PETITIONER: RATTAN LAL GUPTA & ORS. ETC. ETC. Vs. RESPONDENT: SURAJ BHAN & ORS. ETC. ETC. DATE OF JUDGMENT29/11/1973 BENCH: GOSWAMI, P.K. BENCH: GOSWAMI, P.K. REDDY, P. JAGANMOHAN DWIVEDI, S.N. CITATION: 1974 AIR 391 1974 SCR (2) 555 1974 SCC (1) 235 ACT: Motor Vehicles Act, 1939-S.47(3)-If the Regional Transport Authority could grantpermits without first fixing the strength. HEADNOTE: There were two bus routes-the shorter and the longer routes- both being overlapping. On the shorter route, the strength of the stage carriage permit was fixed at 17 in 1950. In July 1958 the Regional Transport Authority decided to extend the shorter route by about six miles (which is called the longer route). In March, 1959 the strength of the shorter route was increased from 17 to 25. The State Transport Appellate Tribunal approved the extension of the shorter route. The R.T A. advertised for eight vacancies in the shorter route and a number of application had been received. Certain objections were raised to the increase in the strength and to the wrong description of the route. In August 1961 the RTA decided that the only route that survived was the longer route. The existing permits for the shorter route were in the meantime converted into permits for the longer route When appellants in the third group had applied for permits on the shorter route, objections were raised that the shorter route had ceased to exist. Overruling the objections, the RTA granted eight permits to the appellants, which decision was upheld' by the State Transport Appellate Tribunal in August, 1967. The High Court held (i) that without fixing the strength first on the longer route permits could not be granted for it(ii) that the RTA should have first decided whether there were two routes or one and then fixed the strength of the route or routes and that not having been done in accordance with law there was no proper disposal of the applications for permits; (iii) that the reduction of the strength of 25 to 9 on the shorter route as done by the RTA was illegal. Dismissing the appeals of the appellants in the first and second groups and allowing the appeal of the third group. HELD : As the RTA had not fixed the number of permits for the longer route the grant of permits for the longer route was invalid. [560-G] in March, 1959 the RTA had fixed the number of permits for the shorter route at 25. As 17 permits had already been granted, the RTA invited applications for eight vacancies in June, 1959. So the strength was fixed long before the invitation of applications for permits. At one stage the RTA had taken the view that the shorter route had merged in the longer route but later it rectified the mistake and held that the shorter route and the longer route existed separately. The latter view of the RTA was correct in the then prevailing circumstances. [560-H] A decision to extend the shorter route to a longer distance under the U.P. Motor Vehicles Taxation Act will not automatically merge the shorter route in the longer route. For that purpose it was necessary for the RTA to take an independent decision under the Motor Vehicles Act. But no such decision was taken. The RTA realised the mistake and rectified it in its meeting of May, 1965. The decision of the RTA dated May, 1965 that the shorter route still existed with a strength of 25 stage carriages and that the shorter route and the longer route were separate routes was correct. [561-C-D] The RTA could not reduce the strength of the shorter route from 25 to 9. There were, therefore, eight vacancies on the shorter route and the RTA could validly grant eight permits to the appellants in the third group. The High Court was wrong in quashing the grant of permits to the appellants in the third group. [561-E-F] R. Obilaswami Naidu v. Transport Appellate Tribunal, Madras [1969] 1 S.C.R. 730, M/s Jaya Ram Motor Service v. S. Rajarathinan, C.A. No. 95 of 1965 decided on 27-10-1967, Mohd. Ibrahim etc. v. State Transport Appellate Tribunal, Madras. 556 etc.. [1971] 1 S.C.R. 523, Abdul Mateen v. Ram Kailash Pandey, [1963] 3 S.C.R. 523 and Baluram v. State Transport Appellate, Authority, M.P., C. A. No. 527/65 decided on 22-3-1968, referred to. JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeals Nos. 15921595
of 1971.
From the Judgment and Decree dated the 30th September, 1969,
of the Allahabad High Court in Civil Miscellaneous Writ Nos.
5210, 5246, 5398 and 5410 of 1964.
CIVIL APPEALS No. 1628-1631 of 1971.
