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2010 DIGILAW 243 (GAU)

Union of India v. Indian Oil Corporation

2010-04-07

AMITAVA ROY, C.R.SARMA

body2010
JUDGMENT Amitava Roy, J. 1. Being dissatisfied with the, judgment and order dated 13.2.2009 passed by the learned Railway Claims Tribunal, Guwahati ('the Tribunal') in Application No. O.A. 1360/2007 preferred by the Respondent herein, thereby directing to refund of an amount of Rs. 41,36,365 along with costs referred to therein, the N.F. Railway, Guwahati represented by the Union of India is in appeal. 2. We have heard Mr. U.K. Nair, learned Counsel for the Appellant and Mr. A. Goyel, learned Counsel for the Respondent. 3. The Respondent-company had booked one consignment of 48 BTPN Wagons containing LVFO from Tinsukia (TXOT) to Hissar under Invoice Nos. 1 to 4 and RR No. 585993 to 585996 dated 3.12.2006. It was, thereafter, by its letter dated 4.12.2006 and 7.12.2006, the Respondent-company requested the railways to divert the rake and intercept the same at New Jalpaiguri ('the NJP') by issuing supersessional railway receipt and refund the differential freight and charges. Eventually, the railways issued supersessional railway receipt Nos. 5 to 8 Rules 950268 to 950271 dated 20.7.2007. Diversion fee was also realized. As the request of the Respondent-company to refund the balance amount of the freight and other charges was not attended to, it lodged the aforementioned claim with the Railway Claims Tribunal. By its order dated 20.11.2008, the learned Tribunal required the railways to settle the claim within the time frame granted by it. The railways, having repudiated the claim on 2.1.2009, on adjudication thereof by the learned Tribunal, the impugned judgment and decree followed. 4. In decreeing the claim of the Respondent-company, the learned Tribunal amongst others took note of para No. 1837(a) and (e) of the Commercial Manual of the Railways as well as, the Railway Board's letter No. 95/TC-III/57/4 dated 11.12.2006. While holding that in the facts and circumstances of the case, para No. 1873(a), as well as the Railway Board's letter dated 11.12.2006 were inapplicable thereto the learned Tribunal laid emphasis on para No. 1873(e) of the Commercial Manual and concluded that in view of the issuance of the supersessional RR (Railway Receipts), the Respondent-company was entitled to the refund of the difference in the freight and charges which it quantified to be Rs. 41,36,365. The learned Tribunal granted 60 days to the railways to make the refund, failing which, it was ordered that the aforementioned sum would carry simple interest at the rate of Rs. 41,36,365. The learned Tribunal granted 60 days to the railways to make the refund, failing which, it was ordered that the aforementioned sum would carry simple interest at the rate of Rs. 6% per annum from the date of the order till realization. The application fee of Rs. 23,160 and the legal practitioner's fee of Rs. 3,000 were also decreed. It is submitted at the Bar that no evidence either oral or documentary except the Railway Board's letter dated 11.12.2006 was adduced in the proceedings. 5. Mr. Nair has argued that as the diversion of the consignment in the present case had been at the instance of the consigner, a plain reading of paragraph 1873(e) as amended would demonstrate in clear terms that no refund of the difference in amount of the freight and other charges was either permissible or contemplated. Referring to the Railway Board's Circular dated 11.12.2006, the learned standing counsel contended that as the consigner admittedly had not furnished any undertaking to effect book delivery of the consignment at the original destination and physical delivery at the station short of the original destination and further as it did not undertake not to claim refund of the freight for the unearned portion, diversion fee was realized. Mr. Nair has sought to impress upon this Court that the contingencies in which a refund of the difference in freight and charges in the event of diversion is envisaged in paragraph 1873(a) of the Commercial Manual has amended, the learned Tribunal fell in error in decreeing the claim of the Respondent-company limiting its attention to para 1873(e) in isolation. Mr. Nair has insisted that having regard to the operational compulsions once a consignment is booked, having regard to the distant location of the ultimate destination, if required preference is accorded to the consignment and as the request for diversion if acceded usually has the impact of dislocating the overall scheme of transportation to the predicament of the other consignments as well as the orderliness of the schedule of operations, except in the situations as envisaged in paragraph 1873(a) as amended, no refund of the difference in the freight and charges is comprehended. According to Mr. According to Mr. Nair, in the instant case no additional freight or charge had been realized for issuing the supersessional railway receipts and that the extra amount relatable to the original railway receipts though cancelled could be validly retained by the railways by reconciling its accounts. 6. Mr. Goyel, as against this has urged that it being apparent from para 1873(e) of the Commercial Manual that in cases where diversion of the destination is permitted by the railways, a fresh invoice/railway receipt has to be issued for the new destination in supersession of the original invoice/railway receipt with freight and other charges leviable from the booking station to the diverted station, there is no scope whatsoever for the railways to retain the differential amount towards freight and other charges and, therefore, the learned Tribunal was perfectly justified to uphold the claim of the Respondent-company. In support of his plea, Mr. Nair has produced before this Court the new railway receipts issued in supersession of the original R Rs. 7. We have extended our anxious consideration to the materials available before this Court, as well as the competing arguments advanced. That the consignment had been originally booked at Tinsukia with its destination at Hissar and that at the request of the Respondent-company, the consigner, it was diverted to NJP located at a point much shorter compared to Hissar is a matter of record. It is also admitted that the railways while permitting the diversion had realized the diversion fee apparently in view of the Railway Board Circular dated 11.12.2006. It is not the case of the Respondent-company that it had at any point of time furnished any undertaking that it would effect book delivery at the original destination and physical delivery at the diverted destination and that it would not claim any refund of freight for the unearned portion. In other words at no point of time the Respondent-company had waived its claim for the difference in amount of freight and charges consequent upon terminating the movement of its consignment at NJP in place of Hissar. 