Research › Search › Judgment

Gauhati High Court · body

2025 DIGILAW 160 (GAU)

Sadguru Engineers And Allied Services Pvt Ltd v. Union of India

2025-01-29

KARDAK ETE

body2025
JUDGMENT : KARDAK ETE, J. Heard Ms. M. Sharma, learned counsel for the petitioners. Also heard Mr.B. Sharma, learned Standing Counsel for the Railway. 2. By filing this writ petition, the petitioners have challenged the impugned Demurrage Charge Bill statements dated 19.10.2021 issued by the Chief Goods Superintendent, Salchapara and the impugned Demand Notice/Letter dated 22.11.2021 issued by the Divisional Railway Manager (C) Lumding, whereby, the petitioners have been directed to pay of Rs. 5,15,970/-(Rupees Five Lakh Fifteen Thousand Nine Hundred Seventy) only as Penal Demurrage Charge. 3. The brief facts of the case are that pursuant to the Public Tender dated 17.07.2018, the petitioner no.1 was approved by the Indian Oil Corporation Limited (hereinafter referred to as IOCL in short) for operation and handling of Packed Bitumen depot of IOCL located on land to be leased by IOCL for a period of 10 years at Silchar, Assam. The petitioner was appointed as Carrying & Forwarding Agents (in short CFA) for operation and handling on land leased to the IOCL at NH-53, Village-Rajnagar, near Srikona Brick Industries at Silchar. Upon appointment at CFA and in terms of the appointment letter and work order dated 29.11.2019 and 01.09.2020, the petitioner has entrusted a consignment “Bitumen” to the Railways in 42 wagons vide electronically transmitted Railway Receipt (et-RR) dated 09.09.2021 from Haldia Dock Complex Bulk, 19-West Bengal for the destination of Salchapara. The said consignment of 42 wagons was arrived and placed at destination Salachapara on 14.09.2021 at 19.40 hours and delivered to IOCL under clear receipt. 4. The Chief Goods Superintendent, Salchapara, had directed the petitioner to make payment of Rs. 7,14,420/-(Rupees Seven Lakhs Fourteen thousand Four Hundred Twenty) only as Penal Demurrage Charge for not releasing 42 wagons within the permissible free time period i.e. 9 hours relying on the Railway Board Circular No. 74 of 2005, which provides the permissible free time for unloading the goods is 9 (nine) hours. 5. Being aggrieved of the said demand, the petitioner had issued a letter dated 16.09.2021 to the Divisional Railway Manager(C), Lumding, for a revision of Demurrage Charge to the tune of Rs. 7,14,420/-(Rupees Seven Lakhs Fourteen thousand Four Hundred Twenty) only accrued against consignment of Bitumen. 5. Being aggrieved of the said demand, the petitioner had issued a letter dated 16.09.2021 to the Divisional Railway Manager(C), Lumding, for a revision of Demurrage Charge to the tune of Rs. 7,14,420/-(Rupees Seven Lakhs Fourteen thousand Four Hundred Twenty) only accrued against consignment of Bitumen. As the demand of Penal Demurrage Charges which is 6 (six) times of Normal Demurrage Charge is not applicable to the case of the petitioner because as per the Railway Board Circular dated 23.10.2008, the penal/higher rates are to be implemented in case of excessive congestion at any terminal and only after giving wide publicity and due notice of 48 hours. 6. It is the contention of the petitioners that the demand has been issued without giving wide publicity and due notice of 48 hours in violation of the Railway Board Circular dated 23.10.2008. It is also contended that the Railway Authority has violated the mandatory conditions as required under the Railway Board Guidelines dated 01.09.2021 regarding round the clock working at railway terminals. 7. The petitioners contend that the transaction involves are a higher volume of traffic which contains 11642 drums of Bitumen in 42 wagons where the total freight charged by the Railway is Rs. 66,30,413/- (Rupees Sixty Six Lakh Thirty Thousand and Four Hundred Thirteen) only and under such circumstances, the Railways must take up the matter on priority basis but on the contrary the Railway in-charge expressed his inability to give permission for unloading the consignment on the ground that the yard has to remain clear for next rake to be placed, which is unfair, arbitrary and illegal on the part of the respondent authorities in demanding penal Demurrage Charge amounting to Rs. 5,15,970/- (Rupees Five Lakh Fifteen Thousand Nine Hundred Seventy) only as Penal Demurrage Charge. 