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U.P. State Road Transport Corporation, Lucknow Vs. the State Transport Appellate (Tribunal) and ors. - Court Judgment

LegalCrystal Citation
SubjectMotor Vehicles
CourtAllahabad High Court
Decided On
Case NumberSpecial Appeal No. No. 227 of 1973
Judge
Reported inAIR1974All218
ActsMotor Vehicles Act, 1939 - Sections 60(1), 68F(1), 68I(1) and 68I(2); Motor Vehicles (Amendment) Act, 1969
AppellantU.P. State Road Transport Corporation, Lucknow
RespondentThe State Transport Appellate (Tribunal) and ors.
Appellant AdvocateSri Kant Sharma, ;R.N. Trivedi and ;M.N. Sharma, Advs.
Respondent AdvocateS.K. Dhawan, ;L.P. Naithani, ;Shanti Bhushan, Advs. and ;Standing Counsel
DispositionAppeal allowed
Excerpt:
motor vehicles - power to frame rules - sections 68f (1) and 68i (2)(cc) of motor vehicles act, 1939 - neither mandatory for the state government to frame rules under section 68i(20(cc) prescribing the form for an application for a permit under section 68 f (1) nor is there any lack of power in the transport authorities to grant permit under section 68 f (1) to state transport undertaking. - - in cases where the legislature has not specifically provided that failure to comply with a provision of law will entail penal consequences and consequent invalidity of the act done, the duty of the courts is to examine the scope and object of the particular enactment in order to determine as to whether the legislature intended the provision, of law to be mandatory or otherwise. this rule of.....yashoda nandan, j. 1. the questions arising for decision in this appeal are as to whether it is incumbent on the state government to frame rules under section 68-i (2) (cc) of the motor vehicles act --hereinafter referred to as the act -- prescribing the form in which an application for a permit under section 68-f (1) of the act must be made and further as to whether in the absence of such rules the regional transport authority or the state transport authority as the case might be is powerless to grant a permit to a state transport undertaking under that provision of the act. 2. the relevant facts giving rise to this appeal are that the aligarh-atrauli-ramghat route was notified for provision of road transport service exclusively by the appellant u. p. state road transport corporation,.....
Judgment:

Yashoda Nandan, J.

1. The questions arising for decision in this appeal are as to whether it is incumbent on the State Government to frame rules under Section 68-I (2) (cc) of the Motor Vehicles Act --hereinafter referred to as the Act -- prescribing the form in which an application for a permit under Section 68-F (1) of the Act must be made and further as to whether in the absence of such rules the Regional Transport Authority or the State Transport Authority as the case might be is powerless to grant a permit to a State Transport Undertaking under that provision of the Act.

2. The relevant facts giving rise to this appeal are that the Aligarh-Atrauli-Ramghat route was notified for provision of Road Transport Service exclusively by the appellant U. P. State Road Transport Corporation, Lucknow--hereinafter referred to as the Corporation. The Corporation is a State Transport Undertaking within the meaning of Section 68-A (b) of the Act. The legality of the scheme was challenged by means of writ petitions which were dismissed by a learned Single Judge of this Court. Special Appeals were filed against the dismissal of the writ petitions and are still pending. In the Special Appeals, interim orders were passed restraining the respondents to the special appeals from preventing the transport operators, who are appellants therein, from plying their vehicles on the route notified. The interim orders are still effective and consequently the existing transport operators on the route in question are at present plying their vehicles. The interim orders, referred to above, were passed on the 27th July, 1971. Since the operation of the scheme was not stayed, the appellant-Corporation filed an application for permits in pursuance of the scheme under Section 68-F (1) of the Act for the route in question on the 11th May, 1972. The application was made in the form prescribed by Rule 50 in exercise of powers under Section 68 which occurs in Chapter IV of the Act. On the 21st November, 1972 on the basis of the application made, the State Transport Authority granted permits to the appellant-Corporation under Section 68-F (1) of the Act. Respondent No. 3, who was one of the transport operators providing transport service on the route preferred a revision against the order of S respondent No. 2 which was allowed. The state Transport Appellate (Tribunal), U. P. took the view that the application on the basis of which permits to the appellant had been granted was in the form prescribed by Rule 50 (a) of the U. P. Motor Vehicles Rules which was a form only for an application for a permit under Chapter IV and not for a permit under Chapter IV-A of the Act. The view was taken that after the amendment of Sections 68-F (1) and 68-I by Act No. 56 of 1969, it was obligatory for the State Government to frame a rule under Section 68-I (2) (cc) prescribing the form for applications for permits under Section 68-F (1) of the Act and since no rule had been framed prescribing the form of application, it was not competent for the State Transport Authority to issue a permit to the appellant corporation under Section 68-F (1) of the Act.

