Parvathnam Muthu vs Union of India (UOI)

Balasubrahmanyan, J.—The point which arises in this revision concerns the interpretation of Section 78-B of the Indian Railways Act.

The matter arises this way: The Petitioner was the consignee of a consignment of timber legs which was carried by the Southern Railway from

Punalur to Coimbatore. The logs arrived in Coimbatore on 13th November, 1973. But there was a delay in the consigned unloading the logs from

the wagons. The Railway calculated the delay as 73 hours. On that basis, the Railway demanded from the consignee Rs. 835.20 P. as demurrage

and Rs. 102.30 P. as wharf age, aggregating to Rs. 937.50 P. The consignee paid the amount under protest. She then sent a notice of claim to the

Railway administration on 31st July, 1976 claiming a refund of the amount paid, on the score that the delay in unloading must be attributed entirely

to the Railway administration in not placing the wagons in a position for unloading. Since there was no compliance with the terms of the notice of

claim, the consignee filed a small cause suit for the amount in the Sub-Court, Coimbatore. The Railway entered appearance and resisted the suit.

One of the defenses put forward by the Railway was that the suit had not been preceded by a valid notice issued by the consignee u/s 78-B of the

Indian Railways Act, within the permitted time-limit of six months from the date of delivery of the consignment. The Sub Court went into the merits

of the consignee''s claim and found that she was bound to pay demurrage charges for a duration of 14� hours as against 73 hours determined by

the Railway. The Sub-Court further held that the consignee was liable to pay the entire wharf age amounting to Rs. 102-30. On the issue as to the

maintain ability of the suit, which arose on the plea of the Railway that the suit notice was not within the time prescribed u/s 78-B, the Sub-Court

and that the notice was issued beyond six months from the date of delivery of the goods. On this ground of want of proper statutory notice within

the prescribed time, the Sub-Court dismissed the suit.

This revision has been filed by the consignee against the dismissal of the suit. Learned Counsel for the consignee submitted that the Court below

was wrong in proceeding on the footing that Section 78-B applied to the claim for refund put forward by the consignee against the Railway in this

case.

The Petitioner''s contention calls for an examination as to what the scope is of Section 78-B, and whether the consignee, in this case, was bound

to send a notice under this provision as a pre-requisite for filing the suit. Section 78-B is couched in a negative form. It provides that a person shall

not be entitled to a refund of overcharge in respect of goods carried by a railway unless his claim to refund has been preferred in writing within six

months from the date of delivery of the goods carried by the railway. The point urged by learned Counsel for the Petitioner is that a claim for

refund of excess demurrage or wharfage cannot be brought within the mischief of the expression refund of an overcharge in respect of goods

carried by a railway. The suggestion is that demurrage and wharf age are terminal charges, and not charges for carriage of the goods. The further

contention is that the suit claim in this case did not retrain to rates of charge, so as to come within the meaning of the statutory expression

overcharge. An overcharge, according to learned Counsel, has reference only of the rates aspect of the charge and not to the amount of liability

itself, as ultimately quantified. The consignee it was urged, did not question the rates as excessive, but questioned the overall liability alone as not

chargeable.

I do not accept these contentions as tenable on the question of construction and application of Section 78-B. This section had been put into the

statute book, obviously with a view to avoid litigation, if it could be avoided, between owners of the goods which are carried by the rail roads and

the Railways which undertake the carriage of such goods. It was apparently expected that the claims of owners for refund or compensation for loss

might get settled this side of the law Courts if the Railways had a chance of knowing the basis of such claims. No wonder, then, that the Legislature

has used fairly wide language in enacting the provision. This is indicated by such words in the section as in respect of Phrases like in respect of, in

relation to and with respect to are words of the widest import, and has been held as such by Courts. Parliamentary draftsmen employ these

expressions in Constitutional provisions as well as in municipal statutes whenever they intend thereby to cover a fairly wide field. The legislative

coverage in enacting Section 78-B) of the Railways Act on the subject of overcharge must necessarily be held to be wide, because the section

speaks of overcharge in respect of goods carried by the Railway. The Railway charges for carriage of goods, and might, on occasion overcharge

the levy for such carriage. The Railway also does incidental things to goods carried. Like allowing them to be left or kept in the goods shed. For

these other services also the Railway charges, and, on occasion, it may overcharge. The expression over charge in respect of goods carried by the