8. It is contended that due to second wave of the Covid-19 pandemic, night curfew was in force from 09.00 p.m. to 05.00 a.m. and under such circumstances the petitioners were facing difficulties for releasing 42 wagons. The Revised Rate Circular dated 17.01.2008 entitle the petitioners to pay only Normal Demurrage Charge which is Rs. 100/- (Rupees hundred) only per 8 wheeled wagon per hour. Therefore, the petitioners are only liable to pay only Normal Demurrage Charge amounting to Rs. 42,000/- (Rupees forty two thousand) only for 10 hours. The Revised Rate Circular dated 17.01.2008 entitle the petitioners to pay only Normal Demurrage Charge which is Rs. 100/- (Rupees hundred) only per 8 wheeled wagon per hour. Therefore, the petitioners are only liable to pay only Normal Demurrage Charge amounting to Rs. 42,000/- (Rupees forty two thousand) only for 10 hours. However, the Chief Goods Superintendent, Salcharpara, calculated and demanded Penal Demurrage Charges 6 (six) times of Normal Demurrage Charge, which is illegal and arbitrary. 9. Ms. M. Sharma, learned counsel for the petitioners, submits that the impugned demand of Penal Demurrage Charge is in utter violation of the principles of natural justice and the procedures of the Railway Board letter dated 23.10.2008 which provides that the penalty are to be implemented in case of excessive congestion at any terminal and only after giving wide publicity and due notice of 48 hours. She submits that impugned Penal Demurrage Charge has been made by not following the procedure laid down in the Railway Board Circular as no wide publicity and due notice of 48 hours was issued, as such same is illegal and arbitrary. She further submits that the respondent authorities have failed to take into account of the Covid-19 situation, at the time when Government has imposed a curfew which was in force from 09.00 p.m. to 05.00 a.m., which created difficulties for releasing the said 42 wagons. Therefore, the impugned demand of Penal Demurrage Charge dated 19.10.2021 for payment of Rs.5,15,970/-(Rupees Five Lakh Fifteen Thousand Nine Hundred Seventy) only is illegal and as such same may be set aside and quashed and the respondent authorities may be directed to allow the petitioner to pay the normal Demurrage Charge in the facts and circumstances of the present case. 10. In support of her submissions, Ms. M. Sharma, learned counsel for the petitioners, has placed reliance on the following judgments. (i) R.K. Coals and Ors. Vs. Union of India and Ors. in WP(C) 2607/2012 decided on 12.10.2018. (ii) Sathyanath & Anr Vs. Sarojamani reported in 2022 7 SCC 644 11. On the other hand, Mr. 10. In support of her submissions, Ms. M. Sharma, learned counsel for the petitioners, has placed reliance on the following judgments. (i) R.K. Coals and Ors. Vs. Union of India and Ors. in WP(C) 2607/2012 decided on 12.10.2018. (ii) Sathyanath & Anr Vs. Sarojamani reported in 2022 7 SCC 644 11. On the other hand, Mr. B. Sharma, learned Standing Counsel for the Railway, while raising the maintainability of the writ petition, submits that the petitioners have not availed the remedy provided under the provisions of the Railway Board's Circular/Guidelines dated 19.05.2016 towards preferring a second appeal against the unwaived amount of demurrage charges as the petitioners had filed an appeal for waiving of the same under the said circular and got waived by reducing the penal charges. Since, the petitioners have relied on the provisions of the said Circular/Guidelines towards claiming their rights and remedies, it is not open to contend that the provisions of the said Circular/Guidelines that requires them to discharge reciprocal duties and liabilities shall not be adhered to. That apart the subject matter of dispute between the parties to the writ proceedings is amenable to the jurisdiction of the Railway Claims Tribunal. Therefore, the present writ petition is liable to be dismissed being not maintainable on availability of alternative efficacious under the law. 12. Mr. B. Sharma, learned Standing Counsel, on merit, submits that after examination by the Divisional Officers and with the approval of the Divisional Railway Manager (C), it was decided to impose graded Demurrage Charge at SCA (Salchapara), DMV (Dimapur) and BXJ (Bokajan) goods terminal for one month to improve release of rakes placed at the above mentioned goods terminals. Decision to levy graded Demurrage Charge was communicated to the above terminals vide office letter bearing No. C/104/484/LM/2020-21 (Misc) dated 09.09.2021 wherein, it was stated to give 48 hours notice. The said letter was