Dismissed

The Union of India v. M/S Concast Ferro Inc.

Karnataka HC19 Jul 2024MFA/475/2017

Case brief

AI extract

What is this about?

Appeal by South Western Railway against a Railway Claims Tribunal award compensating a consignor for 985 MT of undelivered iron ore after a train accident, including freight refund and salvage transport costs. The High Court found the award consistent with the evidence and dismissed the appeal, directing release of the deposited amount to the claimant.

What did the court decide?

Appeal dismissed; deposited award amount along with accrued interest ordered released to respondent No.1 after verification.

The Union of India Vs M/S Concast Ferro Inc. — Karnataka HC (2024) — LawSathi Research

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NC: 2024:KHC:28093-DB MFA No.475/2017

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 19^TH DAY OF JULY, 2024 PRESENT

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THE HON'BLE MRS. JUSTICE K.S.MUDAGAL

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AND

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THE HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL MISCELLANEOUS FIRST APPEAL NO.475/2017 (RCT)

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BETWEEN:

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THE UNION OF INDIA REPRESENTED BY

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GENERAL MANAGER

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SOUTH WESTERN RAILWAY HUBLI.

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Digitally signed by RUPA V Location: HIGH COURT OF KARNATAKA

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THE CHIEF COMMERCIAL MANAGER (CLAIMS) SOUTH WESTERN RAILWAY NO.18, MILLER SROAD BANGALORE.

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…APPELLANTS

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(BY SRI. TIMMANNA BHAT, CGC FOR APPELLANT NO.1 SRI. SATISH KUMAR N, ADV., FOR APPELLANT NO.2)

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AND:

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M/S. CONCAST FERRO INC. DUCSI (V), ADADALAVASA (M) SRIKAKULAM DISTRICT ANDRA PRADESH-532484.

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GENERAL MANAGER EAST COST RAILWAY 1ST FLOOR, BHUBANESHWAR ORRISA-751017.

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THE CHIEF COMMERCIAL MANAGER (CLAIMS) EAST COST RAILWAY 1ST FLOOR, BHUBANESHWAR ORRISA-751017.

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NC: 2024:KHC:28093-DB MFA No.475/2017

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GENERAL MANAGER SOUTH EASTERN RAILWAY NO.14, STRANDS ROAD KOLKATA-751017.

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THE CHIEF COMMERCIAL MANAGER (CLAIMS) SOUTH EASTERN RAILWAY NO.14, STRANDS ROAD KOLKATA-751017.

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…RESPONDENTS

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(BY SRI. S.M. CHANDRASHEKAR, SR. COUNSEL FOR SRI. P. PRASAD AND SRI. AJAY KUMAR, ADV., FOR R1 V/O DTD:26.06.2023 NOTICE TO R2 & R3 HELD SUFFICIENT V/O DTD: 19.01.2024 APPEAL AGAINST R4 & R5 STANDS DISMISSED)

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THIS MFA IS FILED U/S 23(1) OF RAILWAY CLAIMS TRIBUNAL ACT, AGAINST THE JUDGMENT AND AWARD DATED:19.02.2015 PASSED IN OA I/ SBC/2010/01 ON THE FILE OF THE RAILWAY CLAIMS TRIBUNAL, BANGALORE BENCH, BANGALORE, AWARDING COMPENSATION OF Rs.70,12,895/- WITH INTEREST @ 9% P.A.

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THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, VIJAYKUMAR A. PATIL J., DELIVERED THE FOLLOWING:

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JUDGMENT

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Challenging the judgment and award dated 19.02.2015 passed against them, the respondent Nos.1 and 2 in O.A.1/SBC/2010/01 on the file of the Railway Claims Tribunal, Bangalore Bench, Bangalore, have preferred this appeal.

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The appellants were respondent Nos.1 and 2, the respondent No.1 in this appeal was the petitioner and respondent Nos.2 to 5 in this appeal were respondent Nos.3 to 6 in O.A.1/SBC/2010/01 before the Tribunal. For the purpose of

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convenience, the parties are referred to henceforth according to their ranks before the Trial Court.

