S.T. Desai, C.J.
1. The petitioners are a Motor Transport Company which carries on business of stage carriage operators. The petitioners were plying their buses on several routes in Saurashtra. Their permit ill respect of those routes was due to expire on 30th October 1958 and on 26-8-1958 they applied for renewal of the same. On 4th October 1958, respondent No. 3, a co-operative society, applied for running its buses on the routes on which the petitioners were plying their buses. On 2nd January, 1959, the Regional Transport Authority, after bearing both the applications together decided against the petitioners and granted the necessary permit to respondent No. 3. There was an appeal against that decision and the order made in appeal was to remand the matter for determination of certain questions. On 13th July, 1959, the Regional Transport Authority decided the matter and reached the same conclusion as before. The petitioners preferred an appeal against that decision to the State Transport Authority which dismissed the appeal on 26th February, 1960, and the petitioners have come to this Court on this petition.
2. It has been argued before us by Mr. V. G. Hathi, learned advocate for the petitioners, that the order of the State Transport Authority is ex facie bad because the Appellate Committee of the State Transport Authority was not authorised to hear the appeal. The contention is founded on Section 44 of the Motor Vehicles Act, 1939, to which we shall refer hereafter as the Act. The material and relevant part of that section is as under:-
'44 (1) The State Government shall, by notification in the official Gazette, constitute for the State a State Transport Authority to exercise and discharge the powers and functions specified in Sub-section (3), and shall in like manner constitute Regional Transport Authorities to exercise and discharge throughout such areas (in this Chapter referred to as regions) as may be specified in tho notification, in respect of each Regional Transport Authority, the powers and functions conferred by or under this Chapter on such Authorities:-
x x x x
(2) A State Transport Authority or a Regional Transport Authority shall consist of a Chairman who has had judicial experience and such other officials and non-officials, not being less than two, as the State Government may think fit to appoint but no person who has any financial interest whether as proprietor, employee or otherwise in any transport undertaking shall be appointed as or continue as a member of a State or Regional Transport Authority, and, if any person being a member of any such Authority acquires a financial interest in any transport undertaking he shall, within four weeks of so doing, give notice in writing to the State Government of the acquisition of such interest and shall vacate office:
x x x x(5) The State Transport Authority and any Regional Transport Authority, if authorised in thisbehalf by rules made under Section 68, may delegatesuch of its powers and functions to such authorityor person and subject to such restrictions, limitations and conditions as may be prescribed by thesaid rules.' Rule 66 (6) and Rule 70 of the Bombay Motor Vehicles Rules, 1959, have bearing on the contention raised by the petitioners and it will be convenient to set them out at this stage :
'66(6} At the beginning of each year, the Chairman shall nominate a panel of not more than four members, any one of whom may preside at the meeting in the absence of the Chairman (such person being referred to as the Presiding Officer) in the order of preference determined by the Chairman.'
'70. Delegation of powers by State Transport Authority. The State Transport Authority may, by a general or special resolution recorded in its proceedings, delegate :
(a) its powers to decide any appeal or class of appeals under Sub-section (2) of Section 13, or Subsection (2) of Section 16, read with Sub-rule (1) of Rule 8 or Sub-section (4) of Section 21-F, read with Sub-rule (2) of Rule 34 or Section 64 or under Rule 136, or its revisional powers under Section 64-A to a Committee of one or more members of that Authority, as that Authority may appoint; and different Committees may be appointed to decide different appeals or classes of appeals. When the Committee consists of three or four members the quorum shall be two members and when it consists of five or more members the quorum shall be three members.
(b) Its powers under Section 134 to direct a stay of the order passed by the original authority against which an appeal has been preferred or application for revision has been made to it, to the Director of Transport.'
A resolution was passed by the State Transport Authority constituting the members of the Committee to hear appeals against the orders of the Regional Transport Authority passed under Section 64.