pasted at conspicuous place of Salchapara goods terminal for notice of all concerned. In addition, all the handlers/parties dealing with the said goods terminal were informed verbally by the Commercial Supervisor (Goods) regarding imposition of graded Demurrage Charge. Graded Demurrage Charge was implemented from 11.09.2021 after giving due notice of 48 hours. The petitioner's case of Demurrage Charge is of 14.09.2021 which, is beyond the period of 48 hours notice. Therefore, the contention of the petitioner cannot be accepted on merit. Graded Demurrage Charge was implemented from 11.09.2021 after giving due notice of 48 hours. The petitioner's case of Demurrage Charge is of 14.09.2021 which, is beyond the period of 48 hours notice. Therefore, the contention of the petitioner cannot be accepted on merit. More so, the writ petition is not maintainable on the ground of availability of alternative remedy under the law and as such same is liable to be dismissed. 13. Mr. B. Sharma, learned Standing Counsel, has placed reliance on the order of this Court dated 13.03.2021 passed in WP(C) 4756/2020 in the case of same petitioners, M/s Sadguru Engineers And Allied Services Pvt Ltd Vs. The Union of India and 3 Ors, to project that since the petitioners have failed to avail the remedy under the Railway Circular by filing second appeal for waiver (the first appeal having been considered by the authorities by reducing the charge on the appeal of the petitioners), the writ petition is not maintainable without approaching the Higher Authority against such waiver and the petitioners cannot be allowed to approbate and reprobate. 14. Due consideration has been extended to the submissions of the learned counsel for the parties and the materials available on record. 15. Essentially, the petitioners have challenged the imposition of Penal Demurrage Charges levied on the petitioner on the ground that due to Covid-19, night curfew was in force from 09.00 p.m. to 05.00 a.m. and under such circumstances, the petitioners were facing difficulties for releasing 42 wagons and secondly, as per the Railway Board Circular dated 23.10.2008, the penal/higher rates are to be implemented in case of excessive congestion at any terminal and only after giving wide publicity and due notice of 48 hours. 16. As the respondents have raised the maintainability of the present writ petition, on the ground of availability of alternative remedy under the law, I would first proceed to consider the relevant provisions of law. 17. Section 13 of the Railway Claims Tribunal Act , 1987, provides as under:- 13. 16. As the respondents have raised the maintainability of the present writ petition, on the ground of availability of alternative remedy under the law, I would first proceed to consider the relevant provisions of law. 17. Section 13 of the Railway Claims Tribunal Act , 1987, provides as under:- 13. Jurisdiction, powers and authority of Claims Tribunal.-(1) The Claims Tribunal shall exercise, on and from the appointed day, all such jurisdiction, powers and authority as were exercisable immediately before that day by any civil court or a Claims Commissioner appointed under the provisions of the Railways Act ,- (a) relating to the responsibility of the railways administrations as carriers under Chapter VII of the Railways Act in respect of claims for- (i) compensation for loss, destruction, damage, deterioration or non-delivery of animals and goods entrusted to a railway administration for carriage by railway; (ii) compensation payable under section 82A of the Railways Act or the rules made thereunder; and (b) in respect of the claims for refund of fares or part thereof or for refund of any freight paid in respect of animals or goods entrusted to a railway administration to be carried by railway. (1A) The Claims Tribunal shall also exercise, on and from the date of commencement of the provisions of section 124A of the Railways Act , 1989 (24 of 1989), all such jurisdiction, powers and authority as were exercisable immediately before that date by any civil court in respect of claims for compensation now payable by the railway administration under section 124A of the said Act or the rules made thereunder. (1B) The Claims Tribunal shall also exercise, on and from the commencement of Part XIV of the Finance Act, 2017, the jurisdiction, powers and authority conferred on the Tribunal under Chapter VII of the Railways Act , 1989 (24 of 1989). (2) The provisions of the Railways Act , 1989 (24 