Court rejects IFFCO’s plea for refund from railways

Saturday, August 7, 2010

GANDHINAGAR - The Gujarat High Court has rejected the Indian Farmers Fertilizer Cooperative’s (IFFCO) suit seeking refund from the railways in a dispute related to alleged delay in providing rakes for transportation of its goods.

The court, in an order made available Saturday, rejected the plea on the grounds that the railways’ provision under which IFFCO was seeking relief came into existence several years after the alleged excess freight was collection by railways over two decades ago.

IFFCO moved the high court challenging the order of the Railway Claims Tribunal(RCT), Ahmedabad, passed in 1996 which dismissed its claim for refund.

IFFCO had booked railway rakes for transportation of fertilizers from Kalol to various destinations in the country in the late 1980s.

The railways allegedly failed to provide adequate number of rakes within the stipulated time leading to a delay in the movement of fertilizers.

Following this, IFFCO filed a suit in 1988 in Mehsana Civil Court for refund of excess freight of Rs.1,26,230.

The matter was referred to RCT, Ahmedabad. However, RCT rejected the claim for refund Nov 20, 1996.

The company challenged the tribunal order in the high court. Advocate for the appellant, Mauna Bhatt, said in the court that the company could not load the goods within 72 hours as the rakes were supplied late by the railways.

Counsel for the railways, B.I. Mehta said that the company did not comply with its part of the contract.

He said RCT had passed the order after considering the entire documentary evidence on record.

The high court, however, observed that it would have to consider only one point as to whether the a railways circular dated Nov 1, 1994 issued by the Railway Board — to deal with refund-related disputes — would have a retrospective effect or not.

Justice M.D. Shah said: “It appears that the said circular dated Nov 1, 1994 would have only prospective effect and hence, if the wagons are supplied after 72 hours for cases prior to Nov 1,1994, the benefit of train load classification cannot be granted.”

“Hence, the findings arrived at by the learned Railway Claims Tribunal being just and proper are not required to be interfered with and the appeal is required to be dismissed,” the court said in the judgment made available Saturday.

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