Somnath Iyer, J.
1. In respect ol the route between Kibbanhalli and Kibbanahalli in the District of Tumkur an application was presented by respondent No. 4 to the Regional Transport Authority of Tumkur on May 10, 1968 for the grant of a permit to operate his stage carriage. That application was published in the Gazette under Section 57 of the Motor Vehicles Act, which will be referred to as the Act On June 13, 1968, and May 27 1968, was the date within which representation could be made in opposition to the application. The first date of hearing was August 16, 1968, and, January 27, 1969 was the date on which the regional transport authority disposed of the application and in the meanwhile representations had been produced by the petitioner before us and the others.
2. On that day of hearing, the regional transport authority decided to grant the permit to respondent 4 and from that decision there were appeals to the State Transport Appellate Tribunal by the petitioner and two others. When these appeals were posted for arguments, a preliminary argument was advanced on behalf of the petitioner that the permit granted by the regional transport authority was beyond its competence since there was disobedience to Rule 102 of the Motor Vehicles Rules made under the Act, which, insisted upon the production of a solvency certificate at least by the date fixed for the consideration of the application for a permit. It was pointed out to the State Transport Appellate Tribunal that since Respondent 4 had produced no solvency certificate, the regional transport authority has no competence to grant him the permit. This argument was accepted by the State Transport Appellate Tribunal which allowed the appeals and set aside the permit granted to Respondent 4.
3. But, in the further appeal preferred by Respondent 4 to the Mysore Revenue Appellate Tribunal, he produced for the first time, the solvency certificate required by the rules and was able to get back the permit which had been granted to him by the Regional Transport Authority. The Mysore Revenue Appellate Tribunal was of the view that the non-production of the solvency certificate before the Regional Transport Authority did not entitle the petitioner to contend before the State Transport Appellate Tribunal that the permit granted to Respondent 4, despite such non-production could be set aside. In effect, the view that the Mysore Revenue Appellate Tribunal took was that the defect if any emanating from thenon-production of the solvency certificate was one for which the decision of the regional transport authority could not be set aside by the State Transport Appellate Tribunal as provided by Sub-section (2) of Section 134 of the Act.
4. It is this decision of the Revenue Appellate Tribunal which the petitioner asks us to quash in this writ petition, and Mr. Venkatanarasimhachar presented two arguments before us. The first was that the Revenue Appellate Tribunal was in error in thinking that there could be a condonation of the disobedience to the 102nd rule or that compliance with the provisions of that rule could, for the first time, be made in the second appeal presented to the Revenue Appellate Tribunal. The second was that the Revenue Appellate Tribunal was in error in restoring the permit granted by the regional transport authority notwithstanding the fact that the State Transport Appellate Tribunal had yet to dispose of the appeals before it on their merits which it had not done.
5. It appears to us that the first submission has no substance although the second is unanswerable.
6. The argument constructed in support of the first submission rested entirely upon the pronouncement of this court in Writ Petn. No. 270 of 1965 (Mys) the effect of which, according to Mr, Venkatanarasimhachar, was that Rule 102, in so far as it insisted upon the production of a solvency certificate at least by the date when the application had to be considered by the regional transport authority, was a peremptory statutory provision, strict compliance with which could not be dispensed with, and, disobedience to which would lead to the nullification of the grant of the permit by Regional Transport Authority.
7. But, in making his submission In that way, it does not appear to us that Mr. Venkatanarasimhachar is on firm ground since the question whether R. 102 incorporated in that regard is? a mandatory provision, as contended by Mr. Venkatanarasimhachar, did not arise and was not discussed by this court in that writ petition. That was a case in which the Regional Transport Authority refused to grant the permit to the applicant on a twin ground. The first was that he was a new entrant in the field, the second was that he had not produced the solvency certificate required by Rule 102. From the decision of the Regional Transport Authority refusing the permit on those grounds the applicant unsuccessfully appealed to the State Transport Appellate Tribunal and then approached this court and the argument before this court was that Rule 102 was not a valid rule and did not have the force of law. This court restricted the discussion of the matter to the question whether that submissionwas acceptable and reached the conclusion that it was not. The enunciation made by this court was that the provisions of Rule 102 which were made in the exercise of the Rule-making power created by the Act became part of the Act, and so, bound the applicant for a permit and had to be enforced by the Regional Transport Authority.
