PETITIONER: D.R. VENKATACHALAM & ORS. Vs. RESPONDENT: DY. TRANSPORT COMMISSIONER & OTHERS DATE OF JUDGMENT10/12/1976 BENCH: KRISHNAIYER, V.R. BENCH: KRISHNAIYER, V.R. RAY, A.N. (CJ) BEG, M. HAMEEDULLAH CITATION: 1977 AIR 842 1977 SCR (2) 392 1977 SCC (2) 273 CITATOR INFO : R 1984 SC 200 (11) E 1990 SC1851 (29) ACT: Motor Vehicles Rules, r. 155-.4, vires of whether against public interests whether contradicts or impliedly repeals proviso to s. 47(1) of the Motor Vehicles Act, 1939--Expressio unius est exclusio alterius, applicability of. HEADNOTE: The appellants, private stage carriage operators, applied for the renewal of their expiring bus permits. The re- spondent State Transport Undertaking objected, urging preferential grounds in its own favour, claiming to have secured higher marks with the aid of r. 155-A of the Motor Vehicles Rules. The State Transport Undertakings claim was upheld. The appellants moved the appellate Tribunal, and also filed a writ petition before the High Court for direc- tions to the appellate Tribunal to dispose of his appeal without relying on r. 155-A. The writ petition was dismissed by a Single Judge, and an appeal before the Division Bench also failed. In appeal by Special Leave, the appellants assailed the validity of r. 155-A the grounds of its being partial to the Government against public interest and contradicting the proviso to s. 47(1) of the Motor Vehicles Act, 1939. Dismissing the appeals, the Court, HELD: (Per Krishna Iyer J. for himself and on behalf of A. N. Ray CJ.) 1. The assignment of marks under r. 155-A is geared to public interest, which h the desideratum of s. 47(1) of the Act. This is not an arbitrary stroke favouritism because there are many promotional factors bearing on the inter- est of the travelling public which a State enterprise qua State enterprise will, but a private enterprise qua private enterprise will not take care of. There is equity in r. 155-A, making up, as it does, for the present short.falls in the making system vis a vis a government transport service. [398H. 399B] P. Kumaraswamy v. State Transport ,Appellate Tribunal, Madras & [1976] 2 SCR. 214 referred to. The Court observed: Legal Darwinism, adapting the rule of law to new socie- tal developments, so as to survive and serve the social order, is necessary. [398B] Cardozo: The nature of the Judicial Process; Yale Uni- versity Press; pp. 151-152, relied upon. 2. There cannot be any conflict between s..47(1) proviso and the impugned rule. The proviso does not carry any negative injunction that transport tribunal shall not give any other preferential consideration than what is stated in it. There is no implied interdict that in other contingen- cies no preference shah be accorded. The proviso merely takes care of a specific situation. Moreover. the mark- ing formula does not deprive the administrative tribunals their discretion to choose the best [399C-E] Per H.M. Beg, 1. (Concurring) Where there is a single specified mode laid down for doing something exercise of the legal power to do it, the specified mode may, negatively operate. 393 (Krishna Iyer, J.) as a prohibition against what is not prescribed at all and is outside the statute. But expressio unius est exclusio alterius could not apply ot a case where two modes of doing the same thing are provided for by a statute itself. Here both chapters IV and IV-A enable plying of State transport as well as privately owned vehicles on hire on same routes, but the grounds for these combined operations under the two chapters are different. [403A, C, D] Parbhani Transport Co-operative SOciety Ltd., v. The Regional Transport Authority, Aurangabad & Ors. [1960] (3') SCR 177, applied. Nazir Ahmad v. King Emperor (1936) L.R. 63 I.A. 372, distin- guished. Colquhoun v. Brooks (1881) 21 Q.B. 52 at a, 65; Taylor v. Taylor (1876) 1 Ch. D. 426 at 430 and Crawfords "Statuto- ry Construction" 1940 Edn., Chapter 18, paragraphs 157 to 158, pages 240-244, referred to. JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeals Nos.
11781180/76.
Appeals by Special Leave from the Judgment and Order
dated 22-9-1976 of the Madras High Court in Writ Petition
Nos. 3059/ 75, W.A. No. 339/76 and W.P. No. 14 respectively.
Y.S. Chiale, V. Subramanyam and Vineet Kumar for the
Appellant in C.A. 1178/76.
K.S. Ramamurthi, M.N. Rangachari, A.R. Ramanathan, K.
Thimmalai, Jayaraman, M.M.L. Srivastava and A.T.M.S. Sam-
path for the Appellant in CAs. 1179-1180/76.
V.P. Raman, Addl. Sol. Gen. (In CAs. 1178 to 1180/76,
D.N. Misra, J.B. Dadachanji for Respondent No. 2 in CAs.
1178 & 1180 of 1976 and Respondent 2 in C.A. 1179/76.
K. Parasaran, Adv. Genl. Tamil Nadu, ,A.V. Rangam, T.
Sathiadev and (Miss) A. Subhashini for Respondents in CAs.
1179-80 except Transport Corporation.
