Railway Claims Tribunal; Indo Salt Co. Vs. G.M., N.E. Railway [Rajasthan High Court, 17-10-2016]

Railway Claims Tribunal Act, 1987 – Section 23 – Railways Act, 1989 – Section 72 – Maximum carrying capacity for wagons and trucks – the excess weight over and above the permissible level, which is subjected to a penal charge is always below the maximum limit and the extra charge is for services, which involved extra strain to the property of the Railways and, therefore, the same cannot be termed as penal in nature. The appellants had carried 2 tonnes goods in excess of permissible carrying capacity of 28 tonnes and, therefore, the respondents were justified in charging the penal freight from the appellants. The findings recorded by the Tribunal cannot be faulted.

IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR

HON’BLE MR. JUSTICE ARUN BHANSALI

Date of Judgment :: 17.10.2016

S.B. CIVIL MISC. APPEAL NO.1350/2004

APPELLANTS:- 1. Indo Salt Company, 2. Sarvotam Salt Industries, 3. Onkar Dass Rama Kishan, 4. Shanti Lal Hari Narayan, 5. Purohit Enterprises, 6. Hiteshi Sales Corporation, 7. Varun Enterprises, 8. Chiranjee Lal Jai Kishan Soni, 9. Bhanwani Industries. All are the Salt Traders of Phalodi Railway Station of the Jodhpur Division through Manak Lal Vyas (Power of Attorney Holder of all the nine Salt Traders) & the proprietor Sarvotam Salt Industries, Phalodi, Distt. Jodhpur. VERSUS RESPONDENTS:- U.O.I. through :- 2 1. The General Manager, North Eastern Railway, Head Quarter Officer, Gorakhpur. 2. General Manager, Northern Railway, Baroda House, New Delhi (Now General Manager, North Western Railway, Jaipur). 3. Chief Commercial Manager (Refund) Hqr. Office, Northern Railway, Baroda House, New Delhi (Now Hqr. Office North Western Railway, Jaipur). 4. Chief Commercial Manager (Refund) Hqr. Office North Eastern Railway, Gorakhpur. 5. Station Master, Narayanpur Anant, North Eastern Railway. 6. Station Master, Phalodi, Northern Railway, Jodhpur (Now Station Master Phalodi North Western Railway, Jodhpur Division, Jodhpur). ***** Mr. N.K. Khandelwal, for the appellants. Mr. Kamal Dave, for the respondents.

JUDGMENT

BY THE COURT:

This appeal under

# Section 23 of the Railway Claims Tribunal Act, 1987

has been filed by the appellant aggrieved against the judgment dated 10.03.2004 passed by the Railway Claims Tribunal, Jaipur Bench (‘the Tribunal’), whereby the claim made by the appellants has been dismissed.

The application was filed by the appellants before the Tribunal for refund of freight amounting to Rs.4,57,009/-, inter alia, with the averments that the applicants were Salt Traders; after clubbing their demand placed indents for a rake consisting of 40 box wagons to carry salt from Phalodi to Narayanpura Anant; the respondents instead of supplying 40 box wagons, supplied 58 CRT wagons; the applicants loaded their consignment in the allotted CRT wagons and 29 Railways receipts were issued to the applicants. It was claimed that the Station Master, Phalodi through his communication dated 10.04.1995 (Annex.-A/3) specifically asked the applicants to load each CRT wagon, as per its carrying capacity plus 2 tonnes. The applicants complying with the specific written direction, loaded 2 tonnes extra than the carrying capacity in each of the CRT wagons; the required Railway receipts were issued to them. On the consignment reaching the destination, the Station Master, Narayanpura Anant charged penal freight and other penalty for 2 tonnes extra loading in each CRT wagon vide Annex.-A/6, the total amount being Rs.4,57,009/-. It was claimed that applicants had paid the freight for carrying capacity plus 2 tonnes at the booking Station. It was, inter alia, claimed that action of the respondents in recoverying the undercharge was wholly arbitrary and unreasonable, no wrong was committed in loading the CRT wagons in terms of the directions of the Station Master, Phalodi and, therefore, the applicants have no liability, the recovery was contrary to principles of natural justice and prayed that the amount be refunded.

