Kerala High Court
Remesh Kumar vs Regional Transport Authority on 19 June, 2001
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:-
THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN
FRIDAY,THE 7TH DAY OF FEBRUARY 2014/18TH MAGHA, 1935
W.P.(C).No.22693 of 2013 (J)
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PETITIONER(S):-
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REMESH KUMAR, AGED 35 YEARS, S/O PAZHANI SWAMI,
4/382, THEKKAMUKKIYOOR HOUSE,
AGALI P.O, KOTTATHARA, MANNARKAD,
PALAKKAD DISTRICT.
BY ADV. SRI.M.JITHESH MENON.
RESPONDENT(S):-
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1. REGIONAL TRANSPORT AUTHORITY,
PALAKKAD, PIN - 678 001.
2. THE SECRETARY,
REGIONAL TRANSPORT AUTHORITY, PALAKKAD, PIN - 678 001.
3. THE KERALA STATE ROAD TRANSPORT CORPORATION,
REPRESENTED BY ITS DISTRICT TRANSPORT OFFICER,
PALAKKAD, PIN - 678 008.
R1 & R2 BY GOVERNMENT PLEADER SMT.R.REMA.
R3 BY STANDING COUNSEL SRI.P.C.CHACKO.
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
03.01.2014, ALONG WITH W.P.(C).NO.28394 OF 2013-Y, THE COURT ON
07-02-2014 DELIVERED THE FOLLOWING:-
WP(C).No.22693 of 2013 (J)
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APPENDIX
PETITIONER(S)' EXHIBITS:-
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EXHIBIT P1 TRUE COPY OF THE REGULAR PERMIT OF THE PETITIONER
VALID TILL 02-01-2016.
EXHIBIT P2 TRUE COPY OF THE TIMINGS DATED 19-06-2001.
EXHIBIT P3 TRUE COPY OF THE REQUEST SUBMITTED BY THE PETITIONER
BEFORE THE 2ND RESPONDENT DATED 10-08-2013.
EXHIBIT P4 TRUE COPY OF THE REQUEST SUBMITTED BY THE PETITIONER
BEFORE THE 3RD RESPONDENT DATED 10-08-2013.
EXHIBIT P5 TRUE COPY OF THE OBJECTION FILED BY THE PETITIONER
DATED 22-08-2013.
RESPONDENT(S)' EXHIBITS:-
-----------------------------------------
EXHIBIT R3(a) - TRUE COPY OF THE PERMIT NO.P.Tem.9/1323/2013
DATED 07.09.2013 ISSUED BY THE 1ST RESPONDENT.
EXHIBIT R3(b) - TRUE COPY OF THE PERMIT ISSUED TO THE 3RD
RESPONDEENT DATED 01.08.2013 VIDE
NO.P.Tem.9/1039/2013.
EXHIBIT R3(c) - TRUE COPY OF THE PERMIT DATED 31.05.2013
VIDE NO.P.St.9/1631/2013.
EXHIBIT R3(d) - TRUE COPY OF THE PERMIT DATED 02.09.2011
VIDE NO.P.St.9/3640/2011.
vku/- ( true copy )
"C.R."
K. Vinod Chandran, J
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W.P.(C).Nos.22693 of 2013 & 28394 of 2013
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Dated this the 07th day of February, 2014
JUDGMENT
The substantive dispute raised in both these writ petitions are with respect to the operation of Kerala State Road Transport Corporation (for brevity "KSRTC"), which by its timings, in effect interferes with the operation of private stage carriage operators, for reason only of the State Transport Undertaking (for brevity "STU") having not obtained a settlement of timings from the competent authority. The contentions are raised in the background of both the stage carriage operators in the two writ petitions carrying on operations in non-notified routes, where no Scheme is in operation.