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The petitioner filed O.A.1/SBC/2010/01 under

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Section 16 of the Railway Claims Tribunal Act, 1987 (hereinafter referred to as 'the Act'), claiming that the petitioner booked 59 box wagons of high grade iron ore of 3953 MT for transportation from Yashwant Nagar to Srikakulam. The train met with an accident near Vasenkere of South Western Railway. Out of 59 wagons, 16 wagons were capsized and 1 wagon got derailed. The entire consignment in 17 wagons were unloaded on track and used for levelling. The petitioner could salvage only 115.300 tons of iron ore and the same was transported by hiring trucks to Srikakulam. The petitioner claimed that there was a short delivery of iron ore to an extent of 985 tons at the destination. Petitioner made a claim by letter dated 17.01.2009 which was acknowledged by the East Coast Railway, Bhubaneshwar and the same was processed. It is pleaded that the petitioner claimed the cost of high grade iron ore of 985 MT at Rs.5,200/- per MT, further claimed cost of transportation for salvaged iron ore of 115.300 MT by road and also sought for refund of freight charges with interest.

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Respondent Nos.1 and 2 entered appearance before

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the Tribunal and filed written statement disputing the claim and denying their liability. They admitted that the subject train met with an accident, 16 wagons were capsized and 1 wagon got derailed. However, they disputed the rate of Rs.5,200/- per MT claimed by the petitioner and they quoted the rate of National Mineral Development Corporation Ltd. (NMDC), for the relevant period at Rs.1,114/- per MT. They denied the liability towards cost of transportation of salvaged iron ore by road and also denied their liability to refund the freight charges. Respondent Nos.3 and 4 filed written statement stating that they have processed the case of the petitioner.

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Respondent Nos.5 and 6 filed written statement stating that both the forwarding and destination stations do not lie within their jurisdiction and therefore, they have no liability for payment of any amount.

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The Tribunal formulated the issues and recorded

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the evidence of the parties. The petitioner examined two witnesses as AW-1 and AW-2 and Exs.A-1 to A-16 were marked. The respondents did not examine any witness but on

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their behalf, two documents were marked as Exs.R-1 and R-2. The Tribunal, on appreciation of the evidence, came to the conclusion that the petitioner has proved its claim and awarded a sum of Rs.70,12,895/- along with interest @ 9% p.a. along with a sum of Rs.36,450/- towards application fee and a further sum of Rs.10,000/- towards Advocate's fee.

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Challenging the said judgment and award, the above appeal is filed by the Union of India - represented by South Western Railway.

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Sri.Thimmanna Bhat, learned Central Government counsel appearing for appellant No.1 and Sri.Satish Kumar N., learned counsel appearing for the appellant No.2, reiterating the grounds of appeal, submit that the Tribunal has erred in considering the rate of iron ore at Rs.5,200/- per MT. It ought to have considered the rate quoted by NMDC, a Government of India undertaking which states that at the relevant point of time, the rate was Rs.1,114/- per MT. Hence, the entire award is contrary to the material available on record. It is submitted that the Tribunal has erred in awarding transportation charges for transport of salvaged material without any evidence to that

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effect. The Tribunal has also committed error in rejecting the review petition filed by respondent Nos.1 and 2 as it has specifically alleged fraud and misrepresentation by the person representing the petitioner and also stated that it has committed an offence under Section 149 of the Act. It is further submitted that the Tribunal failed to appreciate the fact that the petitioner - Company was represented before the Tribunal by an employee of Tanishka Steel Pvt. Ltd. and he has committed fraud by filing false accounts, fabricated and created documents before the Tribunal. Hence, he submits that the impugned judgment and decree is liable to be set aside.

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Per contra, Sri.S.M.Chandrashekar, learned Senior counsel for Sri.P.Prasad and Sri.Ajay Kumar, learned counsel on record for the respondent No.1 supports the impugned judgment and award of the Tribunal and submits that the Tribunal, by well reasoned order at paragraphs 15 to 19 has allowed the claim petition. It is submitted that the petitioner has adduced oral as well as documentary evidence in proof of loss suffered by it and has also established that the subject iron ore was of high grade and the rates paid for such iron ore was Rs.5,200/- per MT. It is further submitted that the respondents

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did not adduce any evidence before the Tribunal and hence they cannot now contend that the rate of the undelivered iron ore was on the lower side. It is also submitted that respondent Nos.1 and 2 admitted the claim of the petitioner which is evident from the correspondences dated 05.02.2010, 12.04.2010 and 21.06.2010 which were marked as exhibits before the Tribunal. These documents clearly demonstrate that respondent Nos.1 and 2 admitted the claim. However, they have preferred this appeal without any justifiable reason or ground. It is contended that respondent Nos.1 and 2 have deposited the award amount with interest before this Court and the same may be ordered to be released in favour of petitioner by dismissing the appeal.

