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Economic Transport Organisation Vs. State of Kerala and ors. - Court Judgment

LegalCrystal Citation
SubjectMotor Vehicles
CourtKerala High Court
Decided On
Case NumberO.P. No. 4551 of 1979
Judge
Reported inAIR1983Ker44
ActsMotor Vehicles Act, 1939 - Sections 2(23), 66A(1) and 68(2); Kerala Motor Vehicles Rules, 1961 - Rule 225; Constitution of India - Article 245
AppellantEconomic Transport Organisation
RespondentState of Kerala and ors.
Appellant Advocate V. Sivaraman Nair and; V.M. Nayanar, Advs.
Respondent AdvocateGovt. Pleader
DispositionPetition allowed
Excerpt:
.....petitioner to take out agency licences under rule 225 challenged - admittedly petitioner is 'public carrier' as per section 2 (23) having agency offices at some places - rule 225 provides for licensing of agents engaged in business of collecting, forwarding and distributing goods carried by public carriers - rule 225 provides for licensing of principals also whereas statute conceives of licensing agents only - allegedly petitioner-firm carrying on business of collecting, forwarding and distributing goods - public carrier only entitled to transport goods and not to collect, store and distribute them - in case separate license for such activities is to be taken then statute must prescribes so - act does not contain any such provision - rule 225 not to be applied to public carriers in..........j.1. the petitioner is a firm engaged in the business of transporting goods by road, and is a 'public carrier' as defined in section 2 (23) of the motor vehicles act, 1939. the head office of the firm is at calcutta, but it has regional offices at ernakulam, alleppey, cannanore, trivandrum, kozhikode and some other district headquarters of kerala state. at trichur and palghat, it has only 'agency offices'. by exts. p1 to p5 notices issued by the regional transport officers of ernakulam, alleppey, cannanore, trivandrum and kozhikode, the petitioner was required to take out 'agency licences' under rule 225 of the kerala motor vehicles rules; and the question is whether the notices are valid.2. section 66-a of the motor vehicles act reads:--'66-a. agent or canvasser to obtain licence.--.....
Judgment:

M.P. Menon, J.

1. The petitioner is a firm engaged in the business of transporting goods by road, and is a 'public carrier' as defined in Section 2 (23) of the Motor Vehicles Act, 1939. The head office of the firm is at Calcutta, but it has regional offices at Ernakulam, Alleppey, Cannanore, Trivandrum, Kozhikode and some other District headquarters of Kerala State. At Trichur and Palghat, it has only 'agency offices'. By Exts. P1 to P5 notices issued by the Regional Transport Officers of Ernakulam, Alleppey, Cannanore, Trivandrum and Kozhikode, the petitioner was required to take out 'agency licences' under Rule 225 of the Kerala Motor Vehicles Rules; and the question is whether the notices are valid.

2. Section 66-A of the Motor Vehicles Act reads:--

'66-A. Agent or canvasser to obtain licence.-- (1) No person shall engage himself--

(i) as an agent or canvasser, in the sale of tickets for travel by public service vehicles or in otherwise soliciting custom for such vehicles, or

(ii) as an agent in the business of collecting, forwarding or distributing goods carried by public carriers, unless he has obtained a licence from such authority and subject to such conditions as may be prescribed by the State Government,

(2) The conditions referred to in sub-section (1) may include all or any of the following matters, namely:

(a) the period for which a licence may be granted or renewed;

(b) the fee payable for the issue or renewal of the licence;

(c) the deposit of security --

(i) of a sum not exceeding rupees five thousand in the case of an agent in the business of collecting, forwarding or distributing goods carried by public carriers,

(ii) of a sum not exceeding rupees five hundred in the case of any other agent OB canvasser,

and the circumstances under which the security may be forfeited;

(d) the provision by the agent of insurance of goods in transit;

(e) the authority by which and the circumstances under which the licence may be suspended or revoked;

(f) such other conditions as may be prescribed by the State Government.'

Section 68 (2) (ww) authorises the State Government to make rules with respect to

'the licensing of agents engaged in the business of collecting, or forwarding and distributing goods carried by public carriers.'

Rule 225 of the Kerala Motor Vehicles Rules provides for the 'licensing of agents engaged in the business of collecting, forwarding and distributing goods carried by public carriers .

Provisions are made for the Form in which application for licence has to be made, the form in which it is to be granted, the period of the licence and its conditions, approval of the premises used by the licensee, rates of commission he can charge and other allied matters in particular, Clause (a) of Sub-rule (1) defines an agent in the following termi:--

'(a) 'agent' means any person who engages directly or indirectly in the business of --

(i) collecting;

(ii) forwarding and distributing;

(iii) collecting, forwarding and distributing; goods carried by any public carrier.'

