IMPORTANT POINT
Freight rates notified by Railway Administration and charged from a customer when was held violative of Section 28 of the Indian Railways Act it would not be a case of over-charging to attract provisions of Section 78B of the Act in a suit for recovery of the amount.

Headnote:(i) Limitation Act, 1963-Sections 14 and 15-Respondents were charged at flat rate irrespective of commodity transported by railway and they were not given benefit of Telescopic system of rates allowed by Railways to others-Complaint alleging contravention of provisions of Section 28 of Indian Railways Act was filed relating to period 26-4-1963 to 1-10-1966-Tribunal held appellant to have contravened the provisions of Section 28 of the Act but no direction was made for refund of amount illegally and unreasonably collected by Railways-Appeal filed by Union of India against Tribunal s order dt. 18-4-1966 was dismissed on 14-10-1970-Suit for recovery of amount illegally recovered for period 26-4-1963 to 14-8-1972, periods covered by earlier complaints-Suit filed on 12-12-1973 was decreed by trial Court and upheld in appeal-Appeal-Limitation-Suit was within limitation-Cause of action arose on 14-10-1970 when dispute came to be finally adjudicated upon by Supreme Court in appeal against order of Tribunal-Period of two months required by Section 80 CPC was to be excluded-Contention that suit was barred by limitation had no merits.
       Held : Mr. P.P. Malhotra, the learned senior counsel for the appellants has submitted that even if it is assumed that the period of limitation commenced on 14th October, 1970, still the suit should have been filed on or before 14th October, 1973 and, therefore, the suit filed on 12th December, 1973 is barred by limitation. The plea cannot be upheld for two reasons. Firstly, the period of two months required by Section 80 of the Code whereunder notice is mandatorily required to be given before filing the civil suit has to be excluded from computing the period of limitation under sub-section (2) of Section 15 of the Limitation Act, 1963. Secondly, the period between 5th January, 1972 and 29th October, 1973 during which the civil writ petition remained pending for the identical relief based on the same cause of action but which came to be dismissed by the High Court forming an opinion that civil suit was an appropriate remedy, is liable to be excluded from calculation under Section 14 of the Limitation Act, 1963. However, Mr. Malhotra, the learned senior counsel for the appellants would not agree with such propositions and made his submissions. According to him, the West Coast Paper Mills Limited had given gave a notice even before 14th October, 1970 and by repeating the notice under Section 80 of the Code for the second time the West Coast Paper Mills Limited cannot claim its exclusion from computing the period of limitation under Section 15(2) of the Limitation Act. We cannot agree. The cause of action arose to the plaintiff on 14th October, 1970 when the dispute came to be finally adjudicated upon by this Court and in view of the 3-Judges Bench decision dated 5th February, 2004 referred to hereinabove there is no manner of doubt that the decision of the Tribunal has merged with the decision of this Court dated 14th October, 1970. The plaintiff was justified in staking its claim based on the decision of this Court dated 14th October, 1970 and serving a notice under Section 80 of the Code. The notice so served squarely attracts the applicability of sub-section (2) of Section 15 of the Act. (Paras 12 and 13)
       (ii) Limitation Act, 1963-Section 14(2)-Period spent in pursuing a remedy in wrong forum in good faith-Provision is wide in its application and is not confined in its applicability only to cases of defect of jurisdiction-It is applicable also to cases where earlier proceedings have failed on account of other causes of like nature.
       Held : In the submission of the learned senior counsel, filing of civil writ petition claiming money relief cannot be said to be a proceeding instituted in good faith and secondly, dismissal of writ petition on the ground that it was not an appropriate remedy for seeking money relief cannot be said to be defect of jurisdiction or other cause of a like nature within the meaning of Section 14 of the Limitation Act. It is true that the writ petition was not dismissed by the High Court on the ground of defect of jurisdiction. However, Section 14 of the Limitation Act is wide in its application, inasmuch it is not confined in its applicability only to cases of defect of jurisdiction but it is applicable also to cases where the prior proceedings have failed on account of other causes of like nature. The expression "other cause of like nature" came up for the consideration of this Court in Roshanlal Kuthalia & Ors. Vs. R.B. Mohan Singh Oberai AIR [1975] SC 824 = (1975) 4 SCC 628 and it was held that Section 14 of the Limitation Act is wide enough to cover such cases where the defects are not merely jurisdictional strictly so called but others more or less neighbours to such deficiencies. Any circumstances, legal or factual, which inhibits entertainment or consideration by the Court of the dispute on the merits comes within the scope of the Section and a liberal touch must inform the interpretation of the Limitation Act which deprives the remedy of one who has a right. The issue as to the legality and reasonability of the rates charged by the Railways Administration having been finally adjudicated upon by this Court, there is nothing wrong in the respondent West Coast Paper Mills Limited having proceeded on an assumption that what had remained to be done was a simple direction to the Railway Administration to refund the amount of freight to which it had already been adjudged not entitled to recover. However, the High Court was not inclined to grant such relief in exercise of its writ jurisdiction and, therefore, left open the remedy of civil suit available to the respondents. By no stretch of imagination, it can be said that the West Coast Paper Mills Limited was actuated by malafides or want of good faith in instituting the writ proceedings. In our opinion, the period lost during the pendency of the writ proceedings is liable to be excluded from computing the period of limitation under Section 14(2) of the Limitation Act. (Paras 14 and 15)
       (iii) Indian Railways Act, 1890-Section 78B-Suit for recovery of money charged as excess by denying benefit of telescopic system of rates-Tribunal held that in devising the freight rates Railway Administration had contravened provisions of Section 28 of the Act-It was not a case of "overcharging"-Present case was a case of illegal recovery of freight on account of being unreasonable-Case did not attract applicability of Section 78B of the Act.
       Held : The term overcharge is not defined in the Act. In its dictionary meaning "overcharge" means "a charge of a sum more than as permitted by law" [see, The Law Lexicon, P. Ramanatha Aiyar, 1997 Edition, Page 1389]. The term came up for the consideration of the High Court of Gujarat in M/s Shah Raichand Amulakh (D) by his heir Vs. Union of India & Ors. 1971 (12) GLR 93. Chief Justice P.N. Bhagwati (as His Lordship then was) interpreted the term by holding that "Overcharge" is not a term of art. It is an ordinary word of the English language which according to its plain natural sense means any charge in excess of that prescribed or permitted by law. To be an overcharge, a sum of money must partake of the same character as the charge itself or must be of the same genus or class as a charge it cannot be any other kind of money such as money recovered where nothing is due. Overcharge is simply a charge in excess of that which is due according to law. In the case at hand, the freight rates notified by the Railway Administration in exercise of its statutory power to do so, so long as they were not declared illegal and unreasonable by the Tribunal under Section 41 of the Act, were legal and any one carrying the goods by rail was liable to pay the freight in accordance with those rates. The freight paid by the respondents was as per the rates notified. Thus the present one is not a case of overcharge at all. It is a case of illegal recovery of freight on account of being unreasonable and in violation of Section 28 of the Act, consequent upon such determination by the Tribunal and the decision of the Tribunal having been upheld by this Court. A case of illegal charge is distinguishable from the case of overcharge and does not attract the applicability of Section 78B of the Railways Act. (Paras 19 and 20)

