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Amba Prasad Maheshwari Vs. Jugal Kishore - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad
Decided On
Reported inAIR1936All112; 159Ind.Cas.790
AppellantAmba Prasad Maheshwari
RespondentJugal Kishore
Excerpt:
- - the plaintiff had actually no monopoly and his so-called virtual monopoly or the exclusive right which he could enjoy through official favour and public ignorance, was not at all a legal one. it is well settled that agreements for creation of monopolies are void and under the english common law and under section 23, contract act, as the creation of monopolies is opposed to public policy. this bye-law shall not be applicable to through traffic lorries whose part of the journey lies in another district as well......by section 91(a) the board is charged with the duty of constructing, repairing and maintaining public roads and bridges, empowered by section 97, clauses (a), (b) and (c) to lay out and make a new public road or to widen, lengthen, etc., or otherwise improve any public road vested in the board or to divert or discontinue the same. section 105 of the act authorized the board to charge fees for the use or occupation of any public road if it allows the use or occupation of the same as allowing a projection thereon or otherwise.' further section 106 entitles the board to charge a fee to be fixed by bye-law for any licence, sanction or permission which it is entitled or required to grant by or under the act.' it is significant that the sections which vest certain rights in the board and.....
Judgment:
ORDER

Iqbal Ahmad, J.

1. The attempt of the District Board of Saharanpur in the year 1929 to grant to the plaintiff a monopoly or exclusive right to run lorries on hire on certain roads in the District of Saharanpur has been productive of much contusion and has eventually culminated in the present litigation. On the one hand it has been argued that the Board has the right to grant exclusive permits to ply lorries on hire on the District Board road and prevent the owners of lorries who have not been given such permits from using the roads for such purpose, whereas on the other hand it has been contended that it is not within the competence of a Board to create monopolies of this description. For the decision of the civil revision before me it is not necessary to decide the point as, on the findings recorded by the Small Cause Court Judge, the question of law that has been argued does not arise, but as the question has been argued at some length and is of general importance, I consider it desirable to express my opinion on the subject. In the beginning of the year 1929 a proposal was brought before the Board to give exclusive right to the plaintiff for a period of 5 years to ply motor oars and lorries on hire on kachcha roads of the District Board, provided the plaintiff agreed to keep and regularly run buses and cars on fixed hire and further agreed to do the necessary repairs to the roads, bridges and culverts. The plaintiff was agreeable to the proposal and accordingly the Board, by a resolution dated 15th January 1929, approved of the proposal and gave

full power to the Chairman to decide the matter with the consultation of the Collector and Superintendent of Police and have trial.

2. The matter appears to have been discussed between the Chairman and the Collector with the result that the plaintiff executed a document embodying the proposal and the terms mentioned above. A document purporting to be an agreement on behalf of the Secretary of State for India in Council giving to the plaintiff the exclusive right to use the road for the purpose mentioned above was also drawn up but does not appear to have been signed by any person authorized to do so. The question whether it was within the competence of the Board to create a monopoly in favour of the plaintiff does not appear to have engaged the attention either of the Chairman or of the Collector, nor did they take the trouble of getting the documents mentioned above duly executed and registered before translating the proposal into action. This was the beginning of the confusion. Though the documents remained incomplete and ineffectual in law, the plaintiff commenced to run lorries in assertion of his exclusive right to do so; This evoked, as it was bound to do, public protest and the matter was taken to, de-bated and discussed in the Local Legislative Council. The proceedings in the Council were followed by orders issued by various executive authorities, but these, far from easing the situation, made confusion worse confounded. It is obvious that the proceedings in the Council and the consequent correspondence between, or the orders passed by, various Executive Officers are wholly irrelevant for the decision of the question of law mentioned above and, if I refer to these, I do so merely to illustrate the inconsistent and contradictory nature of the correspondence and the orders that were passed by various Executive Officers. All this would have been avoided if any one concerned had paused to consider the elementary question whether the Board had the statutory right to create monopolies of the nature mentioned above and, if so, the manner in which it could be created. This was however not done and the matter was allowed to drift till the Local Government confirmed certain bye-laws framed by the Saharanpur District Board under Section 174(2)(q), United Provinces District Boards Act, on 10th January 1933. A reference to these bye-laws shall presently be made.