K. Jayaram, V.T. Gopalan and K. Ram Kumar for the Appli-
cant and Intervener in C.A. 1178/76.
The Judgment of A.N. Ray C.J., and Krishna Iyer, J. was
delivered by Krishna Iyer, J.M.H. Beg, J. gave a separate
concurring opinion.
KRISHNA lYER, J. A terse presentation of the twin con-
tentions canvassed before us, in these appeals by special
leave, after discomfiture at two tiers below, highlights the
importance of the economic role of the State in undertaking,
with legal preferences, strategic services vital to the
community. The keynote thought underlying our decision is
that the jural postulates of the old competitive order have
to yield place to the new values of developmental jurispru-
dence. Public law, in India, responding to the public needs
and the State’s functional role mandated by the Constitu-
tion, has evolved new approaches to old problems and given
up dogmas which once prevailed during laissez faire days but
now have become obsolete because of the ‘welfare’ economy
which has been nurtured. This radical change in jural
394
perspectives has its impact on canons of statutory construc-
tion and on verdicts about the vires of legislation. All
these generalities acquire appropriate application in the
present cases which arise under the Motor Vehicles Act, 1939
(Act IV of 1939) (the Act, or short) from challenges before
the High Court without avail, by private operators, of the
permit granted to the State Transport Undertaking (STU) by
the transport tribunals. The validity of r. 155A of the
Motor Vehicles Rules framed under s. 68 of the Act is in
issue.
The core of counsel’s submissions is two-fold: (1) Is
rule 155A, assigning five marks for a State undertaking, not
family violative of s 47 of the Act? Does the later
amendment to the proviso to s. 47 giving preference to
State transport systems, other things being equal, impliedly
repeal, as contrary to its content, rule 155A which gives
better advantage to the favoured category, fulfilling the
spirit of the statutory amendment more tellingly ? We will
proceed further after stating the circumstances leading up
to the writ petition before the High Court and the appeal
before us.
The appellants, who have come by special leave to this
Court, are private stage carriage operators. We will relate
the facts of one case (Civil Appeal No. 1178 of 1976) the
decision in which will settle the fate of the rest, the
decisive point of law being identical. The permit of the
appellants but on the route Salem to `rode was to have
expired on September 13, 1974 and so he applied for renewal
under s. 58(2) of the Act. The respondent-State Transport
Undertaking objected to the renewal of the permit urging
preferential grounds in its own favour. The State undertak-
ing’s claim was upheld on the score that it secured higher
marks computed with the aid of r. 155-A. Baulked in his
application for renewal, the appellant challenged the order
before the Appellate Tribunal. Apprehending an adverse
decision on the strength of r. 155-A, he filed a writ peti-
tion before the High Court praying that a direction be
issued to the Appellate Tribunal to dispose of his appeal
without relying on r. 155-A. The plea was negatived by the
learned Single Judge and a Division Bench dismissed the
appeal therefrom. Aggrieved by the concurrent findings the
appellant has assailed before us the vires of r. 155-A as
obnoxious to public interest excluding, in some measure, a
fair competition and being contrary to the proviso to. s. 47
(1 ) of the Act.
A meaningful discussion of the points debated at the Bar
has to begin with a brief outline of the scheme of the Motor
Vehicles Act in the branch relating to grant of permits for
transport vehicles (Chapter IV). All transport vehicles,
before they can be plied in any public place, require per-
mits under s. 42 and even government vehicles, if put to
commercial use, have to possess permits. Applications are
made for stage carriage permits under s. 57 and the consid-
erations germane to their grant are set out in s. 47 of the
Act. It is common ground, and decisions are legion in
support thereof, that the interest of the public generally
is the super-consideration decisive of the award’ of permits
when there is a plurality of applicants. He who can serve
the public best gets the permit to ply the stage carriage
from the quasi-judicial authority charged with the responsi-
bility for choice. We may read the relevant part of s.
47(1) here:
395
(Krishna Iyer, J.)
“47. Procedure of Regional Transport
Authority in considering application for stage
carriage permit,–
(1) A Regional Transport Authority shall, in
considering an application for a stage car-
riage permit, have regard to the following
matters, namely :-
(a) the interest of the public generally;
X X X X Provided that other conditions being
equal, an application for a stage carriage
permit from any State Transport Undertaking or
a Cooperative Society registered or deemed to
have been registered under any enactment in
force for the time being shall, as far as may
be, be given preference over applications from
individual owners.
X X X X"
The interest of the public generally, is often-times too
vague and, generally, the exercise of discretion deserves to
be canalised to guide the statutory bodies and to facilitate
better appreciation by the applicants of the claims that may
ordinarily be considered by transport tribunals. From this
angle, the Tamil Nadu State has framed rules. expressly
subordinated to the paramount factor of public interest
which shall weigh with tribunals when adjudging among com-
peting claimants. ‘This Court, in Kumaraswamy(1), summed up
the purport of the rule thus:
“The system of marks, under the Rules
framed under the Act by the Tamil Nadu Govern-
ment, prescribes the various qualifications
for applicants for permits for passenger
transport under the Motor Vehicles Act. Rule
155-A crystallises these considerations and
describes them as guiding principles for the
grant of stage carriage permits. The rule
itself emphasizes what is obvious, that the
paramount consideration of the interest of the
public, as enshrined in Section 47(1), must be
given full weight while awarding per mits.