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On hearing both sides and examining the materials on record, the point that arises for consideration is “ Whether the impugned judgment and award is sustainable in law”?

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ANALYSIS

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The petitioner filed claim petition before the

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Tribunal claiming compensation of Rs.53,26,880/- towards the value of undelivered iron ore, Rs.14,62,015/- towards refund of freight charges paid on the undelivered goods, Rs.2,24,000/towards transportation of 115.300 tons of salvaged iron ore by truck from the accident spot to Srikakulam and protection charges incurred at the accident spot. In order to prove the claim, the petitioner examined two witnesses and produced 16 documents.

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It is not in dispute that the petitioner booked 59

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box wagons of high grade iron ore of 3953 MT for transportation from Yashwant Nagar to Srikakulam. The train transporting the said iron ore met with an accident near Vasenkere of South Western Railway, 16 wagons were capsized and 1 wagon got derailed. The entire consignment in 17 wagons were unloaded on track and used for levelling at the accident spot. The petitioner could salvage only 115.300 tons of iron ore and the same was transported to Srikakulam by hiring trucks.

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Petitioner claimed that there was a short delivery of iron ore to an extent of 985 tons at the destination. Petitioner made a claim by letter dated 17.01.2009 which was acknowledged by the East Coast Railway, Bhubaneshwar and the same was processed. It is pleaded that the petitioner claimed the cost of high grade iron ore of 985 MT at Rs.5,200 per MT, transportation charges of salvaged iron ore of 115.300 metric ton by road and also sought for refund of freight charges with interest.

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In order to establish its claim, the petitioner examined Sri.Lifson, incharge loading of the petitioner - Company. He deposed that the petitioner had booked 59 wagons of iron ore from Yashwant Nagar to Srikakulam by paying freight charges of Rs.50,74,055/- for transportation of 3953 MT of high grade iron ore. The train met with an accident. Hence, 17 wagons of iron ore were not delivered, they could salvage only 115.300 MT and thus, short delivery is 985 MT of iron ore. He further deposed that they have paid Rs.5,200/- per MT to purchase the iron ore and claimed Rs.53,26,880/- for non-delivery of 985 MT of high grade iron ore, and also claimed refund of freight charges paid on

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undelivered 17 wagons. He also deposed that the petitioner spent Rs.2,24,000/- towards transportation of 115.300 MT of salvaged iron ore from the place of accident to Srikakulam. In support of his evidence, he produced the documentary evidence. Though the said witness was cross-examined by the respondents, nothing could be elicited to consider the defence of appellant. Petitioner examined one Sri.Y.Chandramohan the Assistant Manager - Accounts in M/s.Ruchika Global Interlinks Pvt. Ltd. He deposed that petitioner M/s.Concast Ferro Inc. remitted cost of iron ore supplied by his Company and produced the computerized statement for the period from 01.04.2008 to 15.01.2009 showing the money received for supply of iron ore. In his cross-examination by the respondents also, nothing could be elicited to impeach his evidence.

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Admittedly, respondents did not adduce any evidence in support of their stand before the Tribunal. The material available on record indicates that the South Western Railway in its communications dated 05.2.2010, 12.04.2010 and 21.06.2010 admitted the claim of the petitioner at Rs.5,200/- per MT and liabilities assessed and forwarded to

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respondent Nos.1 and 2 to make the payment. Contrary to the communications referred supra, respondent Nos.1 and 2 filed objections contending that the petitioner's claim is exorbitant and as per NMDC, the rates for non-delivered iron ore should be Rs.1,114/- per MT. On meticulous appreciation of the pleadings, oral and documentary evidence on record, it is evident that the respondents do not dispute that the petitioner had booked the 59 box wagons for transportation of iron ore from Yashwant Nagar to Srikakulam and there was a short delivery of certain extent of iron ore claimed in the claim petition.