JUDGMENT

Lahoti, J.-The two appeals which are being disposed of by this common judgment have a chequered history of litigation. The West Coast Paper Mills Limited, Dandeli and Dandeli Ferro Alloys Limited, Dandeli, the two plaintiffs arrayed as respondents in the two appeals (and which would include their predecessors) have their mills situated at Dandeli in the State of Karnataka. They were required to transport their goods between Alnavar and Dandeli by railways. They were being charged at a flat rate from Alnavar to Dandeli irrespective of the commodity carried and they were not given the benefit of telescopic system of rates which was allowed by the Railways to others and in respect of other goods. The effect of the benefit of telescopic system of rates being denied to the respondents was that they had to pay freight on certain goods at three times compared to what would have been payable in case the benefit of telescopic system of rates was allowed to them.

2. On 24th June, 1963, West Coast Paper Mills Limited filed a complaint (registered as Complaint No. 4/1963) against the Railway Administration complaining of illegality on account of contravention of the provisions of Section 28 of the Indian Railways Act, 1890 (hereinafter referred to as "the Act") and of unreasonability on the part of the Railway Administration in charging the freight at the impugned rates. The period for which the complaint related was 26th April, 1963 to 1st October, 1966 (both dates inclusive and inclusive of the period introduced into the complaint by way of amendment). By order dated 18th April, 1966, the Tribunal held that in devising the freight rates the Railway Administration had contravened the provisions of Section 28 of the Act and the complaint i.e. the respondent West Coast was treated with discrimination and unreasonableness. In spite of holding so, the Tribunal did not direct the amount of freight illegally and unreasonably collected by the Railway Administration, to be refunded in view of the holding of this Court in Upper Doab Sugar Mills Ltd. Vs. Shahdara (Delhi) Saharanpur Light Railway Company Ltd. [1963] 2 SCR 333 wherein this Court has taken the view that the Tribunal is competent only to grant declaratory relief and there is no provision which authorities the Tribunal to grant the consequential relief also.

3. The Union of India preferred an appeal by special leave to this Court laying challenge to the decision of the Tribunal dated 18th April, 1966 under Article 136 of the Constitution of India. By judgment dated 14th October, 1970 [reported as Union of India Vs. West Coast Paper Mills Limited, (1970) 3 SCC 606], the appeal preferred by the Union of India was dismissed and the decision of the Tribunal was affirmed. During the course of its judgment, this Court also recorded a finding that the freight charges levied by the Railway Administration were in contravention of Section 28 of the Act and were unreasonable.

4. Another complaint under Section 41 of the Act (registered as Complaint No. 4/1966) came to be filed before the Railway Rates Tribunal by the West Coast Paper Mills Limited and this related to the period 2nd October, 1966 to 14th August, 1972 and included certain commodities which were not the subject matter of Complaint No. 4/1963. This complaint came to be decided on 12th November, 1972. By that time, the decision of this Court dated 14th October, 1970 was available which was followed by the Tribunal and the complaint was allowed granting a declaration sought for by the complainant.

5. A similar complaint was filed by Dandeli Ferro Alloys Limited registered as Complaint No. 2/1967 which too came to be decided on 12th November, 1972 following the decision of this Court as abovesaid and granting the declaration sought for by the complainant therein. Thus the three decisions by the Tribunal in the three complaints holding the freight rates applied by the Railway Administration to be illegal and unreasonable achieved a f

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2004 Supreme(SC) 244

IMPORTANT POINTFreight rates notified by Railway Administration and charged from a customer when was held violative of Section 28 of the Indian Railways Act it would not be a case of over-charging to attract provisions of Section 78B of the Act in a suit for recovery of the amount.

Cases Referred (6)

IMPORTANT POINT
Freight rates notified by Railway Administration and charged from a customer when was held violative of Section 28 of the Indian Railways Act it would not be a case of over-charging to attract provisions of Section 78B of the Act in a suit for recovery of the amount.