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2008 Supreme(Mad) 4753
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE R. SUDHAKAR
Seshasayee Paper and Boards Limited
Versus
The Union of India owning Indian Railways, represented by Secretary, Ministry of Railways & Another
C.M.A.Nos.176 to 179, 235 to 238 and 388 to 392 of 2000
Decided on: 23-12-2008
For the Petitioner:Aiyar, Dolia, Advocates.
For the Respondents:V.G. Suresh Kumar, Advocate.
The Railway Authorities are obligated to transport goods by the shortest and cheapest route as per General Order No.1 of 1990 and Rule 125(1)(e) of the Goods Tariff Par-I, Vol.I, and must strictly comply with the prescribed procedures.
Headnote:
Railway Authorities - Refund of Excess Freight - General Order No.1 of 1990, Rule 125(1)(e) of the Goods Tariff Par-I, Vol.I - The court discussed the Railway Authorities' obligation to transport goods by the shortest and cheapest route, the requirement for specific instructions on the Forwarding Note in case of closure of the shortest route, and the Railway Authorities' duty to strictly comply with the rules. The court found that the Railway Authorities did not follow the prescribed procedure and were bound to refund the excess freight paid by the appellant.
Fact of the Case:
The appellant, a paper manufacturing company, filed claims for refund of excess freight paid for the transportation of coal from N.L.C. Railway siding to the appellant SPB Railway siding. The claims were based on the Railway Authorities' failure to transport the goods through the shortest and rationalized routes as per General Order No.1 of 1990.
Finding of the Court:
The court found that the Railway Authorities did not follow the prescribed procedure and were bound to refund the excess freight paid by the appellant.
Issues: The issues revolved around the Railway Authorities' obligation to transport goods by the shortest and cheapest route, the requirement for specific instructions on the Forwarding Note in case of closure of the shortest route, and the Railway Authorities' duty to strictly comply with the rules.
Ratio Decidendi: The court held that the Railway Authorities were obligated to transport goods by the shortest and cheapest route as per General Order No.1 of 1990 and Rule 125(1)(e) of the Goods Tariff Par-I, Vol.I. The failure to follow the prescribed procedure mandated the refund of the excess freight paid by the appellant.
Final Decision: The court allowed the appeals in part, granting the appellant refund of excess freight amount paid and interest from the date of the claim petition, while denying pre-suit interest. The respondent railway was permitted to deposit the decree amount with interest as specified, and both parties were directed to bear their own costs.
COMMON JUDGMENT
1. These thirteen appeals have been filed by M/s. Seshasayee Paper and Boards Limited, Pallipalayam, Erode against the following thirteen different orders, dismissing the appeals by the Railway Claims Tribunal, Chennai Bench.:-
.(1) O.R.95 00011 dated 8. 1999 (OR 95 00011 dated 14. 1998) (C.M.A.No.176 of 2000);
.(2) O.R.95 00012 dated 8. 1999 (OR 95 00012 dated 14. 1998) (C.M.A.No.177 of 2000);
.(3) O.R.95 00013 dated 8. 1999(OR 95 00013 dated 14. 1998) (C.M.A.No.178 of 2000),
.(4) O.R.95 00014 dated 8. 1999 (O.R.95 00014 dated 14. 1998) (C.M.A.No.179 of 2000);
.(5) O.R.95 00005 dated 8. 1999 (O.A.III/5/95 dated 14. 1998) (C.M.A.No.235 of 2000);
.(6) O.R.95 00009 dated 8. 1999 (O.R.95 0009 dated 14. 1998) (C.M.A.No.236 of 2000);
.(7) O.R.95 00010 dated 8. 1999 (O.R.95 00010 dated 14. 1998) (C.M.A.No.237 of 2000);
.(8) O.R.95 000016 dated 8. 1999(O.R.95 00016 dated 14. 1998), (C.M.A.No.238 of 2000);
.(9) O.R.95 00004 dated 8. 1999 (OA III/4/95 dated 14. 1998) (C.M.A.No.388 of 2000);
.(10) O.R.95 00006 dated 8. 1999 (OR 95 00006 dated 14. 1998), (C.M.A.No.389 of 2000);
.(11) .R.95 00007 dated 8. 1999 (OA III/7/95 dated 14. 1998), (C.M.A.No.390 of 2000);
.(12) O.R.95 00008 dated 8. 1999 (OR 95 0008 dated 14. 1998) (C.M.A.No.391 of 2000) and
.(13) O.R.95 00015 dated 8. 1999 (OR 95 00015 dated 14. 1998), (C.M.A.No.392 of 2000).
2. The appellant in all the appeals is a limited company engaged in manufacture of paper for which they purchase coal from the Neyveli Lignite Corporation hereinafter called "N.L.C.". The goods are transported from N.L.C. Railway siding to the appellant SPB Railway siding, by rail. In the present case, 49 wagons of lignite were booked as a Train Load at Train Load Rate from N.L.C. Railway siding to the appellant SPB Railway siding under various invoice. The appellant filed claims for refund of excess freight together with interest at 12% from the date of booking by way of 13 claims as follows:-
Table The claims were filed on the premise that the goods, viz., lignite should have been carried from N.L.C. Railway siding to the appellant SPB Railway siding through the shortest and rationalised routes in terms of General Order No.1 of 1990 which comes into effect from 6. 1990. The General provisions in particular para 6.9 to the General Order No.1 of 1990, which is relevant to this case, reads as follows:-
"WHEREAS in the opinion of the Central Government it is necessary in the public interest so to do:
Now, therefore, in exercise of the powers conferred by Clause 1(b) of Section 27-A of the Indian Railways Act, 1890 (IX of 1890), the Central Government hereby directs that all Railway Administrations shall carry, unless it is necessary to divert such wagons for operational convenience after the consignments have been booked any goods or class of goods by such route or routes as specified in this order.
1. GENERAL PROVISIONS.
Table
The respondents are bound to follow the above said G.O.No.1/1990 and if there is any change they are bound to follow the procedure prescribed under the Rules.
3. As far as rate is concerned, para 10 of General Order No.1 of 1990 states that the rates will be charged to those chargeable by the route specified above. According to the appellant, the consignments in these cases were booked for transport from N.L.C. Railway siding yard to the appellant SPB Railway siding. The consignments in all these cases were transported between two places stated above via Tiruchirappalli goods yard whereas in terms of General Order No.1 of 1990, they should have been transported via Salem market which is the shortest route in terms of G.O.No.1/1990. The cost per metric tonne for the routes and the excess paid by appellant is as follows:-
Table Stating that a sum of Rs.28.60 per Metric Tonne were paid in excess for all the consignments, transported through the longer route, appellant issued statutory notice for refund was issued and since it was not accepted, Appl
