Research › Search › Judgment

Calcutta High Court · body

2019 DIGILAW 676 (CAL)

Rashmi Metalliks Limited v. Union of India

2019-06-28

SHAMPA SARKAR

body2019
JUDGMENT : 1. The subject matter of challenge in this writ petition is an order dated November 8, 2018 issued by the Director, Rail Movement (Railway Board) Kolkata, inter alia, holding that the prayer of the petitioners for grant of Priority "C" facility for movement of iron-ore, could not be considered as the matter relating to submission of inflated bills by the petitioner for availing Priority C facility earlier and consequent actions taken by the authorities in that regard, was sub-judice before the Hon'ble Apex Court. 2. The facts as pleaded in the writ petition are that under Section 71 of the Railways Act, 1989, (hereinafter referred to as the said Act) the Central Government was empowered to give special facilities for, or preference to, the carriage of certain goods or class of such goods by general or special orders. Such orders were called Preferential Traffic Orders. For the first time in June 2006, the Central Government included iron-ore in the list of preferential goods to be carried under Priority "C", using the terminology "Programmed Traffic". The policy was renewed from time to time. The petitioners applied for registration under Priority "C" (Programmed Traffic) and were granted registration by the railways on May 29, 2007. The petitioner No.1 paid over Rs.150 crores as freight to the railways for transportation of its product. 3. The railways issued a Rate Circular No.36 of 2009, whereby, dual freight system was introduced, that is, for domestic consumption of iron ore, a concessional freight was introduced and for trading and exports a higher freight was introduced. The petitioner No.1 availed concessional freight for domestic consumption of iron ore and for exports they paid the higher freight. 4. Suddenly, on August 16, 2011, the railways issued a demand notice followed by a demand-cum-show cause notice alleging that the Petitioner No.1 had availed of railway services by paying concessional freight for export of iron-ore although, it was incorrectly shown to be for domestic purpose. It was further alleged that they also submitted inflated production data for getting allocation of rakes. A sum of Rs. 1,32,00,01,758/- towards evaded freight charges and a further sum of Rs. 5,28,00,07,032/- towards penalty was claimed by the railways. The services were also suspended by the railways. It was further alleged that they also submitted inflated production data for getting allocation of rakes. A sum of Rs. 1,32,00,01,758/- towards evaded freight charges and a further sum of Rs. 5,28,00,07,032/- towards penalty was claimed by the railways. The services were also suspended by the railways. The said notice was challenged by way of a writ petition before this Hon'ble Court and by an order dated September 29, 2014, the learned Single Judge granted partial relief to the petitioners. 5. The petitioners, seeking further reliefs preferred an appeal from the order dated September 29, 2014, being MAT No.1970 of 2014. By a judgment and order dated December 24, 2014, the Hon'ble Division Bench allowed the appeal with conditions and held that there was no provision in the said Act to blacklist any rail user on any ground and that the railways had no jurisdiction to impose any penalty or to stop rail services to any rail user. It was held that the Rate Circular No.36 insofar as, it empowered the railways to levy penalty, was illegal. It was further held that the railways could not impose any penalty by way of blacklisting on the basis of its self assessment until the inaccuracy in the declaration submitted by the petitioner No.1 was declared to be so, by the Civil Court in the pending Civil Suit filed by the railways. It was also held that railways could not conduct parallel adjudication proceedings on its own when the Civil Court was in seisin of the matter. However, the Hon'ble Division Bench in order to protect the interest of the railways, directed that at the time of booking of each consignment for carriage of iron-ore, the railways would charge the higher freight and would then decide the freight actually payable by the petitioner No.1. 6. Aggrieved by the part of the said judgment and order dated December 24, 2014, directing the petitioner No.1 to pay the higher freight, the petitioner No.1 preferred a special leave petition being SLP (C) No.15869 of 2015 before the Hon'ble Apex Court. The railways also filed a special leave petition. While the appeals are pending, the operations of the judgment and order dated December 24, 2014 have not been stayed by the Hon'ble Apex Court. Following the petitioner No.1, other rail users who were also charged with similar penalty, filed writ petitions. The railways also filed a special leave petition. While the appeals are pending, the operations of the judgment and order dated December 24, 2014 have not been stayed by the Hon'ble Apex Court. Following the petitioner No.1, other rail users who were also charged with similar penalty, filed writ petitions. The Hon'ble Apex Court, however, stayed all further proceedings in those writ petitions and also stayed all further proceedings in the suit filed by the railways against the petitioner No.1 by an order dated December 14, 2015. 7. In the meantime because of adverse market conditions the petitioners opted out of the Programmed Traffic facility. 