3. Aggrieved by the decision of respondent No. 1, the Corporation filed a writ petition in this Court praying for a writ, order or direction in the nature of certiorari quashing the order of respondent No. 1. Apart from certain ancillary reliefs, it was prayed, in the alternative, that a writ, order or direction in the nature of mandamus be issued to the State of Uttar Pradesh commanding it to prescribe the manner for making an application for the grant of a permit under Section 68-F (1) of the Act. By means of the judgment and order the legality of which is in challenge in this appeal, a learned Single Judge of this Court allowed the writ petition in part. The prayer for quashing the order of respondent No. 1 was refused. The learned single Judge, however, directed the State Government to frame appropriate rules under Section 68-I (2) (cc) of the Act. Parties were ordered to bear their own costs. The learned single Judge held that after the amendment of Section 68-F (1) by the Act 56 of 1969, it became the imperative duty of the State Government to frame rules under Section 68-I (cc) prescribing the manner in which applications for the grant of permits had to be moved by the Corporation. Since admittedly no rules had been framed prescribing the manner for making an application under Section 68-F (1), the view was taken that the application made in the form prescribed by Rule 50 was incompetent and the grant of permits to the Corporation on the basis of such an application was without jurisdiction.

4. Dissatisfied with the order of the learned single Judge, the Corporation has appealed and it has been contended before us that it was neither obligatory for the State Government to frame a rule under Section 68-I (2) (cc) nor was the State Transport Authority powerless to grant permits to the appellant in the absence of such a rule, provided the application was for a permit in pursuance of a scheme approved under Section 68-D (3) of the Act.

5. The question as to whether a particular provision of an enactment is mandatory or merely directory often arises for consideration. In cases where the legislature has not specifically provided that failure to comply with a provision of law will entail penal consequences and consequent invalidity of the act done, the duty of the Courts is to examine the scope and object of the particular enactment in order to determine as to whether the legislature intended the provision, of law to be mandatory or otherwise. This rule of construction was effectively stated by Lord Penzance in Howard v. Bodington, 1877-2 PD 203 in the following words:--

'I believe, as far as any rule is concerned, you cannot safely go further than that in each case you must look to the subject-matter; consider the importance of the provision that has been disregarded, and the relation of that provision to the general object intended to be secured by the Act; and upon a review of the case in that aspect decide whether the matter is what is called imperative or only directory.'

In the same case Lord Penzance observed as follows:--

'Now the distinction between matters that are directory and matters that are imperative is well known to us all in the common language of the courts at Westminster. I am not sure that it is the most fortunate language that could have been adopted to express the idea that it is intended to convey; but still that is the recognised language, and I propose to adhere to it. The real question in all these cases is this; A thing has been ordered by the legislature to be done. What is the consequence if it is not done: In the case of statutes that are said to be imperative, the Courts have decided that if it is not done the whole thing fails, and the proceedings that follow upon it are all void. On the other hand, when the Courts hold a provision to be mandatory or directory, they say that, although such provision may not have been complied with, the ,subsequent proceedings do not fail. Still, whatever the language, the idea is a perfectly distinct one. There may be many provisions in Acts of Parliament which although they are not strictly obeyed, yet do not appear to the Court to be of that material importance to the subject-matter to which they refer, as that the legislature could have intended that the non-observance of them should be followed by a total failure of the whole proceedings. On the other hand, there are some provisions in respect of which the Court would take an opposite view, and would feel that they are matters which must be strictly obeyed, otherwise the whole proceedings that subsequently follow must come to an end.'

6. Lord Campbell in Liverpool Borough Bank v. Turner, (1860) 29 LJ Ch 827, observed:

'No universal rule can be laid down for the construction of statutes as to whether mandatory enactments shall be considered directory only or obligatory, with an implied nullification for disobedience. It is the duty of courts of justice to try to get at the real intention of the legislature by carefully attending to the whole scope of the statute to be construed.'

7. These observations by Lord Campbell were quoted with approval in (1877) 2 PD 203 (Supra) and by Jagannadhadas, J., speaking for the Court in H. N. Rishbud v. State of Delhi : 1955CriLJ526 .

8. Similarly in Banwari Lal v. State of Bihar : (1961)IILLJ140SC it was held that

'As has been recognised again and again by the courts, no general rule can be laid down for deciding whether any particular provision in a statute is mandatory, meaning thereby that non-observance thereof involves the consequence of invalidity or only directory, i.e., a direction that non-observance of which does not entail the consequence of invalidity, whatever other consequences may occur. But in each case the Court has to decide the legislative intent. Did the ligislature intend in making the statutory provision that non-observance of this would entail invalidity or did it not? To decide this we have to consider not only the actual words used but the scheme of the statute, the intended benefit to public of what is enjoined by the provisions and the material danger to the public by the contravention of the same.'

9. Another useful rule of construction was laid down in the House of Lords decision in Justices of Middlesex v. The Queen, (1884) 9 AC 757) by Lord Blackburn in the following words:--

'.....there is a numerous class of cases in which it has been held that certain provisions in Acts of Parliament are directory in the sense that they were not meant to be a condition precedent to a grant or whatever it may be, but a condition subsequent; a condition as to which the responsible persons may be blameable and punishable if they do not act upon it, but their not acting upon it shall not invalidate what they have done, third persons having nothing to do with that.'

10. Similar views have been expressed by Sir Arthur Channcll in Montreal Street Rly. Co. v. Normandin, 1917 AC 170 = (AIR 1917 PC 142) wherein it has been stated that,

'The question whether provisions in a statute are directory or imperative has very frequently arisen in this country, but it has been said that no general rule can be laid down, and that in every case the object of the statute must be looked at. The cases on the subject will be found collected in Maxwell on Statutes, 5th Ed., p. 596 and following pages. When the provisions of a statute relate to the performance of a public duty and the case is such that to hold null and void acts done in neglect of this duty would work serious general inconvenience, or injustice to persons who have no control over those entrusted with the duty, and at the same time would not promote the main object of the Legislature, it has been the practice to hold such provisions to be directory only, the neglect of them, though punishable, not affecting the validity of the acts done.' The abovementioned principles enunciated in Montreal Street RIy Co., 1917 AC 170 = (AIR 1917 PC 142) (supra) were applied with approval by the Federal Court in Biswanath Khemka v. Emperor .