3. The argument which rests on Section 44 is this : Sub-section (2) states that the State Transport Authority shall consist of a Chairman who has bad judicial experience and such other officials and non-officials as the State Government may think fit to appoint Sub-section (5) of that section rules that the State Transport Authority, if authorised in that! behalf by rules made under Section 68 -- and Rule 70 which we have reproduced above does confer that power on the State Transport Authority -- may delegate its powers including that of hearing appeals to any authority or person in accordance with the conditions prescribed by the Rules. Now Mr. Hathi's argument is not that it was not competent to the State Transport Authority to delegate the power of hearing appeals to a Committee to be appointed by the State Transport Authority in accordance with the Rules. The argument is that Sub-section (2) of Section 44 requires that whoever acts as a Chairman of the body which determines any appeal must be a person who has had judicial expert ence. Says Mr. Hathi, it is not necessary that a Chairman appointed by the State Government under Section 44 should preside over every Committee which determines any appeal preferred to the State Transport Authority, but the person who presides over the Committee must be a person who has had judicial experience, It is urged that the State Transport Authority when it decides appeals adjudicates upon very important rights of the parties and decides matters which would have very far-reaching and serious consequences to persons concerned in the transport trade. We agree that the powers of the appellate authority are very wide and their orders can have far-reaching consequences. We also agree that it would be desirable that the person who presides over the Committee of the State Transport Authority and decides appeals relating to granting or refusing of permits and granting and refusing of renewals of permits should be a person who has had judicial experience. But we are not concerned with the question of propriety of any appointment of a person as a president. We are only concerned with the legality and validity of the appointment. The way we read Section 44(2) along with the relevant provisions, it seems to us that the requirement that the Chairman of the State Transport Authority should be a person who has had judicial experience applies only to the case of the Chairman to be appointed by the State Government when initially constituting the State Transport Authority. It is obvious that in a big State like the erstwhile State of Bombay or like the present State of Gujarat, it would not be possible for the entire body constituting the State Transport Authority to hear appeals arising out of orders of different Regional Transport Authorities. It stands to reason that the State Transport Authority should have the power of delegating its authority to smaller committees and it is with that object in view that Sub-section (5) finds place on the Statute Book.
4. That being the position, we address ourselves to the short question whether there is anything in the statute itself or the Rules made thereunder which requires that the person who presides over any such Committee of the State Transport Authority which decides appeals from orders made by the Regional Transport Authorities, should necessarily be a person who has had judicial experience? There is nothing in the relevant provisions and certainly Mr. Hathi has not been able to draw our attention to any provision or rule, which can be said to require that the person who presides over the Committee of the State Transport Authority deciding appeals should be a person with judicial experience. Rule 66(6) which we have set out above lends support to the view which we take of the matter. Mr. Hathi has also urged before us that we must bear in mind the spirit of the Act. There is little in the provisions of the Act which can be said to throw any particular light on the present question. Nor is there anything in any provision touching the object or the spirit of the Act which can guide us in determining the present question. For reasons which we have already discussed, the present contention of Mr. Hathi must be negatived.
5. It is next urged that the Committee which heard the appeal was not authorised to hear appeals under Section 64 of the Act. It is not necessary to reproduce the text of that section. It will suffice to state that Section 64 requires that a person aggrieved by any decision of the Regional Transport Authority of the nature there mentioned may appeal to the 'prescribed authority'. Rule 105 of the Rules empowers the State Transport Authority to hear appeals against certain orders made by a Regional Transport Authority under Section 64. Therefore, it was the State Transport Authority which was the 'prescribed Authority' to hear the appeal in the case of the petitioners, Mr. Hathi asks us in substance and in effect to ignore the provisions and the Rules which we have already considered in examining the first argument of Mr. Hathi when we have to consider his present contention. That, in our opinion, would be a wholly incorrect approach to the matter. Section 64 read with Rule 105 lays down nothing more than that an appeal against an order of the Regional Transport Authority shall lie to the State Transport Authority. But the State Transport Authority in the present context cannot mean the entire body constituting the State Transport Authority. It would include a Committee appointed for the purpose of hearing such appeals in accordance with the provisions of Section 44(5). There is little substance in the present argument and it must be rejected.
6. It is next urged by Mr. Hathi that the notification authorising the members of the Committee of the State Transport Authority to hear appeals is confined to appeals against the orders of the Regional Transport Authority passed under Section 64. He goes on to state that the judgment of the State Transport Authority itself shows that such is the correct position. The notification is not before us, but we shall assume that Mr. Hathi is right when he says that the notification authorised the State Transport Authority to hear appeals against orders of the Regional Transport Authority under Section 64. Even so, we wholly fail to see how it is possible to say that Section 64 should be read in a manner divorced of all other provisions and Rules made under the Act as Mr. Hathi in effect wants us to do. The present contention seems to us to be untenable and must be rejected.