8. But Mr. Venkatanarasimhachar asked our attention to an observation made in the course of that discussion which was to the effect that an applicant who does not comply with Rule 102 would not be entitled to have his application considered by the Regional Transport Authority, and asked us to say that the observation means that in the opinion of this court the relevant part of that Rule was a mandatory provision and not a mere directory provision.
9. But, it appears to us that Mr. Venkatanarasimhachar is not right in asking us to say so, since, it will be seen from the discussion in the decision of this court that the question whether the provisions of Rule 102 in respect of a solvency certificate were imperative provisions or merely directory, was not raised and was not discussed for the obvious reason that that question could not arise until there was non-compliance with the provisions of Rule 102 and a question arose in that situation was whether what had been done in such non-compliance could be sustained on the ground that what was disobeyed was merely a directory provision.
10. The case which came up before this court was one in which there was no such question since on the contrary the Regional Transport Authority insisted on compliance with Rule 102 and refused to grant the permit since there was none.
11. But, there is a direct pronouncement of this court in Writ Petn. No. 141 of 1958 (Mys) in which the question arose in the precise form in which it arises in the present case. That was also a case in which the petitioner did not produce a solvency certificate which was at that point of time required by the proviso to Rule 144 of the then existing Mysore Motor Vehicles and Road Traffic Rules, 1945, but was nevertheless able to get the permit sought by him from the Regional Transport Authority. But, the State Transport Authority which was the appellate authority set aside, the permit on the ground that the solvency certificate had not been produced, and, there was an unsuccessful further appeal to the Revenue Appellate Tribunal. The petitioner then presented a writ petition to this Court and the question which was discussed by this Court was whether the proviso to Rule 144 of those old rules incorporated any mandatory provision in respect of the production of the solvencycertificate or whether the provision which it incorporated was a mere directory provision.
This court discussed the distinction between a mandatory provision and a directory provision and said this:
'The distinction between a mandatory provision and a directory provision Is this: Whereas in the case of a mandatory provision strict compliance with that provision is indispensable, in the case of a directory provision substantial compliance with such provision would be sufficient If the contravention is of a directory provision, there would be no invalidating consequence nor would there be any nullification for its disobedience.'
And, after discussing the purpose of the insistence of a solvency certificate, this court expressed the view that the proviso to that old 114th rule incorporated a mere directory provision disobedience to which was cured by the provisions of Section 134(2) of the Act.
12. None of the questions decided In Writ Petition No. 141 of 1958 (Mys) arose for discussion in Writ Petition No. 270 of 1965 (Mys), and, not unnaturally, there was no discussion of those questions. Those questions could have arisen if the Regional Transport Authority in that second Writ Petn. No. 270 of 1965 (Mys), had granted the permit to the applicant notwithstanding his neglect to produce the solvency certificate and the grant of the permit had been defended on the ground that the 102nd rule of the new rules was a directory provision non-compliance with which did not entail the cancellation of the permit by the appellate authority on the ground of such non-production. But that was not what happened in that case.
13. So, the real pronouncement which governs the case before us is the decision in Writ Petn. No. 141 of 1958 (Mys), and, we do not accede to the submission made by Mr. Venkatanarasimhachar that there is any conflict between the pronouncement in that case and the decision in Writ Petn. No. 270 of 1965 (Mys). In our opinion, there is no such conflict.
14. But, Mr. Venkatanarasimhachar asked us to say that the pronouncement in the earlier writ petition can have no application since it rested on the construction of the proviso to the old 144th rule which, according to him, did not contain provisions similar to those contained in the new 102nd rule. We have no doubt in our minds that Mr. Venkatanarasimhachar is not right in making this submission, The old 144th rule reads:
'144. Application form for permit: Every application for a permit shall be in one of the appropriate forms, namely, 21, 21-A, 21-B, 22. 23, 24 and 25 appended to these rules and shall be addressed to theRegional Transport Authority in accordance with Section 45 of the Act;
Provided that an application for every stage carriage permit on any route in respect of which applications are called for under Rule 127, shall be accompanied by a certificate issued by an officer of the Revenue Department not below the rank of an Amildar to the effect that the applicant is solvent to the extent of a sum of at least Rs. 25,000/- (Rupees Twenty-five thousand).'