2. The petitioner in W.P.(C).No.22693/2013 has been operating in the route Puthoor-Palghat. Exhibit P1 is the permit, which he has obtained in the year 2011 and is valid for five years, i.e., till 2016. The said permit has been valid for the last 35 years, though the operators and carriages have changed from time to time. The petitioner is aggrieved by the operation of the KSRTC, which was commenced on 04.08.2013. The petitioner contends that the KSRTC has no valid permit issued in the route Mannarghat-Palghat, WP(C).Nos.22693/2013 & - 2 - 28394/2013 which is negatived by the KSRTC by production of Ext.R3(a) to R3(d). The petitioner's grievance is against the operation of the KSRTC in the route commenced from 04.08.2013 only, purportedly based on Exhibit R3(a) issued on 07.09.2011. The learned counsel for the KSRTC, per contra, contends that, admittedly, a small portion between Manarghat and Palghat falls within the notified route. As long as the overlapping is not stated to be objectionable as per the provisions of Chapter VI, this contention has to be immediately negatived and I do so.
3. W.P.(C).No.28394/2013 is filed by an operator who is operating a stage carriage in the route Ernakulam-High Court Junction-Njarakkal via. Light House as per Exhibit P1 permit and approved time schedule, Exhibit P2. The petitioner is aggrieved by the introduction of a KSRTC service in the route Njarakkal-Kakkanad (via) Puthuvype Light House with effect from 19.07.2013. The petitioner contends that there was no permit issued in the route and the KSRTC has commenced the operation as published in Exhibit P3 infringing upon the very same timing as settled in the case of the petitioner. Though the permit obtained by the KSTRC has been produced as Ext.R4(c), the petitioner's contention is that the same has been issued only after the filing of the writ petition and that too the same is a WP(C).Nos.22693/2013 & - 3 - 28394/2013 temporary permit. The petitioner would also contend that it is evident from Exhibits R4(c) and R4(d), that with respect to the temporary permit the competent authority has not settled the timings and the District Transport Officer (DTO) of the KSTRC has taken upon himself such authority, by Ext.R4(d).
4. In fact, both the petitioners do not challenge the grant of permit or operation as such, but are aggrieved by the timings on which the KSRTC operates, which, according to them, has not been fixed by the competent authority. It is seen that the DTO of the KSRTC has proposed a timing, in both the cases, on which the KSRTC is operating, which is objected to by the petitioners. Evidently, there has been no settlement of timing by the competent authority in the case of the STU in both the cases. The KSRTC relies on the exclusion provided under Rule 212 of of the Kerala Motor Vehicle Rules, 1989 (hereinafter referred to as "the KMV Rules") to contend that though a settlement of timings would be necessary with respect to the grant of permit to a private operator, the KSRTC having been specifically excluded, it is the prerogative of the KSRTC to decide upon its own timings. In that context, W.P.(C).28394/2013 raises a challenge against Rule 212 to the extent it excludes the KSRTC; as being, ultra WP(C).Nos.22693/2013 & - 4 - 28394/2013 vires the powers conferred under the Motor Vehicle Act, 1988 (for brevity "MV Act of 1988" or the "new Act"), more specifically, Section 96 of Chapter V. Rule 212 reads as under:
"212. Schedule of timings:- (1) The State or Regional Transport Authority may from time to time -
(a) by a general order prescribe a schedule of timings for stage carriages other than those belonging to State Transport Undertakings running on specified routes, or
(b) by a special order prescribe a schedule of timings for each stage carriage other than that belonging to State Transport Undertaking.
(2) The changes ordered by the Transport Authority in the timings of a service shall not be considered as variation of permit under sub-section (3) of section 80 of the Act.
(3) The State Transport Authority or the Regional Transport Authority may, by resolution, delegate to its Secretary the powers conferred on it under this rule subject to any conditions that it may prescribe:
Provided that the State or Regional Transport Authority shall not however vary the timings of a service without giving to the interested permit holders an opportunity to represent their case".
WP(C).Nos.22693/2013 & - 5 - 28394/2013
5. I have heard learned counsel Sri.P.Deepak and Sri.M.Jithesh Menon for the petitioners and the learned Standing Counsel Sri.P.C.Chacko for the KSRTC. Both parties rely on the very same judgments which puts in perspective the history of the 'permitraj' in so far as the Act is concerned and the developments in that branch of law wherein a special status was given to the STU.
