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Union Of India v. Hindustan Petroleum Corporation Ltd.
Judgment Summary — F.A.O. 209/2003 (R.S. Sodhi, J.)
Factual and Procedural Background
This matter includes an application for early hearing (CM. 13381/2004) which was allowed and the case was taken up for hearing. The appeal (F.A.O. 209/2003) challenges the Railway Claims Tribunal's judgment dated 11 November 2002 directing the Railways to pay Rs. 4,99,056 with interest at 9% per annum from the date of filing the application until realisation.
According to the Tribunal's recital of facts, on 30 November 1996 seven tank wagons were booked (Railway Receipt No. C-783277) from Bajva-GP Siding, Koyali to Shakurbasti. The dispute concerned wagon No. WR-916553. The applicant alleged the wagon was loaded with 66,760 litres of motor spirit at origin and, on receipt at Shakurbasti on 3 December 1996, a receiving dip was 161 cms (equated to 41,150 litres), resulting in a shortage of 25,610 litres. The applicant alleged the wagon lacked top and bottom seals at placement and was leaking from the bottom flange, and claimed Rs. 4,99,056 at the DGS&D rate.
The respondent (Railways) denied liability, raised a preliminary objection that the application was not signed/verified by a duly authorised person, and pleaded protection under sections 93/97/98 of the Railways Act, 1989. The respondent also alleged loading and sealing were not supervised by railway staff and suggested leakage could be due to the applicant's employees, though it did not specifically deny that leakage occurred.
The Tribunal framed five issues for decision: (1) whether the application was filed by a duly authorised person; (2) whether there had been short supply of motor spirit; (3) whether a valid notice under section 106 of the Railways Act was served; (4) to what amount the applicant was entitled; and (5) relief.
Legal Issues Presented
- Whether the application has been filed by a duly authorised and competent person.
- Whether there has been short supply of Motor Spirit (Petrol) booked with the respondent railway administration.
- Whether a valid notice under section 106 of the Railways Act was served upon the respondent.
- To what amount, if any, the applicant is entitled to as compensation.
- Relief.
Arguments of the Parties
Appellant's Arguments
- Counsel for the appellant submitted that the Railways are protected under sections 93 and 94 of the Railways Act, arguing it was the duty of the respondent to ensure the consignment entrusted to the Railways was properly secured and that the Railways must prove damage was caused during transit.
- The appellant contended that the question whether the consignment was properly secured at the time of placement is one of fact (implying reliance on factual findings to attract statutory protection).
Respondent's Arguments
- The respondent (Railways) denied responsibility for the alleged shortage and raised preliminary objections that the claim application was not signed, verified, or filed by a duly authorised person.
- The respondent sought protection under sections 93, 97 and 98 of the Railways Act, 1989.
- The respondent alleged that loading and sealing of the wagon were not supervised by railway staff and that any leakage may have been due to fault or negligence of the applicant's employees.
- On other averments, the respondent maintained the consignment was in good condition; it did not specifically controvert that there was leakage to the wagon.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Supreme Court in O.N.G.C case | Directed setting up of a Committee of Secretaries to resolve disputes inter se Public Sector Undertakings and the Government of India. | The court noted that orders were made on 12 March 2004 to resolve the present matter in accordance with that Supreme Court direction; the court observed that those orders had not been implemented and that the failure had unnecessarily consumed judicial time. |
Court's Reasoning and Analysis
The court reviewed the Tribunal's factual findings and legal assessment. The Tribunal had examined evidentiary material and concluded there was no evidence enabling the Railways to claim protection under section 93 of the Railways Act by asserting that consignments were not properly sealed or were handed over in a defective condition. Rather, the Tribunal found positive evidence that seals had been checked when the container entered the yard and that railway staff had examined the wagon for leakage.
Given the Tribunal's factual findings that seals were checked and the wagon was examined by railway staff, the court reasoned that the Railways could not invoke statutory protection under section 93. The appellate court found no infirmity in the Tribunal's judgment applying that legal principle to the established facts. The court also observed (by reference to the Supreme Court's O.N.G.C. direction) that administrative mechanisms for inter-governmental dispute resolution had not been utilized as ordered, which had led to unnecessary use of judicial time.
Holding and Implications
APPEAL DISMISSED.
Direct effect: The Tribunal's judgment directing payment by the Railways of Rs. 4,99,056 with interest at 9% per annum from the date of filing the application until realisation remains in force.
