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1.1The Railway Rates Tribunal was constituted by an Act of Parliament (Central Act 65 of 1948), in the wake of Independence.The Tribunal came into being with effect from 4th April,1949.The Act bars the jurisdiction of ordinary courts in certain matters regarding railway rates/charges and vested it in the Tribunal.The constitution of a specialized Rates Tribunal was a land mark in the history of evolution of railway freight structure in India.




The idea of a Railway Rates Tribunal was imported from the United Kingdom and the United States.The Transport Tribunal in the United Kingdom is appointed by the Sovereign on the joint recommendation of the Lord Chancellor, the President of the Board of Trade and the Minister for Transport.The President of the Tribunal must be an experienced lawyer.The other two members must be experienced men in commercial affairs and railway business.The Inter-state Commerce Commission of the United States is composed of eleven Commissioners appointed by the President with the advice and consent of the Senate.Not more than six of the Commissioners may be appointed from the same political party.The commissioners chosen by the Interstate Commerce Commission have all been public men, many of them experienced lawyers and administrators.



1.3INDIAN LAW – ACT OF 1890:

The Indian Railways Act 9 of 1890 was passed in that year and the question of safeguarding the interest of the public having been brought prominently to the notice of Government, provision was made in that Act for the appointment of a Commission styled a Railway Commission, which was to consist of one Law Commissioner and two Lay Commissioners.The Railway Commission, however, was never appointed and ultimately, the provision in Chapter V of the Act for appointment of Railway Commissions was repealed.



In 1920, Government of India appointed the Acworth Committee which was required, amongst other things, to report whether the then system of control by Government of rates and fares and the machinery for deciding disputes between railways and traders was satisfactory and if not, to advise what modifications were desirable.After an exhaustive enquiry, the Committee recommended establishment of a Rates Tribunal consisting of an experienced lawyer as Chairman and two Lay members; one representing the railways and the other commercial interests with power in any case, deemed of sufficient importance, to add two additional members one on each side.



In April, 1926, in consultation with the Central Advisory Council for Railways, Government appointed the Railway Rates Advisory Committee to deal with certain complaints of undue preference and unreasonable rates and other matters.The opinion of the Committee was advisory and was not binding on the Government.The question of classification of goods as such was outside the purview of the Railway Rates Advisory Committee.Further, only such complaints could be taken notice of by the Committee as would be referred to it by Government.



In 1937, the Wedgwood Committee while going into the question observed that they did not favour the appointment of a body like the Railway Rates Tribunal or the Inter-state Commerce Commission on the ground of legal character necessarily assumed by the hearings before such a body and the cost involved to the applicants.



The Railway Rates Advisory Committee continued to function till it was replaced by the Railway Rates Tribunal in 1949.The Railway Rates Advisory Committee functioned for nearly 20 years and their recommendations were accepted by Government except in very rare cases.The eminent jurists and judges who constituted the Committee showed a high degree of competence and there was no complaint or grievance that the decisions of the Committee were, in any way, faulty or that these decisions were not marked by a correct appreciation of the situation or that the proceedings were dilatory in character.Indeed, the only criticism advanced was that it could not take cognisance of complaints unless they were referred to it by Government and that their findings could not be implemented directly before being accepted by Government.These criticisms were taken note of by the Government when they decided in 1949 to set up, by an Act of Parliament, the Railway Rates Tribunal.



The original proposal of the Ministry of Railways, approved by the Cabinet, was to constitute the Railway Rates Tribunal consisting of a Judge as President and four Members – two to be drawn from the Railways and two from Industry and Commerce.The Standing Finance Committee recommended not only a reduction in the number of members from five to three but went further and suggested that all the members, including the President, should be either Judges of a High Court or persons eligible to become Judges of a High Court and that this Tribunal, composed entirely of Judges, should be assisted by assessors drawn from two panels, one set up by the Federation of Indian Chambers of Commerce and Industry and the other set up by the Railway Board; this recommendation was finally accepted by Government and ultimately by Parliament and the Railway Rates Tribunal was constituted on this basis in 1949.According to the statement of objects and reasons of the relevant bill, the Tribunal was intended to be an inexpensive forum for considering public complaints relating to (a) rates and charges for merchandise traffic by goods trains and (b) complaints of undue or unreasonable preference.In addition, the Tribunal’s permission had to be obtained before Railways can increase the level of class or schedule rates in force, or terminal or other charges or before any commodity was re-classified in a higher class or non-classified commodity was classified.