From the Judgment and Decree dated the 30th September, 1969
of the Allahabad High Court in Civil Miscellaneous Writ Nos.
3216 3217, 3218 of 1967 and 12 of 1968.
CIVIL APPEALS Nos. 1634-1639 OF 1971.
From the Judgment and Order dated the 30th September, 1969
of the Allahabad High Court in Civil Miscellaneous Writ.
Nos. 3892, 3135, 3136 3137, 3138 and 3139 of 1967.
AND
SPECIAL LEAVE PETITIONS (CIVIL) Nos. 3094-3095 OF 1971.
From the Judgment and Order dated the 30th September, 1969
and 28th July, 1971 of the Allahabad High Court in Civil
Miscellaneous Writ Nos. 3927 of 1967 and SCA No. 643-A of
1969 respectively.
Yogeshwar Prasad, S. K. Bagga, S. Bagga, Rani Arora and
Indira Manchanda, for the appellants (in C. A. Nos. 1592-
1595/71) and Petitioner in (SLPs Nos. 3094 & 3095/71).
H. K. Puri, for respondent No. 1 (in C.A. No. 1593) and
respondent On C.A. nos. 1628, 1629 and 1630/7 1)
R. K. Garg and S. C. Agrawala, for respondent Nos. 1 (in
C.A. No. 1594 and Appellants (in C.A. No. 1628-31 and 1634-
39/71)
E. C. Aggravala and A. T. M. Sampath, for respondents Nos.
1 and 2 (in 1595) and respondent no. 3 (in C.A. No.
1634/71).
J. P. Goyal and V. C. Parashar, for intervener (in C.A.
Nos. 1592- 95 and respondent no. 4 (in 1634-37) and
respondent Nos. 4 and 5 (in C.A. Nos. 1638-39/71)
The Judgment of the Court was delivered by
GOSWAMI, J.-There are three groups of appeals with
certificate directed against the judgment of the Allahabad
High Court of 20th September, 1969. The first group (Civil
Appeals Nos. 1592-1595 of 1971) is by Rattan Lal Gupta, Uma
Sharan Sharma, Sewa Ram, Dharam Das Agarwal, Land Lines Pvt.
Ltd., Smt. Kusum Lata and Tribhuvan Kumar; the last two
being the widow and son of Madan Mohan Lal, deceased. The
second group (Civil Appeals Nos. 16281631 of 1971) is. by
Suraj Bhan (in Civil Appeal No. 1628 of 1971) and others.
The third group (Civil Appeals Nos. 1634-1639 of 1971) is by
Harish Chandra, Mahendra Kumar Tayal, Shanti Swarup Jain,
Mitranand Kaushaik, Baru Mal Agarwal, Gur Prasad, Richpal
557
Singh and Bhagwan Singh Sambi. There are also two Special
Leave Petitions Nos. 3094-3095 of 1971 which have not been
admitted but by an order of this Court dated 7th February,
1972, the petitioners’ were allowed to intervene in these
appeals.
The facts relating to the appeals have got to be narrated in
some detail. On October 13, 1950, a route for stage carnage
permit described as Muzaffarnagar-Budhana-Kandhla
(hereinafter the shorter route),was classified as ‘B’ class
route and the strength of the permit was fixed at 17. On
July 18, 1958, the Regional Transport Authority (briefly
RTA) Meerut decided to extend the route by about six miles
upto Issupurteel ( hereinafter the longer route). On March,
23, 1959, the RTA increased the strength or the shorter
route from 17 to 25 under section 47(3) of the Motor
Vehicles Act, 1939 (briefly the Act). As there were already
17 permits in operation, the RTA on June 13, 1969,
advertised for 8 vacancies in the shorter route and fixed
July 27, 1959, as the last date for receiving the
applications and it appears 1117 applications were received.
The State Transport Appellate Tribunal (briefly STA)
approved the extension of the route to Issupurteel on August
8, 1959. The applications which were received in response
to the advertisement were published in the U. P. Gazette of
September 15, 1962. There were some other applications on
June 16, 1963, including a second application of M. N.
