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C.S. Rowjee and ors. Vs. Andhra Pradesh State Road Transport Corporation - Court Judgment

LegalCrystal Citation
SubjectMotor Vehicles
CourtSupreme Court of India
Decided On
Reported inAIR1964SC962; [1964]6SCR330
ActsMotor Vehicles Act, 1939 - Sections 68C, 68D(3) and 68F(1); Andhra Pradesh Motor Vehicles Rules, 1957 - Rules 4 and 141; Motor Vehicles (Amendment) Act, 1956
AppellantC.S. Rowjee and ors.
RespondentAndhra Pradesh State Road Transport Corporation
the case debated over the preparation and enforcement of scheme of nationalization of road transport service and the validity of issue of permits to state transport undertakings- it was held that the route which was proposed to be nationalized under the scheme admittedly lay wholly within the state- the right of the private operators to ply their vehicles beyond the state border was not affected by any of the schemes- therefore the proviso of section 68-d(3) of the motor vehicles act, 1939 was not attracted and consequently the schemes did not suffer from the defects alleged- in andhra pradesh there is admittedly a regional transport authority, therefore it could not be held that such authority was deprived of the power to issue a permit by reason of section 68-f(1) of the act merely.....ayyangar j.1. this batch of 11 appeals which have been consolidated for hearing aredirected against the common judgment of the high court of andhra pradesh andare before us on the grant of a certificate of fitness under art. 133(1) of theconstitution by the said high court. 2. the proceedings concerned in the appeals arise out of writ petitionsfiled before the high court by the several appellants before us under art. 226of the constitution challenging the validity of three schemes framed underchapter iv-a of the motor vehicles act, 1939, nationalising motor transport incertain areas in the kurnool district of the state of andhra pradesh which forconvenience we shall refer to as the impugned schemes. the appellants whoimpugn the validity of the schemes are the previously existing motor.....

Ayyangar J.

1. This batch of 11 Appeals which have been consolidated for hearing aredirected against the common judgment of the High Court of Andhra Pradesh andare before us on the grant of a certificate of fitness under Art. 133(1) of theConstitution by the said High Court.

2. The proceedings concerned in the appeals arise out of Writ Petitionsfiled before the High Court by the several appellants before us under Art. 226of the Constitution challenging the validity of three Schemes framed underChapter IV-A of the Motor Vehicles Act, 1939, nationalising motor transport incertain areas in the Kurnool District of the State of Andhra Pradesh which forconvenience we shall refer to as the impugned Schemes. The appellants whoimpugn the validity of the schemes are the previously existing motor transportoperators whose permits are liable to be modified or cancelled under the provisionsof the Schemes on their coming into force. The impugned schemes were publishedby Government as G.O.Ms. 292, 293 and 294 of the Homes, Transport Department onthe 5th February, 1963 in virtue of the powers conferred on Government bysub-s. 2 of the 68-D of the Motor Vehicles Act. The Andhra Pradesh State RoadTransport Corporation which for shortness we shall refer to as the Corporation,besides the State of Andhra Pradesh and the Regional Transport Authority,Kurnool were impleaded as respondents to the petitions. They are also therespondents before us. By reason of the first Scheme, 34 routes were intendedto be taken over, while under the 2nd and 3rd, 17 and 13 routes respectivelywere proposed to be nationalised. The routes covered by these three schemes areall in the western half of the Kurnool District.

3. Before adverting to the points requiring consideration in the appeals, itwould be convenient to set out the relevant statutory provisions relating tothe nationalisation of Road Transport for it is primarily on their constructionthat the decision of the appeals would turn.

4. Chapter IV-A containing special provisions relating to 'StateTransport Undertakings' was introduced into the Motor Vehicles Act (Act IVof 1939) by an amendment effected by Central Act I of 1956 which came intoeffect on 16-2-1957. The Chapter consists of sections numbered 68-A to 68-I.68-A contains definitions and of these it is sufficient to refer to thedefinition of 'State Transport Undertaking' which includes inter alia'any undertaking providing road transport service, where such undertakingis carried on by...... any Road Transport Corporation established under section3 of the Road Transport Corporation Act 1950.' (to refer to the portionwhich is material.)

5. (It might be mentioned that the Corporation, the first respondent beforeus is a body established under this enactment.)

6. 68-B reads :-

'The provisions of this Chapter and the rules andorders made thereunder shall have effect notwithstanding anything inconsistenttherewith contained in Chapter IV of this Act or in any other law for the timebeing in force or in any instrument having effect by virtue of any suchlaw.'

7. The next section 68-C which is the one most involved in the appeals runs:

'Where any State Transport undertaking is ofopinion that for the purpose of providing an efficient, adequate, economicaland properly coordinated road transport service, it is necessary in the publicinterest that road transport services in general or any particular class ofsuch service in relation to any area or route or portion thereof should be runand operated by the State transport undertaking, whether to the exclusion,complete or partial, of other persons or otherwise, the State transport undertakingmay prepare a scheme giving particulars of the nature of the services proposedto be rendered the area of route proposed to be covered and such otherparticulars respecting thereto as may be prescribed, and shall cause every suchscheme to be published in the Official Gazette and also in such other manner asthe State Government may direct.'

8. The first two sub-sections of section 68-D enable persons affected by aScheme published under s. 68-C to file objections thereto before the StateGovernment within thirty days after the publication of the Scheme. It furtherprovides for the State Government considering the objections raised by personsaffected by the Scheme after giving an opportunity to the objectors and the'undertaking' to be heard in the matter before approving or modifyingthe Scheme. The Scheme so approved or modified is required to be published inthe State Gazette and on such publication it becomes final and is to be called'the approved scheme'. This is followed by sub-section (3) which reads:-

'The scheme as approved ormodified under sub-s. (2) shall then be published in the Official Gazette bythe State Government and the same shall thereupon become final and shall becalled the approved scheme and the area or route to which it relates shall becalled the notified area or notified route :

Provided that no such schemewhich relates to any inter-State route shall be deemed to be an approved schemeunder it has been published in the Official Gazette with the previous approvalof the Central Government.'

9. Section 68-E provides :

'any scheme published under sub-s. (3) of S. 68-Dmay at any time be cancelled or modified by the State transport undertaking andthe procedure laid down in s. 68-C and s. 68-D shall so far as it can be madeapplicable be followed in every case where the scheme is proposed to bemodified if the modification proposed were a separate scheme.'

10. Section 68-F is really consequential on the approval of the scheme andsub-s. (1) thereof enact :-

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

11. Its second sub-section enables the Regional Transport Authority torefuse renewal of any other permits to private operators and otherwise to dealwith those permits so as to give effect to the Scheme. Section 68-G and 68-Hdeal with the payment of compensation and the methods by which the same shouldbe computed but as these are not material, we shall not quote them.

12. Section 68-I empowers the State Government to make rules for the purposeof carrying into effect the provisions of Chapter IV-A and among the specificpurposes for which such rules may be framed is one under s. 68-I(2)(a) whichprovides for the form in which any scheme or approved scheme may be publishedunder section 68-C or sub-section (3) of Section 68-D and as usual a residuaryclause reading :

'any other matter which has to be or may beconsidered.'