8. Thereafter, the petitioner No.1 applied for allotment of rakes under Priority-C giving all the particulars as required by the authorities. From time to time, the railways required more particulars and more documents which were furnished by the petitioner No.1. The petitioner No.1 had meetings with several officers of the railways and as directed by them, the petitioner No.1 furnished documents and particulars. In the meantime, the Goods and Services Tax Act, 2016 was enacted. The petitioner No.1 enrolled itself under the Goods and Services Tax Act, 2016 and had been filing periodic returns about its production and sales. At no point of time, did the zonal railways or the railway board inform the petitioner No.1 that the said petitioner was not eligible for allotment of rakes under Priority 'C'. Then the petitioner No.1 was informed by the South Eastern Railway that they had recommended the name of the petitioner No.1 for allotment of rakes under Priority 'C' under the Preferential Traffic Order. However, it was also informed that the final decision would be taken by the respondent No.5. The petitioner No.1 did not receive any communication either from the South Eastern Railway or the Railway Board to the effect that the said integrated steel plant of the petitioner No.1 was not eligible to get allotment of rakes under Priority 'C'. From time to time, the petitioner No.1 enquired about the fate of the application and finally it was informed that the matter was under consideration of the respondent No.4, who was the appropriate authority under the Preferential Traffic Order. 9. From time to time, the petitioner No.1 enquired about the fate of the application and finally it was informed that the matter was under consideration of the respondent No.4, who was the appropriate authority under the Preferential Traffic Order. 9. The petitioners received a letter dated August 28, 2018, issued by Assistant Coal Programming Officer on behalf of Director (Rail Movement) at Kolkata, informing them that the petitioner's request for inclusion under Programmed Traffic of iron ore movement under Priority-C had been denied by the competent authority. The petitioners had also come to know that the said facility was however given to other parties against whom similar suits or writ proceedings alleging evasion of freight charges were pending. Since the actions of the railways in refusing allotment of rakes under Priority "C" was contrary to the scheme framed under Section 71 of the said Act, that is, the Preferential Traffic Order and the policy of the Central Government, the petitioners challenged the letter dated August 28, 2018 by filing a writ petition before this Hon'ble Court, being W.P.No.17677 (W) of 2018. The said writ petition was disposed of by order dated October 5, 2018, upon setting aside the letter dated August 28, 2018 with a direction that the request of the petitioners contained in the letters dated November 10, 2017, November 27, 2017, January 12, 2018, and February 27, 2018 should be considered by the appropriate authority within four weeks from the date of receipt of the order after giving an opportunity of hearing to the parties and by passing a reasoned order. Thereafter, the order dated November 8, 2018 was served upon the petitioners, which was received by the petitioners on the same day. According to the petitioners, the order dated November 8, 2018, impugned to this writ petition, was in violation of the order dated October 5, 2018 passed by this Hon'ble Court, both in letter and in spirit. 10. Mr. Thereafter, the order dated November 8, 2018 was served upon the petitioners, which was received by the petitioners on the same day. According to the petitioners, the order dated November 8, 2018, impugned to this writ petition, was in violation of the order dated October 5, 2018 passed by this Hon'ble Court, both in letter and in spirit. 10. Mr. S.K. Kapur, learned Senior Advocate, appearing on behalf of the petitioners submitted that Section 71 of the said Act provided that the Central Government may direct the railway administration, in public interest, to give special facilities for carriage of goods or class of goods and the railway authorities in view of such directions, were bound by the statutory duty cast upon them under Section 71 to give such facilities to the applicants, if the applicants fulfilled the criteria mentioned in the policy framed by the concerned Ministry in this regard. According to Mr. Kapur, the Ministry of Railways framed such a policy and the petitioner No.1 had fulfilled the criteria mentioned in the said policy dated June 16, 2006 and was thus eligible for Priority 'C' facility. He submitted that there was no other ground for rejection of the claim of the petitioner for Priority 'C'. He further contended, that the application for grant of Priority 'C' should be considered in terms of the policy itself and should not be guided by the allegations of, submission of inflated production data and submission of incorrect bills in order to avail of lower freight facility until such allegations were proved. As the adjudication in this regard was already sub-judice before the Hon'ble Apex Court, it was Mr. Kapur's submission, that non- consideration of the application of the petitioner would tantamount to blacklisting even before the allegations were proved. He further submitted that a Division Bench of this Court had already held that the blacklisting or imposition of any penalty on the basis of self-assessment or own determination by the railways could not be accepted in law until and unless the inaccuracy in the declarations submitted by the petitioners was proved and established before the Civil Court. In view of the aforesaid judgment the railway authorities were not lawfully permitted to adjudicate the issue and take any coercive action against the petitioners. 11. Mr. In view of the aforesaid judgment the railway authorities were not lawfully permitted to adjudicate the issue and take any coercive action against the petitioners. 