The case of the appellant was rejected on the basis of
Notification No. 79/09 dated 10-06-2009. The appellant is trying to distort the
issue and mislead the court. The claim of the appellant was not rejected under
Section 106(3) of the Railway Act, 1989 but, it was rejected on merits. The
Board considered the time barred cases referred which was easily available to
the General Manager upto 22-02-2010 and were not available to Railway Claims
Tribunal. The appellant had chosen to move to Railway Claims Tribunal and
therefore, naturally he had to face the obstacle of Section 106. The ground of
Section 106 is in relation to the ground of merit and are sufficient for the
dismissal of the case. Power to consider time barred claim case only remains of
academic value in this case because the appellant's case is not acceptable on
merits also.
9. Heard.
10. Perused the record.
11. Based on the pleadings of both the parties, the following issues were
framed by the Tribunal:-
ISSUES:-
"(i) Whether the OA has been signed & verified by the competent
person?
(ii) Whether the Notice as required under Section 106 of the Railways
Act has been served within the prescribed limitation?
(iii) Whether the applicant moved that the alleged
shortage/damage/overcharges to the consignment in question, was due to the
negligence and or misconduct on the part of the respondent railway
administration?
(iv) Whether the respondent proves that it is not liable for for the refund?
(v) What Relief & Cost?"
1 2 . The Tribunal decided the issue No.1 in favour of the
appellants/applicants but, decided the issue Nos. 2 to 4 against the
appellant/applicants on the ground that-
(i) Claims preferred in all cases is barred by limitation.
( i i ) Claims of the appellant/applicant that the respondents have
overcharged and collected excess freight is not reasonable/proved.
Accordingly decided the issue No.3 against the appellant/applicant that it
is not entitled to any relief.
13. To resolve the controversy in appeals, the following two issues
arises for determination:-
(i) Whether the Railway Claims Tribunal was justified in holding that the
claims of the appellant was time-barred.
(ii) Whether the Tribunal committed mistake in rejecting the claim on
merit also.
ISSUE NO.1:-
1 4 . Before proceeding in the matter, reference to the scope of First
Appellate Court while exercising powers under Section 96 of CPC is being
mentioned as held by Apex Court in Saseendran & Anr. Vs. K.M.Cherian (
Died) Through Legal Heir & Ors. (Civil Appeal No. 2191/24 order dated 13-
02-2024) as below :-
"Upon hearing the learned counsel appearing for both the
sides , we are of the view that the High Court ought not to have
set aside the judgment and decree despite finding that the trial
Court did not venture into the issues framed, other than the one
pertaining to the limitation. It is well open to the First Appellate
Court while exercising power under Section 96 of the Code of
Civil Procedure to act as the final Court of the fact and law. An
appeal is the continuation of the proceedings. In such view of
the matter, it is well open to the High Court to consider the
issues both on facts and law either by itself or at best call for
such finding from the trial court."
15. Now Court is examining the facts of these cases. In paragraph-8 of
the application, the appellant/applicant has mentioned the cause of action as
below :-
"8. That the respondent most illegally rejected the case of
the appellant by recording the comments to the effect that
the claims were time barred."
16. The relevant column No. 4 and 6 of the above mentioned (Ex.A/7), a
letter from the office of the General Manager (Commercial) Jabalpur dated 22-
12-2009 referred to appellant, is being reproduced :-
^^4- vkidk nkok i= ljdwyj Øekad WCR ARN 79 of 2009 fn- 10-06-09 ds
rgr vLohdkj fd;k tkrk gSA
6- fVIi.kh i-e-js- ARN 79 of 2009 fn- 10-06-09 ls izpfyr gS vkids nkos blls
iwoZ ds gSaA vr% l{ke vf/kdkjh }kjk nkok fujLr fd, x, gSA**
1 7 . ARN No. 79/09 regarding freight for goods issued by the West
Central Railway regarding haulage charge recoverable for movement of
containers in private owned wagons dated 10-06-2009 (Annexure-A/3) is being
reproduced:
WEST CENTRAL RAILWAY
Sub:-Notification of distance for BANSAPAHAR-OHAN chord line
( Amendment of WCR Distance Table)
Ref :- WCR Distance Table w.e.f. 01.04.2003
The distance for the purpose of charging freight for all goods traffic
moving over BANSAPAHAR (Alpha Code BNSP) of JBP Division WCR to
Ohan ( Alpha Code OHAN) of JHS division NCR Chord line avoiding
Manikpur Station is notified as under :-
----------------------------------------------------------------------------
From Station To Station Distance
----------------------------------------------------------------------------
BANSAPAHAR (BNSP) OHAN(OHAN) 5.23 Kms
----------------------------------------------------------------------------
These instructions will come into force with immediate effect.
