JUDGMENT AND ORDER :

Hrishikesh Roy, J.

Heard Mr. A. Goyal, the learned Counsel representing the petitioner. Also heard Mr. M.K. Choudhury, the learned Senior Counsel appearing for the Railways Authorities.

THE ISSUE

2. The Railway is empowered to penalize consignors when excess load is detected, through re-weighment of the loaded railway wagons and the question to be answered by the Full Bench is, whether a show cause notice/opportunity, should be provided to the consignor, before punitive charge is levied, for the excess load.

3. The matter is placed before the Full Bench, on account of the divergent views taken by this Court in Union of India vs. M/s. Salt Marketing Centre, reported in 1993 (3) GLT 548, where the Division Bench opined that the principles of natural justice must be followed for penalizing a consignor whereas, the counter opinion is expressed in the Union of India vs. M/s. Murali Manahar Enterprises, reported in 1997 (2) GLT 257, where it is held that, parties to the contract in commercial transactions, cannot invoke the writ jurisdiction of the Court. It thus declared that the earlier decision in M/s. Salt Marketing Centre (Supra), was a per incurium decision.

PETITIONER’S ARGUMENTS

4.1. Mr. A. Goyal, the learned counsel for the appellant (writ petitioner) firstly submits that in the case of M/s. Salt Marketing Centre (Supra), there was no binding contract between the Railways and the consignor and thus the punitive charge for the excess load was being levied, under Section 73 of the Railways Act, 1989. On the other hand, the parties in M/s. Murali Manahar Enterprises (Supra), were bound by a contract to pay punitive charge for excess weight and therefore the situations in the two cases, are projected to be different. It is thus argued that the decision in M/s. Salt Marketing Centre (Supra) was rendered in the context of the facts of that case and that ratio may not have a direct application in the later decision in M/s. Murali Manahar Enterprises (Supra), since in the latter case, the parties are covered under contractual obligation.

4.2. The learned counsel submits that although power to levy punitive charge is conferred under Section 73 of the Railways Act, when the word “may” is used in the Section, it is a discretionary power to be exercised by the authority. Referring to the provisions of Railways (Punitive Charge for Overloading of Wagon) Rules, 2012 (hereinafter referred to as ‘the Punitive Charge Rules’), where the word “shall” is used, the Counsel argues that the Rule cannot override the Railways Act. It is therefore contended that the discretionary power must be exercised in the context of each situation with due opportunity, to the affected party.

4.3. The appellant submits that the consignor is made responsible for the accuracy of the particulars furnished by them in the forwarding note, during entrustment of goods to the Railways but there could be factors unrelated to the consignor, such as a faulty weighbridge or defective weighment etc. when the accuracy of the declared load in the forwarding note, may not match. The Counsel thus questions that where the consignor is not at fault, should they still be automatically penalized.

4.4. Mr. Goyal argues that penalizing a party is a quasi-criminal process and in the event of a bona fide mistake, the consignor should not be subjected to punitive charge, by interpreting the powers under Section 73 of the Railways Act, to be mandatory. The counsel therefore argues that penal provision must not be applied blindly, as the power has to be applied with due discretion, in appropriate situations.

RAILWAYS ARGUMENTS

5.1. On the other hand, Mr. M.K. Choudhury, the learned senior counsel for the respondent/Railways submits that the dishonest intent or delinquency of the consignor, is not a relevant factor for levying punitive charge for overloaded wagons, as the objective of the levy is to prevent damage to wagons and the rail tracks and accordingly the counsel submits th

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