13. These draft schemes prepared by the Corporation were published under s.68-D in the official Gazette on the 29th of November, 1962. The appellantsamong other filed objections to the schemes and thereafter there was a hearingof these objections by the Transport Minister of State under s. 68-D(2) on the11th of January, 1963. The Minister passed an order according approval to theschemes on the 12th February, 1963, and the schemes as finalised were publishedin the Gazette on the next day, February 13, 1963. In pursuance of theprovisions of the schemes the Corporation made application to the RegionalTransport Authority for permits. Soon thereafter the applicants and a fewothers filed writ petitions invoking the jurisdiction of the High Court underArt. 226 of the Constitution praying for the quashing of the schemes. Thesepetitions were dismissed by the High Court by a common judgment on the 19th ofApril, 1963, holding that the objections made to the validity of the schemeswould not be sustained. The learned Judges, however, on the application of theAppellants granted a certificate of fitness under Art. 133 in pursuance ofwhich these appeals have been preferred.

14. The points urges by the appellants before us in support of theirsubmission regarding the invalidity of the impugned schemes, were substantiallythe same as were urged before High Court and which the learned Judges repelled.Briefly stated the principal ones were :- (1) that the schemes did not inreality reflect the opinion of the Corporation that 'it was necessary inthe public interest that the Road Transport services in the area or over theroute, specified in the schemes should be run and operated by the StateTransport Undertaking' as is required by s. 68-C but that the schemesowned their origin to the direction of the Chief Minister of Andhra Pradesh whoacted mala fide in directing the Transport Undertaking to frame the impugnedschemes for the areas for which they were purported to be framed; (2) that thedecision by the Transport Minister over-ruling the objections raised by theseveral road transport operators to the schemes was also mala fide, in that hetoo acted in pursuance of the mala fide intentions of the Chief Minister ofAndhra Pradesh; (3) that the provisions of the schemes (and this applied bothto the draft schemes published by the Corporation as well as the approvedschemes published under s. 68-D(3) did not conform to the statutoryrequirements of s. 68-C and rule 4 of the Rules regarding the particulars to beembodied in the schemes and that in consequence the core of the scheme was inviolation of Rule 68(E) of the Act; (4) that the schemes comprised not merelyintra-state routs but also included inter-state transport routes and in thelatter case the procedure prescribed by the proviso to s. 68-D was not followedand hence all the impugned schemes which are integrated ones are bad andrequire to be set aside. There were also a few minor ones which we shall noticeand examine later.

15. We shall deal with these four points in the same order. Before taking upthe first one viz., that the draft scheme in s. 68-D really did not originatefrom the Corporation, the State Transport Undertaking, but that it was doneunder the direction of the Chief Minister who, it was alleged for reasons whichwere set out in the affidavits and to which we shall refer presently was statedto have compelled, directed or induced the Corporation to do so, it would benecessary to give a short resume of the history of nationalised transport inAndhra Pradesh as well as certain events in Andhra Pradesh politics which havebeen the subject of allegations in these proceedings. The present State ofAndhra Pradesh is made up two distinct areas - (1) what is known as the'Telengana area' consisting of nine districts of the old HyderabadState and (2) the 'Andhra area' which separated from Madras i.e. fromthe composite Madras State, in October 1953 and which comprised 11 districts.These two areas were integrated under the States Re-organization Act, 1956, toform the present State of Andhra Pradesh. In the Telengana area the road transportservices had been run by the Government of the Nizam since the year 1932 and by1956 private motor road transport operators had been completely eliminated fromthis entire area. In the Andhra Area comprising the 11 districts however,nationalisation of motor transport had been undertaken. Soon after theformation of the State of Andhra Pradesh, the Andhra Pradesh State RoadTransport Corporation was established with effect from 11th of January, 1958with a view to take steps for extending nationalised transport to the Andhraareas of the State. Certain routes in three of the 11 Districts Krishna, WestGodavari and Gunture were nationalised from 1959 onwards. The Vijayawada -Masulipatam and Vijayawada-Guntur routs were nationalised in the first instanceand thereafter by about September, 1959, almost the entire routes in KrishnaDistrict were nationalised. The next district to be taken up was West Godavariwhich was done in March, 1960. The process was nearly completed in thisdistrict by the 1st of February, 1960, except for a few routes. The Governmenthad sanctioned certain schemes for nationalisation in Guntur District whichwere expected to be completed by October, 1961. The question which wasthereafter the subject of consideration was the manner in which and the stageswhereby nationalisation of the motor transport throughout the State might bebrought about. With this object the Corporation adopted a resolution in 1960 bywhich it decided to appoint an expert Committee to go into question as to theworking of nationalised transport with a view to improve its efficiency as wellas for drawing up plans for the future expansion of the road transport servicesin the State. The terms of reference to that Committee were comprehensive andit started functioning very soon after the members were appointed. Shri S.Anantharamakrishnan, Chairman of Messrs. Simpon & Co. Ltd., Madras, one ofthe principal motor transport operators of the Madras State, was the Chairmanof the Committee and it comprised three other members who were officials of theAndhra Pradesh State Government. The Committee made various recommendations inthe Report which it submitted to the Corporation on the 9th February, 1961.Among the several recommendations which this Committee made, what is ofrelevance to the present appeals and on which reliance was placed in support ofthe plea that the impugned schemes were vitiated by mala fides are thosecontained in Chapter IX of the Report and in particular the priorities of areasfor taking up nationalisation which the Committee recommended in paragraph 125.They set out in paragraph 124 the factors which should be taken into account infixing the order in which new areas should be taken up for nationalisation asbeing (1) 'the most profitable areas should be taken up first;' (2)'from the traffic point of view there should be contiguousexpansion;' (3) 'from the administrative point of view it isconvenient to nationalise bus services district by district;' and (4) 'theproposal to form large sized divisions should be borne in view.' Adoptingthese criteria the Committee stated in paragraph 125 'that thenationalisation of bus transport may be extended to the remaining districts inthe Andhra area as indicated below :-

1961-62 - Guntur District

1962-63 - Nellore and ChittorDistricts

1963-64 - Cuddapah and KurnoolDistricts

1964-65 - Anantapur and EastGodavari Districts

1965-66 - Visakhapatnam andSrikakulam Districts'.

16. The Committee also added in paragraph 126 'we recommend that apolicy decision may be taken by Government on the proposal to extendnationalisation of bus services to the remaining Andhra Districts during theThird Five Year Plan. The order in which the new areas will be taken over mayalso be decided by Government. The Corporation will then be able to make itsplans well in advance, and arrange to provide all the facilities that areneeded for expending its activities to other districts.' This report ofthe Anantharamakrishnan Committee was the subject of consideration by theCorporation and they accepted in March, 1962 the above recommendation regardingthe phased programme of nationalisation of district in the order indicated andembodied this recommendation in their Administration Report for the periodJanuary 11, 1958, (the day on which the Corporation was formed) to March, 31,1961 which was submitted to the Government as required by s. 35(2) of the RoadTransport Corporation Act, 1960, on the 7th of April, 1962. In this lastdocument they said speaking of future trends, 'the programme fornationalisation of transport services in the remaining of the Andhra Pradesh isas indicated below :-

1961-62 - Guntur District

1962-63 - Nellore and ChittorDistricts

1963-64 - Cuddapah and KurnoolDistricts

1964-65 - Ananthapur and EastGodavari Districts

1965-66 - Vishakhapatnam andSrikakulam Districts'.