11. The law on the subject has been stated by Crawford in 'The Construction of Statutes' 1940 Edition page 529 thus:--

'As a general rule, a statute which regulates the manner in which public officials shall exercise the power vested in them, will be construed as directory rather than mandatory, especially where such regulation pertains to uniformity, order and convenience, and neither public nor private rights will be injured or impaired thereby. If the statute is negative in form, or if nothing is stated regarding the consequences or effect of non-compliance, the indication is all the stronger that it should not be considered mandatory.'

A similar view was expressed by the Supreme Court in Dattatraya Moreshwar v. State of Bombay : 1952CriLJ955 in the following words:

'It is well settled that generally speaking the provisions of a statute creating public duties are directory and those conferring private rights are imperative. When the provisions of a Statute relate to the performance of a public duty and the case is such that to hold null and void acts done in neglect of this duty would work serious general inconvenience or injustice to persons who have no control over those entrusted with the duty and at the same time would not promote the main object of the legislature, it has been the practice of the Courts to hold such provisions to be directory only, the neglect of them not affecting the validity of the acts done.'

The observations of the Federal Court in (Supra) were quoted with approval by the Supreme Court in State of U. P. v. Manbodhan Lal Srivastava : (1958)IILLJ273SC .'

12. We shall now proceed to consider the relevant provisions of the Act before us in the light of the rules of construction laid down in and : (1958)IILLJ273SC (Supra).

13. Section 68-I which empowers the State Government to frame rules to give effect to the provisions of Chapter IV-A of the Act is as follows:--

'(1) The State Government may make rules for the purpose of carrying into effect the provisions of this Chapter.

(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters namely:--

(a) the form in which any scheme or approved scheme may be published under Section 68-C or Sub-section (3) of Section 68-D;

(b) the manner in which objections may be filed under sab-section (1) of Section 68-D;

(c) the manner in which objections may be considered and disposed of under Sub-section (2) of Section 68-D;

(cc) the manner in which application under Sub-section (1) of Section 68-F may be made;

(ccc) the period within which the owner may claim an article found left in any transport vehicle under Section 68-HH and the manner of sale of such article;

(d) the manner of service of orders under this Chapter;

(e) any other matter which has to be, or may be, prescribed,'

Sub-section (oc) was introduced in Section 68-I of the Act by Act No. 56 of 1969. Before the amendments brought about in the Act by Act No. 56 of 1969, Section 68-F (1) which is in Chapter IV-A of the Act stood as follows:--

'Where, in pursuance of an approved scheme, any State Transport Undertaking applies in the manner specified in Chapter IV for a stage carriage permit or a public carrier's permit or a contract carriage permit in respect of a notified area or notified route, the Regional Transport Authority shall issue such permit to the State Transport Undertaking notwithstanding anything to the contrary contained in Chapter IV.'

As a result of Act No. 56 of 1969, Section 68-F (1) of the Act was amended and for the words and figures 'in the manned specified in Chapter IV', the words 'in such manner as may be prescribed by the State Government in this behalf' were substituted. Further for the words 'the Regional Transport Authority', the words 'State Transport Authority in any case where the said area or route lies in more than one region and the Regional Transport Authority in any other case' were substituted. Certain other amendments were made in Section 68-F, which it is unnecessary to notice in the present case.

14. Section 68-I (1) is a comprehensive provision empowering the State Government to frame rules to give effect to the provisions of Chapter IV-A and includes within it the power to frame rules in respect of matters mentioned in the Sub-section (2) of that provision. The power to frame rules under Section 68-I (2) in a sense cannot be said to be independent of Sub-section (1) of Section 68-I. Sub-section (2) merely exemplifies some matters in respect of which the State Government has power to frame rules under Section 68-I (1) itself. Apart from the fact that the language of Sub-sections (1) and (2) of Section 68-I itself is directory, it is inconceivable that the legislature intended to make it obligatory for the State Government to frame rules on the very large number of matters in respect of which rules may be framed to give effect to the provisions of Chapter IV-A. If that is so, we do not find it possible to read Section 68-I (1) so as to split it up and to hold that while the power to frame rules in respect of some matters contemplated by it is directory, the duty to frame rules prescribing the form in which an application for a permit under Section 68-F (1) is to be made is obligatory. We are in agreement with the view taken by the Patna High Court in Deep Narain Pandey T. State of Bihar : AIR1960Pat575 that it is not incumbent on the State Government to frame rules wider Section 68-I of the Act and it has the discretion to do so or not.

