The main legal point established in the judgment is the submission to the jurisdiction and authority of the Railway through the petitioners' appeal for waiver of demurrage charges and their payment of demurrage in the past, leading to the dismissal of the appeal.

Rakesh Tiwari, J.

1. Petitioner No. 1 is a Company incorporated under the Companies Act, 1956 having its office at Plot No. IND-5 Sector-I, East Calcutta Township, Kolkata-700 107. Petitioner No. 2 is Sr. Manager of petitioner No. 1 above named and also is the principal officer thereof.

2. Facts culled out from records are that petitions are manufacturers of Rectified Spirit in their distillery at Noorpur, village-Durgapur in the district of South 24 Parganas, having a capacity of production of 50000 litres per day. Rectified spirit is made from molasses under the supervision of Bengal Excise Department of the State Government. Its entire production is re-acquisitioned by the Government which also fixed its sale price. As margin allowed to the manufacture is very low, the petitioners transport molasses by railway rakes to make its business viable.

3. The State of West Bengal is “Molasses Deficit State” being a negligible producer of molasses. Therefore, the petitioners have to import molasses from ‘Molasses surplus State’ like Uttar Pradesh, Andhra Pradesh, Bihar, Maharashtra, Gujarat, Karnataka and Tamilnadu.

4. There is no railway track up to the factory of the writ petitioners at Noorpur. The Eastern Railway has provided a siding at Budge (BGP) for loading and unloading facility. The petitioner also has constructed a goods shed near Calcutta for storage from where the stored molasses is transported to the factory of the petitioner at Noorpur for manufacture of Rectified sprit. Since the capacity of siding at Budge (hereinafter referred to as BGB) is very limited one full rake consisting of about 75 wagons or even half a rake cannot be unloaded at the siding and only 17 wagons can be unloaded at a time. Therefore as per rules of Railway Board, freight on rake-load basis on goods with destination to BGB goods shed are not permitted by the Railways but charges higher freight on wagonload basis at the booking station.

5. Railway board published Rate Circular No. 74 providing for levy of demurrage on wagons as provided in (Para 2.1.2) and on rakes as per (Para 2.2.2) These are reproduced for ready reference:-

“2.1.2 The entire group of wagons placed for loading/unloading shall be treated as one until for the purpose of levy of demurrage charges i.e. even if one wagon our of the group is detained for loading/unloading beyond the prescribed free time, demurrage will be leviable on all the wagons in the group.

2.2.2. In case of goods sheds and railway sidings where the placement capacity is less than a rake, the free time will start with the placement of 1st part of the rake. However, intervening periods between the time of completion of loading/unloading of the 1st part and time of placement of 2nd part of the same rake for loading/unloading between the time of completion of loading/unloading of the 2nd part and placement of 3rd part of the same rake for loading/unloading and so on, should be treated as diesnon. Demurrage for excess detention will be levied on entire rake. Excess detention should be calculated by deducting the permissible free time and periods of dies-non from the period of total detention (i.e. period from the time of placement of 1st part to the release time of last wagon) of the rake.”

6. The petitioners are aggrieved by the demand of demurrage by the Railways on the goods of the petitioner booked to BGB on wagon basis have been levied demurrage on rake basis which is higher on delivery point. The petitioners deny that demurrage is at all payable by them for delay in unloading their goods as they are not responsible for it for the reason that as siding facility at BGB can accommodate only about 17(seventeen) wagons at a time. They are entitled to 5 times for unloading a rake.

7. After exchange of correspondence the petitioner aggrieved by the alleged illegal demand of the Railways preferred writ petition No. 479 of 2009 (IFB Agro Industries Limited and Anr. Vs. The Chief Commercial Manager (FM), Eastern Railwa