6. The scheme of the MV Act of 1988, indicates that the power to frame the Rules is granted in each of the Chapters in the Act and is invoked by the rule making authority to frame the KMV Rules, 1989; under identically numbered Chapters. Hence, the power conferred by Section 96 of Chapter V has been invoked by the rule making authority and the Rules to further the provisions of that Chapter are framed under Chapter V of the KMV Rules, 1989.
7. That the petitioners herein, being private stage carriage operators; and the respondent, being an STU, are operating "stage carriages", defined under sub-section (40) of Section 2, as "public service vehicles", defined under sub-section (35) and coming within the definition of a "transport vehicle" under sub-section (47); brooks no dispute. That the provisions of Chapter V relating to "Control of Transport Vehicles" is applicable to both, also is beyond the pale of WP(C).Nos.22693/2013 & - 6 - 28394/2013 dispute. Section 66 provides for the necessity of permits and prohibits use of motor vehicles as a transport vehicle, save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority. Sub-section (3) exempts certain categories, from the provisions of sub-section (1) of Section 66; within which an STU is not included. Section 67 confers the power on the State Government to control road transport and Section 68 provides for the constitution of Transport Authorities for the State, by the State Government, by notification in the Official Gazette. By Transport Authority, the Act refers to the State Transport Authority (STA) and the Regional Transport Authorities (RTA), the constitution of which also, is specified in the aforementioned Section. Section 70 provides for application for stage carriage permit and the particulars which such application should contain, as provided under clauses (a) to (e), as also specifically clause (f) being "such other matters as may be prescribed". Clause (c) of sub-section (1) of Section 70 makes it mandatory for an application to contain "the minimum and maximum number of daily trips proposed to be provided and the time-table of the normal trips". Sub-section (2) of Section 70 makes it mandatory for the application to be accompanied 'by such document as may be WP(C).Nos.22693/2013 & - 7 - 28394/2013 prescribed'.
8. Section 71 provides for the procedure of the RTA in considering such application for stage carriage permit and sub-section (2) provides for refusal to grant a stage carriage permit, if the time-table furnished contravenes the speed limits as provided in the Act, but also, by a proviso, prescribes an opportunity for amending the time-table before such refusal. Sub-section (3) of Section 71 provides for restrictions and reservations of permits. Clause (a) of sub-section (3) confers the power on the State Government, as directed by the Central Government, to direct the STA or RTA to limit the number of stage carriages within the towns, wherein the population exceeds five lakhs. Clause (b) of sub-section (3) of Section 71 provides for reservation of permits for Scheduled Castes and Scheduled Tribes and clause (d) of sub-section (3) lists out the relevant factors for consideration of an application. The proviso to clause (d) of sub-section (3) speaks of preference in the case of STUs, Co-operative Societies, Ex-servicemen and any other class or category of persons considered necessary by the State Government; if the other conditions are equal. Hence, under Chapter V there is no reservation of permits to STUs. Section 72 deals with the grant of WP(C).Nos.22693/2013 & - 8 - 28394/2013 stage carriage permits and sub-section (2) provides for the conditions which may be attached to the permit, as deemed fit by the RTA. These essentially are the provisions with respect to the grant of permits to stage carriages, which are to be looked into, to resolve the dispute raised in the present writ petitions.
9. A monopoly sought to be created for STUs by the Transport Authorities were successfully challenged by the stage carriage operators in Moti Lal v. Uttar Pradesh Govt. [AIR (38) 1951 Allahabad 257]. The Full Bench decision found such monopoly not flowing from the Statute as it existed then, i.e., Act of 1939. The special provisions relating to STUs hence, were brought into the MV Act, 1939 with the insertion of Chapter IVA by Act 100 of 1956. A Co-operative Society which was carrying on operation of stage carriages in different routes, in the State of Bombay, aggrieved by the refusal to renew the permits granted to it and the grant of permits to the STU, brought a challenge under Article 32 of the Constitution of India before the Hon'ble Supreme Court contending, inter alia, that on introduction of Chapter IVA, the STUs had no right to apply for permits under Chapter IV and that the grant of permits to the STU was illegal and violated the fundamental rights guaranteed under Article 19(1)(g), WP(C).Nos.22693/2013 & - 9 - 28394/2013 in Parbhani Transport Co-operatrive Society Ltd. v. R.T.A., Aurangabad [(1960) 3 SCR 177].