15. Sri Shanti Bhushan, learned Counsel appearing for respondent No. 3, fairly and frankly conceded that on the language of Section 68-I of the Act it is not possible for him to contend that there is a mandatory duty cast on the State Government to frame a rule under Section 68-I (2) (cc) of the Act. He, however, contended that apart from Section 68-I of the Act, there is power in the State Government to frame rates in exercise of powers under Section 68-F (1) of the Act itself providing for the manner in which an application must be made for a permit under that provision of the law. Learned Counsel for the appellant, on the other hand, contended that it would be unreasonable to hold that the legislature had empowered the State Government to frame rules on the same subject under two separate and parallel provisions of the same Act, it being directory for it to do so under Section 68-I and mandatory under Section 68-F (1). For the purposes of this case we shall assume that there is a power in the State Government to frame a rule under Section 68-I of the Act providing for the manner for making an application for a permit under that section. The question, however, still remains as to whether it is mandatory for the State Government to frame a rule prescribing the manner for making an application and the form for it. It is significant that the Act does not lay down even the minimum requirements of a rule, if any, that may be mace by the State Government providing the manner in which an application for a permit has to be made under Section 68-F (1) of the Act, If it be assumed that it is obligatory for the State Government to frame a rule providing for the manner for making an application for a permit under Section 68-F (1) of the Act, the State Government is at liberty to make a rule merely requiring a State Transport Undertaking to address the application to the Regional Transport Authority or the State Transport Authority concerned, as the case may be, and disclosing therein the particular scheme in pursuance of which the permit was sought. There is nothing in the Act which prevents the State Government from making a rule which goes nothing beyond a mere formality. Such a rule, if framed, would serve no useful purpose at all and would not in any fashion further the object intended to be secured by the Act. A rule of this character would be a mere exercise in futility. On the other hand, if it be held that it is obligatory for the State Government to frame a rule, it would give ample opportunities to the rule making authority to delay, if not to thwart and defeat the objectives sought to be secured by Chapter IY-A of the Act. In the present case itself, for instance, the Aligarh-Atrauli-Ram ghat route was notified for exclusive operation of the State Transport Undertaking under Section 68-D (3) of the Act as far back as 31st August. 1968, and yet the State Government has omitted to frame any rule in accordance with Section 68-I (2) (cc) of the Act. A scheme for nationalising a route is framed only when a Slate Transport Undertaking is of opinion that for the purpose of providing an efficient, adequate, economical and properly coordinated road transport service, it is necessary in the public interest that road transport services in general or any particular class of such service in relation to any area or route or portion thereof should be run and operated by the State Transport Undertaking, whether to the exclusion, complete or partial, of other persons or otherwise. Such is the requirement of Section 68-C. The scheme has to be approved by the State Government and evidently it would do so only if after hearing such objections as are contemplated by Section 68-D (1) of the Act, the State Government is of the same opinion as the State Transport Undertaking. The scheme thus would be one in the public interest and if the State Government delays or omits to frame a rule in accordance with Section 68-I (2) (cc) of the Act, public interest would obviously suffer. It strikes us that it could not have been intended by the legislature that the failure on the part of the State Government, which is subject neither to control by the public nor the State Transport Undertaking for whose benefit approved schemes are formulated, to frame a rule which could subserve no particular purpose and may require a mere formality should result in bringing about such consequences. Giving effect to the principle of construction laid down in Montreal Street Rly. Co., 1917 AC 170 = (AIR 1917 PC 142) (Supra) and followed subsequently with approval by the Federal Court and the Supreme Court the conclusion is reasonable that it is not mandatory for the State Government to frame a rule prescribing the form for an application for a permit under Section 68-F (1) of the Act.

16. Learned Counsel for respondent No. 3, however, contended that by virtue of Section 68-B of Chapter IV-A of the Act the provisions of that Chapter have to prevail over the provisions of Chapter IV only in cases where provisions dealing with the same subject exist in both the Chapters. It was contended that since there is no provision in Chapter JV-A analogous to Section 42 of Chapter IV, it was necessary for a State Transport Undertaking also to obtain permits for its vehicles plied for reward or hire. The permits are authorisations to the transport operators concerned to ply their vehicles in accordance with the conditions of the permits granted. An application for a permit under Chapter IV has to contain the particulars mentioned in Section 46 (a) to (e) and such other matters as may be prescribed by rules framed under Section 46 (f) read with Section 68. Under Section 48 (1) of the Act, the Transport Authority concerned has power to grant a stage carriage permit in accordance with the application or with such modifications as it may deem fit. If the application for a permit is granted under Section 48 (1) the particulars mentioned in the application except to the extent modified become conditions of the permit and it would not be open to a transport operator to deviate from those conditions. If there is a breach of any of the conditions of the permit under Section 60 the Transport Authority which granted it has power to cancel it or suspend it for such period as it thinks fit. It was submitted that before the amendment of Section 68-F (1) of the Act by Act No. 56 of 1969, the State Transport Undertaking applying for a permit in pursuance of an approved scheme was required to make an application in the manner provided for in Chapter IV and consequently had to mention in the application the particulars provided for by Section 46 (a) to (e) as well as any other matters prescribed by rules under Section 46 (f) read with Section 68 of the Act. In case a permit was issued, the particulars mentioned in the application became conditions of the permit and it was open to the Transport Authority issuing the permit to enforce conditions of the permit because it had power to cancel it in case there was any breach. This power of control, it was submitted, was in the interest of the travelling public. Our attention was invited to the decision of the Supreme Court in Shrinivasa Reddy v. State of Mysore : [1960]2SCR130 in support of the contention that prior to the amendment of Section 68-F (1) of the Act by Act No. 56 of 1969 it was obligatory for a State Transport Undertaking to apply for a permit even in pursuance of an approved scheme in accordance with Section 46 of the Act. It was submitted that if the legislature considered it obligatory for the State Transport Undertaking to apply for permits in forms prescribed and in accordance with Section 46 of the Act, there was no reason why Section 68-F (1) of the Act after its amendment by introduction of the words 'in such manner as may be prescribed by the State Government in this behalf' should be construed as rendering it unnecessary for the State Government if it so choose to frame any rules leaving it to the State Transport Undertakings to apply for a permit in any manner they choose. It was contended that such an interpretation would be hazardous to the interest of the travelling public because no control could be exercised by Transport Authorities on vehicles plied by the State Transport Undertakings. For a proper appreciation of this contention a brief Survey of certain provisions of Chapter IV-A of the Act and the U. P. State Road Transport Services (Development) Rules, 1958 -- hereinafter referred to as the Transport Services Rules framed by the State Government in exercise of powers under Section 68-I and Section 68 of the Act is necessary.