11. Mr. Kapur referred to the order impugned to this writ petition and submitted that the railway authority while passing the order impugned had failed to comply with the direction of this Hon'ble Court dated October 5, 2018 passed in W.P. No.17677 (W) of 2018. According to him, the authority failed to exercise the jurisdiction vested upon it by law and as directed by this Court. He also referred to the affidavit-in-opposition in order to substantiate that although the authority had issued the order impugned, inter alia, stating that the request of the petitioner may not be considered as the matter was sub judice before the Hon'ble Apex Court, the order was, in effect, a rejection by the authority which was covered up in the affidavit-in-opposition in order to avoid contempt proceedings. 12. Mr. Kapur has taken the Court through the various paragraphs of the affidavit-in-opposition in order to establish that the railway authorities had already, in fact, blacklisted the petitioners and had decided not to allow Priority 'C' facility, in spite of a specific decision of a Division Bench of this Court. According to him, the order impugned was a willful violation of the order dated October 5, 2018 and also the judgment and order of the Hon'ble Division Bench in MAT 1970 of 2014 dated December 24, 2014. It was the case of the petitioners that until there was a finding of guilt, the petitioners could not be blacklisted and the averments made in the affidavit-in-opposition, amounted to pre-judging of the issue and disclosed the closed mind of the respondents. The petitioners were held to be guilty without proper adjudication by the Apex Court where the matter was sub-judice. By a separate affidavit, Mr. Kapur annexed documents to show that similarly situated applicants namely, Haldia Steel Limited and Electro Steel Casting Limited were granted such preferential allotment of rakes under Priority-'C'. Mr. Kapur alleged that the respondents have also treated the petitioner with arbitrariness and have discriminated amongst applicants while granting the Priority 'C' facility. 13. Mr. Kapur relied on the decisions of Commissioner of Police, Bombay vs. Gordhandas Bhanji, reported in AIR 1952 SC 16 , Patel Engineering Co. Mr. Kapur alleged that the respondents have also treated the petitioner with arbitrariness and have discriminated amongst applicants while granting the Priority 'C' facility. 13. Mr. Kapur relied on the decisions of Commissioner of Police, Bombay vs. Gordhandas Bhanji, reported in AIR 1952 SC 16 , Patel Engineering Co. Ltd. vs. C.B. Rathi & Anr., reported, MANU/GJ/0007/1983, Lalith Mathur vs. L. Maheswara Rao, reported in (2000) 10 SCC 285 , M/s. G & S Construction vs. State of West Bengal & Ors., reported in (2014) 1 CHN 663 , BMW Ventures Limited & Anr. vs. Export Credit Guarantee Corporation of India Limited & Ors., reported in (2014) 1 CHN 118 and Pankaj Jain vs. Union of India & Anr., reported in (2018) 5 SCC 743 in support of his above submissions. 14. The respondent, railways filed an Affidavit-in Opposition denying the allegations in the writ petition and stated that from time to time the Railway Board framed and/or laid down guidelines for facilitating preferential allotment of rakes to diverse customers, upon fulfillment of the criteria laid down therein. Accordingly, Railway Board published an Iron Ore Policy on 16th June, 2006, and it had been specifically mentioned in the said policy that the facility of allotment of rakes under Priority-C could be given to the customers upon them fulfilling the conditions laid down therein. The respondents further stated that the said Board's letter and/or Guidelines was modified by a notice being no. RM/Steel/Programmed Traffic/06 dated November 17, 2006 issued by the Railway Board. Various guidelines were laid down for submission of applications for inclusion in the Preferential Traffic Order under Priority-'C'. According to the respondents, the petitioner used to get Priority-C railway rakes on and from June, 2007, however, it withdrew the said Priority-C status in June, 2008 by submitting an application to Respondent No.7. While enjoying the facility, it was alleged that the petitioner No.1 submitted incorrect data in the Excise Return to Rail Movement Directorate at Kolkata for obtaining sanction of Priority-'C'. While enjoying the facility, it was alleged that the petitioner No.1 submitted incorrect data in the Excise Return to Rail Movement Directorate at Kolkata for obtaining sanction of Priority-'C'. Around January, 2017, the respondent no.7 charge sheeted one Shri Pardeep Kumar Biswas, OS/ERDM for his failure to detect the forgery and falsification of the data committed by the petitioners in the Excise Return during the period June, 2007 to March, 2008, for obtaining Priority-C rakes from the Railway Board, Kolkata, and a criminal case being CBI case no.RC2012A0002 under Sections 120B, 420, 471 of the Indian Penal Code read with Section 13(2)and 31(D) of the Prevention of Corruption Act, had been started against the railway official and the petitioner no.1 and a charge sheet had been filed on May 28, 2018 against its directors and an officer of South Eastern Railway. According to the respondents, the said case was still pending before the Learned City Sessions Court at Calcutta. On or about November 27, 2017, the petitioner made a fresh application for obtaining priority-C rakes from the respondent no.7. The said application was duly considered by the respondent no.7 in terms of the order dated October 5, 2018 passed by the Hon'ble High Court, Calcutta in W.P No.17677 (W) of 2018 upon giving an opportunity of hearing to the petitioner no.1. The respondents urge that the prayer of the petitioner no.1 was rejected by the respondent no.7 upon due consideration of the application, submissions and documents of the petitioner and