7. Another of the multifarious contentions Mr. Hathi has thought it necessary to urge before us is that the judgment of the Regional Transport Authority was signed only by the Secretary and the Chairman. The argument is that the judgment not having been signed by all the members of the Committee authorised to hear the applications for renewal of permits and for original permits, the order of the Regional Transport Authority is bad in law. We are unable to see any force in this argument. Moreover, even if it was possible to see any slight substance in the argument, we do not think we would be justified in countenancing any such over-refined technicality.
8. The last argument of Mr. Hathi and the one which might perhaps have been urged by him at the very outset of the hearing of this petition, is that the State Transport Authority though bound to do so has failed to record any reasons for its decision. Section 57(7) of the central enactment requires that a Regional Transport Authority, when it refuses an application for a permit of any kind should give to the applicant in writing its reasons for the refusal. The Motor Vehicles (Bombay Amendment) Act (VII of 1947) lays down inter alia in Section 8 that in Section 57(7) of the central enactment 'after the words 'Regional Transport Authority' wherever they occur, the words 'or the Provincial Transport Authority' shall be inserted'. We are thankful to the Advocate General for drawing our attention to this amendment in Section 57(7) of the central enactment. It follows from Sub-section (7) of Section 57, as we read it, that it is incumbent on the State Transport Authority to record in writing its reasons for refusing to grant a renewal permit to the petitioners,
9. That takes us to a consideration of the contention that the State Transport Authority has failed to record any reasons for the decision against which the petitioners have come to this Court on this petition. Mr. Hathi has taken us through the entire order and decision and levelled strong comments on the same, for the purpose of showing that there is nothing there which can be regarded as reasons for the decision. It has been pointed out on the other hand by the learned Advocate General that towards the end of its Judgment, the appellate Authority has stated:
'After carefully considering the arguments put forth by the parties and going through the facts of the case and also taking into consideration the provision of Sections 47 and 52 of the M. V. Act, 1939, the Appellate Committee were pleased to pass the following order'.
He has also relied on the words with which the judgment concludes -- 'the grant of permit to the respondent Jodiya Sarvodaya V. V. S. Mandali serves the public need in the best manner'. The Advocate General had little to say apart from pointing out these two sentences to us and it is impossible for us to read any reason in the same. We have carefully gone through the whole judgment which we must characterise as very unsatisfactory. The law casts a statutory duty on the State Transport Authority that it shall record in writing its reason for its decision. It is most desirable and altogether necessary that these Authorities under the Act must remember that they should not merely feel that they are doing justice between party and party, but they must take care to see that it appears that justice is being done, and the only way in which a State Transport Authority can give satisfaction in this behalf is by recording proper and legal reasons which have led it to the conclusions reached by it. These Authorities have to deal with very important questions of fact and their decisions affect a very large section of the transport trade to the State. We should like to refer in the present context to certain observations of Mr. Justice Subba Rao (as he then was) in Vedachala Mudaliar v. State of Madras, AIR 1952 Mad 276, at p. 280:
'From the standpoint of fair name of the tribunals and also in the interest of the public they should be expected to give reasons when they set aside an order of an inferior tribunal. If tribunals could set aside the considered orders of subordinate tribunals without any reasons such a power may, in the hands of unscrupulous and dishonest persons -- I do not say that there are any such people in the tribunals we are now concerned with -- turn out to be a potent weapon for corruption, manipulation and jobbery. Further it reasons for an order are given there will be less scope for arbitrary or partial exercise of powers and the order ex facie will indicate whether extraneous circumstances were taken into consideration by the tribunal in passing the order. The public should not be deprived of this only sale-guard unless the Legislature expressed otherwise. I would therefore hold that the order of a tribunal exercising judicial functions should ex facie show reasons in a succinct form for setting aside the orders of the subordinate tribunals'.
It is true that these observations were made by his Lordship in context of an order of a Tribunal which had set aside an order of a subordinate Tribunal. The observations, we may say with respect, are ex facie applicable to a case where the State Transport Authority hears an appeal and confirms the order passed by the Regional Transport Authority.
10. In the result, we must set aside the order passed by the State Transport Authority and remand the matter to the same Authority with the direction that the appeal should be heard afresh and reasons for the decision that it arrives at should be recorded according to law. We give the direction that arguments should be heard afresh because we are informed that after the bifurcation of the State of Bombay there have been many changes in the constitution of the State Transport Authority itself and different committees now hear appeals from decisions of Regional Transport Authorities. The petition succeeds to the extent indicated in our judgment The opponents will pay the petitioners' costs of this petition.