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2021 DIGILAW 868 (PAT)

Swastik Associate v. Union Of India

2021-08-24

MOHIT KUMAR SHAH

body2021
JUDGMENT 1. The instant case has been taken up for consideration through the mode of Video conferencing in view of the prevailing situation on account of COVID 19 Pandemic, requiring social distancing. 2. Heard the learned counsel for the petitioner Shri Gautam Kumar Kejriwal and the learned counsel for the Respondent- Railways, Shri Kumar Priya Ranjan, Advocate. 3. The present writ petition has been filed for quashing the demurrage penalty imposed upon the petitioner to the tune of Rs. 5,60,700/-, by the respondent Goods Superintendent, Dauram Madhepura, East Central Railway, as also for quashing the letter dated 21.01.2020, issued by the respondent Divisional Railway Manager [Commercial] East Central Railway, Samastipur, whereby and whereunder the application of the petitioner for waiver of demurrage charges been rejected. 4. The brief facts of the case are that the petitioner had booked consignment of cement bags with the railways, to be transported by Railway Wagons. The rake of 42 wagons, containing the cement consignment of the petitioner had arrived at the Dauram siding on 27.09.2019, however, the petitioner could not unload the cement bags from the wagons within the stipulated time frame and the cement bags could be unloaded only on 01.10.2019, after cessation of rains, resulting in levy of demurrage charges to the tune of Rs. 5,60,700/-. The petitioner, in terms of Clause-2 of the respondent- Railways' Rates Master Circular Demurrage-Waiver/ 2016, had paid the demurrage charges on 06.10.2019 and on the very same day had submitted waiver application before the Goods Superintendent, Dauram to be forwarded to the Divisional Railway Manager, Samastipur along with his recommendations. Thereafter, the respondent Goods Superintendent, Dauram on 06.10.2019 itself, had forwarded the application of the petitioner to the Divisional Railway Manager, Samastipur, along with his recommendation, which is reproduced herein below:- 5. The Divisional Railway Manager (Commercial), Samastipur, by the impugned letter dated 21.01.2020 has rejected the waiver application of the petitioner. 6. The learned counsel for the petitioner has submitted that the order dated 21.01.2020 on the very face of it smacks of non-application of mind and in fact, no reason whatsoever has been assigned as also the recommendations of the Goods Superintendent, Dauram, Madhepura, in favour of the petitioner, as aforesaid, has also not been considered by the learned Divisional Railway Manager resulting in the order dated 21.01.2020 being perverse and bad in the eyes of law. 7. 7. It is further submitted by the learned counsel for the petitioner that in view of the judgment rendered by the Hon'ble Apex Court in the case of Whirlpool Corporation vs. Registrar of Trade Marks, Mumbai & Ors., reported in (1998) 8 SCC 1 , the alternative remedy of appeal would not operate as a bar and the present Writ Petition would still be maintainable in as much as the impugned Order dated 21.01.2020 has been passed in violation of the principles of natural justice in as much as the Divisional Railway Manager (Commercial), Samastipur has not furnished any reason to reject the waiver application of the petitioner. 8. Per contra, the learned counsel for the respondent-Railways', Sri. Kumar Priya Ranjan, has submitted that the petitioner has the remedy of filing an appeal against the Order of rejection of his waiver application, as is stipulated in clause 3 of the Rates Master Circular Demurrage-Waiver/ 2016. 9. I have heard the learned counsel for the parties and have gone through the materials on record and I find that the case as put forth by the petitioner regarding there being incessant rains resulting in the petitioner being impeded from unloading the cement bags from the wagons has not been disputed by the respondent railways in their counter affidavit, and moreover, the Goods Superintendent has also recommended for waiver of the demurrage charges as also has stated that the reasons furnished by the petitioner for the delay caused in removal of the cement bags from the wagons are genuine and in fact on account of incessant rain, the cement bags could not be removed within time. 10. Consequently, this Court finds that the order dated 21.01.2020 passed by the respondent Divisional Railway Manager (Commercial), Samastipur is wholly unreasoned, has not considered the recommendation of the Goods Superintendent and moreover, no cogent and succinct reasons have been furnished in support of the impugned order dated 21.01.2020, which is an indispensable component of a decision making process, hence this court finds that the impugned order dated 21.01.2020 stands vitiated, having been passed in violation of the principles of natural Justice. In this regard, it would be relevant to refer to a judgment rendered by the Hon'ble Apex Court in the case of Kranti Associates (P) Ltd. V. Masood Ahmed Khan & Ors., reported in (2010) 9 SCC 496, paragraphs No. 12 to 15 and 47 whereof are reproduced herein below:- 12. The necessity of giving reason by a body or authority in support of its decision came up for consideration before this Court in several cases. Initially this Court recognised a sort of demarcation between administrative orders and quasi-judicial orders but with the passage of time the distinction between the two got blurred and thinned out and virtually reached a vanishing point in the judgment of this Court in A.K. Kraipak v. Union of India [ (1969) 2 SCC 262 : AIR 1970 SC 150 ]. 13. In Keshav Mills Co. Ltd. v. Union of India [ (1973) 1 SCC 380 : AIR 1973 SC 389 ] this Court approvingly referred to the opinion of Lord Denning in R. v. Gaming Board for Great Britain, exp Benaim [ (1970) 2 QB 417 : (1970) 2 WLR 1009 : (1970) 2 All ER 528 (CA)] and quoted him as saying "that heresy was scotched in Ridge v. Baldwin [1964 AC 40 : (1963) 2 WLR 935: (1963) 2 All ER 66 (HL)]". 14. The expression "speaking order" was first coined by Lord Chancellor Earl Cairns in a rather strange context. The Lord Chancellor, while explaining the ambit of the writ of certiorari, referred to orders with errors on the face of the record and pointed out that an order with errors on its face, is a speaking order. (See pp. 1878-97, Vol. 4, Appeal Cases 30 at 40 of the Report). 15. This Court always opined that the face of an order passed by a quasi-judicial authority or even an administrative authority affecting the rights of parties, must speak. It must not be like the "inscrutable face of a sphinx". 47. Summarising the above discussion, this Court holds: (a) In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially. (b) A quasi-judicial authority must record reasons in support of its conclusions. It must not be like the "inscrutable face of a sphinx". 47. Summarising the above discussion, this Court holds: (a) In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially. (b) A quasi-judicial authority must record reasons in support of its conclusions. (c) Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it must also appear to be done as well. (d) Recording of reasons also operates as a valid restraint on any possible arbitrary exercise of judicial and quasi-judicial or even administrative power. (e) Reasons reassure that discretion has been exercised by the decision-maker on relevant grounds and by disregarding extraneous considerations. (f) Reasons have virtually become as indispensable a component of a decision-making process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies. (g) Reasons facilitate the process of judicial review by superior courts. (h) The ongoing judicial trend in all countries committed to rule of law and constitutional governance is in favour of reasoned decisions based on relevant facts. This is virtually the lifeblood of judicial decision-making justifying the principle that reason is the soul of justice. (i) Judicial or even quasi-judicial opinions these days can be as different as the judges and authorities who deliver them. All these decisions serve one common purpose which is to demonstrate by reason that the relevant factors have been objectively considered. This is important for sustaining the litigants' faith in the justice delivery system. (j) Insistence on reason is a requirement for both judicial accountability and transparency. (k) If a judge or a quasi-judicial authority is not candid enough about his/her decision-making process then it is impossible to know whether the person deciding is faithful to the doctrine of precedent or to principles of incrementalism. (l) Reasons in support of decisions must be cogent, clear and succinct. A pretence of reasons or "rubber-stamp reasons" is not to be equated with a valid decision-making process. (m) It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-making