the prayer of petitioner no.1 for availing Priority-'C' was rejected because of pendency of the special leave petition being SLP (C) No.19925 of 2015 before the Hon'ble Apex Court in which the action of the authorities in blacklisting the petitioner no.1, for the mis-declaration in the Excise Returns from June, 2007 to March, 2008 was sub-judice. It was contended that submission of incorrect bills resulted in great revenue loss to the railway authorities and to the country as well which went against public interest and public policy. It was stated that the case of the petitioners was altogether different from the other intending customers who had submitted proper documents including Excise Returns for obtaining Preferential Traffic Order under Priority-'C', and the order impugned could not be considered to be arbitrary or discriminatory in nature. It was stated that the case of the petitioners was altogether different from the other intending customers who had submitted proper documents including Excise Returns for obtaining Preferential Traffic Order under Priority-'C', and the order impugned could not be considered to be arbitrary or discriminatory in nature. As the railways detected loss of enormous revenue on account of such mis-declaration with regard to the end use of iron-ore, the matter was handed over to the CBI by the Central Vigilance Commission for detailed investigation into the matter and the CBI found that the petitioner no.1 was involved with the freight mis-declaration in the Excise Return. As such, the railway authorities issued a show cause notice to the petitioner no.1 to show cause as to why the said petitioner no.1 should not deposit with the railway authorities the quantum of evaded freight and penalty on account of mis-declaration regarding end use of iron ore and also as to why traffic would not be suspended. The petitioner failed to respond satisfactorily and the railway authorities were compelled to suspend traffic to the petitioner no.1. In any event, the petitioners continued to get railway rakes under Priority-D on regular basis. It was clarified in the affidavit that the words "cannot be considered" in the last line of the last paragraph of the said letter dated 08.11.2018 may be read as "has been considered but cannot be granted" and the said mistake was inadvertent and unintentional. 15. It was contented by Mr. Partha Sarathi Bose, learned Senior Advocate appearing on behalf of the respondents, that the reliefs claimed in the writ petition were barred by the principles of res judicata and constructive res judicata, inasmuch as, similar prayers which were not granted by the learned Single Judge of this Court in the order dated October 5, 2018 passed by a learned Single Judge in W.P. No.176 (W) of 2018 could not be granted in this writ petition. He further submitted that in the Civil Suit observations have been made by this Court as to how there has been loss of revenue to the railways due to the irregular and dishonest activities of the petitioner in order to avail of benefits under Priority 'C'. 16. On the point of constructive Res Judicata reliance was placed by Mr. Bose on the decisions of Union of India & Ors. 16. On the point of constructive Res Judicata reliance was placed by Mr. Bose on the decisions of Union of India & Ors. vs. Southern Railway Employees Cooperative Stores Workmen Union & Ors., reported in (1998) 5 SCC 530 , T.P. Moideen Koya vs. Govt. of Kerala & Ors., reported in (2004) 8 SCC 106 and Kaushik Cooperative Building Society vs. N. Parvathamma & Ors., reported in (2017) 13 SCC 138 in support of his above submissions. 17. I have heard that the learned Advocates appearing on behalf of the contesting parties and have perused the documents relied upon by them. The point for consideration before this court is whether the order dated November 8, 2018, issued by the Director (Rail Movement) Railway Board, Kolkata, pursuant to the order dated October 5, 2018, passed by a learned Single Judge of this court in W. P. No.17677 (W) of 2018, was sustainable in law. 18. Admittedly, there has not been any adjudication or finding or determination by a competent court, holding the petitioners liable to pay the amounts claimed by the railway authorities on account of unpaid freight charges and penalty. It had been held by the Hon'ble Division Bench in MAT 1970 of 2014 that without such adjudication, the Railways could not impose any penalty or blacklist the petitioner on the allegation of inaccuracies in the declarations. According to the Hon'ble Division Bench, no coercive action by the railways was permissible until such adjudication was made by the competent Civil Court where the suit filed by the railways against the petitioner was pending. 19. By the order impugned to the writ petition, the railway authorities had decided that the request of the petitioner for Priority 'C' facility could not be considered at this juncture as the matter relating to the petitioners' submission of inflated bills and incorrect production data to the railways for getting the allocation of iron-ore, thereby causing loss to the revenue was sub-judice before the Hon'ble Apex Court. It was an admitted position that although the special leave petition against the order passed by the Hon'ble Decision Bench in MAT 1970 of 2014 was admitted by the Hon'ble Apex Court on December 14, 2015, no interim stay was granted. It was an admitted position that although the special leave petition against the order passed by the Hon'ble Decision Bench in MAT 1970 of 2014 was admitted by the Hon'ble Apex Court on December 14, 2015, no interim stay was granted. The order dated October 5, 2018 was passed by the learned Single Judge when the Hon'ble Apex Court was already in seisin of the matter and it can be safely inferred that the learned Single Judge upon considering the entire facts and documents and with date knowledge of the pendency of the appeal before the Hon'ble Apex Court, had set aside the letter dated August 28, 2018, by which the request of the petitioner for Priority 'C' status was rejected, inter alia, holding that the decision was without any reasons and thus violative of the principles of natural justice. A direction was issued upon the appropriate authority of the Railway Board to consider the request of the petitioner for grant of Priority 'C' facility afresh, in accordance with law and to pass a reasoned order. 