Railway authorities cannot lease out the luggage compartments without fixing the upper limit of charges levied by the contractors

Supreme Court: Answering an appeal preferred against the judgement of the division bench of the High Court of Karnataka, a bench of Vikramjit Sen and Shiva Kirti Singh J.J. upheld the decision of division bench directing the Respondent-Railways to fix the outer or upper limit of rates chargeable by the contractors for transporting goods in different trains.

Regarding the question as to interference with the right of the executive to formulate policy, the Court held that power to make subsidiary legislation may be entrusted by the legislature to another body of its choice but the legislature should, before delegating, enunciate either expressly or by implication, the policy and the principles for the guidance of the delegates”. In applying this dicta, it was further said that if a shift from the Railways being a social vehicle to it being essentially a milch cow towards was intended, that mutation was only within the province of Parliament.

In the present case, where the validity of the notification holding the awarding of the contract of lease of the Front Second Class Luggage Rake (FSLR) and Ventilated Parcel Van (VP) of Karnataka Express for a period of two years by the railways was in question, the Court dismissing the appeal stated that Railway tarrif no doubt has to be realistic and keep pace with time and if the state so perceives, need not be a losing financial position. While it may be both pragmatic and sagacious to auction FSLR & VP it can be done with an objective of gathering the optimum revenue. Additionally the court directed the respondents to ensure that the successful tenderer does not charge carriage prices in excess of those prescribed in the Coaching Tarrif No. 24 Part III and permitted a period of three months to the respondents to comply with the impugned judgement of the Division Bench. [S.K.L. Co. v. Chief Commercial Officer 2015 SCC OnLine SC 1382decided on 29-12-2015]

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