17. In the impugned schemes, however, the Corporation made an alteration inthe order of the Districts successively to be taken up for nationalisation. Itwould be seen that after Guntur District which was nearly completed by the endof 1961 the next districts to be taken up during the 1962-63 would have beenNellore and Chittor Districts in that order and it was only thereafter that theDistrict of Cuddapah and after in Kurnool would be taken up. That was therecommendation of the Anantharamakrishnan Committee and which had been acceptedby the Road Transport Corporation as late as April, 1962 and it may bementioned in this connection that the Vice-Chairman of the Road TransportCorporation was himself a member of the Anantharamakrishnan Committee. By itsresolution dated, 4th May, 1962, the Road Transport Corporation decided thatinstead of the above order Kurnool, Nellore and Cuddapah Districts in thatorder would be chosen for nationalisation and in the three schemes which wereformulated in pursuance of this Resolution the western half of Kurnool wasselected as the area to be nationalised in the first instance. As we haveindicated earlier the appellants before us are transport operators whose routesare all in the western half of the Kurnool District. It is this change in theorders of the Districts in which the routes are to be nationalised and thechoice of the Western part of Kurnool for being taken up in the first instancethat are alleged to be due to the mala fide intentions of the Chief Ministerand this forms the main ground upon which the validity of the schemes isimpugned.

18. The allegations in this respect may now be stated. In the affidavit insupport of the Writ Petition No. 267 of 1963 from which Civil Appeal No. 770 of1963 arise, this is what is stated :

'The General Elections forthe various Constituencies of Assembly and Parliament were held in February,1962. It is well-known that there are two groups in the Congress and they wereactively raged against each other. The previous Chief Minister (ShriSanjivayya) and the present Chief Minister (Shri Sanjiva Reddy) were bothreturned from Kurnool District in general elections. The then Chairman of theZila Parishad Shri Vijaya Bhaskara Reddy contested unsuccessfully fromYemniganpur Constituency in Kurnool District. (Yemniganpur is in the westernpart of the Kurnool District). He is the active supporter of the present ChiefMinister. Shri C. Ram Bhopal son-in-law of the present Chief Minister alsounsuccessfully contested from the Nandikothur Constituency in Kurnool District.(Nandikothur is also in the western part of Kurnool). The person whosuccessfully opposed him Sri P. Venkatakrishna Reddy now M.L.A. is a partner in'Venkata Krishna Bus Service' Nandikothur. This firm owns 2 permits and theystand in the name of Jayaramayya who was the Election Agent of Sri VenkataKrishna Reddy. Two persons Sri Ganikhan and Sri Antony Reddy who are staunchsupporters of the present Chief Minister Sri Sanjiva Reddy were selected asCongress candidates by the Parliamentary Board at Delhi when Sanjiva Reddy wasthe President of the Indian National Congress, were also defeated in theirrespective Constituencies. It was considered by one and all that leadingtransport operators among them, (the petitioners) were responsible for thedefeat of these persons and this enraged the feelings of Shri Sanjiva Reddyagainst the operators in Kurnool District and particularly the operators whoseroutes lay in the western areas of the District and with a view to cause themloss and to ruin their business this nationalisation of transport in thewestern part of Kurnool was directed to be undertaken in spite of the Emergencyand in spite of the incapacity of the Road Transport Corporation to fulfiltheir earlier commitments for want of buses. The undivided brothers of Sri T.Narayan, a transport operator, namely Sri Venkataswamy contested the Assemblyseat against Sri Sanjiva Reddy in the Dhone Constituency from which he wasreturned and he refused to withdraw even though lots of pressure were broughton him. Sri Rajasekhara Reddy and Sri Vijayakumara Reddy sons of Sri P. RangaReddy, Minister in the previous Cabinet are also transport operators in theKurnool District. It is known to every one that Sri P. Ranga Reddy is in thegroup opposed to Sri Sanjiva Reddy.

19. Sri Y. Mahananda Reddy another transport operator is a staunch supporterof Sri P. Ranga Reddy. When Sanjiva Reddy was President of the Indian NationalCongress his selection for the Congress ticket was set aside by him and oneVengal Reddy was selected by the Pradesh Congress Committee. It is significantthat the three schemes framed for the part of the Kurnool District relate to theareas in which the routes on which the above stated persons are running theirbuses. It is also significant that the areas in Kurnool District where thesupporters of the present Chief Minister are having permits are not sought tobe included in any of the three nationalisation schemes. In the Nandyal areamost of the transport operators are the supporters of the present ChiefMinister and their routes are excluded from the schemes. It is with a view toachieve the object of hitting against those operators who have fallen intodisfavour and to protect those who are in his good books that the schemes havebeen evolved over routes and parts of the District.'

20. Two further matters were also urged as supporting this plea of malafides. The first was that with a view to carry out the original programme whichwas approved and confirmed by the Corporation in their Administration Reportpublished on April 7, 1962, the routes in the Nellore District which 'accordingto the Anantharamakrishnan Committee Report had to be taken up next weresurveyed and though the elements of contiguity and profitable nature were bothpresent in regard to the extension of the services to Nellore, contiguity bereason of the fact that some buses belonging to the Corporation and runningfrom Guntur were already playing in Nellore District and the profitable naturesince these were evaluated by the Anantharamakrishnan Committee whoserecommendations were examined and approved by the Corporation, thenationalisation of the routes in Nellore was, however, abandoned and that ofthe western part of Kurnool was decided upon. The other fact was that theNational Defence Council passed a resolution as late as the first week ofNovember, 1962, urging the deferring of further nationalisation of transportservices for the present and it was in the teeth of this resolution which waspassed at the meeting at which the Chief Minister himself was present that theschemes of nationalisation of transport services in Kurnool district waspublished by the Corporation on the 29th November, 1962.

21. Before examining whether these allegations have been made out it wouldbe necessary to explain the legal position in relation to which they have to beconsidered. To begin with the schemes now impugned have been formulated by theCorporation which is an independent semi-autonomous body brought into existenceby the State Government by acting under the Road Transport Corporation Act,1950. Under s. 68-C of the Motor Vehicles Act it is the Corporation which isthe State Transport Undertaking which has to form the opinion whether 'forthe purpose of providing an efficient, adequate, economical and properlyco-ordinated road transport service it is necessary in the public interestwhether the service should be run and operated by the State TransportUndertaking.' Secondly, it is the Corporation that has to be satisfiedthat such services should in public interests be provided 'for any area orroute'. In the present case, it is undoubtedly the Corporation that haspublished the schemes under s. 68-C in which these two matters are stated tohave been considered and decided upon by the Corporation itself. It was notdisputed by the appellants that whatever be the inclinations, desires ormotives of the Chief Minister, if the Corporation had by an independentconsideration of the situation decided on the formulation of the impugnedschemes, their validity could not be successfully impugned mearly because theschemes satisfied the alleged grudge which the Chief Minister bore to theaffected operators.

22. The argument urged by the appellants on this part of the case washowever two-fold : (1) That it was not in fact the Corporation that formed theopinion indicated in s. 68-C but really the Chief Minister; (2) That the ChiefMinister was motivated by extraneous considerations, namely, to strike at hispolitical opponents who worked either against himself or his friends,supporters and relations in the elections in February, 1962 and had devised theschemes in order to cause them loss and compass their ruin. A subsidiary pointwas also urged that the Transport Minister who heart the objections under s.68-D(2) was also influenced by the Chief Minister. It was thus said that theChief Minister dominated at every stage through which the schemes passed and thatthe schemes were really the result of his improper motive to ruin his politicalopponents. It was again not disputed by the respondent that if those steps weremade out the schemes would be invalid and ought to be quashed.

23. The learned Judges of the High Court have on this part of the case held: (1) That the allegations made against the Chief Minister had not been proved;(2) Assuming, however, that the Chief Minister was actuated by politicalmotives to his at his opponents, still, the schemes which were published by theCorporation, had been framed by the Corporation not at the dictation of theChief Minister, but as a result of their own independent judgment; and (3)Lastly, the learned Judges held that there was no proof that the Transport Ministerwho heard the objections raised by the appellants to the schemes was influencedby the Chief Minister or acted at his behest, and therefore that the schemesframed and approved were fully in conformity with the requirements of s. 68-C.