17. Section 68-A (b) defines a 'State Transport Undertaking' as any undertaking providing road transport service, where such undertaking is carried on by (i) the Central or a State Government, (ii) any Road Transport Corporation established under Section 3 of the Road Transport Corporations Act, 1950 (64 of 1950), (iv) any municipality or any corporation or company owned or controlled by the Central Government or one or more State Governments. Thus the definition of a 'State Transport Undertaking' itself indicates that though the undertakings also provide a service of motor vehicle carrying passengers or goods or both by road for hire or reward, the organizations by their very constitution are invested with a public character.

18. The conditions of efficiency, adequacy, economy and proper co-ordination of transport service in public interest must be fulfilled before framing of a scheme under Section 68-C. The scheme must give particulars of the nature of the service proposed to be rendered, the area or route proposed to be covered and such other particulars respecting thereto as may be prescribed. It must evidently contain particulars which would satisfy the tests of efficiency, adequacy and proper co-ordination of the transport service contemplated as well as of public interest. These requirements of Section 68-C would evidently cover most of the particulars required by Section 46 (a) to (e). Under Rule 3 of the Transport Services Rules, it is provided that:--

'Every scheme prepared by the State Transport Undertaking shall provide for all or any of the following matters, that is to say;

(a) The date on which the State Transport service shall commence to operate;

(b) The route or area or any portion thereof, on which road transport service shall be provided;

(c) The nature of the road transport service to be provided on the route or area or any portion thereof;

(d) The prohibition, restriction or curtailment of transport services other than those under the scheme;

(e) Whether the road transport service shall be run and operated to the exclusion, complete or partial, of other persons or otherwise;

(f) The extent, if any, to which persons other than the State Transport Undertaking will be permitted to provide road transport services on the route, area or any portion thereof, specified in Clause (b).

(g) The type and carrying capacity of the transport vehicles to be used in such services;

(h) The cancellation or modification of, or refusal to renew, the existing permits granted under Chapter IV of the Act;

(i) The reduction in the number of transport vehicles plying on the route;

(j) The curtailment of the area or routes covered by the existing permits, or making permits ineffective in respect of routes or portions thereof;

(jj) Giving of compensation, if any;

(k) Convenience of the passengers;

(l) Deleted.

(m) Such other consequential or incidental matters as may appear necessary or expedient for the purposes of the scheme.' These are all particulars which scheme formulated under Section 68-C would normally contain even in the absence of the Rule quoted to satisfy the tests mentioned above. Thus a scheme prepared under Section 68-C would be fairly comprehensive in nature providing for all relevant matters with regard to the transport service proposed to be rendered.

19. Under Section 68-D (1) of the Act as it stands

'on the publication of any scheme in the Official Gazette and in not less than one newspaper in regional language circulating in the area or route which is proposed to be covered by such scheme; (i) any person already providing transport facilities by any means along or near the area or route proposed to be covered by the scheme (ii) any association representing persons interested in the provision of road transport facilities recognised in this behalf by the State Government (iii) and any local authority or police authority within whose jurisdiction any part of the area or route proposed to be covered by the scheme lies, may within thirty days from the date of its publication in the Official Gazette, file objections to it before the State Government'.

Since the object of the scheme is to provide efficient, adequate and properly coordinated transport service in the public interest, it is apparent that it would be open to the objectors to satisfy the State Government under Section 68-D (2) of the Act that the scheme would not subserve the objectives for which it had been framed. The State Government has power to approve the scheme or to modify it. The power of modification would naturally be used for furthering the objectives as envisaged by Section 68-C of the Act. The scheme as approved or modified is required to be published in the official Gazette by the State Government. The particulars detailed in the scheme as notified constitute the terms and conditions on which it is approved and under which the State Transport Undertaking concerned has to provide motor transport service on the notified route.