10. In Parbhani Transport Co-operatrive Society Ltd.
(supra), the Hon'ble Supreme Court found that Chapter IV and Chapter IVA laid down two independent sets of provisions. Chapter IVA was found to be conferring a special advantage on the Government, by which the Government was entitled, as a matter of right, to the grant of necessary permits in exclusion to others. Chapter IV was found to have conferred no such advantage; necessitating the Government, to be treated at par with any other operator. It was found that there was no interdiction as such for the Government to apply for permits under Chapter IV, which was the main platform of challenge of private operators. Finding that there is nothing illegal in the Government entering into any business in competition with private citizens, it was held that Chapter IV having not conferred any special privilege on the Government, the STU also would have to apply for a permit under the said Chapter. Chapter IVA was found to have been introduced only because the legislature in its wisdom thought that; when there is an approved scheme, an STU should be entitled to a carte blanche, without anything more; clearly conceiving the possibility WP(C).Nos.22693/2013 & - 10 - 28394/2013 that when applying under Chapter IV, the STU may stand to lose in such grant, by virtue of the statutory conditions preferring a private operator. The challenge raised on the grounds, of violation of Article 14 and Article 19(1)(g), was, hence, negatived.
11. In Sher Singh v. Union of India [AIR 1984 SC 200], the constitutional validity of Section 47(1-H) of the MV Act, 1939 was considered. The STU, in the said case, was pitted against a private operator who had been, for long, operating in an inter-State route holding as much as 12 permits in the said route. While the STU asserted its entitlement to permits in preference to the petitioner by virtue of Section 47(1-H) of Chapter IV, the petitioners claimed preference under Section 58 of Chapter IV. The distinction, so far as the provisions of Chapter IVA; being that in respect of a notified area or a notified route, was taken note of. An application for stage carriage permit under Chapter IV was held to be one, liable to be processed, even in the case of an STU, at par with any other private operator; comparing the merits and demerits of a rival private operator; subject only to a preference to the STU if all other things are equal. The exclusion or elimination of private operators in the teeth of an application made by an STU, was found to be a fait accompli, only WP(C).Nos.22693/2013 & - 11 - 28394/2013 under Chapter IVA and not under Chapter IV. It was held so (at p.
204):
"There is no question of eliminating private operators merely because the Undertaking applies for a stage carriage permit under Chap.IV. That situation is catered to under Chap.IV-A. In an application under Chapter IV, Corporation has to enter the arena like any other applicant, face the competition and come-up to the level of other private operators intending to obtain stage carriage permits and then in respect of the route in question claim preference".
What was conceded to the STU, is only a preference and not a monopoly or an exemption or reservation.
12. The provisions of Section 47(1-H), tilting the balance in favour of an STU, when all other things are equal, was found to be not offending Article 14 or Article 19(1)(g). An application for renewal was held to be impliedly one to be proceeded with, in the same manner and to the same extent, as an application for a fresh permit. In that case, a State amendment made to Section 58 providing for a preference to the STU, over all applications for renewal, was also noticed to negative the contention of the private operators. WP(C).Nos.22693/2013 & - 12 - 28394/2013
13. Ishwar Singh Bagga v. State of Rajasthan [(1987) 1 SCC 101] dealt with the challenge against a Circular which conferred the powers to be exercised by the police officers under Section 129A of the MV Act of 1939, on the officers of the State Road Transport Corporation. While striking down the notification, the distinction in Chapter IV and Chapter IV-A of the MV Act, 1939 was reiterated by the Hon'ble Supreme Court.
14. The Rules included in Chapter V of the KMV Rules are framed to carry out the purposes of Chapter V of the Act, wherein Rule 212 deals with the schedule of timings. Sub-section (2) of Section 70 requires the application to contain the documents prescribed. Rule 143 of the KMV Rules prescribes that the application for regular permit shall be in the Form "P.St.S.A." which Form provides for appending a time-table proposed by the applicant. This is in consonance with Section 71, which mandates that any time-table in conflict with speed limits as provided under the Act ought to be refused by the RTA, definitely, after providing an opportunity to amend the same to bring it in conformity with the speed limits as notified under Section 112 of the Act. The practise and procedure for making applications for permits, the grant and settlement of timings as provided under the Act are WP(C).Nos.22693/2013 & - 13 - 28394/2013 elucidated in Somarajan v. R.T.A., Ernakulam [2006 (4) KLT 628].