That means to say that the various factors set
out in rule 115-,4 are subject to section
47(1). This is clarified by sub-rule (4) of
Rule 155-A, which runs thus:
“After marks have been awarded under
sub-rule (3), the applicants shall be ranked
according to the total marks obtained by them
and the applications shall be disposed of in
accordance with the provisions of sub-section
(1 ) of section 47.”
There is no doubt that bus transport is
calculated to benefit the public and it is in
the fitness of things that the interest of the
travelling public is highlighted while evalu-
ating the relevant worth of the various claim-
ants.”
Rule 155A(3)D(1) offends against the prescription in the
proviso
(1) [1976] 2 S.C,R.214.
396
to s. 47(1 ) and is void, according to counsel for the
appellants. Before examining this alleged vice, we may as
well read sub-rule (3) of Rule 155-A to the extent neces-
sary:
“(3) After eliminating in the manner
laid down in subrule (2), the applicants who
are unsuitable, marks shall be awarded for
assessing the different qualifications of the
remaining applicants for the grant of permits
as follows :-
(A) Residence–Two marks shall be award-
ed to the applicant who has his principal
place of business or permanent residence at
either terminus or on the route.
Explanation.–The term ‘principal place
of business’ shall mean only the registered
headquarters of the company and not the resi-
dence of the Managing Director or any other
Director of the Company.
(B) Technical qualification (for Owner
or Managing Director).—Two marks shall be
awarded to the applicant if the Owner or the
Managing Director of the organisation has
technical qualification which may be useful to
run the transport service efficiently.
(C) Workshop facilities.–Two marks
_shall be awarded to the applicant who is in
possession of workshop facilities as given in
Explanation under item (2)(iv).
(D) (i) Five marks shall be awarded to
the applicant falling within the proviso to
clause (c) of section 62-A of the Motor Vehi-
cles Act, 1939, i.e., State Government, Cen-
tral Government or any Corporation or Company
owned by the Central Government or State
Government.
(ii) The applicant who operates not
more than nine stage carriages excluding spare
buses, shall be awarded marks as follows :–
(1 ) Applicant operating one to three buses–4
marks.
(2) Applicant operating four to six buses–3
marks.
(3) Applicant operating seven to nine buses–2
marks.
Provided that if a new entrant has made
an application for a short route other than
town service route, no marks shall be awarded
to any applicant under clause (B), (C) and (D)
(ii).”
The ground of invalidation urged is that there is no
justification for grant of 5 marks to an applicant falling
within r. 155A (3)(D)(1) solely for the reason that it is
owned by the State Government. Ownership is irrelevant and
the sacrifice of public interest at the altar of government
interest is contended to be a flagrant partiality shown by
the subordinate legislation in the teeth, and transgressing
the limits, of the equal consideration implicit in s. 47(1
). The. second argument
397
(Krishna Iyer, J.)
is that the proviso to s. 47(1), as amended by Act 48 of
1974 (Tamil Nadu Amendment Act) gives preference to a State
Transport Undertaking, other things being equal, and im-
pliedly provides against any larger preference being shown
to such an undertaking in the guise of rules. For this
reason, the generosity of the rule being contrary to the
narrow preference in the proviso to the section (brought in
by later amendment), the former cannot co-exist with the
latter and must be taken as impliedly repealed. Although
this amendment to the Act was later than the promulgation of
the rules, the law as it stands today is the basis of our
judgment. Thus the two question formulated right at the
beginning of the judgment arise in the setting of facts and
law we have broadly described above.
It was urged by Shri Chitale, followed by Shri Rama-
murthy, in two of the several matters heard together, that
Part IVA provided for monopolistic award of permits to the
State Transport Undertaking but Part IV put everyone on a
competitive basis, regardless of whether one was a State
undertaking or not, the most meritorious winning the battle
in a free market economy. If the soul of Part IV were free
competition, not ‘rigged’ selection, aid in the shape of
extra marks given by rules had to be withdrawn and every
applicant had to run without anyone being given a handicap
in the race. State undertakings being awarded 5 grace marks
for no reason except that they belonged to the State was a
gross violation of the spirit and letter of s. 4 7 (1 )
which postulated the promotion of public interest as the
basic consideration and the selection of the ablest as the
criterion for choice. Both counsel, in their overlapping
arguments, stressed that there was a negative mandate in the
proviso to s. 47(1) not to prefer a State undertaking save
where other conditions were equal and if the State undertak-
ing was unable to attain the condition of equality with
another, its claim could not be promoted by the artifice of
assignment of marks to a State undertaking qua State under-
taking.
Public law, in our pie-bald economy and pluralist socie-
ty, responds to societal challenges and constitutional
changes. TO miss the ideological thrust of our Constitution
and the economic orientation of our nation while construing
legislation relating to public law and scanning them for
their validity is to fail in understanding the social phi-
losophy that puts life and meaning into the provisions of
the Act. The law, being realistic, reckons with the social-
ist sector covering State and co-operative enterprises.