of 1989) and the rules made thereunder shall, so far as may be, be applicable to the inquiring into or determining, any claims by the Claims Tribunal under this Act. 18. Section 36 of the Railways Act , 1989 provides for complaints against a railway administration. (2) The provisions of the Railways Act , 1989 (24 of 1989) and the rules made thereunder shall, so far as may be, be applicable to the inquiring into or determining, any claims by the Claims Tribunal under this Act. 18. Section 36 of the Railways Act , 1989 provides for complaints against a railway administration. It provides that any complaint that a railway administration (a)is contravening the provisions of section 70; or (b)is charging for the carriage of any commodity between two stations at a rate which is unreasonable; or (c)is levying any other charge which is unreasonable, may be made to the Tribunal, and the Tribunal shall hear and decide any such complaint in accordance with the provisions of this Chapter. 19. On bare reading of the above provisions, shows that any complain against the Railway Administration in respect of contravention of the provisions of section 70, or charging for the carriage of any commodity between two stations at a rate which is unreasonable or levying of any other charge which is unreasonable, person aggrieved may make a complaint to the Tribunal under the Railway Claims Tribunal Act , 1987. Having considered the provisions, the present case appears to be covered under Sub-Section(c) of Section 36 of the Railways Act , 1989, against which a complaint may be made before the Tribunal under the Railway Claims Tribunal Act , 1987. 20. Regard being had to the merit of the case at hand, it would be apposite to consider the relevant circular or guideline of the railway. The rates Demurrage/wharfage is provided under the circular/guidelines of Rate master circular Demurrage Wharfage waiver, 2016. 21. Clause 3.4 provides as under:- 3.4. PENAL DEMURRAGE CHARGE 3.4.1 In case excessive congestion takes place at any terminal/steel plant, CCM/COM/DRM can increase the demurrage rates, even at progressively increasing rate subject to a maximum of six times of the prevalent rate. This penal demurrage rates should be implemented only after giving wide publicity and due notice of 48 hours and should be applicable for the notified period. 3.4.2 The rates can be increased by say, 2 times or 3 times or soon, and not necessarily six times at one go in all cases. In fact, Railway may decide to levy variable rates like 2 times for first three hours detention, 3 times for next twelve hours detentions and so on and so forth. 3.4.2 The rates can be increased by say, 2 times or 3 times or soon, and not necessarily six times at one go in all cases. In fact, Railway may decide to levy variable rates like 2 times for first three hours detention, 3 times for next twelve hours detentions and so on and so forth. Railway must judiciously evaluate the situation and the rates should be increased on merit to the extent considered justified. Levy of six times rate should be resorted only when the situation becomes very alarming. 22. For levy of Penal Demurrage Charges and higher Wharfage Charges vide circular issued by the Director, Traffic Commissioner (rates) Railway Board dated 23.10.2008 provides for Demurrage Charge of the penal and higher rates to be implemented in case of excessive congestion at any terminal and only after giving wide publicity and due notice of 48 hours, which is reproduced herein below:- Government of India Ministry of Railways Railway Hoard No.TC-1/2005/201/2 Now                                                                                                                                                                          Delhi, Dt.22.10.2008 General Managers (Commercial) General Managers (Operating) All Indian Railways. Sub: Levy of penal demurrage charges and higher wharfage charges. Ref: 1. No.TC-1/2005/201/2 dt. 19.12.2005 (Rates Circular No.74 of 2005) 2. No.TC-1/2005/201/2Pt.B dt. 08.03.07 (Rates Circular No.21 of 2007) Vide Rates circulars referred to above, Railway can increase the demurrage and wharfage rates, even at progressively increasing rate, subject to a maximum of six times of the prevalent rate. These penal/higher rates are to be implemented in case of excessive congestion at any terminal and only after giving wide publicity and due notice of 48 hours. It has come to the notice of Board that Zonal Railways are levying penal