The new 102nd Rule reads:
'102. Application for a stage carriage permit: Every application for the grant of a stage carriage permit shall be in the prescribed form and shall be accompanied by a solvency certificate issued by an officer of the Revenue Department not below the rank of a Tahsildar to the effect that the applicant is a solvent at least to the extent of a sum of Rs. 35,000/-. It shall be sufficient if such a certificate is produced before the date fixed for consideration of the applications if for any reason the certificate cannot be produced with application.
Provided that it shall not be necessary to produce the solvency certificate where the application is made by a State Transport Undertaking.'
15. The requirement of the proviso to that old 144th Rule and that of the new 102nd Rule is, it is plain, the same in the sense that under both these statutory provisions, it is necessary for applicant to produce along with his application the solvency certificate referred to by them, The only alteration which the new rule made was to increase the amount to which the solvency certificate relates. So Mr. Achar cannot contend that there is anything in the new 102nd Rule which can take it out of the enunciation made in Writ Petition No. 141 of 1938 (Mys).
16. On the contrary, there is something in the new 102nd Rule which weakens the submission made by Mr. Achar that its provision with respect to a solvency certificate is an imperative provision. It will be seen that although the earlier part of it says that a solvency certificate shall be produced along with the application, the rigidity of that requirement is relaxed in the concluding part of that rule which says that a certificate could be produced at any time before the date fixed for the consideration of the application for a permit.
17. This relaxation with respect to the production of the solvency certificate, far from indicating its imperative character, impresses upon it, in our opinion, the attribute of a directory provision. The view that we take stands reinforced by the provisions of Rule 100 of the new rules which reads:
'100. Application not to be rejected on technical grounds: A transport authorityshall not reject an application for the grant or renewal of a permit or for the counter-signature of a permit merely on a technical ground such as:
(1) When an application is presented to a Transport Authority, not having jurisdiction;
(2) When the application is not in proper form.
(3) Where the prescribed challan for the fee due is not attached to the application;
(4) Where the prescribed court-fee stamp is not affixed in the application.
Is every such case, the Secretary to the Transport Authority may return the application for presentation to the Transport Authority having jurisdiction or for rectification of any defects in the application.'
The non-production of a solvency certificate is of course a technical omission similar to the illustrative technical grounds found in Clauses (1) to (4) to Rule 100. It is not one which appertains to the merits of the case, and, when the solvency certificate is not produced, there is a mere technical non-compliance with Rule 102 which says that it shall be produced along with the application.
18. Now, the first part of the new 102nd Rule says that every application 'shall be in the prescribed form'. But Clause (2) to Rule 100 says that when the application is not in proper form it shall not be rejected but shall be returned. If, therefore, the insistence on the presentation of an application In the proper form cannot be considered to be a mandatory requirement, we should normally also say the same thing with respect to the production of a solvency certificate which should accompany, according to the 102nd Rule, the application which should be presented in the proper form. It is not proper, in our opinion, to say that the first part of Rule 102 is not mandatory, but that the second is.
19. Similarly, clause (3) of Rule 100 says that where, the prescribed challan for the fee due is not attached to the application it shall not be permissible for the concerned authority to reject the application although the requirement that the application shall be accompanied by a treasury challan is to be found in Rule 120 which says that every application for the grant of renewal or counter-signature of a permit thereof shall be accompanied by a treasury challan for having paid the prescribed fee.
20. The words such as those with which the opening paragraph of Rule 100 concludes make it clear that clauses (1) to (4) of that rule are merely illustrative and not exhaustive, and that the purpose of Rule 100 is to emphasise upon the im-permissibility of the rejection of an application for a permit on mere technical grounds which do not appertain to the merits. We do not feel persuaded to accept the argument of Mr, Achar that the non-production of a solvency certificate does not introduce a mere technical defect.
21. But, Mr. Achar with great exercitation advanced the argument that if we should express the view which we have taken in this case with respect to the production of a solvency certificate, the regional transport authorities would feel greatly encouraged to condone the non-production of solvency certificate In cases in which they wish to grant such permits to persons who do not produce their solvency certificates and to insist on their production only when they do not feel persuaded to grant the permit
22. We do not think that Mr. Achar is right in anticipating any such deliberate disregard of the provisions of R. 102 by the concerned regional transport authorities. What we have said does not mean that the Regional Transport Authority may dispense with the production of a solvency certificate. On the contrary, it would be their plain duty to insist on the production of that certificate and to return the application to the applicant if It is not produced, as required by R. 100.
