Failure to provide a reasoned, speaking order for rejecting a demurrage waiver application violates principles of natural justice.

The petitioner, a Nepalese company, filed an application for the waiver of demurrage charges amounting to Rs. 4,672,800/-.

The respondent authority, via letter no. ECR/CRM/FM/DC/NRPA/18 dated 25.06.2019, disposed of the waiver application without providing specific grounds or findings.

The petitioner challenged this order as being "non-speaking" and silent on the merits of the grounds urged for waiver.

The petitioner argued that the case was squarely covered by a previous judgment of a Co-ordinate Bench of the same court.

1. Whether the order dated 25.06.2019 passed by the Railway authorities regarding the waiver of demurrage charges was a "speaking order" in compliance with the principles of natural justice?

2. Whether the respondent authority is required to consider the recommendations of lower-level officials and record cogent reasons when deciding on an application for waiver of demurrage charges?

The Court relied on the principles established in Kranti Associates (P) Ltd. v. Masood Ahmed Khan (2010), which mandates that both quasi-judicial and administrative authorities must record reasons in support of their conclusions to ensure transparency and accountability.

A "reasoned" or "speaking order" is an indispensable component of the decision-making process.

The court followed the precedent set in M/s Swastik Associate v. The State of Bihar Ors. (CWJC No. 3097 of 2021), which established that failure to consider recommendations or provide succinct reasons vitiates an administrative order.

The Court observed that the impugned order dated 25.06.2019 was fully silent regarding the specific grounds raised by the petitioner for the waiver of charges.

By referring back to the Swastik Associate precedent, the Court noted that an order that ignores recommendations from the Goods Superintendent—who has direct knowledge of the site conditions—and lacks "cogent and succinct reasons" stands vitiated for violating the principles of natural justice.

Such an order was likened to the "inscrutable face of a sphinx," failing the requirement that administrative actions affecting rights must demonstrate objective consideration of relevant factors.

The Court found the respondent's decision-making process to be arbitrary and lacking the necessary transparency required under the rule of law.

The matter was remanded to the Divisional Railway Manager (Commercial), Sonepur, with a specific direction to reconsider the petitioner's application dated 08.03.2018. The DRM is ordered to take into account the recommendations of the Goods Superintendent, Narayanpur Anant, and pass a reasoned, speaking order within six weeks of receipt of the judgment.