15. This Court in Somarajan (supra) considered the challenge against a Circular which required the Secretary, R.T.A. to fix the time schedule of every permit even before consideration of the application for permit by the RTA. The power to grant permit was found to be a quasi-judicial function, conferred by statute and looking at the provisions of the Act, it was held that an application for permit presented with a settled set of timings, was not at all contemplated. It was also held that such a stipulation would run counter to the statutory provisions. The practise of settling the time schedule after the grant, on the production of the current records of the vehicle, was held to be in tune with the statutory scheme. That the power to prescribe a set of timings can be exercised by the Secretary, RTA as delegated by the RTA and none other is established on the strength of the decision in Philipose v. R.T.A. [1991 (2) KLT 502]. The delegated powers of the Secretary under the MV Act, 1988 and the KMV Rules, 1989, which power is to be exercised after grant of the permit and before issuance of the same, is also declared in Somarajan (supra).
16. The Act contemplates an application for permit, to be made to the RTA, which authority considers the same under Sections WP(C).Nos.22693/2013 & - 14 - 28394/2013 71 and 72; to either grant or refuse the same. On the circumstance of a grant, which presumes that the time-table proposed is not in conflict with the speed limits notified, there is the further procedure for settlement of timings upon which only, the permit could be effectively operated by the grantee. Such settlement of timings, undisputedly, is delegated to the Secretary of the RTA under Rule 212(3). The scrutiny of the time-table proposed by the applicant, preliminarily made by the RTA is only to see that the same is in conformity with the speed limits. The further procedure for settlement of timings is taken up by the Secretary, the delegate of the RTA, only on production of the current records.
17. Though the above practise is followed in the case of private stage carriage operators, the petitioners are aggrieved by the exemption granted in Rule 212 of the KMV Rules, to the STU, from a settlement of timings by the Secretary, RTA. The practise followed in the case of KSRTC, an STU, as is agreed by both sides, is to merely apply for a grant of permit. The settlement of timings, on which operations are carried on, is done by the DTO of the KSRTC. This is also evidenced from Exhibit R4(d) produced in W.P.(C).No.28394 of 2013, a settlement of timings made by the DTO.
WP(C).Nos.22693/2013 & - 15 - 28394/2013
18. The petitioners would contend that the only exemption from obtaining a permit for operation of stage carriages as public services, is that provided under sub-section (3) of Section 66; which does not provide for such exemption to the STU. Chapter V is concerned only with non-notified routes, the notified routes being covered by Chapter VI. Chapter VI grants a carte blanche to the STU for operation in such notified routes. That an application has to be made by the STU also, for a grant of permit under Chapter V, is definite and the same has to be under Rule 143 read with the Form prescribed, 'P.St.S.A'. The distinctive nature of the provisions under Chapter V and Chapter VI is no longer res integra.
19. That the application made by a party for a permit must substantially conform to the requirements of Section 66 read with Rule 143 as also the Form P.St.S.A. is also no longer res integra. The Maharashtra State Road Transport Corporation v. Babu Goverdhan Regular Motor Service & Others [1969 (2) SCC 746] substantially raised the issue whether the RTA could reject an application, at the threshold, for non-furnishing of information required; as discernible from a conjoint reading of Section 46 of the Motor Vehicles Act, 1939 (for brevity "MV Act of 1939" or the "old Act") with WP(C).Nos.22693/2013 & - 16 - 28394/2013 Rule 80 & Form 'P.St.S.A' prescribed under the said rule framed under Chapter IV of the old Act. The STU in the said case raised inter alia the contention that Form 'P.St.S.A' prescribed under the rule making power of the State goes beyond the powers conferred and that Section 46 of the MV Act of 1939, was not mandatory. Section 46 was found to be requiring information to be given by an applicant for permit, not only in respect of what has been enumerated in clause (a) to (e); but also under clause (f), being information on "such other matters as may be prescribed" by the Rules framed under the Act.
