In an order that brought relief to the Ministry of Railways, the Supreme Court allowed it on Thursday to continue to sell only ‘Rail Neer’ bottled drinking water at stations and in premium trains according to their circulars issued previously.
A bench headed by Justice Ranjan Gogoi vacated the stay it had imposed in May, putting in abeyance the two government circulars issued by Indian Railways in 2015, directing contractors and caterers to sell only ‘Rail Neer’, which is manufactured by the IRCTC.
An association had challenged the circular before the top court.
While lifting the stay, the bench said it will hear the association’s petition at length before giving a final opinion on the circulars. “Till then, however, we cannot stop the sales,” the bench told the association’s counsel.
According to ministry officials the sales of Rail Neer had come down from one lakh a day to 20,000 after the May order. The Centre defended its decision to push the sales of bottled drinking, claiming vendors were giving priority to other brands and not the state-owned brand.
It said the license agreement signed between the petitioner and railways makes it incumbent upon vendors to opt for Rail Neer. If IRCTC is unable to meet the demand then the vendors can choose other brands.
The ministry rejected the allegations that ‘Rail Neer’ was a substandard brand and said it amounted to just 10% of the total sales of bottled water, leaving enough room for other brands.
Railways said between 2012 and 2014 IRCTC sold around 11 crore bottles every year. In 2014-15 the production of the bottles dropped because the static and mobile licensees chose other brands.