A response to the application was filed by the respondent-Railways, except for accepting that the applicants loaded 2 tonnes extra than the carrying capacity in each of the CRT wagons, rest of the averments made in the application were denied. In additional pleas, it was submitted that the applicants have no cause of action, after getting indent from the consignors, the administration placed 58 CRT wagons for loading of subject consignment at forwarding Station, wagons supplied were having carrying capacity of 28 tonnes in each CRT wagon, wherein the consignments were directly loaded, which was not supervised by the Railway Staff. The permitted loading of salt in CRT wagons was 28 tonnes only i.e. the carrying capacity, however, the applicants loaded more than the carrying capacity; when the loading was more than the allowed weight, the freight ought to have been charged as per Rules, but the staff of the forwarding Station charged normal rate by mistake and on arrival of the consignment at destination station, the error was detected and charges were realized. It was prayed that the application be dismissed.

The applicants filed replication to the reply. Reliance was placed on the instructions (Annex.-A/3) regarding loading of goods to the extent of carrying capacity plus 2 tonnes. The allegations made in the reply were denied and the claim was reiterated.

Based on the pleadings of the parties, the Tribunal framed four issues. One additional issue regarding maintainability was also framed. In support of the claim, the applicants filed affidavits of two persons and the respondents filed affidavits of three persons. The Station Master at Phalodi Shiv Lal, while in service filed affidavit on behalf of the respondents and after retirement filed an affidavit in support of the claim of the applicants and he was cross-examined by the counsel for the Railways.

After hearing the parties, the Tribunal came to the conclusion that the applicants have right to sue, the extra loading of 2 tonnes in CRT wagons was against the provisions of Rules and Circulars issued by the Govt. of India, the normal carrying capacity of a CRT wagon is 28 tonnes, 2 tonnes extra has been loaded beyond its normal carrying capacity, which is the maximum carrying capacity as per Circular dated 11.10.1991, therefore, the charges levied against the consignors are as per Rules and they cannot be termed as arbitrary or illegal. It was held that joint petition was maintainable. However, keeping in view the finding on the four issues, the application was dismissed.

Feeling aggrieved, the present appeal has been filed by the appellants.

It was submitted by learned counsel for the appellants that the appellants loaded 58 CRT wagons as per the direction Annex.-A/3 of the Station Master, Phalodi i.e. carrying capacity plus 2 tonnes, the Railway receipts were issued and the forwarding note indicated the quantity i.e the carrying capacity plus 2 tonnes, freight was also charged for the entire weight, the goods Clerk at the destination charged penal freight of a sum of Rs.4,57,009/-, which was paid and delivery was taken. Initially the application was filed before the Tribunal at Patna, which was subsequently transferred to Jaipur.

With reference to the various provisions of the

# Railways Act, 1989

(‘the Act’), it was submitted that the freight has been defined under Section 2(17) of the Act, maximum carrying capacity for wagons and trucks has been provided under Section 72 of the Act, punitive charge for overloading a wagon is prescribed under Section 73 of the Act and power to measure/weigh has been conferred under Section 78 of the Act. It was submitted that the maximum carrying capacity can be fixed by the Central Govt. only and normal carrying capacity for every wagon is determined by the Railway Administration; it is open for the Railway Administration to vary the normal carrying capacity for wagons and, therefore, once the Station Master vide Annex.-A/3 permitted the appellants to load goods to the extent of carrying capacity plus 2 tonnes, it cannot be said that the appellants committed any error and were liable for payment of penal charges and, therefore, the judgment impugned deserves to be quashed and set aside.

With reference to the finding given by the Tribunal, it was submitted that the Circular dated 11.10.1991 is wrongly relied on and the relevant Circular dated 19.06.1991 prescribes for the minimum weight condition pertaining to the CRT wagon at 28 tonnes and not the normal carrying capacity.

With respect to the Circular relied on by the Tribunal, it was submitted that the same provided for charging upto and only upto 28 tonnes and nothing beyond and, therefore, the same could not be relied on from the said purpose. It was prayed that the judgment impugned be set aside and the application filed by the appellants be allowed in toto.

Reliance was placed on judgment of Hon’ble Supreme Court in

# Jagjit Cotton Textile Mills v. Chief Commercial Superintendent, N.R. & Ors; (1998) 5 SCC 126

Vehemently opposing the submissions made by learned counsel for the appellant, learned counsel for the respondent-Railways submitted that the penal freight is applicable when a consignor loads more than the permissible carrying capacity, but less than the maximum carrying capacity to compensate the wear and tear on account of such overloading, in any case no amount of goods can be loaded beyond the maximum carrying capacity. Re-weighment is permissible and if the goods are found in excess, the freight can be recovered. As the appellants were carrying extra goods, they are required to pay freight and the said amount of freight cannot be termed as penalty, which aspect is well settled as per the judgment in the case of Jagjit Cotton Textile Mills (supra).