( Harish Billore)
Commercial Manager/Goods freight
Off. Chief or Manager
Sub:- Haulage Charge recoverable
for movement of containers in privately
owned wagons.
Date :10.06.2009
18. A perusal of the above mentioned Annexure-A/3 and Annexure-A/7
clearly states that the claims for refund of freight preferred through Annexure-
A/6 was rejected on the ground that they pertains prior to the enforcement of
ARN of 2009 dated 10-06-2009. The appellant approached the Tribunal
submitting vide paragraph-8 of the application that the respondents in most
illegally, arbitrary manner rejected the claim by recording the comments to the
effect that claims were time barred.
1 9 . The Tribunal concluded that the claim preferred in all cases
mentioned in the chart is barred by limitation as notice under Section 106 has
n o t been served within the prescribed limitation period without taking into
consideration the M/S. Maihar Cement Vs. Union of India & Ors. AIR 2012
MP 104 in which the issue for consideration was that:-
"12. That the applicant is required file an application under Section
13(1)(b) of the Railway Claims Tribunal Act, 1987 for refund of excess of
charges of freight within 3 years of the date on which the freight is paid to
the railway in terms of Section 17(1)(c) of the Railway Claims Tribunal
Act, 1987. In this case, a separate application for condonation of delay is
being filed in terms of Section 17(2) of the Railway Claims Tribunal Act,
1987."
and the Court held that:-
"28. In view whereof while holding that the claim of
excess payment of freight charge being a claim for overcharge
and is governed by the provisions contained under Section 106 of 1989
Act, and that the circular dated 11.1.1995 issued by Railway
Board in purported exercise of its powers under Section 3 of 1905 Act
which empowered the General Manager to take into consideration the time
barred claim for refund of overcharge as per the circular in existence then
and subsequent circular dated 22.2.2010 being not effective from
retrospective date will not abdicate the General Manager of his powers as
it existed in the year 1995, it is directed that the General Manager shall
consider the claim of the petitioner for refund of time barred claim
towards overcharge and shall pass reasoned and cogent order while
taking into consideration the contention of the petitioner qua
Section 61 of 1989 Act. The impugned order is accordantly
quashed."
So, the Tribunal was not correct to record the finding that the claim was
time barred.
ISSUE NO.2:-
20. Now, this Court is examining the finding of the Tribunal on merits.
21. In paragraph-7 of the application before the Tribunal, the averment
reads as under:-
"7. That the applicant on realizing that the goods booked
by it were carried through a shorter route when, in fact, the
freight of the longer route was charged, applying the
doctrine of quantum meruit issued a notice under the
provisions of the section 106(3) of the Railways Act, 1989.
The applicant also prayed for the grant of refund of the
excess freight paid. A copy of the application/notice for
refund dated 06.08.2009 received by the respondent on
10.08.2009."
2 2 . In paragraph-7 of memo of appeal, the same ground has been
reiterated. This Court is referring to paragraph-10 of the case of Associated
Cement Co. Ltd. Durg Vs. Union of India AIR 1998 MP 241.
"10. It appears to this Court that it is the case of the
appellant that in assuming that the goods were to be carried
by longer and costlier route under the rationalization
scheme, the servants and the officers of respondent made a
fundamental error of fact going to the root of the contract.
This error was transmitted by them to the appellant as it
had bow to their dictates on account of urgency in
transportation of goods. The error so committed by both
the parties to the agreement for transportation of goods
related a fact essential to the agreement. This mistake was
not regarding the rate or value of transportation charges as
the parties were ad idem on that issue. The fundamental
mistake was that goods have to be carried by a longer route
under the rationalized scheme. Such a contract can be held
to be void ab initio. The appellants, therefore, could claim
refund only of excess paid and respondent can retain the
freight for carrying the goods to actual distance on the
doctrine of Quantum Meruit."