The special status of a government-owned transport
undertaking in a Welfare State is obvious. It has large
resources to cater to the traffic needs. It has, within its
range of influence and coordination. many services useful to
the travelling public, which may be beyond the reach of
private ownership. Its functional motto is not more profits
at any cost but service to citizens first and in a far
larger measure than private companies and individuals,
although profitability is also a factor even in public
utilities. Its sensitivity to community welfare and en-
couragement of labour participation, its accountability to
the Government, the legislature and the public put it in a
category by itself. It is socially conscious, not profit
obsessed. We are aware of the shortfalls of some public-
sector undertakings in some respects
398
but it needs little argument to hold that to classify State
transport systems on a separate footing is realsic and is
ordinarily no sin before the principle of equality before
the law. The legislative body has done, in the given circum-
stances, what it thought was sound policy and we find no
vice in the policy.
To classify what is conceptually and operationally
different into a separate category is intelligence, not
impertinence. The judicial art of interpretation and ap-
praisal is imbued with creativity and realsm, especially
where fundamental changes have been wrought by the Constitu-
tion in our approach to public sector enterprises. Legal
Darwinism, adapting the rule of law to new societal develop-
ments, so as to survive and serve the social order is neces-
sary:
“That court best serves the law which
recognizes that the rules of law which grew up
in a remote generation may, in the fullness of
experience, be found to serve another genera-
tion badly, and which discards the old rule
when it finds that another rule of law repre-
sents what should be according to the estab-
lished and settled judgment of society, and no
considerable property rights have become
vested in reliance upon the old rule. It is
thus great writers upon the common law have
discovered the source and method of its
growth, and in its growth found its health and
life. It is not and it should not be station-
ary. Change of this character should not be
left to the legislature. If judges have
woefully misinterpreted the mores of their
day, or if the mores of their day are no
longer those of ours, they ought not to tie,
in helpless submission, the hands of their
successors.”
(Cardozo: The Nature of the Judicial Proc-
ess: Yale University Press: pp. 151-152).
This refreshing perspective guides us to look at the
submissions advanced. Both the contentions can be shot down
by three considerations. Firstly, a State enterprise, in a
truly Welfare State, is charged with a social consciousness
and responsibility for its citizens, an attention to serve
them and a willingness to embark on public utility undertak-
ings better to fulfil people’s demands. The public sector
enterprises are expected to be model employers and model
servants, planning their budgets, subjecting themselves to
public audit and criticism and inquest by legislative com-
mittees and the Houses of the legislature. Profits are
their concern but, more importantly, public weal is their
commitment. Such is the philosophy of the State sector in
our socialistic pattern of society. Article 19(6)(ii) and
Art. 38 of the Constitution, s. 47 (1 ), especially the
proviso, and Charter IVA of the Act (now governed by the
impregnable Ninth schedule to the COnstitution) throw light
on this policy of the paramount law. Here, therefore, the
rule making authority, having regard to all relevant circum-
stances, has decided to award to a State Transport Undertak-
ing 5 marks. This is not an arbitrary stroke of favouritism
because there are many promotional factors bearing on the
interest of the travelling public which a State enterprise
qua State enterprise will, but a private enterprise qua
private enterprise will not, take care of.
399
(Krishna lyer, J.)
After all, private enterprise has its primary motivation in
profit, although, under State direction, it is becoming
socially responsive. The superiority in many respects (not
all respects) of State Transport Undertakings, in the legis-
lative judgment, has led to r. 155A. This classification
has noetic nexus with and rational relation to the object of
augmenting the good of the passenger community. The theory,
rooted in the obsolescent laissez faire economics, that only
cold competition among claimants to run businesses brings
out the best operator has serious limitations in fields
where the focus is on public service, not gains of business.
Public law, adapting itself to this socio-economic view,
shifts its emphasis. This is what we have earlier called
legal Darwinism. We, therefore, hold that the assignment of
marks under r. 155A is geared to public interest, which is
the desideratum of s. 47 ( 1 ) of the Act.
We now move on to an examination of the alleged fatal
incompatibility between the proviso to s. 47(1) and L 155A.
This second submission of counsel is a trifle mystifying.
There cannot be a contradiction without diction. Unless s.
47(1) proviso carries a negative injunction that transport
tribunals shall not give any other preferential considera-
tion than what is stated in it, there cannot be any con-
flict between it and the impugned rule. The proviso to the
section does nothing of the kind. It merely takes care of a
specific situation. Where a State Transport Undertaking: and
a private operator are equally balanced, the scales may be
tilted in favour of the former. There is no implied inter-
dict that in other contingencies no preference shah be
accorded. It is not a ‘Thus far and no further’. Indeed,
the spirit of this proviso has been carried further by the
rule, having regard to the realities of the total transport
system plying in the State.