20. When a scheme has been approved, Section 68-F (1) of the Act authorizes the State Transport Undertaking concerned to apply to the appropriate Transport Authority for a permit in pursuance of it. The use of the words 'in pursuance of an approved scheme' in Section 68-F (1) merely means that the application is made to give effect to the scheme and in execution thereof. Whatever other particulars an application for a permit under Section 68-F (1) may or may not contain, it is bound to disclose the Transport Authority to which it is addressed, the State Transport Undertaking which is the applicant and mention the particular approved scheme in pursuance of which a permit is sought. To our mind, when a State Transport Undertaking applies under Section 68-F (1) stating specifically in the application, as it must, that it is for operation of a motor transport service in pursuance of a particular notified approved scheme, it undertakes to ply the vehicles on the terms and conditions contained in the scheme and the particulars of the scheme become incorporated in the application by reference to it. We are also of the opinion that when the Transport Authority concerned issues a permit on the basis of such an application, it can legitimately mention in it the various terms and conditions of the approved scheme. In such a case the terms and conditions would unquestionably be 'conditions contained in the permit' within the meaning of Section 60 (1) (a). Even in cases where the terms and conditions of an approved scheme are not detailed out in the permit and the permit merely discloses as it should that it has been issued in pursuance of a particular scheme, the terms and conditions of the scheme become incorporated in the permit by reference to it by necessary implication and would amount, in our opinion, to 'conditions contained in the permit'. Moreover, the general conditions mentioned in Section 59 become attached to permits granted under Section 68-F (1) by operation of the statute. We are minded to hold and do so that if there is either a breach of any of the conditions of an approved scheme which are also the conditions of a permit under Section 68-F (1) or of any conditions mentioned in Section 5S (3) of the Act, the permit-holder is liable to penalties under Section 60. Further Rule 13 (1) of the Transport Services Rules provides that;

'No person shall use or cause to be used a transport vehicle on a notified route or area or portion thereof in contravention of the provisions of the approved scheme.' This rule clearly applies even to State Transport Undertakings. Section 112 makes penal a breach of this rule as of other rules framed under the Act.

21. For the reasons given, we are left unimpressed with the contention that in the absence of any prescription of the form for an application under Section 68-F (1) there could be no conditions attached to the permit issued and consequently the Transport Authorities would be powerless to exercise any control over State Transport Undertakings thus jeopardising the interests of the travelling public. This consideration is consequently of no avail in support of the view that the legislature intended it to be mandatory for the State Government to frame rules either under Section 68-F (1) or under that provision read with Section 68-I (cc).

22. The authority to which an application for a permit under Section 68-F (1) has to be made is prescribed by that provision of the Act itself. The purpose to effectuate which an application is maintainable under Section 68-F (1) and for which permits can be granted are also mentioned in the section. All matters of any substance must necessarily be contained in the notification approving the scheme and in the view taken by us the particulars of the scheme become incorporated by reference in the application made for a permit in pursuance thereof. Thus if the State Government chooses to frame any rule prescribing the form for an application for a permit it can by such rules merely provide for unsubstantial particulars of a formal character concerned with matters pertaining to convenience, uniformity and orderliness of the proceedings. A rule-making provision of such a character, in our view, could not have been intended by the legislature to be obligatory.

23. Before the amendment of Section 68-F (1) by Act 56 of 1969, an application for a permit in pursuance of an approved scheme was required to be made in 'the manner specified in Chapter IV'. This attracted the application of Section 46 which provides the particulars required to be mentioned in an application for a permit. The particulars envisaged by Section 46 are clearly divisible in two categories. Certain particulars were considered so vital that they were laid down by the legislature itself in Sub-sections (a) to (e) of Section 46. Other particulars were left to be prescribed by the State Government by rules under Sub-section (f). Since all matters considered substantial were provided for by the legislature itself, it is obvious, matters left to be provided by the State Government by rules were considered of little importance. In this context it is not possible to hold that it is mandatory for the rule making authority to frame rules under Section 68 read with Section 46 (f). If the State Government failed to frame rules contemplated by Section 46(f) and a State Transport Undertaking made an application for a permit under Section 68-F (1) mentioning therein the particulars contemplated by Sub-sections (a) to (e) of Section 46 and none other because no rules existed as contemplated by Sub-section (f), could it be said that the application was not made in 'the manner specified in Chapter IV'? In such a situation is it possible to hold that the Transport Authority concerned had no jurisdiction to issue a permit under Section 68-F (1) because no rules had been framed under Section 68 read with Section 46 (f)? Our answers to both the questions posed must be in the negative. We find it impossible to hold that merely because the State Government had chosen not to frame rules regarding matters not considered of importance by the legislature, the relevant Transport Authorities had no jurisdiction to issue permits to effectuate schemes formulated on considerations of efficiency, economy and proper coordination of transport service and approved because they are in public interest. It appears to us that since all substantial and material particulars must necessarily be contained in the approved scheme itself it was considered redundant to require mention being made of matters provided for in Sub-sections (a) to (f) of Section 46. It may well be that this consideration led the legislature to amend Section 68-F (1) and Section 68-I (cc) leaving it to the discretion of the State Government to frame rules providing for the manner of making an application for a permit under Section 68-F (1).

24. It has been held in Abdul Gafoor v. State of Mysore : [1962]1SCR909 that

'the Regional Transport Authority acts wholly in a ministerial capacity while dealing with an application of the State Transport Undertaking under Section 68-F (1).'

No one has a right to object to the issuance of a permit under Section 68-F (1) when an application is made by a State Transport Undertaking. All that the Transport Authority has to do is to ensure that the application is for a permit in pursuance of an approved scheme. If that is found to be so, the Transport Authority has no option but to issue the permit asked for.