8. 1873(e) of the Commercial Manual, which deals with diversion of goods underlines that a request therefore ought not to be permitted as a matter of course and is permissible at the discretion of the authority competent to sanction the same. 8. 1873(e) of the Commercial Manual, which deals with diversion of goods underlines that a request therefore ought not to be permitted as a matter of course and is permissible at the discretion of the authority competent to sanction the same. A supplement to this paragraph was incorporated by the Railway Boards letter dated 8.1.2002 which being of considerable significance is extracted herein below To relieve congestion arising on account of force majeure conditions, namely, (a) Act of God; (b) Act of War; (c) Act of public enemies; at the booked destination station the Railway Administration with the prior approval of the Chief Commercial Manager and the Chief Operations Manager and with the consent of the concerned consignee/consignor may permit rebooking/diversion/delivery short of destination of consignments to nearby alternative station for delivery. No rebooking/diversion fee will be charged in this regard and the freight charges up to the rebooked/diverted station will be recovered on such consignments allowing telescopic rate benefit for the entire distance traversed. In these circumstances when delivery of consignments short of destination is permitted, freight charges for the uncovered journey will be refunded. 9. It is obvious from hereinabove, that in situations as contemplated therein for which neither the consignor nor the consignee is responsible, the railways may permit rebooking/diversion/delivery short of destination of consignments to nearby alternative stations and in such contingencies no rebooking/diversion fee would be charged and the freight charges for the uncovered journey would be refunded. 10. Para 1873(e) which also dwells on the issue of diversion of consignment in the circumstances other than above is set out herein below for ready reference: On receipt of the advice that the consignment had actually been diverted, and not otherwise, Station Master of the booking station will issue a fresh invoice to the diverted destination in supersession of the invoice to the original destination vide para 1863, freight and other charges being levied from the booking station to the diverted destination as if the consignment had been booked initially to that destination. 11. It stipulates that on the diversion of the consignment, the Station Master of the booking station would issue a fresh invoice for the diverted destination in supersession of the invoice for the original destination, freight and other charges being levied from the booking station to the diverted destination, as if the consignment had been booked initially to that destination. 11. It stipulates that on the diversion of the consignment, the Station Master of the booking station would issue a fresh invoice for the diverted destination in supersession of the invoice for the original destination, freight and other charges being levied from the booking station to the diverted destination, as if the consignment had been booked initially to that destination. Noticeably, this paragraph unlike paragraph 1873(a) as amended is silent on the aspect of refund of the differential amount of the freight and the charges. 12. Whereas, Mr. Nair has insisted that in view of this distinguishing feature, the Respondent-company's claim ought not to have been allowed being impermissible under the Commercial Manual, Mr. Goyel has maintained that the plain language of paragraph 1873(e) does not admit of any doubt of refund of the differential amount. The learned Tribunal as noticed hereinabove, has decreed the claim of the Respondent-company on the ground of issuance of supersessional Railway Receipts which according to it signified the permissibility of realization of freight and other charges for the consignment only up to the shorter destination, i.e., NJP and, therefore, directed refund of the differential amount. It is not in dispute that for issuing fresh Railway Receipts no additional freight and other charges had been realized from the Respondent-company. The consequence of issuance of the fresh Railway Receipts is essentially the cancellation of the originals. This assumes significance in view of the fact that the freight and other charges for the destination of Hissar in the case in hand had been realized at the issuance of the Original R.R. These contained the necessary particulars of the consignment, the destination thereof as well as the freight and the charges for the services to be provided for transportation up to Hissar. On the request of the consignor for interrupting the consignment at NJP though diversion fee was realized no refund of the difference in the amount of freight and charges was made. 13. On the request of the consignor for interrupting the consignment at NJP though diversion fee was realized no refund of the difference in the amount of freight and charges was made. 13. Having regard to the fact that the movement of the consignment in question, in the case in hand was terminated at NJP and that the related transaction had been regularized by the issuance of the new Railway Receipts on cancellation of the originals which under para 1873(e) are deemed to have been so issued against the freight and other charges leviable for transportation to the new destination, we are unable to persuade ourselves to hold that paragraph 1873(a) as amended has an exclusionary effect to render a constricted application of paragraph 1873(e) so as to relieve the railways from making any refund of difference in freight and charges in case the diverted destination is located at a shorter distance compared to the original one. Though para 1873(e) is not as expressive as 1873(a) as amended on the facet of refund, we are of the unhesitant view that any other interpretation would have the potential of not only working injustice to the consignor or consignee as the case may be, but also result in undue enrichment of the railways. However, thereby we do not intend to underestimate the significance of the operational imperatives of the Railways as pleaded. But on an analysis of the scheme of the Commercial Manual, vis--vis this limited aspect of refund of freight and other charges in case of diversion to which our attention has been drawn, we are of the view that the approach of the learned Tribunal in the attendant facts and circumstances cannot be faulted with. 14. In the above view of the matter, we do not find any merit in the present appeal, which is accordingly dismissed. No costs. Appeal dismissed.