The third consideration which silences the appellant’s
charge of violation of s. 47 is that the marking formula
does not deprive the administrative tribunals of their
discretion to choose the best. The consternation of the
private entrepreneurs that by manipulating the marking
mechanism the State undertaking, regardless of its demons
trable inferiority of public service, will knock off all the
permits, paralysing the power of the Tribunal to pick and
choose, by the overwhelming and inevitable superiority of
marks, is misplaced. The fear is falsified if we read the
rule aright. It has, written on its face, its own limita-
tion. Marks shall guide, not govern the award. Full
discretion, to some extent, canalised by the marking proce-
dure, still vests in the Transport Authority. For, the
marks, these authorities will remember, sway the exercise
of judgment, not supersede it. It is conceivable that
the pecularities of a route, the calamitous performance in
an area of a State transport system, the outstanding spe-
cial facilities of a particular private operator or other
like feature may outweigh the mechanics of marks. After
all, many qualifications, advantageous to the travelling
public, may be thought of, untouched by the rigid marking
moulds. They are not irrelevant and may still be regarded
by the tribunals. All this leads to the conclusion that
marks shape but do not clinch the ultimate selection. The
public is the consumer; its plenary service is the final
test. Therefore, these is
400
nothing in r. 155A deprivatory of the discretion vested by
s. 47(1).This interpretative footnote must allay the appre-
hensions voiced by counsel. Nor are we convinced that there
is no possibility of a private operator exceeding the mini-
mum marks of a State Transport Undertaking. Moreover, the
marking formula lacks flexibility. Merely because the State
Transport Undertaking has no ‘residence’ or workshop on
the route, although its attention and ability to react are
considerable, why should it suffer a marks-created handicap
? There is equity in r. 155A, making up, as it does, for the
present shortfalls in the marking system visa visa govern-
ment transport service.
The appeals, for these reasons, must suffer dismissal.
There will be no order as to costs.
BEG, J. I agree with the conclusion reached by my
learned brother Krishna Iyer. As arguments in this batch of
cases seem to raise some questions which I, speaking entire-
ly for myself, consider to be really outside the sphere of
the law which we have to interpret and apply, I would like
to make some observations on the implications of these
questions argued after stating my reasons for agreeing with
my learned brother.
Mr. Chitaley’s first argument for some of the appellants
raised only what may be described as “normal” legal ques-
tions of construction or interpretation (there is some
difference between these two allied processes as will
appear from Crawfords “Statutory Construction”, 1940 Edn.,
Chapter 18, paragraph 157 to 158 pages 240-244), as to
whether Rule 155A(3)(D)(i), reproduced in the judgment of my
learned brother Krishna Iyer, gives effect to or conflicts
with Section 47 of the Motor Vehicles Act, 1939 (hereinaf-
ter referred to as ‘the Act’). It was urged by the learned
Counsel that what can be done only by resorting to Chapter
IV-A of the Act, by framing a scheme for partial or complete
nationalisation of the routes involved, cannot be accom-
plished by framing a rule only ostensibly purporting to give
effect to Section 47(1 ) of the Act or the proviso to it.
In ultimate analysis, the rule of construction relied
upon by Mr. Chitaley to make the last mentioned submission
is: “Expressio unius est exclusio alterius”. This maxim,
which has been described as “a valuable servant but a dan-
gerous master (per Lopes J., in Court of Appeal in Colgu-
noun v. Brooks(1) finds expression also in a rule, formu-
lated in Taylor v. Taylor,(2) applied by the Privy Council
in Nazir Ahmad v. King Emperor(3) which, has been repeat-
edly adopted by this Court. That rule says that an express-
ly laid, down mode of doing something necessarily implies a
prohibition of doing it in any other way. The maxim from
which the rule in Taylor v. Taylor(supra) is derived and
the rule itself were discussed and explained by this
Court in the Parbhani Transport Co-operative Society
Ltd. v. the Regional Transport Authority, Aurangabad & Ors
(4) with specific reference to the argument advanced there
that,
(1) (1881) 21 Q.B.D. 52 at 65. (2) (1876) 1 Ch. D. 426
at 430. (3) (1936) L.R. 63 I.A. 372. (4) [1960] (3)
S.C.R. 177.
401
as Chapter IV-A is meant for running its own buses by the
State by nationalisation of Motor Vehicle Road Transport
Services, it was not open to the State to apply for per-
mits at all under Chapter IV of the Act which applies to
private operators only. This argument,repelled by this
Court there has been put forward before us in a somewhat
different and attenuated form by Mr. Chitaley. Neverthe-
less, the basic rule of interpretation submitted to us is
the same as the one which was relied upon in this Court in
the Parbhani Transport Co-operative Society’s case (supra)
in an attempt to exclude the State Transport Undertaking
altogether from entry into what was sought to be made out to
be the exclusive preserve of private operators. Before us,
it is contended that exclusion of private operators could
only be brought about by resorting to a duly framed scheme,
on appropriate grounds given in Section 68C of the Act, but
not indirectly by framing the kind of rule which has the
effect of excluding private operators from the sphere of
open competition which, it is submitted postulates an ini-
tial equality of positions. This argument rests, as I will
indicate below, on two erroneous assumptions: firstly,
that Rule 155A(3)(D)(i) has the effect of excluding private
operators; and, secondly, that the proviso to section 47(1)
compels the permit issuing authorities to postulate or start
by assuming an equality of conditions, as between private
operators and a State Transport Undertaking. Indeed, if
they were to start with the assumption of equality they
will have to give preference to the State Transport Under-
taking straightaway because that is what the proviso re-
quires. The mainstay of the arguments of learned Counsel
for the appellants before us, however, is that Rule
155A(3)(D)(i) really has the effect of excluding the private
operators altogether by making it impossible for them to
ever obtain preference over the State Transport Undertak-
ing when it applies for a permit in competition against
them.