25. Even before the amendment of Section 68-F (1) of the Act by Act No. 56 of 1969, it was not mandatory for an applicant applying for a permit to do so strictly in accordance with Section 46 of the Act. An application for a permit not containing all the particulars required by Sub-sections (a) to (f) could not be summarily rejected by a Transport Authority merely on the ground that it was not in accordance with Section 46. Section 46 provides that an application for a permit in respect of service of stage carriages or use of a particular motor vehicle as a stage carriage shall 'as far as may be, contain' the particulars provided for by Clauses (a) to (f). The very language employed makes it abundantly clear that merely because an application for a permit did not meticulously comply with the requirements of Clauses (a) to (f) of Section 46 it did not cease to be an application under that provision and it could not be rejected merely on that account. In the view taken by us, we find support from the decision of the Supreme Court in The Maharashtra State Road Transport Corporation v. Babu Gover-dhan Regular Motor Service, Warora : [1970]2SCR319 . The facts of the case before the Supreme Court were that the appellant as well as respondents 1 to 5 and 8 to 16 before the Supreme Court applied to the Regional Transport Authority, Nagpur on various dates in the years 1964-65 for the grant of stage carriage permits on certain routes. Under Section 68 read with Section 46 (f) and Rule 80 the State Government had prescribed Form P. St. S. A. for an application for a permit. The form contained various items of particulars which an applicant for a permit was required to furnish. The applications made by the appellant gave incomplete particulars with regard to certain items of the prescribed form. The Regional Transport Authority, after considering the applications and objections filed and hearing the parties, passed orders granting the permits asked for in favour of the appellant. Respondents 1 to 5 filed appeals before the Appellate Committee of the Transport Authority of Maharashtra challenging the grant of the permits in favour of the appellant and rejecting their respective applications. Before the Appellate Committee, respondents 1 to 5 raised a contention that the mandatory information required to be submitted in an application for a permit under Section 46 of the Act read with Form P. St. S. A. prescribed had not been fully and completely furnished by the appellant in its application. The Appellate Committee, after noting that the appellant, had in its application given major items of information as required under Section 46 and the relevant form, held that information regarding certain other matters as provided in the form of the application had not been provided by the State Corporation and in consequence there was a major defect in its application and that the other operators had no opportunity to properly object and contest the claim of the State Corporation. In this view, the Appellate Committee remanded the matter to the Regional Transport Authority for reconsideration with a direction that the State Corporation should be asked to furnish complete information and, after receipt of such information in the prescribed form, they must be duly published and an opportunity afforded to respondents 1 to 5 to be duly heard by way of objection and the entire matter be reheard and decided afresh. Respondents 1 to 5 before the Supreme Court challenged the order of the Appellate Committee before the Nagpur Bench of the Bombay High Court under Articles 226 and 227 of the Constitution. They contended before the High Court that the appellate Committee should have rejected the application of the State Corporation on the ground that the mandatory provisions of Section 46 of the Act had not been complied with. They also urged that the application filed by the State Corporation, inasmuch as it lacked information on vital matters, as provided in Section 46 of the Act read with the form, could not be considered to be an application under the Act and, as such, it did not deserve to be considered at all. It was submitted that the order of the Appellate Committee really amounted to allowing the appellant to convert a defective application so as to bring it in conformity with the provisions of the Act and the form, which is not permissible in law. The High Court in the order under attack before the Supreme Court took the view that there had been no proper compliance by the State Corporation with Section 46 in as far as it had not given complete particulars in respect of matters mentioned in columns 10, 14 and 15 of the prescribed form in its applications. It held that withholding of information on vital points, constituted! a defect in the application of the appellant and that created considerable difficulties for the authorities in considering the claims for the grant of permits. It also held that the Act did not, either expressly or impliedly, give power either to the Regional Transport Authority or the Appellate Committee to give an opportunity to an erring applicant to furnish additional or further particulars so as to convert a defective application into a proper application. The High Court held that the provisions of Section 46 of the Act read with Section 48 cast a mandatory duty upon an applicant, applying for a permit, to give the particulars required in the several clauses of Section 46 and that if the required particulars were not given such an application would not be an application within the meaning of Section 46 and the rules and, therefore, was liable to be rejected. In the end the High Court held that after the application filed by the State Corporation had been held to be defective, the Appellate Committee had no jurisdiction to give the State Corporation a fresh opportunity of furnishing additional particulars. In the view taken by it, the High Court set aside the order of the Appellate Committee and remanded the appeals to the Appellate Committee directing it to reconsider on the materials already on record the applications of ail parties except that of the State Corporation and to decide the question of grant of permits between the rival parties afresh. The result of the order of the High Court was the rejection of the applications made by the appellant Corporation.