Learned counsel for the respondents with reference to the Circulars dated 19.06.1991 and 11.10.1991, reiterate that the normal carrying capacity of a wagon was 28 tonnes and as the appellants had admittedly loaded 2 tonnes more than the normal carrying capacity, they were liable to pay the freight as charged and, therefore, the judgment impugned passed by the Tribunal does not call for any interference.

I have considered the submissions made by learned counsel for the parties and have perused the material available on record.

The relevant provision having implication in the present appeal is Section 72 of the Act as the entire controversy revolves around the said provision, which reads as under:-

# 72. Maximum carrying capacity for wagons and trucks

(1) The gross weight of every wagon or truck bearing on the axles when the wagon or truck is loaded to its maximum carrying capacity shall not exceed such limit as may be fixed by the Central Government for the class of axle under the wagon or truck.

(2) Subject to the limit fixed under sub- section (1), every railway administration shall determine the normal carrying capacity for every wagon or truck in its possession and shall exhibit in words and figures the normal carrying capacity so determined in a conspicuous manner on the outside of every such wagon or truck.

(3) Every person owning a wagon or truck which passes over a railway shall determine and exhibit the normal carrying capacity for the wagon or truck in the manner specified in sub-section (2).

(4) Notwithstanding anything contained in sub-section (2) or sub-section (3), where a railway administration considers it necessary or expedient so to do in respect of any wagon or truck carrying any specified class of goods or any class of wagons or trucks of any specified type, it may vary the normal carrying capacity for such wagon or truck or such class of wagons or trucks and subject to such conditions as it may think fit to impose, determine for the wagon or truck or class of wagons or trucks such carrying capacity as may be specified in the notification and it shall not be necessary to exhibit the words and figures representing the carrying capacity so determined on the outside of such wagon or truck or such class of wagons or trucks.”

The above provision provides that the gross weight of every wagon bearing on the axles when the wagon is loaded to its maximum carrying capacity shall not exceed such limit as may be fixed by the Central Government for the class of axle under the wagon. Sub-section 2 provides that every Railway Administration shall determine the normal carrying capacity for every wagon in its possession and shall exhibit in words, the normal carrying capacity so determined in a conspicuous manner on the outside of every such wagon. However, the normal carrying capacity would be subject to the limit of maximum carrying capacity. Sub-section 4 provides that notwithstanding the normal carrying capacity where a Railway Administration considers it necessary or expedient in respect of any wagon carrying any specific class of goods, it can determine for the wagon such carrying capacity as may be specified in the notification and is shall not be necessary to exhibit the words representing the carrying capacity so determined on the outside of such wagon.

The sum and substance of the above provision, which deals with the carrying capacity of the wagons is that the maximum carrying capacity is the outer limit, the normal carrying capacity, which would be less than or equal to the maximum carrying capacity, which is required to be displayed on the wagon and the said normal carrying capacity to the extent of maximum carrying capacity can be varied by notification, but it would not be necessary to exhibit the said modified normal carrying capacity on the wagon. While the power to fix maximum carrying capacity is with the Central Government, the normal carrying capacity/varied normal carrying capacity is with the Railway Administration, however, for varying the normal carrying capacity under sub-section 4 of Section 72 of the Act, the requirement is of the notification and ‘notification’ has been defined under Section 2(26) to mean a notification published in the official gazette.

The concept of maximum carrying capacity, normal carrying capacity and the charging of freight on account of excess loading has been elaborately dealt with by Hon’ble Supreme Court in the case of Jagjit Cotton Textile Mills (supra), on which both the parties have placed reliance, it was held as under:-

“42. In our view, these contentions are not tenable. As has been noticed in our discussion on Point 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 up to any upward variation thereof and this limit is called the permissible carrying capacity. Section 73 of the new Act and Rule 161A of the old Rules permit loading in excess of the permissible carrying capacity without any penal charges, now up to a limit of 2 tonnes. (Earlier it was up to 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 section 73 of the new Act and the old Rule 161A 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 up to the destination point at the other end, the replacement cost of the coaches, engines or rails or of repairs to the 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 anyprinciple 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 therefore is the Railway Rates Tribunal. Rule 161A 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 section 73 or Rule 161A which permits levy on such a consignee cannot, in our view, be said to be arbitrary or unreasonable in the context ofArticle 14.”

A perusal of the document (Annex.-A/3) reveals that the document bears signatures of the Station Master and indicates in his handwriting providing for “2 tonnes enhanced in each wagon” at the beginning of the allotment and further indicates CC+2 tonnes/CRT+2 tonnes.