20. As such, in my view, the Director (Rail Movement) erred in passing the order impugned thereby, holding that the request of the petitioner for grant of the Priority 'C' status may not be considered as the matter was sub-judice before Hon'ble Apex Court. While passing the order impugned the Director (Rail Movement) Railway Board, Kolkata, also observed that the petitioner company had neither been blacklisted, nor was there any proposal to do so. In support of such contention, it was stated that the petitioner continued to be an investor under the WIS Scheme and the WIS contract was subsisting with the railways. I am of the opinion, that once the learned Single Judge by order dated October 5, 2018 had directed the appropriate authority of the railways to consider the request of the petitioners contained in the letters dated November 10, 2017, November 27, 2017, January 12, 2018 and February 27, 2018 for grant of Priority 'C' facility by giving an opportunity hearing to all parties and by passing a reasoned order, it was a mandatory direction on the authority to consider and dispose of the request of the petitioners for grant of Priority 'C' facility with proper reasons based on the policy and documents. Moreover, the judgment passed by the Hon'ble Division Bench in MAT 1970 if 2014 was also binding upon the railways. In this case, the authority concerned has failed to exercise its jurisdiction and has not complied with the order dated October 5, 2018. A duty was cast upon the authority to pass necessary orders on the basis of the letters written by the petitioner with the request for grant of Priority 'C' facility. The authority could not have abdicated his duty by refusing to consider the matter on the ground that the matter was sub-judice, despite there being a mandatory direction of this Court to pass a reasoned order. On this ground alone, the order dated November 8, 2017 ought to be set aside. 21. The next question which falls for decision, is whether the order impugned suffers from any other illegality and perversity as urged by Mr. Kapur, learned Senior Advocate appearing on behalf of the petitioners. Section 71 of the said Act empowered the Central Government to direct any Railway Administration to give special facility to the public for carriage of such goods or class of goods consigned by or to the Central Government, or the Government of any State. On the basis of the above provision under the said Act, the Government of India, and Ministry of Railways by an order dated June 16, 2006 directed that Priority 'C' facility should be given to consumers on fulfilment of certain conditions. The policy incorporated in the said letter dated June 16, 2006 was as follows:- GOVERNMENT OF INDIA MINISTRY OF RAILWAYS (RAILWAY BOARD) No.2003/TT-1/27/20 New Delhi, Dated 16.6.2006 All General Managers (Operating) All India Railways Sub:- Policy on programming of iron ore traffic The issue of inclusion of certain additional consumers of programming traffic category is considered by this Ministry and it has been decided that the following guidelines will be applicable for deciding the eligibility of the consumers for inclusion of programmed traffic of iron ore. This policy will be subject to any subsequent review. A. Terminology to be used for moving traffic on Priority "C" will be programmed traffic and not CBT or any other nomenclature. B. This priority may be given to customer based on following consideration. (i) It may be given to a domestic industry and not for trade etc. This policy will be subject to any subsequent review. A. Terminology to be used for moving traffic on Priority "C" will be programmed traffic and not CBT or any other nomenclature. B. This priority may be given to customer based on following consideration. (i) It may be given to a domestic industry and not for trade etc. (ii) Traffic offered should be minimum of 0.5 MT per annum and the unit's location/needs are such that it is primarily dependent on the Railways for its transportation needs. (iii) Availability of captive railway siding in handling their commitment for the same at loading and unloading end. (iv) Ability/willingness to give outward traffic of value added goods. (v) Ability of the railways to carry the traffic offered with reasonably leftover capacity for general users. The applicant industry must state in their request for inclusion under "programmed Traffic" the Annual Production Capacity of the plant and actual production in last 3 years supported with documentary evidence. Initially the inclusion of a customer under programmed traffic will be done in Railway Board's Office. Based on experience, this will be delegated to the EDRM/Zonal Railways at a later date. While initial programme will be approved by Board's office, subsequent modification will be done by EDRM/Kolkata or steel industry of ER, ECR, SER, SECR and ECoR. In all other cases it will be done by respective COM/CFTMs. Sd/- (Sunil Mathur) Exe. Director, Traffic Trans(s) Railway Board 22. Subsequently, the policy was revised on October 29, 2007 but the criteria as laid down under the policy dated June 16, 2006 were not changed. Thus, I do not find from the