You can call setbuf(fp,NULL) after opening, and now the stream is unbuffered. What this means is apparently implementation-dependent.

As to why you'd do that? - well, who knows the exact circumstances in this case. Perhaps this was faster in some meaningful case that was relevant to some other project (and then maybe the fread doesn't call fgetc after all!). I'm just speculating. Well-reused code often ends up with stuff that needs rethinking, that, even if noticed, nobody has the time or inclination to attempt to fix.