20. The rule making power under Section 68 to make Rules for the purpose of carrying into effect the provisions under Chapter IV was found to include the power to prescribe the forms to be used for the purposes of Chapter IV. The compliance of an applicant to the requirements of Section 46 as well as the Form prescribed under the Rule was emphasized. The Form prescribed under the Rules, was found to be an integral part of the Rule which, the State Government was authorised to make, under the statute. Though the authority to reject an application for permit, summarily, on grounds alone of there being insufficient particulars, was found to be not in existence; the need to furnish full and complete information within the knowledge of WP(C).Nos.22693/2013 & - 17 - 28394/2013 the applicant was held to be a statutory mandate. Taking cue, from the right to make representations against the grant of a permit (as was the scheme under the old Act), it was held that the consideration of such objections or representations can be effective only, if the particulars required under the Act, Rules and those prescribed in the Form are furnished. What has been declared in the said decision, on the provisions of Chapter IV of the Act of 1939, applies on all fours to the provisions in Chapter V of the Act of 1988. The Hon'ble Supreme Court especially referred to the provisions in clause (f) of Section 46 being "such other matters as may be prescribed", which, in the Act of 1988, finds in 'pari materia' expression in sub-clause (f) of sub-section (1) of Section 70. Hence, the form prescribed is an integral part of Rule 143, which the State Government is authorized to frame under Section 96 of the Act, as has been held by the Supreme Court. The Form P.St.S.A. speaks of time-table proposed in item No.9 and the daily trips proposed in item No.10. A time-table necessarily should accompany the application, on which the settlement of timings is arrived at.
21. This Court has now to look at the powers under Rule 212 of the KMV Rules and the exclusion provided therein. The WP(C).Nos.22693/2013 & - 18 - 28394/2013 exclusion of the STU in Rule 212, which is the subject matter of challenge herein, has been noticed in many decisions of this Court. But, however, the validity of the same has not been considered till date. The K.S.R.T.C. places reliance on a decision of a learned Single Judge of this Court in Haridas v. K.S.R.T.C. [1990 (1) KLT 708], wherein it was noticed that Rule 212 of the K.M.V. Rules specifically ousted the jurisdiction of the RTA in prescribing a schedule of timings in respect of the stage carriages belonging to the STU. It is to be immediately noticed that in the said writ petition, there was no challenge to the Rule. An earlier unreported decision of this Court of another learned Single Judge in O.P.No.5609 of 1983 dated 08.01.1985 [P.M.Devassia v. State of Kerala] has also been placed before this Court, wherein the distinction noticed in the afore-cited Supreme Court judgments with respect to Chapter IV and Chapter IV-A was taken note of and it was held that though certain preferences are there, with respect to STUs, there is no special treatment as such, if a route or an area does not fall under Chapter IVA.
22. On point is a decision of a Division Bench of this Court in Thomas Lucka v. Secretary, R.T.A. [1991 (2) KLT 229]. The Division Bench was considering an appeal from a judgment of a WP(C).Nos.22693/2013 & - 19 - 28394/2013 learned Single Judge, which took the view that if the timings do not offend the speed limits as prescribed under the Act, then an order approving a set of timings under Section 71(2) cannot be challenged by another operator on grounds of prejudice to that other stage carriage operator. In the said case, an STU was not a party and the dispute was between two private operators. However, the said decision answers the question raised by the K.S.R.T.C. that in declining permit under Section 71, the power available to the RTA is only to look at the speed limit. The timings proposed not being offensive to such speed limits, no objection of a rival operator could be considered, was the argument.