2.1.In actual working of the Tribunal, constituted as a purely judicial Tribunal assisted by assessors, it came to be realised that in the deliberations of the Tribunal, association of persons having knowledge of business and of the economic conditions of the country, as of paramount importance though vital, was stated to be missing with the result that at the critical stage of arriving at a judgment neither the experience of the advisers of the commercial panel nor of the railway panel was availed of by the Tribunal.





3.1.It was due to the intensity of the public feeling that the Government of India, Ministry of Railways appointed in June, 1955, Railway Freight Structure Enquiry Committee (known; as Mudaliar Committee) with certain terms of reference including inter alia “to examine what changes, if any, are needed in the existing constitution, jurisdiction and rules of procedure of the Railway Rates Tribunal, so that the Tribunal might be a more effective and expeditious instrument for adjudication of railway freight matters at a reasonable cost to the litigant”.The Committee found that the system of assessors had been a failure and it recommended that this be abolished; and that the purpose for which it was introduced would be better served by a revised constitution of the Tribunal as recommended by them.


3.2.The Committee also recommended that the Chairman and Members of the Tribunal may be appointed for a period of five years and may, in suitable cases, be made eligible for re-appointment; on the analogy of the practice in the United Kingdom, the President and Members of the Tribunal may be appointed by the President of India on the recommendations of the Law Minister, the Minister for Industry and Commerce and the Minister for Railways.The Committee submitted its report to the Government in April 1957.It was substantially on the basis of the recommendations of the Mudaliar Committee that necessary amendments to Chapter V of Act 53 of 1957 relating to Railway Rates Tribunal were made.


3.3.The Mudaliar Committee recommended that the jurisdiction of the Tribunal be divided into mandatory and advisory functions – mandatory functions where the judgment of the Railway Rates Tribunal is binding on the Government in matters relating to undue preference, unreasonableness of a rate between two stations and unreasonableness of other charges; advisory functions relating to classification and to references by Central Government in matters falling within Section 45 of the Act and in cases where the Railway Board decide to grant station-to-station rates involving reductions beyond the limits prescribed by the Board for individual administrations.




4.1.The Rail Tariff Enquiry committee while dealing with regulation of tariffs and services had observed that there is no body, which is authorised regularly and in an obligatory manner to look at the rate structure of the Indian Railways and to suggest or enforce changes therein.Taking into consideration the experience of regulation over railway tariffs and services in other countries and the situation in India, the Committee was of the view that some regular machinery to look at the rates charged and services provided by the Railways for different streams of traffic needs to be set up and the matter is so important that it required a full scale examination of alternative methods of tackling it.Therefore, the Committee had thought it fit to draw attention to the problems and mentioned some of the alternatives.The Committee had suggested that one way would be to entrust the task of regulation to the Railway Rates Tribunal after properly equipping it in terms of methods and staff to deal with such matters.



5.1.Under the original Act of 1890, the Tribunal while granting relief could only fix the rates or charges as it deemed reasonable, but it could not order refund of any amount already over charged by the Railway administration.Under the revised Act, Railway Rates Tribunal can direct the railway administration to refund the amount as being in excess of rate or charges as fixed by it, and that charged by the railway administration.This power has been specifically given to avoid delay and hardship to complainants.