Kaushik. These were also published in the U. P. Gazette on
June 16, 1963. Mohds. Ibrahim filed his objections to the
applications published on September 15, 1962. He objected
to the increase in the strength and to the route being
wrongly described in the advertisement. On 2nd to 4th
August, 1961, the RTA had decided that there was only one
route upto Issupurteel and that applications presented
either upto Kandhla or upto issupurteel should be considered
as presented for the entire route viz., the longer route.
The RTA also held that Muzaffarnagar Budhana-Kandhla route
ceased to exist in 1958 by referring to its earlier
resolution No. 71 of 18th July 1958 and that thereafter the
only route that survived was the longer route upto
Issupurteel. It appears most of the existing permits for
the shorter route were in the meantime converted into the
longer route under section 57 (8) of the Act. Suraj Bhan’s
application for a permit was published on November 2, 1963.
Meanwhile 7 renewal applications from the existing permit
holders were received between November 4, 1963 and May 18,
1964, in anticipation of expiry of their permits. The
appellants in the first group objected to these renewals and
prayed for grant of fresh permits to them for the longer
route. On June 13, 1964, their objections to the renewals
as well as those for fresh permits were published in the
Gazette. On July 4, 1964 some more applications were
published for the longer route. To give some more details,
thirteen applications for the longer route were published on
July 1, 1961; twenty seven on June 15, 1963 and two on
November 2, 1963. Mohd. Ibrahim and his union of the
existing operators objected to these applications. On 28th
and 29th August, 1964, the RTA considered only II renewal
applications and 12 fresh applications and other
applications were not even put up before the RTA. The RTA
ordered renewal of 11 permits and rejected the objection to
the renewal of the appellants in
–M602Sup CI/74
558
the first group as well as their applications for fresh
permits. The ground given was that none of the objectors
and 12 applicants for fresh permits had turned up. The
appellants in the first group to the STA impleading 8 out of
the 11 renewal permit holders. The STA by its order dated
November 10, 1964, set aside the order of the RTA dated
28th /29th August, 1964. Four writ petitions were filed in
1964 against the order of STA dated November 10, 1964. The
appellants in the third group had applied for permits on the
shorter route. Certain persons-had objected to their
applications on the ground that the shorter route had ceased
to exist. On May 6-8, 1965, their objections were
overruled, and the RTA granted 8 permits to the said
appellants. This order was upheld by the ‘STA on August 29,
1967. There were 19 other writ petitions of 1967 and 1968
be-‘ fore the High Court which were also heard together. Of
these five petitions were directed against the order of the
STA of August 29, 1967. Seven petitions were directed
against the orders of both the RTA and of the STA made
respectively on 6th to 8th May, 1965 [item 30 (a)] and on
29th August, 1967. Seven more petitions were directed
against the orders of the RTA of 6th to 8th May, 1965 [item
(c)] and of the STA of 29th August, ‘1967.
With reference to the first group of writ petitions, the
High Court held that the strength of 25 had not been fixed
by the RTA for the longer route. It further held that the
grant of six permits forthwith on the longer route was
illegal that since the number of applicants for permits on
this route were in excess of the number of permits which
could be-granted, no grant could be made without first
fixing the strength of the longer route. The High Court,
therefore, set aside the order of the STA dated November 10,
1964. It also at the same time set aside that part of the
order of the RTA of 28th/29th August, 1964, by which their
applications for fresh permits had also been rejected. The
High Court also quashed the orders of the RTA and STA dated
May 6-8, 1965 and August 29, 1967 respectively. The High
Court further observed that “until the shorter and the
longer routes were held on legally relevant considerations
to be separate for purposes of granting permits, all the
pending applications whether for the extended or unextended
route should have been taken up together”. Since this was
not done by the RTA nor by the STA, the orders of both were
“vitiated by patent illegality as regards applications for
fresh permits”. The High Court also noted that it was
admitted by all the parties that the strength of 25 had been
fixed for the unextended route and that no strength of the
extended route had been fixed at all. That being the
position, following the decisions of this Court in R.
