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Judgment
K.S. Jhaveri, J.—By way of this petition, under Article 226 of the Constitution of India, the petitioner has prayed for the following reliefs;
[A] This Hon''ble Court be pleased to issue a writ of certiorari or any other appropriate writ, order or direction quashing and setting aside the alleged notification dated 01.10.2004 issued by the Chief Commercial Manager-CCG in so far as it gives effect to the letter dated 28.04.1999 prospectively from 01.10.2004 instead of 01.06.1999 and be further pleased to quash and set aside the demand notices dated 14.10.2004, 22.11.2004, 23.11.2004 and 04.01.2005 issued by the respondent No. 2.
[B] This Hon''ble Court be pleased to hold and declare that the respondent No. 1 _ Board, having issued directions to charge freight on the basis of actual pattern of movement and not with reference to serving station concept with effect from 01.06.1999, it is not open for the Zonal Railways to defy these instructions and to give effect to the same prospectively.
[C] Pending admission, hearing and final disposal of this petition, this Hon''ble Court may be pleased to restrain the respondent No. 2 and Zonal Railways from calculating chargeable distance for rake load traffic taking reference to serving station concept and be further pleased to stay the operation, implementation and execution of the demand notices issued by the respondent No. 2.
[D] &&&..
[E] &&&..
The petitioner herein is a multi-state Co-operative Society registered under the Multi-state Co-operative Societies Act, 1984 [hereinafter referred to as "the said Act" for short] having its registered Office at New Delhi and one of its units at Kalol, District Gandhinagar. One of the functions of the petitioner-society includes the dispatch of fertilizers from its unit at Kalol to various parts of the country through the Railways.
2.1 On 28.04.1999 the Railway Board, respondent No. 1 herein, issued a communication resolving that the calculation of chargeable distance for rake load traffic from the sidings to the take-off point or vice-versa should be on the basis of the actual pattern of movement and not with reference to the serving station concept, which was to be implemented w.e.f. 01.06.1999. In pursuance of the above direction issued by the Railway Board, the petitioner booked its rake and paid the freight accordingly. The said arrangement continued from 31.07.1999 to 30.12.2002.
2.3 However, after 31.12.2002 and up to 30.09.2004, respondent No. 2 charged freight on the basis of the serving station concept and not the take-off point concept. Not only that the respondent No. 2 also initiated proceedings for recovery on the ground that the freight was required to be calculated not on the basis of actual pattern of movement but, on the basis of serving station concept. The petitioner-society raised its objections to the aforesaid arrangement and has also approached the competent authority for getting refund of the excess freight levied by the Railways.
2.4 The petitioner-society was served with a demand Notice dated 14.10.2004, issued by the Office of respondent No. 2, calling upon the petitioner to make payment of the difference so calculated. In the said communication, reliance was placed on a letter dated 01.10.2004 issued by the competent authority of the Railways, whereby, it was decided that for the traffic from Khodiyar side, the chargeable distance will be from Khodiyar to Buffer end of IFFCO siding, with immediate effect.
2.5 In furtherance of the demand Notice dated 14.10.2004, two different communications dated 22.11.2004 and 23.11.2004 respectively were issued calling upon the petitioner-society to make the payment, which was followed by another communication dated 04.01.2005. The petitioner, vide reply dated 20.01.2005, informed the Office of respondent No. 2 that it had paid the freight charges on the basis of the actual pattern of movement, as resolved by the Railway Board vide its communication dated 28.04.1999 and therefore, it was not required to make any further payment. However, being aggrieved by the above action of the respondents, the petitioner-society has preferred the present petition.
Mr. Manish R. Bhatt, learned Sr. Advocate appearing with Mrs. M.M. Bhatt for the petitioner-society, has submitted that respondent No. 1, vide its communication dated 28.04.1999, had issued directions to all the Railway Zones to calculate chargeable distance on the basis of the actual pattern of movement from siding to take-off point and not on the basis of the serving station concept. The said arrangement came into force w.e.f. 01.06.1999 and therefore, it is not open for respondent No. 2 to raise demand for the period in question on the ground that a formal circular to that effect had not been issued by the concerned Zonal Railway. Therefore, the impugned action of respondent No. 2 deserves to be quashed and set aside.
Learned Counsel appearing on behalf of the respondents has justified the action of respondent No. 2 by submitting that before the distance was notified in connection with the impugned communication dated 28.04.1999, the petitioner had started to pay freight on the basis of the actual pattern of movement, without reference to the serving station concerned. To resolve the said issue, the petitioner had also given an undertaking in writing dated 31.07.1999. Therefore, the petitioner was very much aware of the fact that it was not paying the actual chargeable freight. Hence, the respondent No. 2 authority was completely justified in issuing the impugned demand Notice.