24. The correctness of these conclusions have been challenged before us andthe first matter that requires to be considered is as to whether theallegations against the Chief Minister have been made out. The question raisedhas manifestly to be considered from two aspects. The first is whether thefacts alleged which were stated to have been the cause of the Chief Minister'sanimus against the transport operators in the western part of Kurnool have beenestablished. In regard to this the first point to be noticed is that thecontents of the affidavit were not vague, but details were given and these were: (1) The existence of two groups in the Congress Party at the time of theGeneral Elections in 1962, the Chief Minister being the head of one of them andof the other Mr. Sanjivayya; (2) That at the last General Elections certaincandidates who were named and who are stated to have belonged to the group ofthe Chief Minister were defeated; (3) The Constituencies where they stood werein the western portion of the Kurnool District; (4) That this defeat wasoccasioned by persons belonging to the other group in the Congress Party whosenames are also given; (5) That several of these members supporting thedissident group were motor transport operators and who are stated to have takena prominent part in the elections and in the defeat of the candidates belongingto the Chief Minister's group; (6) The matters in relation to Ranga Reddy andhis sons etc. These are what might be termed objected facts.

25. If these allegations were held not proved, then the entire plea of theappellants on this part of the case fails, because there would be no foundationfor the submission regarding the mala fides of the Chief Minister. If, however,these facts were held to be made out, the second aspect requires to be examinedand that is whether the Court has material to hold that these facts led theChief Minister to entertain feelings of personal hostility to these transportoperators because of the aid and support the latter gave to the candidatesbelonging to the group opposed to him which led to the defeat of his partymen.On this aspect the allegations were that the Chief Minister felt chagrined atthe defeat of his partymen and supporters and desiring to wreak his vengeanceagainst the motor transport operators of the western parts of Kurnool, hispolitical opponents, instructed the Corporation to change the order in whichthe districts should be taken up for nationalisation and had Kurnool taken upfirst, departing from what had been decided upon, just a little whilepreviously by the Corporation, and that the Corporation gave effect to theseinstructions and directions by not only taking Kurnool first, but even in thatdistrict eliminating the private operators from the western portions of thedistrict who were the political opponents of the Chief Minister. This, it isobvious, would be a matter of probabilities and of the inference to be drawn bythe Court from all the circumstances on which no direct evidence can beadduced.

26. It is, no doubt, true that allegations of mala fides and of impropermotives on the part of those in power are frequently made and their frequencyhas increased in recent times. It is also somewhat unfortunate that allegationsof this nature which have no foundation, in fact, are made in several of thecases which have come up before this and other Courts and it is found that theyhave been made merely with a view to cause prejudice of in the hope thatwhether they have basis in fact or not some of it at least might stick.Consequently it has become the duty of the Court to scrutinise theseallegations with care so as to avoid being in any manner influenced by them, incases where they have no foundation in fact. In this task which is thus cast onthe courts it would conduce to a more satisfactory disposal and considerationof them, if those against whom allegations are made came forward to placebefore the court either their denials of their version of the matter, so thatthe court may be in a position to judge as to whether the onus that lies uponthose who make allegations of mala fides on the part of authorities of thestatus of those with which this appeal is concerned, have discharged theirburden of proving it. In the absence of such affidavits or of materials, placedbefore the Court by these authorities, the Court is left to judge of theveracity of the allegations merely on tests of probability with nothing moresubstantial by way of answer. This is precisely the situation in which we findourselves in the present case.

27. The learned Judges of the High Court have repelled the allegationscontained in the affidavits which we have set out earlier on grounds and forreasons which do not appeal to us. As the learned Advocate-General did not seekto support those grounds and that reasoning we do not consider it necessary toset them out or deal with them. If the reasons given by the learned Judges ofthe High Court be put aside, the position resolves itself into this thatallegations with particularity and detail have been made in the petition. Weare here having in mind the allegations we have enumerated and categorisedearlier as objective facts. As to these there is no denial at all of them, noteven by the Transport Minister who though he filed an affidavit, confinedhimself to the allegations regarding his having been dictated to by the ChiefMinister when he approved the schemes, though it is obvious they are capable ofdenial and if need be with the same particularity with which they have beenmade in the petition. The learned judges of the High Court have not rejectedthe allegations regarding the objective facts on the ground of their patentimprobability or absurdity, nor did the learned Advocate-General make anysubmission on these lines.

28. The next question is as regards the inference to be drawn from thesefacts which in the absence of their denial have to be taken as true. It is herethat we have felt the greatest uneasiness, because if the facts which serve asthe foundation for the plea of mala fides are made out, the only question wouldbe whether the inference of mala fides on the part of the Chief Minister wouldbe a reasonable one to draw. It is at this point that we are faced with thenecessity of having to proceed without there being any effective answer to thepropriety of drawing the interference which the appellants desire. There hasbeen no denial by the Chief Minister, nor an affidavit by any person who claimsor can claim to know personally about the truth about these allegations. TheSecretary to the Home Department - One Mr. S. A. Iyengar has filed acounter-affidavit in which the allegations we have set out earlier have beenformally denied. He says, 'I have been expressly instructed and authorisedby the Hon'ble the Chief Minister to state that the allegations suggestingpersonal animus and giving mandate are false and mischievous and have beendeliberately made to create an atmosphere of sympathy'. The learnedAdvocate-General did not suggest that the Court could act upon this second-handdenial by the Chief Minister, as the statement by Sri S. A. Iyengar is merelyhearsay. We are, therefore, constrained to hold that the allegations that theChief Minister was motivated by bias and personal ill-will against theappellants, stands unrebutted.

29. The learned Advocate-General realising this position, desired us toproceed on that bias and his submission was that assuming that the allegationsmade against the Chief Minister were made out and that he had bias and ill-willagainst the appellants, still there was no proof that the Corporation which wasan autonomous body was similarly motivate and that unless the appellants wereable to establish it, bias or ill-will on the part of the Chief Minister wouldbe irrelevant.

30. We agree as already indicated that he is right in this submission. Thistakes us to the consideration of the question as to whether the Corporationcarried our the mandate of the Chief Minister as was alleged by the appellantsor whether the impugned schemes were formulated by them as result of theopinion which they themselves formed that they were necessary in publicinterest for the purposes set out in s. 68-C of the Act. On this matter thereis an affidavit by the Corporation denying the allegation made by theappellants that the Corporation acted merely as the tool of the Chief Ministerin order to carry out his behest, and it is there asserted that the decision toframe the schemes was taken as a result of the independent opinion formed bythem after an examination of the entire question. The acceptability of theserival assertions were debated before us most strenuously during the hearing ofthese appeals.