3. By G.O. No. 850-VIII-12, dated 8th March 1930, (Ex. A), the alleged agreement between the plaintiff and the Board was declared void and against public policy. Further in answer to a question in the Legislative Council the Hon'ble the Home Member replied that no sanction of the Government was obtained for the monopoly alleged by the plaintiff and that the monopoly had since been cancelled. Notwithstanding all this plaintiff continued to exercise the monopoly granted to him and by D. O. No. 600-C, dated 23rd April 1930, the Secretary to the Local Self-Government Department informed the plaintiff that he can continue to hold a virtual monopoly of the motor traffic in the District and that:

There was nothing to prevent this monopoly being continued at least until the whole question had been thoroughly gone into.

4. It is manifest that it is impossible to reconcile G.O. dated 8th March 1930, with D. O. dated 23rd April 1930. The D. O. dated 23rd April 1930, was followed by three D. O. letters written by the Commissioner of the Meerut Division. One was addressed to the District Magistrate of Saharanpur, another to the Secretary, Local Self-Government, and the third to the Deputy Secretary to U.P. Police Department. In all these the Commissioner reiterated the view expressed by the Secretary to Local Self-Government in his D. O. dated 23rd April 1930, viz., that the plaintiff was entitled to continue to exercise the monopoly granted to him. In 1932 and 1933 the Commissioner and the D.I.G. wrote letters to the Superintendent of Police of Saharanpur to the effect that the monopoly should be continued. The matter again came up before the Legislative Council on 6th March 1933, and I gather. from the judgment of the Court below that the Hon'ble Minister for Local Self-Government recognized the monopoly in favour of the plaintiff. But in the end of 1933 or in the beginning of 1934, the Superintendent of Police registered certain lorries belonging to the defendant and allowed them to be plied on hire on the roads over which the plaintiff's lorries were run. The plaintiff then brought the suit giving rise to the present application in revision in the Court of Small Causes at Saharanpur for the recovery of damages on account of alleged breach' of plaintiff's monopoly or exclusive right to run lorries on certain roads in the District. The Court below has found as a fact that:

The plaintiff had actually no monopoly and his so-called virtual monopoly or the exclusive right which he could enjoy through official favour and public ignorance, was not at all a legal one.

5. It also held that the Superintendent, of Police ' could legally grant' permits to the defendant and he did so grant them. In view of these findings the plaintiff's; suit was dismissed.

6. The findings of the Small Cause Court, Judge that the monopoly claimed by the plaintiff was not granted to him is based on the fact that the agreement executed by the plaintiff was 'unilateral and unregistered,' and the agreement purporting to be on behalf of the Secretary of State for India, was, according to the Collector's letter, 'not in any way an agreement' but 'was only an order and was headed as such.' It is clear, as already observed, that no lease in favour of the plaintiff was created by means of duly executed documents, and therefore no exception can be taken to the finding of the Court below that the monopoly claimed by the plaintiff was not granted to him. This finding disentitled the plaintiff to any relief and his suit was accordingly rightly dismissed. But apart from these the Board had, in my judgment, no authority to create a monopoly in the plaintiff's favour entitling him to run lorries on hire on particular roads in the district to the exclusion of others and accordingly the suit for damages for breach of the alleged monopoly was not maintainable. District and Municipal Boards are creation of statutes and their rights and duties must be sought for within the four corners of the Acts creating them. It is well settled that agreements for creation of monopolies are void and under the English Common law and under Section 23, Contract Act, as the creation of monopolies is opposed to public policy. Even the Crown cannot without statutory authority, except in certain cases which are irrelevant for the purposes of the present case, grant a monopoly to any person or group of persons to secure the sole exercise of any known trade throughout the country: vide Halsbury's Laws of England, Vol. 27, paragraph 1026, p. 526. It is clear that an agreement that discloses an attempt on a large scale to reserve in favour of a particular individual the right to ply on hire motor lorries to the exclusion of others is against public policy as it has the tendency to fix the hire at an artificial figure and is therefore unenforceable in law.