Obilaswami Naidu v. Transport Appellate Tribunal, Madras(1)
and ,Ills Jaya Ram Motor Service v. S. Rajarathinan (2), the
High Court held that without fixing the strength first on
the longer route permits could not be granted for it. On
the question of routes, the High Court observed that the RTA
should have first decided whether there were two routes or
one route and then fixed the strength of the route or routes
and that not having so done, in accordance right law, there
was no proper disposal of the applications for permits. The
High Court further pointed out that the reduction of the
strength of 25 to
(1) [1569] 1 S. C. R. 730.
(2) C. A. No. 95 of 1965 decided on 27-10-67.
559
9 in the shorter route in the manner done by
the RTA was illegal. The High Court finally
decided as follows
“In our opinion, the applications of all the
petitioners and the contesting opposite
parties could be properly considered by the
Transport Authorities only after deciding the
following questions on relevant considerations
contained in sections 47 (1) of the Act
(a) Whether it is necessary to nationally
separate the whole route into two overlapping
routes for the purposes of granting permits
(b) What should be the strength on the whole
route, or, if it is decided to fix two routes,
one within the other, the respective strengths
of the two routes” ?
The High Court gave also other appropriate directions in the
decision.
The learned counsel, Mr. Yogeshwar Prasad, at first made
some submissions with regard to abatement of the writ
applications before the High Court on account of non-
substitution of the heirs and legal representatives of
deceased, Madan Mohan Lal. But he finally did not press the
same. The learned counsel, however, submitted that there
was no defect or lack of jurisdiction in the order of the
STA to merit interference by the High Court. He further
submitted that the strength of the longer route was fixed
and the longer route was in existence and the STA was
perfectly justified in granting the permits by their order
of November 10, 1964.
Mr. Garg, on the other hand, submitted that there was a
shorter route and its strength was rightly reduced. to nine
and the nine permits were validly granted. His further
contention is that in the absence of the strength being
fixed for the longer route and of consideration of all the
applications for the longer route, grant of permits to
Rattan Lal Gupta and others was bad. Mr. Goyal drew our
attention to the fact that in the absence of special orders.
of this Court his client was granted permits by the RTA on
June 3, 1973, on the longer route. The learned counsel,
therefore, supports the judgment of the High Court.
The controversies in these appeals centre round grant of
stage carriage permits appertaining, as claimed, to two
routes, one shorter and the other longer, mentioned above
and both being admittedly overlapping. At first we shall
consider the appeals relating to the longer route. It has
been held in Mohd. Ibrahim etc. v. State Transport
Appellate Tribunal, Madras, etc.,(1) following the earlier
decisions in Adbul Mateen v. Ram Kailash Pandey (2), M/s
Jaya Ram Motor Service (3), Baluram v, State Transport
Appellate Authority M.P.(4) and R. Obliaswami Naidu (5) as
follows
“The next question which falls for
determination is the
point of time when a Regional Transport
Authority will
(1) [1971] 1 S.C.R. 474.
(3) C.A. No. 9511965 decided on 27-10-1967.
(5) [1969] 1 S.C.R. 730.
(2) [1963] 3 S.C.R. 523.
(4) C.A. 727/65 decided on 22-3-68.
560
under section 47(3) of the Act fix the limit
of number of stage carriage permits. This
Court in Abdul Mateen’s case (4) said that the
general order by the Regional Transport
Authority under section 47 (3) of the Act in
regard to the limit of number of stage
carriage permits can be modified only by the
Regional Transport authority when exercising
the jurisdiction under section 47(3) of the
Act. The Regional Transport Authority while
acting under section 48 of the Act in regard
to the grant of permits has no jurisdiction
and authority to modify any order passed by
the Regional Transport Authority under section
47 (3) of the Act. in other words, the limit
fixed by the Regional Transport Authority
under section 47(3) of the Act cannot be
altered by the Regional Transport Authority at
the time of grant of permits. It is,
therefore, established that the determination
of limit of number of permits is to be made
before the grant of permits. That is why
section 48 of the Act is prefaced with the
words “subject to the provisions of section 47
of the Act” meaning thereby that the jurisdic-
tion of the Regional Transport Authority to
grant permits is subject to the determination
of the limit of number of permits under
section 47 (3) of the Act. This Court stated
the legal position in M/s Jaya Ram Motor
Service’s case(2) and said ‘It is therefore
clear that the authority has first to fix the
limit and after having done so consider the
application or the representations in
connection therewith in accordance with the
procedure laid down in section 57 of the Act’.