31. Certain facts already set out have a bearing on this question, and thesewe shall recall. The Anantharamakrishnan Committee had laid down the criteriafor determining the order in which areas and routes had to be selected fornationalisation, and applying these principles had drawn up a list of theremaining districts in which nationalisation should be successively taken up.If that order was followed. Nellore would have been the next district to betaken up and the turn of the Kurnool District would have come up afternationalisation of the routes in the Nellore, Chittor and Cuddapah districtswere completed. This report had been submitted to the Corporation in February,1961 and after further detailed examination of these recommendations theCorporation had accepted the recommendation regarding the order of theDistricts to be taken up for nationalisation and had embodied this approval inits Administration Report dated March 24, 1962 which was published in April,1962. It is only necessary to add that the Corporation had also had the routesin Nellore surveyed a little while before. In February, 1962, however, the generalelections to the Assembly and the Parliamentary Constituencies had taken placeand the allegations of the appellants related to the feelings that arose duringthe course of elections. The present Chief Minister assumed office as ChiefMinister on March 12, 1962. On April 19, 1962, it is admitted that he summoneda conference of the Corporation and it officials at which, and this also isadmitted, he suggested that the nationalisation of bus routes in the KurnoolDistrict should be taken up first. Now the Chief Minister himself made astatement as to what he did at this meeting. It is the case of the appellantsthat it was the mandate given to the Corporation by the Chief Minister at thisConference that brought about this change in the order of the districts to betaken up for nationalisation and not the independent opinion of the Corporationas to what was needed in the public interest as required by s. 68-C. As regardshis part at the conference, the Chief Minister himself stated in the Assemblyon July 26, 1962 :

'To say that the Corporation will do everything forthe simple reason that it is an autonomous body, and also to say that we willnot at all interfere, is not fair. It will not be fair. Now and then we shallhave conferences. For example, the Corporation wanted to nationalise Chittordistrict. We had discussions. Kurnool is surrounded by three nationaliseddistricts; one side Mahaboobnagar, one side Guntur and the other side thedistrict of Nellore which is going to be nationalised. I questioned as to whythe district of Kurnool which if surrounded by three nationalised districts isleft out, and instead the district of Chittor which is abutting the borders ofMadras and Bangalore is sought to be taken up. They could not explain. I saidKurnool district is a very compact one and three districts around it arenationalised. They thought that was more practicable and reasonable. Thereforethey changed their minds. As a result of such discussions, once in a way we(Government) do interfere but will not interfere in day to dayadministration.'

32. The conference, as stated earlier, addressed by the Chief Minister wason the 19th of April, 1962. This was followed by the resolution of theCorporation of May 4, 1962. This ran :

'The Corporation noted the discussion which tookplace in the office of the Chief Minister on 19th April, 1962, in regard toprogramme of nationalisation of Road Transport Services during the Third FiveYear Plan Plan period and resolved that during the Third Five Year Plan threemore districts in the order mentioned could be nationalised, viz., Kurnool,Nellore and Cuddapah in view of difficult financial position..........ChiefExecutive Officer explained that as there is a depot at Kurnool and as Kurnoolis contiguous to the nationalised districts, it would be easier to nationaliseKurnool rather Nellore district. The nationalisation could be extended to theNellore district after Kurnool district is nationalised. The Corporationtherefore resolved that Kurnool district could be taken up for nationalisationin preference to Nellore.'

33. In the counter-affidavit which the Corporation filed to the writpetition the Chief Executive Officer after denying that the Corporation wasactuated by mala fides in framing the three impugned schemes, stated that theacceptance by the Corporation of the recommendation of the AnantharamakrishnanCommittee was tentative and that it could not fetter them from discharging itspowers and duties under the statue. It gave the following reasons for thedecision to nationalise Road Transport Services in a part of the Kurnooldistrict in preference to other areas : (1) because there is a Government depotat Kurnool, (2) Kurnool is contiguous to the entire Telangana area which isnationalised and also contiguous to the nationalised area of Guntur. It alsostated that the choice was made in the interest of the maintenance of servicecontiguity and coordination and it added that 'the impending completion ofthe Rangapur Bridge over the river Krishna, which when completed wouldfacilitate the operation of direct services from Hyderabad through Kurnool tothe areas beyond. Besides it asserted that the Corporation which was anautonomous statutory authority was vested with powers under the Road TransportAct and it was, therefore, malicious to allege that the decision by theCorporation to prepare the impugned schemes was either influenced by the ChiefMinister or was under a mandate from him and it asserted that in formulatingthe schemes the necessary opinion under s. 68-C was formed by itself.

34. The learned Judges of the High Court have accepted this statement, madeon behalf of the Corporation and have replied the attack made on it based onthe schemes not having been formulated as a result of the opinion formed by theCorporation itself. The learned Advocate-General commended this approach andthis conclusion for our acceptance. He also pointed out that theAnantharamakrishnan Committee had themselves indicated in paragraph 126 oftheir report that the order in which the new areas will be taken over fornationalisation might be decided by the Government, so that the order in whichmotor transport in the several districts should be nationalised, was notprescribed by the Committee as a rigid or hard and fast rule, but the order ofthe districts was treated even by them as a flexible one which was capable ofand was intended to be, modified by the Government by making policy decision onthese matters taking into account not merely the finances available for nationalisationbut also other relevant matters.

35. We have given the matter our best consideration, but we are unable toagree with the learned Judges of the High Court in their conclusion. The firstmatter which stands out prominently in this connection is the element of timeand the sequence of dates. We have already pointed out that the Corporation hadas late as March, 1962 considered the entire subject and had accepted therecommendation of the Anantharamakrishnan Committee as to the order in which thetransport in the several districts should be nationalised and had set these outin their Administration Report for the three year period 1958 to 1961. It must,therefore, be taken that every factory which the Anantharamakrishnan Committeehad considered relevant and material for determining the order of the districtshad been independently investigated, examined and concurred in, before thoserecommendations were approved, It means that upto March-April, 1962 aconsideration of all the relevant factors had led the Corporation to aconclusion identical with that of the Anantharamakrishnan Committee. The nextthing that happened was a conference of the Corporation and its officials withthe Chief Minister on April 19, 1962. The proceedings of the Conference are noton the record nor is there any evidence as to whether any record was made ofwhat happened at the conference. But we have the statement of the ChiefMinister made on the floor of the State Assembly in which he gave an account ofwhat transpired between him and the Corporation and its officials. We havealready extracted the relevant portions of that speech from which the followingpoints emerge : (1) that the Chief Minister claimed a right to lay down rulesof policy for the guidance of the Corporation and, in fact, the learnedAdvocate-General submitted to us that under the Road Transport Corporation Act,1950, the Government had a right to give directions as to policy to theCorporation; (2) that the policy direction that he gave related to and includedthe order in which the districts should be taken up for nationalisation; and(3) that applying the criteria that the districts to be nationalised should becontiguous to those in which nationalised services already existed, Kurnoolanswered this test better than Chittoor and he, applying the tests he laiddown, therefore suggested that instead of Chittoor, Kurnool should be taken upnext. One matter that emerges from this is that it was as a result of policydecision taken by the Chief Minister and the direction given to the Corporationthat Kurnool was taken up for nationalisation next after Guntur. It is also tobe noticed that if the direction by the Chief Minister, was a policy decision,the Corporation was under the law bound to give effect to it (vide s. 34 of theRoad Transport Corporation Act, 1950). We are not here concerned with thequestion whether a policy decision contemplated by s. 34 of the Road TransportAct could relate to a matter which under s. 68-C of the Act is left to theunfettered discretion and judgment of the Corporation, where that is the StateUndertaking, or again whether or not the policy decision has to be by a formalGovernment order in writing, for what is relevant is whether the materialsplaced before the Court establish that the Corporation gave effect to it as adirection which they were expected to and did obey. If the Chief Minister wasimpelled by motives of personal ill-will against the Road Transport Operatorsin the western part of Kurnool and he gave the direction to the Corporation tochange the order of the districts as originally planned by them and insteadtake up Kurnool first in order to prejudicially affect his political opponents,and the Corporation carried out his directions it does not need much argumentto show that the resultant scheme framed by the Corporation would also bevitiated by mala fides notwithstanding the interposition of the semi-autonomousCorporation.