not only makes the judges and decision-makers less prone to errors but also makes them subject to broader scrutiny. A pretence of reasons or "rubber-stamp reasons" is not to be equated with a valid decision-making process. (m) It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-making not only makes the judges and decision-makers less prone to errors but also makes them subject to broader scrutiny. (See David Shapiro in Defence of Judicial Candor [(1987) 100 Harvard Law Review 731-37].) (n) Since the requirement to record reasons emanates from the broad doctrine of fairness in decision-making, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See Ruiz Torija v. Spain [(1994) 19 EHRR 553] EHRR, at 562 para 29 and Anya v. University of Oxford [2001 EWCA Civ 405 (CA)], wherein the Court referred to Article 6 of the European Convention of Human Rights which requires, "adequate and intelligent reasons must be given for judicial decisions". (o) In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of "due process". 11. A constitution Bench of the Hon'ble Apex Court, in a Judgment rendered in the case of S.N. Mukherjee v. Union of India, reported in (1990) 4 SCC 594 , has held in paragraph No. 39 as follows:- "39. The object underlying the rules of natural justice "is to prevent miscarriage of justice" and secure "fair play in action". As pointed out earlier the requirement about recording of reasons for its decision by an administrative authority exercising quasi-judicial functions achieves this object by excluding chances of arbitrariness and ensuring a degree of fairness in the process of decision-making. Keeping in view the expanding horizon of the principles of natural justice, we are of the opinion, that the requirement to record reason can be regarded as one of the principles of natural justice which govern exercise of power by administrative authorities...................." 12. It would also be apt to refer to yet another judgment rendered in the case of State of Orissa vs. Dhaniram Luhar, reported in (2004) 5 SCC 568 , paragraph No. 8 whereof is reproduced herein below:- "8. Even in respect of administrative orders Lord Denning, M.R. in Breen v. Amalgamated Engg. It would also be apt to refer to yet another judgment rendered in the case of State of Orissa vs. Dhaniram Luhar, reported in (2004) 5 SCC 568 , paragraph No. 8 whereof is reproduced herein below:- "8. Even in respect of administrative orders Lord Denning, M.R. in Breen v. Amalgamated Engg. Union [(1971) 1 All ER 1148 : (1971) 2 QB 175 : (1971) 2 WLR 742 (CA)] observed: "The giving of reasons is one of the fundamentals of good administration." In Alexander Machinery (Dudley) Ltd. v. Crabtree [1974 ICR 120 (NIRC)] it was observed: "Failure to give reasons amounts to denial of justice." "Reasons are live links between the mind of the decision-taker to the controversy in question and the decision or conclusion arrived at." Reasons substitute subjectivity by objectivity. The emphasis on recording reasons is that if the decision reveals the "inscrutable face of the sphinx", it can, by its silence, render it virtually impossible for the courts to perform their appellate function or exercise the power of judicial review in adjudging the validity of the decision. Right to reason is an indispensable part of a sound judicial system; reasons at least sufficient to indicate an application of mind to the matter before court. Another rationale is that the affected party can know why the decision has gone against him. One of the salutary requirements of natural justice is spelling out reasons for the order made; in other words, a speaking-out. The "inscrutable face of the sphinx" is ordinarily incongruous with a judicial or quasi-judicial performance." 13. Having regard to the facts and circumstances of the case and for the reasons mentioned herein above, the impugned order dated 21.01.2020, passed by the Divisional Railway Manager (Commercial), Samastipur is set aside and the matter is remanded back to the Divisional Railway Manager (Commercial), Samastipur, with a direction to him to consider the recommendation of the Goods Superintendent, Dauram dated 06.10.2019 and pass a reasoned and a speaking order, after application of mind within a period of six weeks from the date of receipt/ production of a copy of this judgment, in accordance with law. 14. The writ petition stands disposed of on the aforesaid terms.