The Tribunal, while dealing with the said document (Annex.-A/3), discarded the evidence of Shiv Lal, Station Master on account of his first deposing in support of the Railways and after retirement deposing in favour of the appellants and raising contention diagonally opposite to each other. The said determination of the Tribunal discarding the evidence of the Station Master Shiv Lal, cannot be faulted as a person, who seeks to take stands diagonally opposite only on account of change in circumstance, i.e. while in service and after retirement cannot be relied on.

Whereafter, the Tribunal concluded as under:-

“34. The respondents have filed affidavits of Shri Arun Prasad Shrivastava, Sr. Commercial Clerk, Narayanpura Anant, Shri Dwarka Prasad Driwedi, Assistant Station Master, Phalodi and Shri Shiv Lal, Station Master, Phalodi. Shri Shiv Lal while filing affidavit favourable to the respondents has relied upon the circulars issued by the Government of India as referred to above. Shri Arun Prasad Shrivastava has also relied upon the aforesaid circulars and deposed that the under charges were collected, based upon the rules and law prevalent at the given time.

Respondents have filed calculation sheet for realization of over load weight & under charges regarding the wagons under consideration and have given particulars about the rates and other details. Therefore, it is established by the evidence of both the parties that the extra loading of two tones in CRT wagons was against the provisions of rules and circulars issued by the Government of India. The normal carrying capacity of a CRT wagon is undisputedly 28 tonnes.

Two tones extra has been loaded beyond its normal carrying capacity which is the maximum carrying capacity as per the aforesaid circular of Government of India dated 11/10/91. Therefore, the charges levied against the consignors/consignees of the consignments as per Part II of Appendix 1/12 of Indian Railway Conference Association Goods Tariff No.41 are as per rules and they cannot be termed as arbitrary or illegal. The applicants have failed to prove by reliable, trustworthy and cogent evidence that the charges levied for over loading at destination station were improper and against the rules.”

The Rate Circular (Goods) No.123 of 1991, issued by the General manager (Commercial), Gorakhpur pertaining to the subject “Minimum weight for charge for commodities with ‘CC’ minimum weight condition when loaded in BCX and CRT wagons” indicated as under:-

“The matter has been reviewed and it has been decided that, with effect from 15.7.1991, for commodities for which the Minimum Weight Condition notified is the Carrying Capacity of the wagon, the Minimum Weight for charge when loaded in BCX wagons (i.e. BXC, BCXC, BCXB and BCXT wagons) will be revised to 55.5 tonnes and when loaded in CRT wagons to 28 tonnes.”

The said Circular was clarified vide another Rate Circular (Goods) No.245 of 1991, inter alia, providing as under:-

“It is clarified that:-

(i) Commodities with CC minimum weight condition are permitted to be loaded and charged upto and only upto 55.5 Tonnes when loaded in BCX wagons irrespective of the marked carrying capacity of the individual wagon.

(ii) Commodities with CC minimum weight condition are permitted to be loaded and charged upto and only upto 28 tonnes when loaded in CRT wagons irrespective of the marked carrying capacity of the individual wagon.”

A combined reading of both the Circulars reveal that the carrying capacity of the CRT wagons was indicated at 28 tonnes, which under provisions of Section 72 of the Act would be the normal carrying capacity of the wagons and the communication (Annex.-A/3), produced by the appellants cannot be construed to mean, increasing the permissible carrying capacity underSection 72(4) of the Act so as to bring the goods loaded by the appellants within the permissible carrying capacity as the Station Master, cannot be said to be authorized to vary the permissible carrying capacity of a wagon, inasmuch as, the power vests with the Railways Administration and the Railway Administration has been defined under Section 2(32) of the Act in relation to a Government Railway means the General Manager of a Zonal Railway, therefore, the document (Annex.-A/3) cannot come to the rescue of the appellants for the purpose of the determining the permissible carrying capacity of the wagons.

Hon’ble Supreme Court in the case of Jagjit Cotton Textile Mills (supra) has held that the excess weight over and above the permissible level, which is subjected to a penal charge is always below the maximum limit and the extra charge is for services, which involved extra strain to the property of the Railways and, therefore, the same cannot be termed as penal in nature.

In view thereof, it is apparent that the appellants had carried 2 tonnes goods in excess of permissible carrying capacity of 28 tonnes and, therefore, the respondents were justified in charging the penal freight from the appellants. The findings recorded by the Tribunal cannot be faulted.

In view of the above discussion, the judgment dated 10.03.2004 passed by the Railway Claims Tribunal, Jaipur Bench does not call for any interference. There is no substance in the appeal, the same is, therefore, dismissed.

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