The reply on behalf of the State is that no exclusion of
private operators is either intended or brought about by an
application of Rule 155A(3)(D)(i) of the Act. On the other
hand, it is submitted that, as an ordinary operator and a
State Transport Undertaking are, in many ways, so unlike
each other that, unless five marks were assigned to each
application of the State Transport Undertaking, it could
not compete at all, on a fair and equal footing, with pri-
vate operators, who are able to obtain straightaway two
marks for residential qualifications, four marks if they are
operating not more than three buses, and two marks for
workshop facilities. apparently, the residential qualifica-
tion has reference to residence within the area in which
the motor vehicles are to ply, and marks workshop facilities
are granted to operators who are able to show such facili-
ties on particular routes whereas the State Transport
Undertakings, it is pointed out, will neither have a resi-
dence within such an area nor may be able to show, in a
particular case, workshop facilities on particular routes
even though they may have better workshop facilities on
the whole. Again, two marks are to be given to private
concerns or organisations, plying on particular routes, if
their owners or Managing Directors have certain technical
qualifications. It is pointed out that, as State Transport
Undertakings do
402
not have individual owners or Managing Directors, for whom
these marks could be allotted, even though they may have
technically much better qualified personnel to attend to
their motor vehicles, the impugned Rule 155A(3)(D)(D could
be justified as meant only to place State Transport Under-
takings on a footing of possible equality with private
operators in competing. for permits to be granted under
Section 47(1) read with Section 42(3) of the Act and to do
no more. Furthermore, Rule 155A(3)(D)(i) occurs in a group
for marks to be assigned on the basis of the number of
vehicles run by the operators. In any case, it was submit-
ted that it is a fair provision as a rough guide but is
not decisive by any means. It seems to me that the conten-
tion advanced on behalf of the State that the impugned part
of Rule 155A enables provisions of the proviso to Section
47(1), read with Section 42(3), to be worked a manner in
which the statutory provisions were intended to overate and
does not really authorise a circumvention or infringement
of the provisions of Chapter IV of the Act, is well founded.
The manner in which provisions of Chapter IV of the Act
were meant to operate in cases of competition between pri-
vate operators and State Undertakings was explained in the
Parbhani Transport Co-operative Society’s case (supra) as
follows (at p. 184):
“The Government has of course the power
to do. any business it lies and therefore the
business Of running stage carriages. We have
earlier drawn attention to the change made in
cl. (a) of S. 42(3) by the: amendment of 1956.
Previously, it was not necessary for the
Government to obtain permits under s. 42(1)
for buses that it intended to run as stage
carriages. SinCe the amendment the Government
can no longer run transport vehicles for
commercial purposes without obtaining permits
under S. 42(1 ). Now the plying of buses as,
stage carriages is a commercial enterprise and
for such buses, therefore, under the sections
as they stand, the Government would re-
quire permits as any one else. That being
so, the sections clearly, contemplate that
the Government may apply for and obtain
permits for its buses run as stage car-
riages. The rule applied in Nazir Ahmad’s case
(1936) L.R. 63, I.A. 372, 381) does not permit
the ordinary meaning of s. 42, sub. s.(1) and
sub. s.(3), el. (a) to be cut down because
of the provisions of Chapter IVA. The Act
lays down two independent sets of provisions
in regard to the. running of buses by the
Government, one under Chapter IV and, the
other under Chapter IVA. Chapter IVA was
intended to give the Government, a special
advantage. When the Government chooses to
proceed under that chapter, it becomes
entitled as a matter of right under s. 68F(1
) to the necessary permits. Under Chapter IV
the Government does not have any such advan-
tage; it has to compete with other applicants,
to secure permits to be able to run its buses.
The powers under the two. chapters are there-
fore different. To such a case the principle
of Nazir Ahmad’s case cannot be applied”.
403
Both Chapters IV and IVA enable plying of State transport
as well as privately owned vehicles on hire on same routes,
but the grounds for these combined operations under the
two chapters are different. The governing principle of
Section 47(1) is to preserve as free and open a competition
as possible in public interest, whereas the reason for
allowing private operators upon a nationalised route may be
broader one of public policy which may favour a decision
against sudden stoppage of privately provided motor trans-
port, so as to avoid wastage of national wealth, even though
it takes the form of investments by individual entrepre-
neurs, or, its object may even be prevention of undue hard-
ship to private operators. Other reasons for permit-
ting combined services can be. given. It is, however,
possible only under Chapter IVA to exclude private operators
completely. But, unless any rule relating to provision of
motor transport under chapter IV has that effect it cannot
be asserted that what can be done only by resorting to
Chapter IVA is being attempted under the provisions of
Chapter IV.