3. Clause (ii) of Section 66-A (1) conceives of carriage of goods by public carriers i. e. transport of goods by the owner of a transport vehicle, as indicated in Section 2 (23). It also conceives of an 'agent' for the business of collecting, forwarding and distributing the goods so carried. The primary function of ;he public carrier is to transport goods; but 'or doing so, he has first to receive the good) from a consignor at one end, and after transport, deliver it to the consignee at the other. Collecting, forwarding and distribution of goods are incidental to their transport or carriage. The carrier may receive the goods direct from the consignor and deliver it direct to the consignee, in which case there is no agency. But the carrier can also appoint an agent for collecting, forwarding and distributing the goods he carries. On a plain reading of Clause (ii) of Section 66-A (1), it seems to be designed for dealing with agents so appointed, if and when they are appointed, and not with the carrier himself. The person who requires a licence under the section is the agent appointed by a carrier for collecting, forwarding and distributing goods in connection with their transport, and not the person who transports. The person who transports has to obtain a permit for his vehicle under Sections 54 and 56 of the Act; but if another person engages himself in the business to collecting, for' warding and distributing goods which is incidental to the transport business of the carrier, the former has to take out a licence.

4. Section 68 (2) (ww) empowers the State Government to make rules only with respect to the licensing of agents of the above type. The provisions of Section 68 (2) (ww) are in conformity with Clause (ii) of Section 66-A (1), But when we turn to the definition clause in Rule 225, what is seen is that any person who engages in the business of collecting, forwarding and distributing goods carried by a public carrier is treated as an 'agent'. While Section 66-A deals with a person who 'engages himself as an agent' in a business, the definition in the Rule includes every one who is in the concerned business, whether as agent or otherwise. By the process of defining 'agent', 'he rule attempts to bring in other persons also, not covered by the section. Putting it more bluntly, while the statute conceives of licensing agents only, the rule provides for the licensing of principals also. This position is further clarified by para (4) of the counter-affidavit, when it states:

'As revealed by paras 1 and 2 of the Original Petition the petitioner, company is conducting the business of collecting, storing, forwarding and distributing goods carried by public carriers and vice versa and hence the petitioner's establishment is covered by the provisions of Rule 225 of the Kerala Motor Vehicles Rules, 1961. Therefore, the petitioner is obliged to get a licence from the licensing authority to carry on his business. The petitioner is not only transporting the goods but it is collecting and storing goods at particular places which is established and maintained by the company at its costs. When the licensing authorities took steps to enforce the provisions of Rule 225 the petitioner has approached this Honorable Court by filing this Original Petition.'

What is asserted is that the petitioner-firm is carrying on the business of collecting, forwarding and distributing goods; it is not asserted that it is doing so as agent of any public carrier.

5. The learned Government Pleader contends that the permit granted to a public carrier under Sections 54 and 56 authorises him only to transport goods, and not to collect, store, forward and distribute them. That, may be so. And if the statute prescribes that a separate licence for collecting, forwarding etc, is also to be taken out by him, that can be given effect to. But the Motor Vehicles Act does not apparently contain any such prescripons. Section 66-A only requires an 'agent' to take out licence; and in the guise of giving effect to this provision, the rule-making authority cannot prescribe a licence for the carrier also, for the sole reason that in its opinion, such a licence will also be desirable. Apart from Sections 66-A am 68 (2) (ww), the Government Pleader is not able to refer to any other provision of the Act which authorises the rule-making authority to frame a rule like Rule 225. And in so far as the definition in Rule 225 (1) provides for licences in respect of persons other than agents, the definition is beyond the rule-making power.

6. The agents referred to in Section 66-A appear to be persons who engage themselves as agents of a public carrier in that part of his business pertaining to collecting, forwarding and distribution of the goods he transports. A public carrier may not be in a position to make arrangements for receipt and delivery of the goods by himself, at every place; and in such places, he can appoint others for collection and distribution in those cases, the transport of goods will be his direct function, while collection and distribution will be done for him, on his behalf, by others appointed as agents by him for the purpose in the present case, for example, the petitioner-firm collects and distributes goods at Ernakulam through its own office, employing servants; but at Trichur and Palghat, it has to rely on agents, because it has no office with its own employees at those two places. It is probably agents like those at Trichur and Palghat that are intended to be covered by Section 66-A. Even at Ernakulam, the petitioner can appoint another person as agent for collecting, forwarding and distributing the goods, if it finds that its own office cannot handle the whole of that work. Such an agent will also require a licence under Section 66-A. He may arrange for his own premises for collecting and storing the goods, in which case he will have to get the premises approved under Rule 225 (10). He will have to display the licence at the said premises under Sub-rule (13) (b). He can collect commission only at the rates prescribed by Sub-rule (9). He will also have to comply with the requirement of written contracts under Sub-rule (8). But the important thing is that he alone is required to do such things by virtue of Section 66-A and not the carrier. If it is desirable to insist that the carrier also should do all such things, appropriate other provisions will have to be made in the Act itself. A provision for licensing agents cannot be sufficient authorisation for the rule-making authority to rope in the principals also.

7. My conclusion therefore is that the provisions of Rule 225 cannot be applied to public carriers, despite the definition in Sub-rule (1), in respect of collecting, forwarding and distributing of goods carried by them on their own behalf, through their own offices and with the aid of their servants. It is declared that the definition clause in Rule 225 (1) has to be read down in the above manner; and in that view, I am not striking it down. But Exts. P1 to P5 will have to be quashed, and I do so.

8. Original Petition allowed as above. No costs.


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