documents that the authorities could either add or subtract to the terms and conditions provided in the policy for allocation of Priority 'C' status, which were already laid down by the Central Government in this regard. Moreover, going by the language of Section 71 of the said Act, I have no hesitation to hold that the railways administration was empowered to only enforce those eligibility criteria as laid down in the letter dated June 16, 2006 issued by the Executive Director Traffic Trans(s) Railway Board and could reject the claim of the petitioners, only on non- fulfilment of those criteria. It should be kept in mind, that the Hon'ble Division Bench had categorically held that the respondents, that is, the railway authorities did not have any power to adjudicate and self assess the quantum of unpaid freight and penalty payable by the petitioner for the mis-declaration, without proper adjudication by the Civil Court where the suit filed by the Railways was pending. The Hon'ble Division Bench had also held that the railway authorities did not have any power to blacklist the petitioners for such mis-declaration until the liability of the petitioner was adjudicated by the competent Civil Court. The Division Bench further held that the respondent/railway authorities did not have any power to also take any coercive steps against the petitioner for the alleged mis-declaration. The relevant portion of the judgment of the Division Bench in MAT 1970 of 2014 is set out below:- "In our view until such lacuna in the legislation is filed up by appropriate legislation by the Parliament, the interest of the railway authority can only be protected if we work out the following modality for transportation of the iron ore by the appellant company without suspending it by way of blacklisting. We thus, direct that at the time of booking each consignment for carriage of iron ore from one railway terminal to the other by rakes of wagons, the railway administration will realise the freight rate at class 180 plus Distance base Charges as per para 1 of the Rates Circular No.36 of 2009 from the consignor and will ultimately decide the actual freight rate payable by the consignor/consignee, on being satisfied about the actual endues of the iron ore to be transported under the consignment through railway rakes of wagons. Thus, if the appellant company after receiving delivery of iron ore under any consignment of submission of the declaration regarding its domestic consumption of the iron ore at its factory as per para 3 of the said Rates, can satisfy the railway authority about the endues of such iron ore as per its own declaration, the railway authority will refund the amount which the railway authority realized on account of Distance Based Charges for transportation of iron ore under the relevant consignment. It is further clarified that for recording such satisfaction about endues of the iron ore as per the declaration given by the consignor/consignee, the railway authority may not only verify the documents to be submitted by the consignor/consignee in support of their claim for refund of the Distance Based Charge realized by the railway authority at the time of booking the consignment, but also may take inspection at the factory site for ascertaining the actual endues of such iron ore by the consignee." 23. Although, in the order impugned to this writ petition the respondent authority had come to a finding that the request of the petitioner for grant Priority 'C' status could not be granted as the allegation of mis-declarations was sub-judice before the Hon'ble Apex Court but, in the affidavit-in-opposition filed by the respondents a different stand has been taken and in unequivocal terms, the said respondents had stated that the expression may not be considered should be read as "cannot be granted". In the affidavit-in-opposition, it had also been stated that the application of the petitioner was rejected because of false declaration. The petitioners have also been labelled as dishonest businessmen. The authorities have actually pre-determined the issues thereby, rejecting the claim of the petitioner, inter alia, on the grounds of falsification of documents, data, bills thereby causing loss of revenue to the railways. Although, the said reasons were not expressly assigned in the order impugned, nonetheless the order impugned is perverse and cannot be sustained in law in view of the fact that the authorities had indirectly rejected the claim of the petitioner for Priority 'C' although the reasons were not spelt out in the order. The authorities have sought to bypass the decision of the Hon'ble Division Bench of this Court which had categorically held that the respondents did not have any power under the law to adjudicate the loss of revenue and impose the punishment of blacklisting without there being prior adjudication in a civil suit. Thus, by issuing the order impugned, the respondents had indirectly refused the Priority 'C' status of the petitioner which amounted to blacklisting although, the reason assigned for non-consideration was pendency of the matter before the Hon'ble Apex Court. Under such circumstances the order impugned cannot be sustained on the ground of perversity and violation of the principles of natural justice. Thus, by issuing the order impugned, the respondents had indirectly refused the Priority 'C' status of the petitioner which amounted to blacklisting although, the reason assigned for non-consideration was pendency of the matter before the Hon'ble Apex Court. Under such circumstances the order impugned cannot be sustained on the ground of perversity and violation of the principles of natural justice. The order impugned amounts to rejection of the claim of the petitioner as already admitted by the respondents in their affidavit-in- opposition. I hold that the effect of the order amounts to blacklisting the petitioner without following the proper procedure. There is also another aspect in the matter. In the supplementary affidavit filed by the petitioners, it has been pleaded that the respondents had granted Priority 'C' facility to two similarly situated companies, namely Haldia Steel Limited and Electro Steel Casting Limited. Such discrimination in granting of Priority 'C' facility in a pick and choose manner cannot be accepted. The respondents have failed to substantiate that the petitioner No.1 was not similarly situated with those companies. 