The rule in Nazir Ahmad’s case (supra) applies only to
cases where there is a single specified mode laid down for
doing something in exercise of the legal power to do it. In
that event, the specified mode-may, negatively, operate as
a prohibition against what is not prescribed at all and is
outside the statute. But, it could not apply to a case
where two modes of doing the same thing are provided for by
a statute itself. Nor, as I have indicated above, could it
be said that what is to be done under Chapter IV and what
can be done under a scheme under Chapter IVA are really the
same simply because, in a given case, the results of both
may appear to be similar or even identical.
Mr. Ramamurthi, appearing on behalf of some of the
appellants, embarked on quite an ambitious argument built
upon an elaboration of the theme that Chapters IV and IVA
belong to two different fields or spheres of action which
cannot, so to speak, be allowed to mix, overlap, or collide.
It was contended that the waters of what are, in the eye of
law, two different streams of activity. must not be allowed
to mingle. If 1 am not mistaken, even the word “pollute”
was used, in the flow of arguments, to describe, possibly in
a light vein, the alleged inequity of an invasion by a
State Transport Undertaking of the supposedly exclusive
preserve of private enterprise. It was suggested that such
a result would involve “pollution” of the domain of open
competition, which is forbidden territory for State Under-
takings introduced as a consequence of another ideology or
sphere of action found in Chapter IVA. It seems to me that
to hear such an argument, advanced even in a lighter vein,
is really rather surprising in view of the language of the
statute and welt known facts to which it is related. It is
quite well known that ours is what is known as a “mixed
economy”. The highest norms of our-law are embodied in
our Constitution. Article 19(6)(ii) of the Constitution
clearly contemplates: “the carrying on by the State, or by
a Corporation or controlled by the State, of any trade,
business, industry or service, whether to the exclusion,
complete or partial, of citizens or. otherwise”.. And,-in
order to fulfil the objectives of the Preamble. to our
Constitution, the Constitu-
404
tional mandate, contained in Article 39(c) of the Constitu-
tion, which the State has to carry out, may make it impera-
tive upon the State, in appropriate circumstances, either
to take over or nationalise motor transport on roads in any
region or area completely or to supplement the Transport
Services provided by private operators with those provided
by the State. It seems to me that neither Chapter IV nor
Chapter IV-A can be really put into two separate water-tight
compartments so as to make it imperative either to exclude
State Transport Undertakings from operating under the provi-
sions of Chapter IV or to exclude private operators when a
scheme under Chapter IV-A, which may itself provide for only
a partial exclusion of such operators, is in force. In the
face of the clear words of proviso to Section 47 (1 ) of the
Act, enabling State Transport Undertakings to provide
Transport facilities in open competition, and of Section
68(C) in Chapter IV-A of the Act, enabling “the exclusion
complete or partial” of private operators from particular
areas or routes, such an argument cannot be put forward at
all before us under some preconceived notions even after
these very notions had been rejected by this Court in the
Parbhani Transport Co-operative Society Ltd’s case (supra).
It is clear that the two chapters of the same Act are
both intended to subserve “the interest of the public gener-
ally” in any area in the country, That is the integrating or
governing principle evident from the language of the Act
itself in both Chapter IV and Chapter lV-A of the Act.
An argument advanced on behalf of the appellant seemed to
be that Rule 155A(3)(D)(i) results in defeating the mandate
of Section 47(1) of the Act, that the Regional Transport
Authority must, as explained repeatedly by this Court, keep
“the interest of the public generally” in the fore-front.
As already indicated by me, this argument really proceeds on
the erroneous assumption that the mere fact that the State
Transport Vehicles are given five marks would defeat public
interest by excluding consideration of all facts except that
the State Undertaking has applied for one or more permits on
a particular route. As my learned brother Krishna Iyer has
also pointed out, this is an unwarranted assumption. Rule
155A gives only guidance, but the totality of factors men-
tioned in Section 47(1)’really decide.
It was suggested on behalf of the State Transport Under-
taking that the obvious capacity of a State Undertaking to
provide facilities which are beyond the reach of private
operators, that its actions are subjected to such constant,
vigilant, and rigorous control on behalf of the public, and
that it is bound to be so free from any desire to make
profit.s, by sacrificing public interests or convenience of
passengers that, even if nothing else was considered, these
presumed advantages would justify the award of five marks on
each application of the State Undertaking for a permit.
If this line of reasoning was completely accepted and car-
ried to its logical conclusion, the provision/or giving five
marks ,to each application of the State Undertaking would
become quite otiose or unnecessary because, in that case,
the State Undertaking would, by relying merely on a presumed
superiority for purposes of Section 47 (1 ), get a prefer-
ence automatically. The proviso to Section 47 (1 ) of the
Act would then, apart from making it clear that the State
Undertaking can also apply for permits, for which
405
purpose Section 42(3) was enough, serve: no useful purpose.