Railway can, therefore, be regarded as comprehending excess charges of all kinds levied by the Railway in relation to the goods carried. The

words of the section are not overcharge for the carriage of the goods, but overcharge in respect of goods carried. The only nexus required under

the section is that the goods in respect of which overcharge is alleged must be goods carried by the railway. That at once excluded goods not

carried by the railway. But that is all that it excludes.

It is clear from this construction of the section that excess wharf age and excess demurrage collected by the Railway must be classed as

overcharges in respect of the goods carried by the Railway even though they are not charges levied for actual carriage of goods, over the rail-

tracks, but only terminal levies.

I reject the other contention of the Petitioner''s learned Counsel on the construction of the section, which is to the effect that overcharge only

connotes an excess in the application of the rates of charge and it cannot relate to an excessive imposition of liability as a matter of overall quantum.

The expressions charge as well as overcharge in my view, are properly employed only with reference to the actual quantum of liability, and they

cannot be applied to relate to the rates of charge. For the rate structure is only a measuring red for the charge and cannot itself be the charge. The

question to be asked u/s 78-B is whether the claim against the Railway is for an overcharge. The answer will be in the affirmative in two situations.

There will be an overcharge, if the railway applies a higher rate than is appropriate. There can also be an overcharge, where even at a rate which

itself is not open to objection, there is yet an excessive liability foisted by the Railway. It is not proper to restrict the expression overcharge only to

the former kind of case where the Railway applies a higher rate than which the law allows.

In this case there was no dispute between the parties as to the rate of wharf age or the rate of demurrage. The real controversy in the suit, on the

merits, was as to the precise amount of demurrage and wharf ages. What was involved was thus the application of undisputed rates of demurrage

and wharf age to the period during which the railway yard was occupied by the consignee''s goods, that is to say the period in excess of the free

time allowed to the consignee within which to clear the goods. In other words, the dispute was as to what precisely was the period of delay, on the

consignee''s part, to clear the goods. The decision of the Court below was that the delay was 14� hours as against 73 hours asserted by the

Railway on the basis of which the demurrage has already been collected from the consignee. This was therefore a typical case of an overcharge of

demurrage, in the sense that the Railway had overcharged the consignee by taking the period of delay as 73 hours when they ought properly to

have charged on the basis of 14� hours. Section 78-B, therefore, clearly applies to this case. It follows that the consignee should have complied

with the period of time prescribed in the section while sending the Railway a suit notice for claiming the refund.

The matter of construction of the section which has arisens in this case is not res integra. There are two reported decision of the Gujarat High

Court which has taken a view of Section 78-B similar to the one I have arrived at as to the meaning of overcharge. See M/s. Shah Raichand

Amalakh v. Union of India (1971) 12 Guj. L.R. 93 and Union of India Vs. Mansukhlal Jethalal, In the earlier case Section 78-B had come in for

elaborate discussion at the hands of Bagawathi, C.J. (as he then was). He expressed the view that overcharge would include demurrage and wharf

age as well, apart from excessive charges for carriage of goods. He observed that the charges for demurrage and wharf age are not entirely

unrelated to the business of the railways as a carrier. The learned Judge further observed that overcharge is not a term of art, and in its plain natural

sense, the expression refers to any charge in excess of that which is due according to law.

The result of the above discussion is that there is every justification for the dismissal of the suit by the Court below on the score that the

Petitioner ought to have sent a notice to the Railway u/s 78-B for the suit claim within six months from the date of delivery, and since she sent a

notice beyond the time-limit under that section, the suit was incompetent. The civil revision petition is accordingly dismissed. There will, however

be no order as to costs.