26. The State Corporation appealed to the Supreme Court. Learned counsel for the appellant, inter alia, argued before the Supreme Court that the provisions of Section 46 of the Act were not mandatory and there was no jurisdiction in the authorities functioning under the Act to reject the application summarily on the ground that the application was not in conformity with the Act and the Rules framed thereunder. On the other hand, learned counsel for the contesting respondents urged that in order that an application filed by a party may be considered by the authorities charged with the duty of granting permits, the essential condition precedent was that the application must conform with the requirements of Section 46. It was urged that the object underlying Section 46 of the Act was to enable the other applicants and the various other interested persons to know the nature of the claim made by a particular applicant and to make either suitable representations against the same or to file objections. It was urged that the High Court's view that the absence of particulars in respect of items 10, 14 and 15 in the form was a non-compliance with the Act and, therefore, the application made by the applicant was no application under the Act, was correct. It was submitted that the Appellate Committee's order allowing the appellant to, so to say, amend the application, by giving additional particulars, was properly set aside by the High Court. The Supreme Court held that the rule framed by the State Government prescribing the form for an application under Section 46 of the Act was a valid rule. After considering the various provisions of Chapter IV specially Section 47 which provides for taking into consideration by the relevant Transport Authority any representations made, Sub-sec-tion (3) of Section 57 which provides for the Regional Transport Authority making available applications for permits or inspection at its office and for publication of the same in the prescribed manner inviting representations within the period mentioned therein and Sub-sections (4), (5) and (6) of Section 57 which deal with the consideration of the representations received and disposal of applications for permits at a public hearing at which applicants for permits and persons who make representations are to be given an opportunity of being heard it held, that :

'An application filed by a party for a permit must, at any rate, substantially conform to the requirements of Section 46, as well as to the form framed under the rule-making power of the State Government.'

The Supreme Court further held that :

'Therefore the relevant rule and the form prescribed, have to be read together, and so read it follows that an applicant for a permit must comply, at any rate, substantially with the various matters mentioned therein.'

The Supreme Court refused to accept the view taken by the High Court that the application of the appellant being defective was liable to be dismissed, inasmuch as columns 10, 14 and 15 of the application form had not been properly filled in. The Supreme Court clearly held that it was not inclined to agree with the reasoning of the High Court that under such circumstances the applications filed by the appellant could not be treated to be applications under the Act. Though the Supreme Court held that an applicant for a permit must furnish full and complete information, that is within his knowledge or possession in his application for the grant of a permit, it did so on the consideration that the Act gave a right to the contending claimants and certain other persons and authorities to file objections and representations against the grant of permits on the basis of an application made and not on the consideration that the requirements of Section 46 are mandatory. It was clearly held that neither the Transport Authority constituted under the Act nor the High Court had power to summarily reject an application purported to be made under Section 46 on the ground that it failed to comply with the requirements of Section 46 of the Act. It was held that :

'What the High Court has done in this case, was really to reject the application of the appellant summarily, a power, which even the Transport Authority does not, in our opinion, have under the Act. Probably the statute did not give power to an authority to reject an application summarily in cases not coming within the proviso to Section 57 (3) because when considering an application for grant of permits on merits, it may be open to the Regional Transport authority, after giving reasons, under Section 57 (7) to refuse the application for permit. In such a case, as the Regional Transport Authority is bound to give reasons, the sufficiency and validity of the reasons given may also be canvassed before the appellate authoity in an appeal under Section 64 of the Act. But all this can be (done only at the time while considering the grant of permits on merits and -- Ed.) not at an earlier stage, and the refusal to grant the permit will be not on the ground that the application is defective, but on the ground that the particulars or information and other matters given in the permit do not enable the Regional Transport authority to take the view that a particular applicant's claims are superior to those of others.'

27. If the Supreme Court had been of the view that the requirements of Section 46 are mandatory, it would naturally have concluded that an application failing to comply with the requirements of Section -46 was not an application under the Act and was not maintainable and consequently liable to summary rejection. Though in the case discussed above the Supreme Court was concerned with an application under Section 46, similar considerations would apply to an application under Section 68-F (1) of the Act before its amendment by Act 56 of 1969 because till then an application for a permit under that provision had to be made 'in the manner specified in Chapter IV' that is to say in accordance with Section 46. If it was not mandatory for a State Transport Undertaking to apply for a permit strictly in accordance with Section 46 of the Act, we see no reason to hold that after the amendment the legislature intended it to be obligatory for the State Government to frame rules under Section 68-I (cc) and to require a' application for a permit under Section 68-F (1) after its amendment being made strictly in accordance with the rules, if any framed. It may be mentioned here that when an application is made under Section 46, objections and representations can be filed and permits can be granted by the Transport Authority concerned only on a comparison of suitability of the various applicants. On the other hand, when an application under Section 68-F (1) is made, no one has a right to object to the issuance of a permit. This consideration fortifies us in our conclusion that it is neither mandatory for the State Government to frame any rules under Section 68-I (cc) of the Act nor is there any lack of power in the Transport Authorities to grant permits under Section 68-F (1) of the Act, if no suck rules have been framed.

28. On a consideration of the scheme of the Act, the objective sought te be secured and the fact that by exercising its rule-making power the State Government can provide merely for unsubstantial matters relating to the manner of making an application for a permit under Section 68-F (1), we conclude that the power is merely discretionary. Further, in our judgment the jurisdiction of the Transport Authorities to issue permits is not dependent on the State Government framing such rules.

29. It was further contended by the learned counsel for the appellant that the revision was not maintainable before respondent No. 1 at the instance of respondent No. 3 because he had no right to object to the grant of a permit and consequently there was no case within the meaning of Section 64-A, the record of which could be called for by the Revisional Authority and orders passed therein. In the view taken by us on merits with regard to the orders passed by the State Transport Appellate (Tribunal), it is unnecessary to decide this question in the present case.

30. In the result, we allow this appeal, set aside the order of the learned single Judge and quash the order passed by respondent No. 1. The appellant shall be entitled to its cost from respondent No. 3 of this appeal as well as of the writ petition.


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