23. Now, the Court is discussing the claim of the appellant that Chord
line section was Commissioned and opened for traffic on 16-02-2008 and
goods traffic was moving through this section.
24. Authorisation Notification Dated 19-02-2008 Annexure-A/1(i) is
being reproduced to examine the veracity of claim.
AUTHORISATION
HAVING INSPECTED ON 16-02-2008 THE OPENING OF
SINGLE LINE BETWEEN BANSAPAHAR SECTION (CHORD LINE)
FOR PASSENGER TRAFFIC FROM KM 1253.63 (EX. CSTM)
LENGTH 5.23 OF JABALPUR DIVISION OF WEST CENTRAL
RAILWAY AND HAVING SATISFIED MYSELF THAT THE
PROVISIONS OF SECTION 22(I) OF THE RAILWAYS ACT, 1989
HAVE BEEN SUBSTANTIALLY COMPLIED WITH, I HEREBY
AUTHORISE UNDER THE POWERS DELEGATED TO ME VIDE
RAILWAY BOARDS NOTIFICATION NO. GSR625(e) DATED
21.07.2000 AND NOTIFICATION NO. GSR673(a) DATED 08.10.2001,
OPERATION OF PASSENGER TRAFFIC ON BANSAPAHAR-OHAN
SECTION OF WEST CENTRAL RAILWAY AT THE SPEED OF 60
KMPH SUBJECT TO THE FOLLOWING CONDITIONS :-
( i ) OBSERVANCE OF ALL OTHERS PERMANENT AND
TEMPORARY SPEED RESTRICTIONS AS IMPOSED BY THE
RAILWAY ADMINISTRATION FROM TIME TO TIME( ).
DATE OF COMMISSIONING OF SECTION MAY PLEASE BE
INTIMATED TO THIS OFFICE
( SUDHIR KUMAR)
SR. COMMISSIONER OF RAILWAY SAFETY
CENTRAL CIRCLE, MUMBAI
PLACE : MUMBAI
DATED : 19.02.2008
25. Senior Divisional Commercial Manager, West Central Railway,
Jabalpur Shri Viswaranjan s/o- Ramprakash has filed affidavit that the route of
Bansapahar-Ohan was not opened for goods traffic on 16-02-2008 and the
same has been opened vide ARN No. 79/09 dated 10-06-2009 and hence, the
goods were transporting through Manikpur only. No counter-affidavit has been
filed. The same facts were already on record through paragraph-10 of the reply
to the memorandum of appeal and supported by an affidavit of Shri Vinodit
Tamori, the then, Deputy Chief Commercial Manager, West Central Railway,
Jabalpur.
2 6 . Perusal of Annexure-A/1(i) also shows that it relates to passenger
traffic only and route for goods traffic was opened vide notification Annexure-
A/3 dated 10.06.2009. Accordingly, it is not proved that the goods in all
appeals was transported through shorter route of Chord line of Bansapahar-
Ohan prior to 10.06.2009 and the claims of the appellant does not find the
support of "principle of quantum meruit". In the matter of M/s Maihar Cement
Vs Union of India and Ors. AIR 2012 MP 104, as per paragraph-4 of the
order, it was not in dispute that in all the cases, the cement was transported
through a shorter route whereas this fact was disputed in these cases and as per
paragraph-26 of the order it is not proved that the goods in all appeals was
transported through shorter route of Chord Line of Bansapahar-Ohan. So, the
appellant are not entitled for any relief on the basis of M/s Maihar Cement
(supra) and Associated Cement Company Limited Durg (supra).
27. As the issue No. 2 is not proved in favour of the appellant/applicant
so, the appeals MA No. 1802/16, MA No. 1800/16, MA No. 1804/16, MA No.
1805/16 and MA No. 1807/16 does not deserves to be allowed and all the
appeals are hereby dismissed.
(GAJENDRA SINGH)
JUDGE
PG