5.2.Further as per the original Act of 1890, the Tribunal while dealing with any complaint against a railway administration with regard to contravention of provision relating to prohibition of undue preference, could fix reasonable rate for carriage of any commodity between two stations only within the limit of the maximum and minimum rates fixed by the Central Government.In the revised Act 1989, this limitation has been removed and the Tribunal is empowered to fix any rate, which it considers reasonable.


5.3Under the new Act, 1989, the railway administration has been given powers to charge lump sum rates mutually agreed between the railway administration and the consignor for the carriage of goods or for any other service related to the carriage of goods.This concept of fixation of lump sum rates has been specifically excluded from the jurisdiction of the Tribunal in the revised Act of 1989.



6.1.Chapter VII of the Railways Act, 1989, consisting of Sections 33 to Sec.48 deals with the constitution, powers and various facets of the activities of the Tribunal.


6.2.The Tribunal is constituted in terms of Section 33 of the Railways Act, 1989 hereinafter referred to as “the Act”.It consists of a Chairman and two other Members appointed by the Central Government.The Chairman should have been a Judge of the Supreme Court or of a High Court.One member should have special knowledge of the commercial, industrial or economic conditions of the country and the other should be a person with special knowledge and experience of the commercial working of the railway.Sec.33(8) stipulates that no act or proceeding of the Tribunal shall be invalidated merely by reason of any vacancy in or any defect in the constitution of the Tribunal or any defect in the appointment of a person acting as a Chairman or other Member of the Tribunal.



7.1Sec.34 empowers the Tribunal with the previous approval of the Central Government, to appoint such officers and employees as it considers necessary for the efficient discharge of its functions under the Chapter and also the terms and conditions of service of the Officers and employees of the Tribunal by making regulations for the purpose.


7.2The Tribunal under Sec.38 of the Act shall have the powers of a civil court under the Code of Civil Procedure, 1908 (5 of 1908) for the purposes of taking evidence on oath, enforcing the attendance of witnesses, compelling the discovery and production of documents, issuing commission for the examination of witnesses and of reviewand shall be deemed to be a civil court for all the purposes of Section 195 and Chapter XXXV of the Code of Criminal Procedure, 1973 (2 of 1974).The Tribunal shall also have power to pass such interim and final orders as the circumstances may require, including orders for the payment of costs.


7.3The Tribunal has the powers under Sec.46 of the Act to transmit any decision or order made by it to a civil court having local jurisdiction and such civil court shall execute the decision or order as if it were a decree made by the court.


7.4 The Tribunal also has the powers to make regulations consistent with the Railways Act to regulate its procedure for the effective discharge of its functions, with the prior approval of the Central Government.Sec.35 of the Act enables the Tribunal to sit at such places or places as it may find convenient for the transaction of its business.



8.1Under Section 36 of the Railways Act, 1989, the Tribunal can hear and decide in respect of any complaint against a railway administration that it –

(a)is contravening the provisions of Sec 70; (prohibition of undue preference) or

(b)is charging for the carriage of any commodity between two stations a rate which is unreasonable; or


(c)is levying any other charge which is unreasonable.

While granting relief, the Tribunal may

(i)fix such rate or charge as it considers reasonable from any date as

it may deem proper, not being a date earlier to the date of the

filing of the complaint;

(ii)direct a refund of amount, if any, as being the excess of the rate or charge fixed by the Tribunal under clause (i).



8.2.Sec.41 mandates that in case of any complaint under Clause (a) of Sec.36, the burden of proof on the respective parties shall be as laid down therein.


8.3.Under Section 37, following matters are excluded from the jurisdiction of the Tribunal.

a)classification or re-classification of any commodity;

b)fixation of wharfage and demurrage charges (including

conditions attached to such charges);

c)fixation of fares levied for the carriage of passengers

and freight levied for the carriage of luggage, parcels,

railway material and military traffic; and

d)fixation of lump sum rates.

8.4Sec.43 provides that no suit shall be instituted or proceedings taken in respect of any matter which the Tribunal is empowered to deal with or decide under the Chapter VII.