23. The Division Bench, however, noticed Section 72 and considered the powers available to the statutory authority as also the question of the right of other operators to object, in paragraph 5, which is extracted hereunder:
"5. It is necessary that an applicant should indicate in the application the proposed timings and the minimum and maximum number of daily trips. These particulars are necessary for more purpose than one. They are necessary because the authority must satisfy itself that the provisions of the Act relating to the speed limit are not likely to be contravened. This aspect can WP(C).Nos.22693/2013 & - 20 - 28394/2013 be decided on an study of the timings and the distance of the route and the like. These particulars relating to timings have to be furnished in the application and require approval for another reason too. Public interest requires that the authority granting a permit should ensure elimination of unhealthy competition between operators, if the timings granted to two or more stage carriages are identical or near identical, depending on the locality, the amount of traffic obtaining therein, density of passenger traffic and the like, there is every possibility of unhealthy competition leading to excessive speed, endangering safety of public. This is an aspect which has been well-recognised over the years. This aspect is not covered by S.71(2) as rightly pointed out by the learned Judge. The attention of the learned Judge was not drawn to S 72(1). S.72(1) of the Act empowers the Authority to grant permit in accordance with the application or with such modification as it deems fit or refuse to grant such a permit. Where the timings given in the application are such that the provisions of the Act relating to speed are likely to be contravened and for that reason the application is likely to be rejected, the proviso to S.71(2) enables the applicant to amend the time table suitably. S.71(2) does not empower the Statutory Authority to modify the WP(C).Nos.22693/2013 & - 21 - 28394/2013 time-table suggested by the applicant. However, such a power is clearly spelt out from sub-section (1) of S.72, in as much as it grants power to make modifications as it deems fit. The modification could as well be in regard to the timings suggested in the application. The Statutory Authority has power to fix timings in public interest, even deviating from the timings suggested in the application".
This Court categorically held that the existing operators who may be adversely affected by the timings granted, have a right to make a representation before a decision is taken under Section 72, which right is available before the Secretary of the RTA who has been delegated the power to settle timings, in a granted permit. Rule 212 takes away all rights of a private operator, when the STU is a rival operator and throws to the wind the public interest, insofar as averting unhealthy competition.
24. The KSRTC places overwhelming reliance on the decision in D.R.Venkatachalam v. Dy. Transport Commissioner [AIR 1977 SC 842], to sustain the exclusion in Rule 212 as being within the competence of the State. That was a case in which the State of Tamil Nadu provided for a system of marks under the Rules framed WP(C).Nos.22693/2013 & - 22 - 28394/2013 under Chapter IV of the old Act, prescribing various qualifications for applicants for permits and by the very same Rule 155-A provided for a weightage of 5 marks in the case of STUs. In the leading judgment by V.R.Krishna Iyer, J. it was held that the contentions can be negatived on three considerations. It was held that the welfare State had taken into consideration the public interest, which definitely would be best served by a STU and the same cannot be said to be an "arbitrary stroke of favouritism" (sic). The proviso to Section 47 was held to carry no negative intention and the rule making authority was held to have hence, just carried further the spirit of the proviso. Lastly it was held that the marking system did not at all deprive the authority of its discretion, since the system was introduced only to guide and not to govern the grant of a permit.
25. The learned counsel would, however, pointedly refer to the concurring judgment of M.H.Beg,J., who held that Chapter IV and IVA cannot be put in two separate water tight compartments. Immediately it is to be noticed that, the observation was in so far as holding that the respective Chapters do not provide, imperatively, for exclusion of STUs or private operators. With respect to the marking system, it was held so:
WP(C).Nos.22693/2013 & - 23 - 28394/2013
"As there cannot, between such dissimilar operating units, be comparability of conditions or advantages offered, unless some rule is framed 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 and practicable".
None of these grounds can be imported in the instant case. No public interest can be garnered from the exclusion granted in Rule 212 and it cannot be said to be a mere preference; sanctioned by the statute or a measure in furtherance of such preference. As to discretion being vested with the authority when by Act of 1988, a liberalized scheme was introduced and the grant of a permit is uncanalised, the exclusion confers a sort of carte blanche on the STU, giving their operations a definite edge over that of the private operators. That is not a mere preference and would boil down to a stark monopoly.
26. The learned Standing Counsel for the K.S.R.T.C. then, would urge that in the present case the exemption provided in Rule 212 of the KMV Rules with respect to settlement of timings in so far as stage carriages operated by KSRTC was a policy decision taken by the Government, to give an advantage to the STU and on the accepted principle, of this Court under Article 226, not interfering with WP(C).Nos.22693/2013 & - 24 - 28394/2013 the policy decisions, cautions this Court to steer away from interfering in such policy decision. The Rule, hence, is sought to be sustained as one validly framed under Section 96 of Chapter V and if not; on the premise that the legislative field being defined under the Concurrent List, the State could even by executive fiat, resort to such course, without specific legislative sanction.
