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Synopsis

The Supreme Court on January 9, 2025, highlighted the pivotal role of Indian Railways in the nation's infrastructure, noting that it transports approximately 673 crore passengers annually and significantly influences the country’s economy. Court emphasized that any attempt to undermine the integrity or stability of the ticketing system has to be stopped on its tracks.

A bench of Justices Dipankar Datta and Prashant Kumar Mishra made the observations while holding that creating hundreds of fake user IDs to sell tickets without any authorization from the railways would certainly be an offence under the Railways Act, 1989.

However, it said that Section 143 of the Act, by being completely silent on creation of multiple user IDs, penalises the actions of only the unauthorised agents and not unauthorised actions of the authorised agents.

The court gave a go-ahead to the prosecution of unauthorised agents Mathew K Cherian and another person for indulging in acts of creating fraudulent user IDs with the Indian Railway Catering and Tourism Corporation web portal to procure and peddle railway tickets for profit, without being an agent authorised for it. 

The bench, however, quashed the proceedings against J Ramesh, an authorised agent for creating multiple personal-user IDs and issuing unauthorised e-tickets procured through the IRCTC website, contrary to IRCTC Rules. 

The bench examined the question of whether the act of creating fake/multiple user IDs by an individual, who may or may not be an authorised railway agent, with the intention to procure and supply online tickets through the IRCTC portal would constitute an offence under Section 143 of the Act.

The court pointed out that the purport and objective of Section 143 of the Act are to restrict entities that are not under the disciplinary control of or are not authorised by the railways to conduct the business of procurement and supply of railway tickets. Railway servants and authorised agents stand apart since, on its own terms, Section 143 has no application to them, it said.

Section 143, on its plain language, prohibits any person, other than a railway servant or an authorised agent, from conducting the business of procurement and supply of railway tickets, the court said.

"The provision does not specify the modalities of the procurement and supply. Hence, if we read the section and give its contents the natural and ordinary meaning, keeping in mind the objective and purpose of the legislation, it admits of no doubt that this provision criminalises unauthorised procurement and supply, irrespective of the mode of procurement and supply," the bench said.

The court said the mere fact of the system of e-reservation and e-tickets being introduced after the enactment of the Act does not render the provision in Section 143 toothless to combat the illegal sale of e-tickets. 

"Section 143, importantly, makes no distinction between physical and online sale of tickets. The mischief that the provision seeks to remedy is that there should not be illegal and unauthorised procurement and sale of tickets, whatever be the mode – physical or online," the bench said.

The court noted there has been a major technological development in the last three decades by reason whereof a significant number of services provided by the governments are available online. 

"Electronic and internet services have not only become indispensable but offer significant advantages to the public. Having regard to the comprehensive phraseology employed in Section 143, the net of its coverage is wide enough to encompass regulation of the conduct of ticketing agents and to protect the public from unscrupulous elements trying to defraud them by sale of valueless ticket," the bench said.

The court said statutory interpretation has to follow certain principles which have been formulated through legal precedents. 

"No court can refuse to enforce a provision on the sole basis of the provision predating any subsequent development regarding the ticketing process. If it can be demonstrated that a statutory provision is broad enough to envelop the subsequent developments, even if the developments were not envisioned by the legislature, the provision would stay operational," the bench said.

The court noted the whole scheme of e-ticketing was introduced for the convenience and betterment of the passenger’s experience of travelling on a train, due to which the procurement and supply of these e-tickets, rightfully so, is highly regulated.

"The idea of protecting the consumer and strictly prohibit using personal/fraudulent IDs to book tickets for commercial purposes. These rules, further, bar sharing of the credentials by these authorised agents. Also, the perils of hoarding of resources by a select few are widely known and has to be kept in mind," the bench said.

The court also noted that IRCTC has limited the number of tickets that can be reserved on one personal user ID to 12 per month (24 per month with a user ID that is Aadhaar verified).

In the case, the bench found, Mathew, had allegedly created hundreds of fake user IDs to sell tickets without any authorisation from the railways. 

"Although the internet and e-tickets were unknown in India when the Act was brought into force, this conduct of Mathew (who is neither a railway servant nor an authorised agent) nevertheless attracts criminality under Section 143(1)(a) of the Act," the bench said.

In a case of Mathew, the Kerala High Court had quashed proceedings against him under Section 143.

However, in the case of Ramesh, the bench said, he, being an authorised agent, could not be proceeded against under Section 143 of the Act for alleged breach of any of the terms and conditions of the contract. "If, at all, he would be liable to face civil action," court held.

In case of Ramesh, the Madras High Court had declined to quash the proceedings.

The court allowed the appeals in both the cases.

Case Title: Inspector, Railway Protection Force Kottayam Vs Mathew K Cherian & Anr