8.5.However, Section 39 of the Act provides for the Central Government to make a reference to the Tribunal in respect of any of the matter specified in Para 5.3 above for enquiry and report.Sec.40 of the Act obligates the Central Government to give to the Tribunal such assistance as it may require and shall also place at its disposal any information in the possession of the Central Government which that Government may think relevant to any matter before the Tribunal.


8.6.Decision, etc., of the Tribunal.—The decisions or orders of the Tribunal shall be by a majority of the members sitting and shall be final.However, an appeal can be made before the Supreme Court by a Special Leave Petition under Art. 136 of the Constitution of India.That apart, as per the position of law declared by the Supreme Court, the decisions of any Tribunal constituted and functioning like the one under consideration, can be challenged before a Division Bench of the High Court concerned invoking jurisdiction under Article 226 of the Constitution of India (vide decision reported in All India Reporter 1997 SC 1125).


8.7Where a railway administration considers that since the date of decision by the Tribunal, there has been a material change in the circumstances on which it was based, it may, after the expiry of one year from such date, make an application to the Tribunal under Section 45 of the Act and the Tribunal may, after making such inquiry as it considers necessary, vary or revoke the decision.






9.1.Rule 24(2) of the Railway Servants (Disciplinary and Appeal) Rules 1968 provides for Group ‘C’ railway servants who were dismissed/removed/compulsorily retired from service, in their revision petitions to General Managers, to request him to refer their cases to Railway Rates Tribunal for advice.However, this rule envisages only advisory role for Railway Rates Tribunal and the General Manager can differ and refer such cases to Railway Board for final decision.Besides conferring only advisory role, the rules do not cover other groups of railway servant.


10.Present Scenario.

10.1.Sec.47 enjoins upon the Tribunal to present annually a report to the Central Government of all its proceedings under Chapter VII.


10.2.In the initial stages, the litigation before the Tribunal was as to what are the nature of payments which fall under the word ‘charges’ or ‘all other charges’ and whether charges agreed to be paid under the Contract with the Railways concerned can be challenged by one of the parties say the Complainants to be unreasonable before this Tribunal having agreed to pay such charges.Questions relating to the unreasonableness of siding charges, disputes as to what are the components which will go to constitute charges for maintaining the sidings, rationalisation of routes and levy of charges on such routes despite in certain cases the existence of shorter routes, levy in collection of charges of hauling of wagons and disputes relating to method of calculation of cost of engine hour cost and application of DSEA formula.Further, questions as to the period upto, which, the disputes raised, could be entertained or refund ordered also loom large in some of the litigations.Yet another the categories of cases which are coming in large numbers were as to the fixation of market value of land and the levy of licence fee/rate for the occupation of the land belonging to the Railways by the Transporters of the Goods.The question as to whether relief can be granted for the period prior to the actual date of filing of the complaint was being raised again and again in some of the earlier cases.Disputes as to whether the weight for charge should be either the actual weight or the estimated weight (carrying capacity plus periodical revision and enhancement) that is loaded in a wagon were also being raised now and then with reference to the particular facet of claim pertaining to different users.


10.3.Of late, the number of cases that are coming pertain to levy of penal charges sought to be collected on account of excess weight found noticed that would have been loaded in the wagon on the basis of weights recorded in the Electronic in-motion weighbridges and also on the basis of fixation of the maximum loadable quantity of weight in respect of different kinds of wagons.Some of the cases also pertain to disputes relating to the commodities with lesser density or weight being charged on the basis of higher rate of charge fixed for the same class or group of commodities but are more weightier in density.So far as the majority of the cases now pending for disposal before this Tribunal is concerned, they relate to levy of penal charges on the basis of weight recorded through the Electronic in-motion weighbridge and different categories of coal and other commodities being charged uniformly irrespective of the actual loadability but on the principle of loadability fixed by the Railways with reference to model class or type of wagons.



Source : RRT CMS Team Last Reviewed on: 19-04-2016  

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