Again in the case of R. Obilaswami Naidu (1)
this Court considered the submission in that
case as to whether the Regional Transport
Authority could decide the number of permits
while considering applications for permits.
This Court did not accept the submission be-
cause such a view could allow an operator who
happened to apply first to be in a commanding
position with the result that the Regional
Transport Authority would have no opportunity
to choose between competing operators and
public interest might suffer. In the same
case it is again said that the determination
of the number of stage carriages for which
stage carriage permits may be granted for the
route is to be done first and thereafter
applications for permits are to be
entertained”.
As the R. A. had not fixed the number of permits for the
longer route, we agree with the High Court that the grant of
permits for the longer route is invalid. But the legal
position in regard to the grant of permits on the shorter
route is different. Admittedly, on March 23, 1959, the RTA
had fixed the number of permits for this route at 25. As 17
permits had already been granted, the RTA invited
application for eight vacancies on June 13, 1959. So the
strength was fixed long before the invitation of
applications for permits. it is true that at one stage the
RTA had taken the view that the shorter route had merged in
the longer route; but later it rectified the mistake
561
and held that the shorter route and the longer route existed
separately. We think that the second view of the RTA was
correct in the then prevailing circumstances. On July 18,
1958, the RTA resolved that “Muzaffarnagar-Budhana-Kandhla
route be extended to Gangeru-Issupurteel”. The extension
was made under the U.P. Motor Vehicles taxation Act. At no
time the RTA has taken a decision for abolishing the shorter
route. In its meeting on August 2-4, 1961, the RTA upheld
the objection that the shorter route had ceased to exist.
The RTA said, “Originally Muzaffarnagar-Budhana-Kandhla was
the name of the route. Subsequently about six miles of
kachcha route was considered motorable and then the RTA on
18-7-1958 declared that Muzaffarnagar-Budhana-Kandhla route
be extended upto Issupurteel. After this decision the
Muzaffarnagar-Budhana-Kandhla route could not ‘have separate
existence but was merged in the longer route”. As already
pointed out, a decision to extend the shorter route to a
longer distance under the Motor Vehicles Taxation Act will
not automatically merge the shorter route in the longer
route. For that purpose it was necessary for the RTA to
take an independent decision under the Motor Vehicles Act.
But no such decision was taken. The RTA realised the
mistake and rectified it in its meeting on May 6-8, 1965.
The RTA then decided: “We have considered the entire matter
carefully and have perused all earlier resolutions of the
RTA. We are of the opinion that Muzaffarnagar-Budhana-
Kandhla (the shorter route) still exists with a strength of
25 stage carriages and that the shorter route and the longer
route are separate routes. Even after the approval of the
longer route by the STA, the RTA had offered permits to
displaced operators on the shorter route”. We think that
this resolution states the correct position.
It may be mentioned at this place that in the August meeting
the RTA reduced the strength of shorter route from 25 to 9.
That could not be done. In the result, there would remain
eight vacancies on the shorter route for which the RTA bad
already invited applications. So the RTA could validly
grant eight permits to the appellants in the third group.
The STA rightly affirmed this decision of the RTA. The High
Court, in our view, was not right in quashing the grant of
permits to the appellants in the third group.
in the result, the appeals in the first and second groups
are dismissed. The appeals in the third group are allowed
and the judgment of the High Court qua these appeals is set
aside. The permits granted to the appellants in the third
group of appeals, if already cancelled in pursuance of the
order of the High Court, will be restored to them. Shri
Garg, counsel for the appellants, has given an undertaking
that the appellants will surrender permits granted to them
for the longer route. The Special Leave Petitions Nos. 3094
and 3095 of 1971 are admitted, and the appeals arising out
of them are dismissed. Parties will bear their own costs.
P.B.R. Appeals dismissed.
562