23. The elucidation that we have made with respect to the directory character of Rule 102 only means that if by over-sight or inadvertence or even in analogous other circumstances a permit Is granted to the applicant who has not produced the solvency certificate, the grant of that permit should not be set aside in appeal or in revision contrary to the provisions of Section 134(2) of the Act.
24. Our enunciation, which, regulates the exercise of appellate or revisional power and does not authorise the original authority such as the Regional Transport Authority to act in contravention of the clear provisions of Rule 102,
25. What emerges from the discussion so far made is that when the appeal preferred by the petitioner was heard by the State Transport Appellate Tribunal, it should have considered the question whether the grant of permit without the production of a solvency certificate was an error or omission or irregularity within the meaning of Section 134(2) of the Act end to further focus attention on the question whether such error or omission or irregularity had resulted in the failure of justice.
26. Our view that the requirement of a solvency certificate is a directory provision means that there was either an error or emission or irregularity in the proceedings in which the Regional Transport Authority granted, the permit to respondent 4 within the meaning of Section 134(2), and so, it became the duty of the State Transport Appellate Tribunal to consider the question whether such error or omission or irregularity had resulted in a failure of justice, But, the State Transport Appellate Tribunal did not bestow any thought to either the one question or to the other and on the unsupportable assumption that some illegality had been committed by the Regional Transport Authority, it proceeded to quash the permit.
27. It should be remembered that neither the petitioner nor the other objectors resisted the grant of the permit by the Regional'Transport Authority on January 27, 1969 when they were present before it on the ground that the solvency certificate had not been produced. That condemnation of the permit was made for the first time in the appeal and even then the petitioner did not produce any material to sustain the view that the grant of the permit without insistence of a solvency certificate had resulted in a failure of justice.
28. An attempt was made to sustain the order of the Regional Transport Authority in the further appeal preferred to the Revenue Appellate Tribunal by respondent 4 who in that appeal made good the deficiency by the production of the solvency certificate. It is quite apparent that no one could take the view, -- and no such view was pressed on us --that the grant of the permit without the production of that solvency certificate had resulted in a failure of justice.
29. So, we do not accept the contention that the Revenue Appellate Tribunal was in error in overturning the order of the State Transport Appellate Tribunal on the ground that the non-production of the solvency certificate before the Regional Transport Authority was not a good ground for the cancellation of the permit granted by it.
30. But, we must set aside the order of the Revenue Appellate Tribunal by which it restored the permit to respondent 4. That, the Revenue Appellate Tribunal, could not obviously do since, the State Transport Appellate Tribunal disposed of the appeals only on a preliminary ground that the solvency certificate had not been produced. If that ground disappeared in consequence of the view taken by the Revenue Appellate Tribunal, the appeal had to be remitted to the State Transport Appellate Tribunal for fresh disposal according to law and on the outstanding question on which it had not rendered any decision.
31. So we set aside that part of the order of the Revenue Appellate Tribunal by which it restored the permit grantedby the Regional Transport Authority and instead, we issue a direction that the State Transport Appellate Tribunal will now proceed to take back to its file the appeal preferred by the petitioner and proceed to dispose of it according to law on the merits as indicated in this order.
32. We however make it clear that It will not be permissible for the petitioner to raise any contention before the State Transport Appellate Tribunal which has been decided by this judgment.
33. Mr. Achar says that the petitioner had presented an application for stay before the State Transport Appellate Tribunal and that on that application no order has yet been made, and, Mr. Rangaswamy explains to us that no order was made on that application since the State Transport Appellate Tribunal proceeded, at the request of both the parties to dispose of the appeal expeditiously and did so.
34. In that situation, we make a direction that the State Transport Appellate Tribunal shall dispose of the appeal preferred by the petitioner within one month from this day.
35. Let a copy of this judgment be transmitted to the State Transport Appellate Tribunal not later than Monday, the 21st instant.
36. Order accordingly.