36. It is also to be noticed that the Chief Minister in his statement to theAssembly stated that when he made an enquiry of the Corporation as to why theydid not choose Kurnool as the next district, the officials of the Corporationhad no answer to give. It is somewhat remarkable that the Corporation and itsofficials should have remained silent and tongue-tied notwithstanding that itsVice-Chairman was a member of the Anantharamakrishnan Committee and had as amember thereof considered the entire question in all its aspects and laid down(1) the criteria for determining the order of priority; and (2) by applyingthese tests had laid down the priorities among the districts and more thanthis, the entire body of the Corporation had considered the severalrecommendations of the Committee in their report and while rejecting some hadaccepted this particular recommendation regarding the order in which thedistricts should be taken up and this last one had happened within a month orso before the conference addressed by the Chief Minister. If in thesecircumstances the appellants allege that whatever views the Corporationentertained they were compelled to or gave effect to the wishes of the ChiefMinister, it could not be said that the same is an unreasonable inference fromfacts. It is also somewhat remarkable that within a little over two weeks fromthis Conference by its resolution of May 4, 1962, the Corporation droppedNellore altogether, a district which was contiguous to Guntur and proceeded totake up the nationalisation of the routes of the western part of the Kurnooldistrict and were able to find reasons for taking the step. It is also worthyof note that in the resolution of the 4th May, 1962, of the Corporation onlyone reason was given for preferring Kurnool to Nellore, namely, the existenceof a depot at Kurnool because the other reason given, namely, that Kurnool wascontiguous to an area of nationalised transport equally applied to Nellore and,in fact, this was one of the criteria on the basis of which theAnantharamakrishnan Committee itself decided the order of priority among the districts.As regards the depot at Kurnool which was one of the two reasons set out in theresolution for the choice of that district in the first instance, learnedCounsel for the appellants submitted that this reason was one invented tojustify the Corporation's action directed against them and to obviate thecomment that the reason for the change was political and not for providing anadequate service for the area. He submitted that the so-called depot was merelya garage with a few reparing tools and not any full-fledged repairing workship.None of the affidavits filed on behalf of the appellants, however, made anyallegation regarding the nature of the facility afforded at this 'depot' - andso we are not in a position to act merely on the arguments adduced to us at thebar. It has however to be noticed that the existence of this 'depot' at Kurnoolescaped the noticed of the Anantharamakrishnan Committee, who in their reporthave devoted some attention to the need for depots and the equipment these shouldpossess and referred to certain deficiencies which they noticed in the depotswhich they inspected. The officials of the Corporation did not evidently bringthis depot at Kurnool to the notice of the Committee. Again, when in theirAdministration Report, the Corporation accepted the recommendations as regardsthe order in which the districts should be nationalised, the existence of thisdepot at Kurnool seems also to have escaped the attention of the Corporationitself, as a factor to be taken into account in making the choice of thedistrict. But we are basing no conclusion on this feature.

37. When the Transport Corporation, however, filed the counter-affidavit itwas not content to rest merely with the reasons given in the resolution asthose which were taken into account in arriving at the decision but added onemore, namely, the impending completion of the bridge at Rangapur across theKrishna as a further reason which had been taken into account for arriving at adecision. What the Court of concerned with and what is relevant to the enquiryin the appeal is not whether theoretically or on a consideration of thearguments for and against, now advanced the choice of Kurnool as the nextdistrict selected for nationalisation of transport was wise or improper, but atotally different question whether this choice of Kurnool was made by theCorporation as required by s. 68-C or, whether this choice was in fact and insubstance, made by the Chief Minister, and implemented by him by utilising themachinery of the Corporation as alleged by the appellants. On the evidenceplaced in the case we are satisfied that it was as a result of the conferenceof the 19th April, 1962, and in order to give effect to the wishes of the ChiefMinister expressed there, that the schemes now impugned were formulated by theCorporation.

38. The next submission of the learned Advocate-General was that evenassuming the Chief Minister directed the order in which districts were to betaken up for nationalisation, still the scheme framed by the Corporation couldnot be assailed as not in conformity with the requirements of s. 68-C of theAct so long as the choice of the 'area' in which and the routes in itto be run by the Corporation was made by them alone. This argument proceedsfrom the circumstance that even taking it that the Chief Minister directed theCorporation to take up the nationalisation of the routes in the Kurnooldistrict in the first instance, there was no allegation that he gave anydirection regarding the area in the district and the routes. We fail to see anyforce in this argument. If the choice of the district was that of the ChiefMinister, the fact that within the area of the district pointed out to them,the Corporation selected some area within the district and the routes withinthat area, cannot on any reasonable construction of s. 68-C be a sufficientcompliance with the statute. We are disposed to read the word 'area' in thesection as meaning such 'area' in the entire State as the Corporation shouldconsider proper and not as the learned Advocate-General would read as areawithin a circumscribed part of the State determined by an outside authority.

39. Besides, there is really little or no explanation forthcoming from theCorporation for choosing the western part of the Kurnool district for theexclusion of the private operators in the first instance. The principalallegation regarding mala fides on the part of the Chief Minister made by theappellants was directed to demonstrate that the object of the present schemeswas to eliminate operators whose routes lay on the western side of thedistrict. It is also stated in the affidavits that the friends or supporters ofthe Chief Minister were operating motor transport in the eastern part ofKurnool. Therefore it might be expected that the counter-affidavits filedoffered a rational expansion as to why this portion of the Kurnool district waschosen in the first instance in preference to the other portion of thedistrict. Needless to say the resolution of the Corporation of May 4, 1962,offers no assistance in this matter and as we have said earlier though thecounter-affidavits contained a denial of the allegation that the Corporationwas acting at the behest of the Chief Minister, there is no explanation for thechoice of the western portion. Our conclusion therefore is that the impugnedschemes are vitiated by the fact that they were not in conformity with therequirements of s. 68-C.

40. The next question is as regards the approval of the schemes by theTransport Minister under s. 68-D(3). It was the case of the appellants thatjust like the Corporation, the Transport Minister also merely carried out thewishes of the Chief Minister and that therefore the approval by the TransportMinister must be held to be vitiated by the mala fides of the Chief Minister.In regard to this, however, two matters have to be remembered. The first isthat there is nothing on the record to show that the Chief Minister influencedhis colleague and beyond the fact that both the Chief Minister as well as theTransport Minister are members of the same Council of Ministers, there isnothing to indicate that the Chief Minister influenced the Transport Minister.The other matter is that the Transport Minister had stated on oath that inconsidering the objections under s. 68-D(3) and approving the schemes he wasuninfluenced by the Chief Minister. We, therefore, consider that there is nobasis for holding that the Transport Minister's approval of the schemes doesnot satisfy the requirements of the law.

41. In view that we take the schemes have to be set aside as not inconformity with s. 68-C of the Act, the other objections raised do not requiredconsideration but in view, however, of the arguments addressed to us on them weshall briefly deal with them.