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The claim of the petitioner for non-delivery of 17 wagons of iron ore is assessed by the Tribunal at Rs.5,200/per MT considering the oral evidence of AW-1 and AW-2 and the invoice-cum-challan issued by Ruchika Global Interlinks Pvt. Ltd. The finding of the Tribunal is strictly in consonance with the evidence available on record. The Tribunal has recorded detailed finding at paragraphs 15 to 19 and has come to the conclusion that the petitioner has proved the claim with regard to non-delivery of certain extent of high grade iron ore, transportation charges of salvaged iron ore and refund of

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freight charges of non-transported iron ore. The said finding of the Tribunal is neither perverse nor contrary to the evidence available on record calling for interference in the present appeal.

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Sofar as the contention of the respondent Nos.1 and 2 that the petitioner is entitled to the loss of iron ore at the rate of Rs.1,114/- per MT as per the NMDC quote is concerned, the same is required to be rejected for the reason that the respondents did not produce any evidence before the Tribunal with regard to the prevailing rate of high grade iron ore at the time of accident. The document produced by the respondents issued by NMDC dated 04.11.2009 indicates that the rates w.e.f. 01.04.2008 may be taken as Rs.1114/- per MT. However, the said letter does not specify the quality of iron ore and the rate for such quality or the overheads costs on that. Author of that document was not examined. The oral evidence of AW-1 clearly indicates that the short delivered iron ore was of high grade quality and the claim of Rs.5,200/- per MT includes transportation of iron ore from mines to the railway station so also loading in the wagon. Hence, the plea of the respondents that the petitioner is entitled to compensation for

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the loss of iron ore at Rs.1,114/- per MT is without any basis and contrary to the material available on record.

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The Tribunal, by a well reasoned order has come to the conclusion that the petitioner is entitled for refund of freight charges in a sum of Rs.14,62,015/- for non-delivery of the 17 wagons of iron ore. Admittedly, the respondents failed to transport 17 wagons of iron ore to Srikakulam. Hence, the finding of the Tribunal for refund of freight charges is as per the evidence available on record. The Tribunal has also rightly directed the respondents to pay Rs.2,24,000/- towards the transport of salvaged iron ore of 115.300 MT to Srikakulam from the place of accident. It is not in dispute that from the place of accident, the petitioner transported 115.300 MT of iron ore to Srikakulam via road by hiring truck. AW-1, in his evidence, clearly deposed that as per the certificate issued by the railway officials at the accident spot, the salvaged material was lifted and transported to Srikakulam by engaging five lorries and the approximate distance from the accident spot to Srikakulam is 1000 k.m. and they had hired the lorry at Rs.45/per k.m. Though the said witness has been cross-examined by the respondents, neither any suggestion has been made with

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regard to the cost of transportation of salvaged iron ore nor any contrary evidence was produced to the claim of the petitioner. Hence, the contention of the respondents with regard to non-production of documents for transportation of salvaged iron ore and its cost, is rejected.

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Admittedly, the respondents filed review petition before the Tribunal contending that the petitioner has played fraud and misrepresented before the Tribunal. The review petition filed by the respondents in Review petition M.P.No.2/2015 in O.A.1/SBC/2010/01 was dismissed on 06.10.2016. The said order has attained finality. The counsel

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on record before the Tribunal identifying the claimant led evidence. Hence, now the respondents cannot contend that the petitioner has played fraud by impersonation. Further, respondent - authority has not initiated any criminal proceedings against the petitioner for the alleged fraud or impersonation. On the very same grounds of misrepresentation and fraud, the review petition was filed which came to be rejected by a well reasoned order of the Tribunal. Hence, the contention of the respondents with regard to fraud and misrepresentation merits no consideration.

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For the aforementioned reasons, we do not find

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any error or perversity in the finding recorded by the Tribunal.

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Hence, we proceed to pass the following:

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ORDER

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The appeal is dismissed.

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The amount in deposit before this Court along with interest, if any, accrued, shall be released to respondent No.1 digitally after due verification.

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No order as to costs.

Sd/JUDGE

Sd/JUDGE

List No.: 1 Sl No.: 9

The Union of India v. M/S Concast Ferro Inc.

Case brief

What is this about?

What did the court decide?

The Union of India v. M/S Concast Ferro Inc.

Case brief

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