24. The Hon'ble Division Bench in its order dated December 24, 2014 had fixed the modalities for transportation of iron-ore by the petitioner, keeping in mind the interest of the railways and in order to prevent undue enrichment of the petitioner. Thus the contention of the authorities that dishonest businessmen causing loss of revenue should not be granted the facility has also been taken care of. The order has not been stayed by the Apex Court and until and unless the said order of the Division Bench was reversed, in appeal or stayed the railway authorities were bound to give Priority 'C' facility to the petitioner, subject to the compliance of the provisions of and the terms and conditions contained in the policy dated June 16, 2006 issued by the railway authorities and subsequently revised. 25. Mere pendency of the appeal before the Hon'ble Apex Court could not be a ground for rejection and or refusal of the request of the petitioner. 25. Mere pendency of the appeal before the Hon'ble Apex Court could not be a ground for rejection and or refusal of the request of the petitioner. Reference may be made to the decision of the Hon'ble Apex Court in the case of Shree Chamundi Moped Limited vs. Church of South India Trust Association CSI CINOD Secretariat, Madras reported in (1992) 3 SCC 1 , in which the Hon'ble Apex Court had laid down the proposition of law, to the effect that, even if an order challenged before it was stayed, it did not mean that the said order impugned had lost it is force but, its existence as a fact continued on record. I agree with the propositions of law put forward by Mr. Kapur and hold that the respondent authorities were mandated under the statute and under the policy to grant Priority 'C' facility in public interest and for the benefit of the public. Such enabling power was coupled with the duty to exercise it when the circumstances so demanded. The respondent authority while considering the request of the petitioner ought to have the decided issue as directed by this Court on October 5, 2018 based on the fact and circumstances and on the law laid down by the Hon'ble Division Bench in this regard in MAT 1970 of 2014 as also on the policy framed by the Ministry of Railways (Railway Board). The grounds for rejection under the circumstances, could only be non-compliance of the terms and conditions as laid down in the letter dated June 16, 2006. The relevant portion of the Judgment in Commissioner of Police, Bombay vs. Gordhandas Bhanji reported in AIR 1952 SC 16 is quoted below:- "45. It was objected as to this that there is no specific law which compels him to exercise the discretion. Rule 250 merely vests discretion in him but does not require him to exercise it. The relevant portion of the Judgment in Commissioner of Police, Bombay vs. Gordhandas Bhanji reported in AIR 1952 SC 16 is quoted below:- "45. It was objected as to this that there is no specific law which compels him to exercise the discretion. Rule 250 merely vests discretion in him but does not require him to exercise it. That is easily met by the observation of Earl Cairns L.C. in the House of Lords in Julius v. Lord Bishop of Oxford, observations which have our full and respectful concurrence:- 'There may be something in the nature of the thing empowered to be done, something in the object for which it is to be done, something in the conditions under which it is to be done, something in the title of the person or persons for whose benefit the power is to be exercised, which may couple the power with a duty, and make it the duty of the person in whom the power is reposed, to exercise that power when called upon to do so.' 46. The discretion vested in the Commissioner of Public under Rule 250 has been conferred upon him for public reasons involving the convenience, safety, morality and welfare of the public at a large. An enabling power of this kind conferred for public reasons and for the public benefit is, in our opinion, coupled with a duty to exercise it when the circumstances so demand. It is a duty which cannot be shirked or shelved nor can it be evaded; performance of it can be compelled under section 45." 26. It is undoubtedly established by law, that any authority within the meaning of the Article 12 of the Constitution was obliged to act fairly without being arbitrary or capricious. The Railway Authorities and the Railway Board being an organ of the state were required to act bona fide and in accordance with law and should not have rejected the request of the petitioners by perceiving the petitioners as dishonest businessmen thereby indirectly blacklisting the petitioners, although restrained by the Hon'ble Division Bench to do so. The Railway Authorities and the Railway Board being an organ of the state were required to act bona fide and in accordance with law and should not have rejected the request of the petitioners by perceiving the petitioners as dishonest businessmen thereby indirectly blacklisting the petitioners, although restrained by the Hon'ble Division Bench to do so. The rejection and or refusal to decide the request of the petitioners on the specious plea that the inflated bills furnished by the petitioner were subject matter of an appeal before the Hon'ble Apex Court, in my view, amounted to an indirect rejection of the request as would appear from the clarification of the order given by the respondents in their affidavit-in-opposition. Reference is made to the decision of M/s. G & S Construction vs. State of West Bengal & Ors., reported in (2014) 1 CHN 663 , and BMW Ventures Limited v. Export Credit Guarantee Corporation of India Limited, reported in (2014) 1 CHN 118 . 