demurrage and wharfage charges at a rate of six times of the prevalent rate lu a routine manner. It is to clarify that in terms of extant instructions, penal/higher rates can be increased upto maximum of 6 times of the prevalent rate, implying thereby that these rates can be increased by say, 2 times or 3 times or so on, and not necessarily 6 times at one go in all cases. In fact, Railway may decide to levy variable rates like 2 times for first 3 hours detention, 3 times for next 12 hours detention and so on and so forth. Railway must judiciously evaluate the situation and the rates should be increased on merit to the extent considered justified. In fact, Railway may decide to levy variable rates like 2 times for first 3 hours detention, 3 times for next 12 hours detention and so on and so forth. Railway must judiciously evaluate the situation and the rates should be increased on merit to the extent considered justified. Levy of six times rates should be resorted only when the situation becomes very alarming.” 23. On the consideration of the above circulars of the Railways, it reflects that if a Penal/Higher rates of demurrage charges to be levied, the same has to be levy after wide publicity and notice of 48 hours. It provides that in case of excessive congestion takes place at any terminal/steel plant, CCM/COM/DRM can increase the demurrage rates, even at progressively increasing rate subject to a maximum of six times of the prevalent rate. This penal demurrage rates should be implemented only after giving wide publicity and due notice of 48 hours and should be applicable for the notified period.The rates can be increased by 2 times or 3 times or soon, and not necessarily six times at one go in all cases. Railway may decide to levy variable rates like 2 times for first three hours detention, 3 times for next twelve hours detentions and so on and so forth. Railway must judiciously evaluate the situation and the rates should be increased on merit to the extent considered justified. Levy of six times rate should be resorted only when the situation becomes very alarming. 24. In the case of R.K. Coals (Supra) , this Court has observed on its attending facts, which in my view would not come to the aid of the petitioners and the same is reproduced herein under:- “11. Considered the submission of the learned counsel for the parties. The respondent Senior Divisional Commercial Manager, Northern Railway, Ambala Cantonment, filed the affidavit-in- opposition on behalf of the respondents. It is stated in the said affidavit-in-opposition that the penal demurrage was imposed as per rules and the placement of racks were made by operation of feasibility and availability of space. The Railway Board Rate Circular No. 74/2005 authorises CCM/COM/DRM to impose penal demurrage after giving 48 hours advance notice to the parties and the said increase in the demurrage rate is subject to maximum of six times of the prevalent rate. Mr. The Railway Board Rate Circular No. 74/2005 authorises CCM/COM/DRM to impose penal demurrage after giving 48 hours advance notice to the parties and the said increase in the demurrage rate is subject to maximum of six times of the prevalent rate. Mr. Das produced the Corrigendum No. 2 to Rates Circular No. 21/2007 dated 17.01.2008 whereby under Group I, Wharfage rates would be levied under Group I Rs. 100/- per wagon each or part thereof and the said rate is applicable uniformly for all types of wagon w.e.f. 01.02.2008. The stand of the Railway is clear and specific that the penal demurrage charges are to be imposed after giving 48 hours advance notice to the parties. On perusal of the Wagon Transferred Register produced by Mr. Das, the learned counsel for the Railways it is seen that the rack of the present petitioner was placed for unloading on 06.04.2012 at 0930 hours. From the said register itself it is clear and apparent that the said penal demurrage notification was issued on 07.04.2012 at 1745 hours. From the Annexure-4 which is the copy of the said notification of penal demurrage it is seen that the same was received by the agent of the present petitioners on 07.04.2012 at 1815 hours. There is no evidence brought by the respondent Railways in order to show that the said penal demurrage was imposed after giving 48 hours advance notice to the parties. Clause 3.3 of the Rates Circular No. 74/2005 dated 19.12.2005 speaks of in case excessive congestion takes place at any terminal, CCM/COM/DRM can increase the demurrage rates even at progressively increasing rate subject to a maximum of six times of the prevalent rate. This penal demurrage rates should be implemented only after giving wide publicity and due notice of 48 hours and should be applicable for the notified period.” 