Broader implications: The opinion does not announce any new legal precedent. It endorses the Tribunal's factual finding that seals were checked and that, on those facts, the Railways could not claim protection under section 93 of the Railways Act. The court also noted administrative orders (per the Supreme Court's O.N.G.C. direction) meant to promote executive resolution of PSU-government disputes had not been implemented in this case.
CM. 13381/2004:
R.S Sodhi, J.:— This is an application for early hearing. The same is allowed and disposed of. The matter is taken up for hearing today.
F.A.O 209/2003:
2. This appeal is directed against the judgment dated 11th November, 2002 of the Railway Claims Tribunal, (Principal Bench) Delhi (for short “the Tribunal”), whereby the learned Tribunal has directed the Railways to pay a sum of Rs. 4,99,056/- together with interest @ 9% per annum from the date of filing the application till realisation.
3. The brief facts of this case, as has been noted by the Tribunal, are as under:
“This claim for compensation by the applicant company for an amount of Rs. 4,99,056/- is based on allegations that the respondent railways delivered a consignment of Motor Spirit (Petrol) short by 25610 ltrs.
2. The applicant company on 30.11.1996 had booked 7 tank wagons vide Railway Receipt No. C-783277 Ex. Bajva-GP Siding, Koyali to Shakurbasti. The dispute relates to wagon No. WR-916553.
3. The applicant has averred that the said tank wagon was loaded with 66760 ltrs. of Motor Spirit (Petrol) having dip measurement by volume at 255.5 Cms at the destination. The said tank wagon was received at the siding of the applicant at Shakurbasti at 13.00 hrs. on 3.12.1996 A receiving dip measurement was conducted which was found to be 161 cms. amounting to 41150 ltrs. and thus there was shortage of 25610 ltrs. The wagon did not have top and bottom seals at the time of placement and it was leaking from bottom flange. The applicant therefore preferred claim for Rs. 4,99,056/- at the D.G.S & D. rate of Rs. 19,486.76 per KL. but the respondent repudiated the same on the grounds that there was no delay in transit and that seals were not provided at the forwarding station. Hence, this application.
4. The case of the respondent is total denial of the responsibility for the shortage as alleged by the applicant. The respondent, by way of preliminary objection stated that the application is not signed, verified and filed by a duly authorised person and sought protection under sections 93/97/98 of the Railways Act, 1989 (for short the ‘Act’). It is further alleged that the loading and sealing of the wagon was not supervised by the railway staff and therefore if there was any leakage it was due to the fault and negligence on the part of the employees of the applicant. This defence is further repeated on merits in reply to other averments of the applicant. In reply to paras 7(b) and (c) of the claim application pertaining to the dip measurement at the receiving station and condition of the wagon, the respondent merely repeated that the consignment was in good condition and that the loading and sealing was not supervised by its staff. However, it was not specifically controverted that there was any leakage to the wagon.
5. Based on these pleadings, following issues have been settled and our findings thereon are recorded as follows—
1. Whether the application has been filed by a duly authorised and competent person?
2. Whether there has been short supply of Motor Spirit (Petrol) booked with the respondent railway administration?
3. Whether a valid notice under section 106 of the Railways Act was served upon the respondent?
4. To what amount, if any, the applicant is entitled to as compensation?
5. Relief.”
6. Counsel for the appellant submits that the Railways are protected under sections 93 and 94 of the Railways Act inasmuch it was the duty of the respondent to ensure that the consignment entrusted to the Railways was properly secured and to prove that damage was caused during transit. The question whether the consignment was properly secured at the time of placement with the Railways is one of fact. The Tribunal finds that there is no evidence on record to show that the Railways can claim protection under section 93 by insinuating that the consignments were not properly sealed and/or handed over in defective condition. On the contrary, there is positive evidence on record to show that the seals were checked when the container moved into the yard as also was examined by the Railway staff for any leakage of wagon.
7. In that event of the matter, the Railways can hardly claim protection under section 93 of the Railways Act. I find no infirmity in the judgment under challenge.
8. I may point out that the Supreme Court in O.N.G.C case has directed the setting up of a Committee of Secretaries to resolve disputes inter se Public Sector Undertakings and the Government of India. In the present case, orders had been made on 12th March, 2004, to resolve the matter in accordance with the aforesaid judgment of the Supreme Court, which obviously has not been done and has unnecessarily taken up judicial time.
9. As discussed above, I find no merit in the appeal. F.A.O 209/2003 is dismissed.
10. Appeal Dismissed.
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