7. An examination of the various provisions in the U.P. District Boards Act, 1922, leads me to the conclusion that it is not within the competence of a Board to create a monopoly of the nature referred to above. By Section 91(a) the Board is charged with the duty of constructing, repairing and maintaining public roads and bridges, empowered by Section 97, Clauses (a), (b) and (c) to lay out and make a new public road or to widen, lengthen, etc., or otherwise improve any public road vested in the Board or to divert or discontinue the same. Section 105 of the Act authorized the Board to charge fees for the use or occupation of any public road if it allows the use or occupation of the same as allowing a projection thereon or otherwise.' Further Section 106 entitles the Board to charge a fee to be fixed by bye-law for any licence, sanction or permission which it is entitled or required to grant by or under the Act.' It is significant that the sections which vest certain rights in the Board and charge it with certain. duties as regards public roads do not in any way authorize the Boards to limit the legitimate user of the rights by the public in any manner. The fee that it is entitled to charge for the use or occupation of a public road by a virtue of the provisions of Section 105 is limited to the case of use or occupation of the road by allowing a projection thereon or otherwise.' The word 'otherwise' in Section 105 must be taken to be ejusdem generis with the words 'allowing a projection.' There is no provision in the Act that entitles the Board to charge fees for the use of the road as a highway by the members of the public. That this is so is made clear by the provisions of Section 148 of the Act. That section while entitling the Board to fix and levy, with the previous sanction of the Local Government, tolls for the use of bridges constructed, repaired or maintained under Clause (a), Section 91 is silent about the right of the Board to charge fees for the use of the road as a highway. Clause (a) 6f Section 91 deals not only with bridges but also with public roads, as there is a specific provision in the Act giving the power to the Board to charge fees for the use of the bridges and the Act is silent as to the tolls for the use of the roads, the conclusion is irresistible that the legislature intended to and did deny to the Board the right to charge tolls or fees for the use of the roads. Creation of monopolies by the Board for the exclusive user of particular roads for a particular purpose must obviously be with the object of making monetary gain as a consideration for the grant of the monopoly but as the Board is not authorized by the Act to make money by allowing the roads to be used as a highway, the creation of such monopolies is ultra vires of the Board.

8. But it is argued that as by Section 146(b) of the Act all public roads, which have been constructed or are maintained out of the District Board funds, vest in and belong to the Board, the Board has the right to grant permission to one individual to solely ply lorries on hire on the roads. In my judgment there is no force in this contention. The soil of the. road no doubt vests in the Board, but the right of the public to use the road for the purpose of passing and re-passing is untrammelled by the provisions of Section 146 of the Act. Section 146 means no more than this: that whereas the public has a right of way on the road, the soil and every right incident to the ownership of the soil is vested in the Board. The ownership of the Board is subject to the right of the public to use the highway and there is no provision in the Act, that in any way limits or curtails the legitimate use of a highway by the public for the exercise of the right of passing and re-passing over the same. Every owner or driver of a car or lorry is registered under the Indian Motor Vehicles Act 1914, and who has the necessary license or permit required by that Act has a right to use all public roads, whether vested in the Board or not as a highway and the Board is not authorized to jeopardize this right of the public by creating monopolies in favour of particular individuals.

9. The learned Counsel for the plaintiff-applicant relied on the decision in Harrison v. Duke of Rutland (1893) 1 QBD 142, in support of his contention that as the roads were vested in the Board it had the right to grant the monopoly to the plaintiff. The facts of that case were as follows: The Duke of Rutland was the owner of a grouse moor crossed by a highway, the soil of which was vested in him. On the occasion of a grouse drive upon this moor, Harrison, the plaintiff, went upon the highway, not for the purpose of using it as a highway, but solely to interfere with the Duke of Rutland's enjoyment of his right of shooting, by preventing the grouse from flying towards the butts occupied by the shooters. Harrison was forcibly prevented by the Duke of Rutland's men from causing the interference and then Harrison brought an action for assault against, the Duke of Rutland and his men. The plea taken by the defendants was that the plaintiff was a trespasser and was therefore not entitled to sue, It was held that 'inasmuch as the plaintiff was upon the highway for purposes other than its use as a highway, he was a trespasser.' It is argued by the learned Counsel that though the public has the right to use the roads to run cars or lorries on the same, it has no right to use the roads for the purpose of making profit by plying ears or lorries on hire. In other words the contention; is that the use of a highway for the purpose of making profit without the leave and license of the owner of the soil constitutes a trespass, l am wholly unable to agree with this contention. The mere fact that a highway is used to make money by charging hire is not an illegitimate use of the highway as in so doing the man who charges the hire does not exercise any greater right than that of a passing and re-passing over the highway, a right which he shares with the public at large. In the case relied upon by the learned Counsel Harrison used the way not for the purpose for which a highway is meant but for the purpose of causing obstruction in the exercise of the right that the Duke of Rutland undoubtedly had in the grouse moor. That case has therefore no application to the present case. Lastly it has been urged that the Board was authorized by Section 174(2)(q), District Boards Act, to grant to the plaintiff the exclusive right to ply lorries on hire, Section 174 provides that:

