IMPORTANT POINT
High Court has rightly held that notification issued for formation of new railway zones is not violative of Section 3 of Railways Act, 1989 as the same is formed for the purpose of efficient administration of the railways.

JUDGMENT

Rajendra Babu, J.-The petitioners before us filed a writ petition in the High Court of Delhi challenging the formation of seven railway zones. The petitioners contended that the notification issued for formation of new zones is violative of Section 3 of the Railways Act, 1989 (hereinafter referred to as the Act ) as the same is not formed for the purpose of efficient administration of the railways.

2. The petitioners relied upon a proceeding of the Railway Board and a note prepared for the consideration of the meeting to be held on November 30, 2001. There are several aspects considered in that note, namely, (i) that there is unprecedented financial crunch in the railways and recommendations made by the Railways Reforms Committee in 1984 to form new four Zones remained unimplemented on account of the same and the position has not improved but has only worsened; (ii) that on account of technological innovations by utilisation of Information Technology the Railways can centralise their operations and thus reducing the relevance of the new zones; (iii) that the Comptroller & Auditor General has recommended for reconsideration of the decision for creation of new zones and division from the point of view of financial viability; (iv) that the Standing Committee of Parliament on Railway have recommended for creation of new zones on the basis of work load, efficiency and effective management; (v) that the Railway Convention Committee recommended that instead of creating new zones expenditure to be incurred on the same could be better utilised for procurement of rolling stock, doubling and renewal of railway lines and in electrification programmes; (vi) that the management cadres and staff federations are not in favour of new zones and divisions; (vii) that Rakesh Mohan Committee has suggested that the formation of additional zones would be of dubious merit and would add substantial cost and be of little value to the system; (viii) that there would be tremendous dislocation in the zones, operating discipline, traffic accounts and staff matters that will affect the system adversely; (ix) that the creation of zones or divisions apart from causing upheaval will also divert the railway s attention to restructure itself to be more competitive in the market; (x) that therefore, the Board was of the view that it would not be appropriate for formation of seven new zones in the context of financial crunch, the opinion expressed by the Parliamentary Committees and, therefore, calls for further examination of the matter. The petitioners also placed reliance upon the draft that has been prepared by the Member Secretary of the Committee to finalise the detailed territorial jurisdiction of new zones and stated that "Though the recommendations of the Study Group were accepted by the Railways in principle, the entire issue was further examined in the Railway Board and the final proposal was made for the creation of the six new zones, four as per the Report of the Study Group and two additional zones with the objective of the development of the backward areas particularly of Orissa and Bihar. Another zone of Bilaspur was added as it had heavy workload and in view of the continuous long pending demand of the region...." It was very strongly contended that though Railway Reforms Committee had recommended in 1984 for formation of new zones, the situation has entirely changed in view of various factors referred to above and this was admitted position inasmuch as in Parliament the Minister for Railways answered that no study regarding utilisation of new zones had been conducted and even as late as on March 1, 2002 it was stated that owing to resource crunch the proposed new zones and divisions will only gradually become operational depending on the availability of the investable resources and, therefore, no time frame could be fixed. It was pointed that the expenditure in the creation of new zones would result in accumulation of fresh arrears