Indeed, if such a view were to be accepted, the first part
of the proviso to Section 47 (1 ) would seem to rest on a
false premise because there could be no case in which
“other conditions” could ever be “equal” as between a State
Transport Undertaking and a private operator. The State
Transport Service would, in that case, always get a prefer-
ence. For this reason, I do not think that this line of
reasoning could be pushed too far. It has to be assumed, in
view of the opening words of the proviso to section 47 (1 ),
that there may be cases in which an application of the
basic principle, contained in Section 47 (1) of the Act, may
tilt the balance either in favour of the State Undertaking
or the private operator. The proviso applies only where
the State Undertaking could’ reasonably be deemed to be in
a position of equality as regards comparative advantages
offered by it. As there cannot, between such dis-similar
operating units, be comparability of conditions or advan-
tages offered unless some rule is flamed and applied which
could make comparison reasonably possible, it seems to me
that Rule 155A(3) (D)(i) is justifiable on the ground that
it makes what is legally contemplated and permissible also
practicable.
The proviso. to Section 47 (1 ) reads as
follows:
“Provided that other conditions being
equal, an application for a stage carriage
permit from any State Transport Undertaking or
a co-operative Society registered or deemed to
have been registered under any enactment in
force for the time being shall, as far as may
be, be given preference over applications from
individual owners.”
An examination of this proviso shows that an. equality of
other conditions is contemplated before any question of
giving preference, merely on the ground that the applicant
is the State Transport Undertaking or a Cooperative Society,
can arise. If other conditions are equal, then, undoubted-
ly, the choice as between such equals must, if the proviso
is to be given effect, be made in favour of the State Trans-
port Undertaking or a Cooperative Society automatically.
That is how, in such a case, See. 47(1) itself would be
deemed to operate.
The validity of the proviso is not challenged. Even if
Article 14 were available for an attack upon it, as it is
not during the current emergency, it is clear that the State
Transport Undertaking does stand in a separate category.
Therefore, it could be found entitled, for obviously good
and intelligible reasons, to preference over private
operators “other conditions being equal”. The narrow ques-
tion before us. Thus, appears to me to be nothing more than
whether the impugned part of Rule 155A sub-serves or vio-
lates the proviso. The proviso itself is meant to explain
what public interest, as visualised by Section 47(1), re-
quires. Hence it appears to me that the validity of the
impugned part of Rule 155A could be determined on purely
legal grounds as a necessary corollary of the proviso to
Section 47(1). The impugned part of the Rule is there to
make the proviso workable and not to defeat its provisions.
406
It is, however, becoming increasingly fashionable to
start with some` theory of what is basic to a provision or
a chapter or in a statute or even to our Constitution in
order to interpret and determine the meaning of a particular
provision or rule made to sub-serve an assumed “basic”
requirement. I think that this novel method of construc-
tion puts, if I may say so, the cart before the horse. It
is apt to seriously mislead us unless the tendency to use
such a mode of construction is checked or corrected by this
Court. What is basic for a section or a chapter in a stat-
ute is provided: firstly, by the words used in the statute
itself; secondly, by the context in which a provision oc-
curs, or, in other words, by reading the statute as a whole;
thirdly, by the preamble which could supply the “key” to the
meaning of the statute in cases of uncertainty or doubt;
and, fourthly, where some further aid to construction may
still be needed to resolve an uncertainty by the legislative
history which discloses the wider context or perspective in
which a provision was made to meet a particular need or to
satisfy a particular purpose. The last mentioned method
consists of an application of the Mischief Rule laid down in
Heydon’s case long ago.
If we start from a theory as to. what the real purpose
or need is or could be, the danger is that we may be inject-
ing a subjective notion or purpose of our own into what is,
after all, a legal question of construction or interpreta-
tion, according to well recognised principles, although it
may be necessary, in exceptional eases, to explain or forti-
fy the interpretation adopted in the light of so well under-
stood and. well known a purpose or theory that we could take
judicial notice of it and refer to it. The exposition of
the well known purpose or theoretical foundation must,
however, generally, flow from and explain an interpretation
adopted, on the strength of legally acceptable and
accepted canons of construction, if we are to avoid the
danger of an a priori determination of the meaning of a
provision based on our own pre-conceived notions of an
ideological structure or scheme into which the provision to
be interpreted is somehow fitted. The path of judicial
certainty and predictability has to be paved with well
settled principles of construction and interpretation. We
cannot let it develop into a slippery slope be-set with
hazardous possibilities. The science of statutory construc-
tion and interpretation–I think can call it that–rests on
certain systematised principles and rules of common sense,
logic, and reason. It can not be transformed into a happy
hunting ground for whatever may captivate the forensic or
judicial fancy or become something akin to poetry without
even the attractions of euphony.
For the reasons given above, I find that, on an applica-
tion of the ordinary and well recognised rules of interpre-
tation, without resorting to any of the novel methods
suggested by some of the arguments of learned Counsel for
the appellants, the impugned part of Rule 155A(3) (D)(i)
is valid. I, therefore, concur with nay learned brother
Krishna Iyer, and hold that the connected appeals and peti-
tions before us must be dismissed.
M.R. Appeals dis- missed. ?407