A Board by a special resolution may, and where required by the Local Government shall, make bye-laws consistent with this Act, and with any rule, for the purpose of promoting or maintaining the health, safety and convenience of the inhabitants of such area and for the furtherance of the administration of the district under this Act.

10. Further it is provided by Section 174(2)(q) that a Board may in the exercise of the power to make bye-laws make a bye-law

providing for the regulation or prohibition of any description of traffic on any public road where such regulation or prohibition appears to the Board to be necessary.

11. In this connexion reference is made to the bye-laws referred to above that were framed by the Saharanpur District Board and were confirmed by the Governor acting with his Ministers' and were published in the United Provinces Gazette dated 14th January 1933. One of the bye-laws framed by the Board was as follows:

The number of lorries permitted to be run on a particular District Board road shall be fixed from time to time by the Chairman in consultation with the licensing authority and no lorries in excess of this number shall be allowed to run on these roads. This bye-law shall not be applicable to through traffic lorries whose part of the journey lies in another district as well. The owners of the lorries before obtaining a license shall take a certificate from the Chairman that the lorry can be allowed to run on a particular road.

12. In my judgment the Board has no right under Section 174 to make the bye-law quoted above. The word regulation' has been used in Sub-clause (q) in contradistinction to the word 'prohibition'. By a bye-law the Board has the right to prohibit generally any description of traffic, provided the prohibition appears to the Board to be necessary. The prohibition however cannot be partial. Either the Board can totally prohibit traffic of a particular description or it cannot. The word 'regulation' is used in the sense of making provision for the time at which and the manner and order in which a particular description of traffic, which is not prohibited, can be carried on the roads, and is certainly not used in the sense of authorizing the Board to make a bye-law that has the indirect effect of a partial prohibition of a particular description of traffic. One can regulate an act which is allowed and not an act which is prohibited A monopoly granted to one individual to run lorries has the effect of prohibiting others from exercising the same right, and nothing could have been farther from the. intention of the. legislature than to vest the Board with the right to do what is universally recognized as opposed to public policy by making a bye-law for the purpose of 'regulating traffic'. It is to be remembered [that while full effect is to be given to the purport of the provisions in enactments constituting local bodies such as District Boards, the language of such enactments is not to be stretched to cover attempts made to interfere in any way with the exercise of the ordinary rights of citizens. The law on the subject has been thus laid down in Logan v. Pyne 43 Iowa 524, (2):

The power of Municipal Corporations is strictly confined within the limits prescribed by the statutes creating them and will not be extended by the Courts upon mere inference. It always depends upon express grant or must be necessarily implied, an incident to other powers expressly granted or indispensable to the object and purpose for which the corporations were created. Doubts as to the existence of such powers must be resolved against the corporations and in favour of the public. A Municipal Corporation can grant if at all exclusive privileges for the protection of business which, without prohibitory legislation would be free to all men, only Under express legislative grant of power. Monopolies being prejudicial to the public welfare, the Courts will not infer grants thereof, refusing to presume the existence of legislative intention in conflict with public policy.

13. The view that I take is in consonance with the decision in Somu Pillai v. Municipal Council Mayava Ram (1905) 28 Mad 520. I therefore hold that the Board was not competent to grant the monopoly to the plaintiff and the plaintiff's suit was rightly dismissed. The application is dismissed with costs.


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