42. The next point that was urged was that the schemes were not inconformity with s. 68-C of the Act for another reason. A scheme to be publishedby the Transport Undertaking is required by s. 68-C to give 'particularsof the nature of the services proposed to be rendered and such otherparticulars respecting thereto as may be prescribed', prescribed, ofcourse, meaning 'prescribed by rules'. These particulars, it isobvious, are required to be set out in the scheme, so that (a) transport operatorsrunning vehicles on the routes might know that they are affected by the schemeand might, if they see sufficient reason therefor, prefer objections under s.68-D(1); and (b) the operators and others formulate their objections properly,particularly in the matter of pointing out the deficiency or inadequacy of theschemes or the services proposed to be run under the schemes for the approvingauthority to consider. It was urged on behalf of the appellants that theimpugned scheme did not furnish particulars required by this provision. Thisdraft scheme, as published under s. 68-C, and that as approved finally,contains six columns which are respectively headed (1) Serial Number; (2) Nameof the Route, indicating its course; (3) Length of the route in miles; (4)Number of vehicles proposed to be operated on each route; (5) Total number oftrips each way to be performed on each route; and (6) The nature of theservices. Now, columns 4 and 5 do not contain the precise number of vehiclesproposed to be operated or the precise total of the trips each way to beperformed daily. But on the other hand each of these columns is sub-dividedinto two - 4 and 4(a), 5 and 5(a). Under column 4 is given the minimum numberof vehicles proposed to be operated and under 4(a) the maximum number.Similarly column 5 sets out the minimum number of total trips each way and 5(a)the maximum number. Now in several of these the variation between the maximumand the minimum in columns 4 and 5 is 1 to 2 i.e. if one is the minimum two is themaximum, and similarly if two is the minimum, four is the maximum, but thereare others in which the variation is even more pronounced, for instance, inscheme number one, in serial number 15 the minimum is one and the maximum threein both columns 4 and 5 and in serial number 16 the proportion between, themaximum and minimum is even more pronounced for in column 4 it is 1 to 4. Theposition is similar in regard to serial No. 20. The objection that is raised tothis method of specifying the maximum and the minimum of the number of vehicleswhich will be put on the route and the number of trips which these vehicleswill operate is, that one of the objects of the schemes is the provision, amongothers, of an adequate road transport service. It is common ground that thepersons affected by the schemes may object to the scheme on the ground that itdoes not offer an adequate service and that this would be a relevant matter forconsideration by the authority approving the scheme. It is, therefore, urged onbehalf of the appellants that the schemes as promulgated which disclose not theactual number of vehicles that would run or the number of trips which thevehicles would make, do not enable the affected objectors to raise theirobjections to the adequacy of the service proposed and similarly do not affordrequisite information to the approving authority under s. 68D(3) to decidewhether to approve the scheme or not, Besides this general objection, it ispointed out that the specification of a minimum and a maximum in columns 4 and5 is contrary to what has been prescribed by the Andhra Pradesh Motor VehiclesRules, 1957, made in relation to 'the particulars to be contained inschemes under Ch. IV-A.' Rule 4 of these Rules which have statutory force unders. 68-C requires draft schemes and approved schemes to contain inter alia'the number of vehicles proposed to be operated on each route and thetotal number of trips to be performed daily on each route.' By a ruleframed on the 26th of December, 1958, the State Government framed a rulenumbered as Rule 5 of these Rules which reads :

'5. The State Transport Undertaking may at itsdirection, vary the frequency of services on any of the notified routes orwithin any notified area having regard to the needs of traffic during anyperiod, either by increasing or decreasing the number of trips of the existingbuses or by increasing or decreasing the number of buses.'

43. The validity of Rule 5 was one of the matters that was raised forconsideration by this Court in Dosa Satyanarayanamurty etc. v. The AndhraPradesh State Road Transport Corporation : [1961]1SCR642 and this Courtheld that Rule 5 was repugnant to s. 68-E which reads :

'Any scheme published under sub-s. (3) of s. 68-Dmay at any time be cancelled or modified by the State Transport Undertaking andthe procedure laid down in s. 68-C and s. 68-D shall, so far as it can be madeapplicable be followed in every case where the scheme is proposed to bemodified as if the modifications proposed were a separate scheme.'

44. and struck it down. Thereafter rule 5 was deleted, but rule 4 remains aswe have set out. The question for consideration is whether the prescription ofmaxima and minima in columns 4 & 5 is in conformity with the requirementsof Rule 4. It was submitted on behalf of the appellants (1) that the reason whythese maxima and minima were put down in the schemes, contravening Rule 4, wasin reality to avoid the operation of s. 68-E and to get over the decision ofthis Court striking down Rule 5 and that for the same reason which underlay thedecision of this Court in Dosa Satyanarayanamurty's case : [1961]1SCR642 the prescription of maxima and minima contravened s. 68-E as it operates is noway dissimilar to Rule 5 and that as this vice pervades the entirety of thescheme as published, all the three schemes should be set aside. In furthersupport of their submission the appellants relied on the affidavit filed by theAssistant Secretary to the Transport Department who stated that the prescriptionof maxima and minima was adopted because 'it enabled the Corporation toprovide adequate services with reference to the public needs, without having togo through the elaborate gamut of modifying the approved scheme for thepurpose.'

45. The learned Judges of the High Court have repelled this contention onthe ground of the analogy furnished by Sections 46 and 48 of the Act under whichapplications for State carriage permits by private operators and the permitsgranted to them are required to state the minimum and maximum number of dailyservices proposed to be provided to relation to each route or area, was anindication that a scheme specifying the maxima and minima of the number ofbuses and services was in conformity with and did not contravene Rule 4. Thelearned Advocate-General adopted the same line of argument and submitted thatthe language of Rule 4 did not in terms prohibit the specification of a minimumand maximum and that Rule 5 which this Court struck down as being repugnant tos. 68-E was attracted only when the maxima or minima set out in the scheme wasdeparted from. He, however, conceded that the gap between the minimum and themaximum specified in a scheme might be so wide as to render the same acontradiction of Rule 4 but he submitted that the variations in the 3 schemesbefore us between columns 4 and 4(a) and columns 5 and 5(a) respectively wereso slight as not to amount to a failure to fix the number of vehicles to beoperated or the trips they would do on the routes.

46. In the case before us in view of the conclusion we have reached thatsome of the variations between the maxima and the minima in the number ofvehicles proposed to be operated on each route are such as, adopting the testsuggested by the learned Advocate-General himself, to really contravene Rule 4we have not thought it necessary to finally decide the larger question, whetherthe mere prescription of the maxima and minima, particularly for the reasonsset out in the affidavit of the Assistant Secretary to the TransportDepartment, constitutes a violation of s. 68-E as also of Rule 4 of the MotorVehicles Rules, 1957 as to require the same to be struck down. We might,however, mention in passing that we are not much impressed by the argumentbased on Sections 46 and 48. It must be remembered that we are concerned with arequirement of Ch. IV-A and under s. 68-B of the Act, not only the provisionsof that Chapter but the rules made thereunder are to have effectnotwithstanding anything in Ch. IV in which s. 46 and s. 48 occur. This apart,the rule-making authority had the analogy of the provisions of Sections 46 and 48before it, but yet chose not to adopt the same phraseology as was employed inthese sections. Besides, as the provisions of Ch. IV-A invade the rights ofprivate operators to carry on business and is justified as a reasonablerestriction on their rights in public interest, it might very well have beenconsidered that a more precise indication should be afforded by the scheme toenable its adequacy to be tested by the quasi judicial procedure which has to befollowed before the scheme becomes effective. However, as stated already, thereis no need to decide this matter finally in view of our conclusion that thescheme contravenes Rule 4 even on the test submitted by the Advocate-General.In saying this we have in mind routes 15, 16, 18 and 20 of scheme No. 1 inwhich the variation in the number of vehicles is 1 to 3, 1 to 4 and 3 to 8 andsimilarly in scheme No. 2 route No. 1 where the variation is 6 to 12 and inscheme No. 3 route No. 1 the variation is 5 to 9. We might mention that we havetaken into account not merely the proportion but the variation in the number.We have set these out as merely illustrative and we have not thought itnecessary to make an exhaustive list of all the routes.