27. With regard to the decisions cited by Mr. Bose on the point that the reliefs claimed in the writ petition were barred by the principle of constructive res jedicata as provided in explanation IV of Section 11 of Civil Procedure Code, I do not agree with Mr. Bose inasmuch as, there has not been any adjudication in the previous writ petition and the authority was directed by the learned Single Judge of this Court to consider the request of the petitioner for Priority 'C' facility afresh and in accordance with law upon hearing the petitioners and dispose of the same by passing a reasoned order. On the basis of the direction of this Hon'ble Court, the respondent No.7 passed the order impugned. This is a new cause of action and can always be challenged in a subsequent writ petition. Moreover, the question of applicability of explanation IV does not arise inasmuch as, there had been no deemed denial or refusal by this Hon'ble Court of the reliefs claimed by the petitioners in W.P. No.17677 (W) of 2018. With regard to the decisions relied upon by Mr. Moreover, the question of applicability of explanation IV does not arise inasmuch as, there had been no deemed denial or refusal by this Hon'ble Court of the reliefs claimed by the petitioners in W.P. No.17677 (W) of 2018. With regard to the decisions relied upon by Mr. Bose, learned Senior Advocate appearing on behalf of the respondents, I hold that the decision in Union of India & Others vs. Southern Railway Employees Cooperative Stores workmen reported in (1998) 5 SCC 530 is not of any assistance to the respondents inasmuch as, in that case the dispute between the workman and the Union of India had already reached a finality in a prior proceeding and the order passed by the Tribunal had been confirmed by the Hon'ble Apex Court. As such, the Apex Court held that the parties thereto could not deny the liability or the binding effect of the earlier decision by taking a plea that subsequently a contrary view had been taken by another bench in a similar case. With regard to the decision of Kaushik Cooperative Building Society (supra), I am of the opinion that the said decision had no manner of the application in the facts of the present case. The Hon'ble Apex Court in the said judgment held that the principle of resjudicata or constructive resjudicata had been adopted as a public policy to give finality to the decision of a court of competent jurisdiction and also to prevent multiplicity of proceedings. The case before this court is not one in which parties have raised a contrary plea on a matter which was finally decided by a court of competent jurisdiction and were abusing the process of court by filing one petition after another. On the contrary, the respondents have failed to comply with the specific directions of this Court passed in these proceedings. There is no quarrel with the proposition of law laid down in the decision of T.P Moideen Koya (supra). The said judgment does not have any application in this case. 28. Under such circumstances, with the above observations the order impugned dated November 8, 2018, is hereby quashed and set aside. There is no quarrel with the proposition of law laid down in the decision of T.P Moideen Koya (supra). The said judgment does not have any application in this case. 28. Under such circumstances, with the above observations the order impugned dated November 8, 2018, is hereby quashed and set aside. The respondent No.4, that is, The Chairman, Railway Board is directed to consider the matter fresh in terms of the observations made hereinabove, by re-examining the issue and taking in to account the letters dated November 10, 2017, November 27, 2017, January 12, 2018 and February 27, 2018, in accordance with law and in terms of the existing policy for Programmed Traffic (Priority 'C'). The order should be a reasoned one and should be passed upon hearing the petitioner and/or its representatives. Further, in the said order the authority should also indicate with reasons, whether similarly situated applicants for Priority 'C', namely, Electro Steel Casting Limited and Haldia Steel Limited were granted the facility whereas the petitioners were denied the same. If the authority arrives at a conclusion while disposing of the applications of the petitioners that the petitioners were similarly situated with to Electro Steel Casting Limited and Haldia Steel Limited, then the same facility should be given to the petitioners. While disposing of the applications of the petitioner the respondent No.4 should pass a reasoned order and communicate the same to the petitioners. The entire exercise should be completed within a period of six weeks from the date of communication of this order. The permission if granted, would be subject to the final result of the appeals pending before the Hon'ble Apex Court. The modality of transportation and booking as also the freight payable should be in terms of the order dated December 24, 2014 passed in MAT No.1970 of 2014, till the appeal was decided by the Hon'ble Apex Court. 29. This writ petition is disposed of with the above observations. 30. There will be, however, no order as to costs. Urgent photostat Certified Copy of this judgment, if applied for, be given to the parties, on priority basis.