Heard learned Counsel for the respective parties and perused the documents on record. The respondent No. 1-Railway Board, vide its communication dated 28.04.1999, issued directs to all concerned that chargeable distance for rake load traffic from the sidings to the take-off point & vice-versa should be on the basis of actual pattern of movement and not on the basis of the serving station concept. It was further directed that the revised actual distance, based on the above methodology, was to be notified in the Local Distance Tables for the correct charging of freight.
The aforesaid communication has been issued by respondent No. 1-Railway Board in exercise of powers u/s 71(1) of the Railways Act, 1989. The said proviso empowers the Central Government to direct any railway administration to carry any goods or class of goods by such route or routes at such rates, as may be specified, by general or special order. The said communication dated 28.04.1999 has been issued by respondent No. 1-Railway Board in exercise of the powers u/s 71 of the said Act. Section 71(3) of the said Act mandates that every railway administration shall be bound to comply with any order passed under Sub-section (1) of Section 71 of the said Act. Therefore, it is incumbent upon every railway administration to comply with any order/s passed u/s 71(1) of the said Act. As stated herein above, the communication dated 28.04.1999 has been issued by respondent No. 1-Railway Board in exercise of the powers u/s 71(1) of the said Act. Therefore, respondent No. 2-railway administration was duty bound to comply with the directions issued vide the said communication. However, admittedly, it has not complied with the said order issued by respondent No. 1-Railway Board.
To justify the above lacunae, respondent No. 2-railway administration has taken shelter of the fact that the petitioner-society had undertaken to solve any disputes / debits that may arise at a later stage in view of the impugned communication, by placing reliance upon the communication of the petitioner dated 31.07.1999. It is the say of respondent No. 2 that before the distance was notified in pursuance of the impugned communication, the petitioner had started paying freight on the basis of actual pattern of movement, without reference to the serving station concerned. In the impugned communication dated 28.04.1999, issued by respondent No. 1-Railway Board, it has been categorically stated that in all cases where the revised distance for charge has not been notified so far, the same shall be implemented w.e.f. 01.06.1999. In connection with the aforesaid direction, respondent No. 2 issued the Notification on 05.10.2004, i.e. after a period of more than five years. Until that date, respondent No. 2 had not taken any steps to ensure that directs issued by the Railway Board, vide its communication dated 28.04.1999, were implemented in letter and spirit.
It is pertinent to note that so far as the issue regarding chargeable distance is concerned, the same has already been worked out by respondent No. 2 under its Local Rate Advice 10 of 1997 and so far as the case of the petitioner-society was concerned, it was fixed at 7 (Seven) Kms. The petitioner-society had been paying the charges on the basis of the said chargeable distance since 31.07.1999 and it had continued to pay as such till 30.12.2002. It was only after the said period that respondent No. 2 had charged freight on the basis of serving station concept instead of take-off point concept.
In my opinion, respondent No. 2-railway administration could not put the burden of its own tardy and leisurely action on the shoulders of the petitioner-society. It would not be open to respondent No. 2 to run away from its untimely action by placing reliance on the so-called undertaking dated 31.07.1999 of the petitioner-society. The fact remains that for a long period of more than five years, respondent No. 2-railway administration had been callous by not taking appropriate action in pursuance of the impugned communication dated 28.04.1999 issued by its supervisory Board. Respondent No. 2 cannot put the blame for its own inaction on the petitioner-society who has been paying the freight charges regularly on the basis of the chargeable distance fixed by respondent No. 2 itself by the Local Rate Advice 10 of 1997. Looking to the totality of facts, I am of the opinion that the action of respondent No. 2 of issuing the demand Notice is unjust and improper. Hence, the same deserves to be quashed and set aside.
For the foregoing reasons, the petition is allowed. The impugned Notification dated 01.10.2004 and demand Notices dated 14.10.2004, 22.11.2004, 23.11.2004 and 04.01.2005 issued by respondent No. 2 are quashed and set aside. The petitioner-society shall make payment of freight charges on the basis of the communication dated 28.04.1999 issued by respondent No. 1-Railway Board. It is clarified that if the petitioner-society does not make payment on the basis of 7 (Seven) Kms chargeable distance, then it shall be open to respondent No. 2 to recover the deficient amount from the petitioner. The petition stands disposed of accordingly. Rule is made absolute.