47. The next objection was that some of the routes included in the schemewere inter-State routes and that under the proviso to s. 68-D(3) it could notbe deemed to be an approved scheme unless the previous approval of the CentralGovernment had been obtained. We consider this objection as without force. Theroute which is proposed to be nationalised under the scheme admittedly lieswholly within the State. The right of the private operators to play theirvehicles beyond the State border us not affected by any of the schemes. Itwould, therefore, follow that the proviso to s. 68-D(3) is not attracted andconsequently the scheme does not suffer from the defect alleged.

48. The next point made was that the language employed to indicate thenature of the service in column 6 of the schemes was vague, with the resultthat operators who had, in fact, been affected by the scheme understood thewords employed as not affecting them consequently did not make objections asthey were entitled to under s. 68-D(2). We have examined the language employedand we consider that the submission does not deserve serious consideration norwe are satisfied that any party was really misled by ambiguous phrasing ofcolumn 6 of the scheme. In fact, learned Counsel did not press this objectionafter the matter was discussed during arguments.

49. The next series of objections to the schemes are those which arise incivil Appeals Nos. 771 to 778. The point most strenuously contended related toan illegality which was alleged to have occurred in the implementation of thescheme Under s. 68-(1) the State Transport Undertaking has to make theapplication in the manner specified in Chapter IV-A for 'a Stage Carriagepermit' ........... 'to the Regional Transport Authority' andthat Authority is directed to grant the permit to the Undertakingnotwithstanding anything to the contrary in Ch. IV. In accordance with theprovisions of this section the State Road Transport Corporation made anapplication for the grant of permits to the Regional Transport Authority. Theobjection raised is that the application had to be made not to the RegionalTransport Authority but only to the State Transport Authority which authorityalone, it is urged, is competent to entertain applications for the grant ofpermits where the length of the route is 100 miles or over and such route isover a Trunk Road. Three of the routes in scheme 2 with which Civil Appeal Nos.773, 776 and 777 are concerned are of a lenght beyond 100 miles and the roadwayon which the route lies are admittedly Trunk Roads. Under Rule 141 of theMadras Motor Vehicles Act Rules permits on routes covering a distance of over100 miles on Trunk Roads could be granted only by the State TransportAuthority. It was this Authority that had granted the permits to operate onthese three routes to the respective appellants in these appeals. The argumentis that even when a Transport Undertaking applies for a stage carriage permitunder s. 68-F(1) it must comply with the provisions of Rule 141. On the basisof this reasoning the appellants in these three Civil Appeals have applied fora writ of prohibition against the Regional Transport Authority before whom theapplications have been filed. Section 68-F(1) reads :

'68-F(1). Where, in pursuance of an approved schemeany State transport undertaking applies in the manner specified in Chapter IVfor a stage carriage permit or a public carrier's permit of a contract carriagepermit in respect of a notified area or notified route, the Regional TransportAuthority shall issue such permit to the State transport undertaking,notwithstanding anything to the contrary contained in Chapter IV.'

50. The learned Judges of the High Court have held that the RegionalTransport Authority which is specifically mentioned in s. 68-F(1) is empoweredto issue the permit to the transport undertaking 'notwithstanding anythingto the contrary contained in Chapter IV' and that the section rendered theprovisions of Rule 141 of the Motor Vehicles Rules inapplicable to casescovered by s. 68-F(1). We find ourselves in agreement with this view, Besides,s. 68-B of the Act enacts :

'68-B. The provisions of this Chapter and the rulesand orders made thereunder shall have effect notwithstanding anything inconsistenttherewith contained in Chapter IV of this Act or in any law for the time beingin force to in any instrument having effect by virtue of any such law.'

51. Therefore any provisions in Chapter IV which are inconsistent with thosecontained in Chapter IV-A would to that extent be superseded. No doubt, s.68-F(1) speaks of an application in the manner specified in Ch. IV which if thewords stood alone are capable of being understood as meaning the authority towhom the application has to be made, but as the authority to issue the permitin pursuance of the application is specified as the Regional TransportAuthority and as that authority is directed to issue the permit notwithstandinganything in Ch. IV so much of Ch. IV or the Rules made thereunder, whichspecify the authority to grant the permit as being someone other than theRegional Transport Authority, is to that extent superseded. It was pointed outthat under Rule 141 the State Transport Authority was itself vested with thepowers of the Regional Transport Authority where the route was of thedescription mentioned earlier, but this, in our opinion, makes no difference.No doubt, in a State where there is no Regional Transport Authority at all(vide e.g. proviso to s. 44(1)), but there is some other authority whichfunctions as the Regional Transport Authority for the purposes of the Act, suchan Authority might be that which would be comprehended by s. 68-F(1) but whereas in Andhra Pradesh there is admittedly a Regional Transport Authority, we cannotaccede to the submission that such authority is deprived of the power to issuea permit by reason of s. 68F(1) merely because the Regional Transport Authorityof that area cannot grant permits under Ch. IV.

52. There were certain other points urged in Civil Appeal No. 771 whicharose only if the Regional Transport Authority to whom applications under s.68-F(1) were made, was not competent to entertain application and issue apermit. In view of our conclusion as regards the point urged in Civil AppealNo. 771 of 1963 do not arise.

53. There remains for being dealt with one minor point which was urged inCivil Appeals Nos. 883 and 884 which we consider entirely without substance.The point was that the description of the route in the scheme was too vague andmisleading, so much so that the appellants did not file their objections beforethe Government. Taking the case of Civil Appeal No. 883, it is by an operatorwho runs a service from Uravakonda to Adoni. Serial No. 16 of scheme No. 1describes the route as Adoni to Uravakonda. It was urged that as the schemenotified the route Adoni to Uravakonda but not Uravakonda to Adoni, theappellant thought that his route was not affected. The objection is on its veryface frivolous because throughout the scheme, it is only the terminal pointsthat are specified and that specification carries with it and obviously impliesthat the operation of transport between the two termini is intended to benationalised. The complaint in Civil Appeal No. 884 is the same, only the routeis different. This completes all the points that are urged before us.

54. In view of our conclusion that the schemes are vitiated bynon-compliance with the requirements of s. 68-C and the Rules made thereunder,we hold that they have to be quashed as not warranted by law.

55. The appeals are accordingly allowed and the appellants are granted adeclaration that the schemes are invalid and cannot be enforced. The appellantswould be entitled to their costs here and in the High Court - one hearing fee.

56. Appeals allowed.

Ayyangar, J.

57. When the judgment in the above appeals was pronounced on January 27,1964 the learned Advocate for the appellants brought to our notice thefollowing order passed by this Court on June 10, 1963 when the interim stay ofthe operation of the schemes which are impugned in the above appeals, wasvacated on the opposition by the State Government :

'Stay vacated on the learned Advocate-General forAndhra Pradesh giving an undertaking that in case the appeals succeed, theState will compensate the appellants for the loss incurred by them during theperiod that the appeals were pending in this Court by reason of the fact thatthey were not allowed to ply their buses on the routes under the respectivepermits granted to them. The learned Advocate-General further undertakes thatthis amount of compensation will be determined in the present proceedingsthemselves. No order as to costs.'

58. The learned Counsel requested us that we should give some directions interms of this undertaking. In view of the above we would add the following atthe end of the judgment which was pronounced on January 27, 1964 :

'In view of the order passed by this Court on June10, 1963, when the interim order of stay was vacated at the instance of therespondent, recording the undertaking on the part of the State that it wouldcompensate the appellants for the loss incurred by them during the period whenthe appeals were pending in this Court, there will be a declaration to thateffect, and the High Court will determine the amount so payable and passsuitable directions for the payment thereof.'

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