WLC Lease Agreement Responsibilities Quiz

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Questions and Answers

What is the responsibility of WLC regarding the insurance of the leased Wagons?

WLC must secure insurance only if requested by the Lessee.

WLC is not responsible for securing any insurance.

WLC must acquire insurance only for third-party liabilities.

WLC is responsible for securing insurance against damage and third-party liabilities. (correct)

Under what condition does WLC not incur stabling charges?

When the Wagons are moved from one terminal to another by WLC.

When the Wagons are in the custody of IR.

When the stabling is due to reasons attributable to Lessee.

When the Wagons are held in private sidings with valid agreements. (correct)

What is the consequence of WLC's default in payment to IR?

IR will terminate the lease immediately.

IR must notify WLC before taking any action.

IR will impose fines based on the amount due.

IR may exercise a lien on the leased Wagons. (correct)

What specifically triggers the payment of stabling charges according to the given content?

Failure to accept the consignment at the terminal by WLC/Lessee. Signup and view all the answers

Who resolves disputes regarding the agreements made with the Zonal Railway?

An Arbitrator nominated by the General Manager of the Zonal Railway. Signup and view all the answers

What is the primary objective of the wagon leasing scheme?

To develop a strong wagon leasing market with better wagon designs Signup and view all the answers

Which of the following best describes a 'Lessee'?

An entity that leases wagons from a Leasing Company Signup and view all the answers

What defines High Capacity Wagons (HCW)?

Wagons with a payload 2.0 tonnes higher on designated routes Signup and view all the answers

Which term is used for wagons waiting for a Lessee's nomination?

Idle Leased Wagons Signup and view all the answers

What is the role of a Wagon Leasing Company (WLC)?

To procure and lease railway wagons to authorized entities Signup and view all the answers

Special Purpose Wagons (SPW) are specifically designed for what?

Rail transportation of specific commodities Signup and view all the answers

Which entity is not involved in the wagon leasing system?

Private real estate developers Signup and view all the answers

Who provides the Concession to Operators for running trains on the IR network?

The Ministry of Railways Signup and view all the answers

What is the main aim of the Liberalized Wagon Investment Scheme (LWIS)?

To promote private investment for the procurement of wagons. Signup and view all the answers

Which of the following entities are eligible to lease wagons?

Registered companies in India with asset leasing experience. Signup and view all the answers

What is the minimum net worth required for an applicant to become a Wagon Leasing Company (WLC)?

100 Crore. Signup and view all the answers

For how long is the registration of a Wagon Leasing Company (WLC) valid?

35 years. Signup and view all the answers

What happens if a Wagon Leasing Company (WLC) is found to be insolvent?

Its registration is summarily cancelled. Signup and view all the answers

What types of wagons can be leased to end users under the scheme?

High Capacity Wagons and Special Purpose Wagons. Signup and view all the answers

Which condition applies to the procurement of wagons by a WLC?

Prior administrative approval from MOR is required. Signup and view all the answers

Which of the following types of wagons is NOT explicitly mentioned for leasing?

Liquid Tank Wagons. Signup and view all the answers

What is the registration fee for an entity to register as a WLC?

Rs. 5 Crore. Signup and view all the answers

What type of maintenance spare percentage is required in the wagon procurement process?

4%. Signup and view all the answers

What condition must be met before the wagons are inducted into service?

They must undergo mandatory safety and quality inspections. Signup and view all the answers

Which entity is NOT allowed to sub-lease the wagons held by the Lessee?

Any third agency Signup and view all the answers

What must the Wagon Leasing Contract include to certify ownership of the wagons?

Explicit rights of the WLC to terminate the lease Signup and view all the answers

What happens when the WLC terminates the lease for the wagons?

IR holds the idle leased wagons awaiting further nomination. Signup and view all the answers

Which entity is primarily responsible for claims and compensation regarding the wagons?

Indian Railways Signup and view all the answers

What is the nature of the agreements in Wagon Leasing Contracts?

They are bi-partite agreements between WLC and the Lessee. Signup and view all the answers

What is required for WLC to purchase wagons from operators?

Approval from the Ministry of Railways is required. Signup and view all the answers

What type of change can the WLC make regarding the Lessee on approved routes?

Substitute the Lessee under intimation to IR. Signup and view all the answers

Who is liable for freight and other charges claimed by IR?

Lessee of the Wagons Signup and view all the answers

What will happen to the brake van of the rake purchased by WLC?

It will be added to the general pool of IR brake vans. Signup and view all the answers

Study Notes

Freight Marketing Master Circular/WLS/2014/0

Objective: Develop a strong wagon leasing market, particularly with better wagon designs. Establishes policy for wagon leasing and operation on Indian Railways.
Definitions & Abbreviations:
- IR: Railway Administration
- MOR: Ministry of Railways
- End User: Rail customers
- Operators: Third-Party Logistics Companies
- WLC: Wagon Leasing Company
- Lessor: Company leasing wagons
- Lessee: End Users or Operators under Concession
- HCW: High Capacity Wagons (payload at least 2 tonnes higher)
- SPW: Special Purpose Wagons (for specific commodities)
Types of Wagons: High Capacity Wagons, Special Purpose Wagons, Container Wagons
Eligibility Criteria for WLC (Wagon Leasing Company):
- Registered in India (Companies Act, 1956)
- At least 5 years experience in asset leasing
- Minimum net worth of 100 Crore (subsidiaries must meet 25/50% net worth criteria)
Registration of WLC:
- One-time non-refundable registration fee of Rs. 5 Crore.
- 35-year validity (extendable based on performance)
- Cancellation for insolvency or breach of contract.
Procurement of Wagons by WLC:
- Directly from manufacturers or through imports
- Units based on pre-determined block rake composition, with spares and brake vans
- Benefits under the Liberalized Wagon Investment Scheme (LWIS) for Lessees
- Mandatory safety and quality inspections by authorized agencies
Leased Wagons:
- Bi-partite agreements between WLC and Lessee
- Responsibility for wagon lease contracts is with Lessee and WLC
Sub-leasing: Not permitted by Lessee
Liabilities:
- IR is responsible for claims and compensation per relevant provisions.
- Lessee is responsible for related payments to IR.
- WLC is responsible for Wagons, insurance, and related costs.
Maintenance of Wagons: IR will handle maintenance under agreed contracts.
Lien: IR can exercise lien on leased wagons due to defaulting payments (by the WLC or Lessee).
Dispute Resolution: Disputes are resolved by an Arbitrator nominated by the Zonal Railway.

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Description

Test your knowledge about the responsibilities of the WLC regarding the insurance of leased wagons and the conditions under which they incur or avoid stabling charges. Explore the consequences of default payments and understand the dispute resolution process with the Zonal Railway. This quiz is essential for anyone involved in wagon leasing agreements.