25. In the Case of Sathyanath ( Supra ) , the Hon’ble Supreme Court has held that if the procedural violation does not seriously cause prejudice to the adversary party, Courts must lean towards doing substantial justice rather than relying upon procedural and technical violations. It is not to be forgotten that litigation is nothing but a journey towards truth which is the foundation of justice and the Court is required to take appropriate steps to thrash out the underlying truth in every dispute. It is not to be forgotten that litigation is nothing but a journey towards truth which is the foundation of justice and the Court is required to take appropriate steps to thrash out the underlying truth in every dispute. It is often said that procedure is the handmaid of justice. Procedural and technical hurdles shall not be allowed to come in the way of the court while doing substantial justice. If the procedural violation does not seriously cause prejudice to the adversary party, courts must lean towards doing substantial justice rather than relying upon procedural and technical violation. We should not forget the fact that litigation is nothing but a journey towards truth which is the foundation of justice and the court is required to take appropriate steps to thrash out the underlying truth in every dispute. In my view, the above are the settled proposition of law which is not applicable in the present case 26. In the present case, although, the learned Standing Counsel, Railway, has submitted that a letter dated 09.09.2021 was pasted at conspicuous place of Salchapara for notice of all concerned, wherein, it was stated to give 48 hours notice, the same appears to be not in consonance with the Railways Board letter dated 19.05.2016, which provides for levying the Demurrage charge in as much as the respondents have failed to establish wide publicity and issuance of 48 hours notice as the penal demurrage rates should be implemented only after wide publicity and due notice of 48 hours and should be applicable for the notified period. 27. Coming back to the remedy available under the law, it is to be taken note that by the Act of Parliament, the Railway Tribunals Act, 1987 and the Railways Act , 1989 have been enacted providing a remedy for making complaints against the Railway Administration which may be made before the Railway Claims Tribunal. 28. As noted above, the respondents authorities has failed to show that a Penal/Higher Demurrage Charge has been demanded after wide publicity and th notice of 48 hours and the grievance is levying of charge which is 6 times of the normal demurrage charge which according to the petitioner is arbitrary, in my view would fall under Section 36 (c) of the Railways Act , 1989 for which a complaint may be made to the Tribunal under the Railway Claims Tribunal Act , 1987. 29. In the considered view of this Court, the grievance raised of not adhering to the Railway Circular dated 22/23.10.2008 of not providing 48 hours notice and after wide publication and also on the ground of Covid-19 situation at the relevant point of time, when the curfew was imposed, the same would be within the contours of the provisions of Section 36 (c) of the Railways Act , 1989, within the jurisdiction of the Railway Claims Tribunal. In that view of the matter, this Court is of the view that the petitioners have the remedy available under the law for their grievances. 30. In view of the foregoing discussions, in my considered view it would be appropriate that the petitioners approach the remedy available under the law. Accordingly, it is provided that the writ petitioners may approach the available remedy as per the provisions of Railway Claims Tribunal, 1987, and Railways Act , 1989. Consequently, without interfering with the impugned Demurrage Charge bill and the impugned Penal Demurrage Charge dated 22.11.2021 issued by the Divisional Railway Manager(C) Lumding, whereby, the petitioners have been directed to pay of Rs. 5,15,970/-(Rupees Five Lakh Fifteen Thousand Nine Hundred Seventy) only as Penal Demurrage Charge, the writ petition is disposed of providing a liberty to the petitioner to approach the appropriate forum. 31. The writ petition stands disposed of.No order as to cost(s).