27. The MV Act, 1939 provided for "Control of Transport Vehicles" in Chapter IV and "Special Provisions relating to State Transport Undertakings" in Chapter IVA. The provisions, with respect to the above heads, in MV Act of 1988 is found respectively in Chapter V and Chapter VI. The decisions with respect to the distinctive nature of Chapter IV and Chapter IVA of the Act of 1939 would equally apply in the case of Chapter V and Chapter VI of the Act of 1988, subject, however, to the liberalized policy as has been noticed in Mithilesh Garg v. Union of India [AIR 1992 SC 443]. This Court is not actually concerned with the provisions of Chapter VI, wherein the STUs have been conferred with privileges, on the routes on which a Scheme is notified. We are directly concerned with the grant of permits under Chapter V or more specifically the settlement of timings provided for by Chapter V and the Rules framed thereunder. The grant of permit, as WP(C).Nos.22693/2013 & - 25 - 28394/2013 has been noticed in Mithilesh Garg (supra) is no longer a debatable point, since the liberalized scheme provided for the grant of a permit for the asking, irrespective of the number of operators in the field. An existing operator cannot object to the grant as such and the scheme envisaged under Sections 47 and 57 of the Act of 1939 has been completely done away with, by the Act of 1988, as has been found by the Hon'ble Supreme Court in Mithilesh Garg (supra).
28. Nor are the petitioners aggrieved by the grant as such and are only concerned with the KSRTC prescribing timings for itself, stultifying their services operated upon settled timings; the latter settled by the statutory authority. This Court is, hence, to focus upon the settlement of timings and the exemption of the STUs under Rule
212. Whether the State exceeded its limits, in providing for such exemption under Rule 212 of Chapter V of the Rules framed, invoking the powers granted to the State Government under Section 96 of Chapter V, is the issue, arising for adjudication and if not can it be sustained as a policy decision effectuated under Article 162 of the Constitution of India.
29. The liberalized policy as introduced by the Act of 1988, no doubt, took away the right of a rival operator to object to the grant WP(C).Nos.22693/2013 & - 26 - 28394/2013 of a permit and even the authority of the RTA to restrict such grant. But to confuse the same with settlement of timings is begging the question. Another Division Bench in Secretary, Changanacherry T.R.B.T. Co-operative Society v. Mathew Job [1992 (1) KLT 297] considered Mithilesh Garg & Thomas Lucka (both supra) and held so:
"8. In our view, the above said decision of the Supreme Court in Mithilesh Garg's case (supra) clearly lays down that the existing operators have no right to object to the grant of a permit to a new operator under the new Act, 1988.
xxx xxx xxx
9. The learned counsel for the appellant relied upon yet another decision of the Division Bench of this court in Thomas Lucka v. Secretary, RTA (1991 (2) KLT
229). In that case it was only held after a reference to Ss.70, 71 and 72(1) of the Motor Vehicles Act, 1988 that the existing operators who may be adversely affected by the timings given in an application for a permit or timings proposed to be fixed, have a right to have an opportunity to make a representation before a decision is taken under S.72(1), as to the timings. In so far as the said decision stated that the existing operators have a right to make a representation in respect of the timings to be granted for a new operator, we are in entire agreement with the said decision. If the said decision, as contended WP(C).Nos.22693/2013 & - 27 - 28394/2013 by the respondents, intended to lay down that the existing operators have a right to object even to the grant of a permit to a new operator, after the commencement of the new Act, we cannot agree with it".
The distinction, in so far as the sustainability of an objection to the grant and that to the timing, is crystal clear and the latter survives the abolition of 'permitraj' . The public interest in settling timings of rival operators do not at all stand effaced by the introduction of the liberalized scheme by the Act of 1988.
30. Hence the liberalized scheme of the new Act, alone does not warrant rejection of the contention of the petitioners with respect to their right to object to the settlement of timings. Again another Division Bench of this Court in Krishnankutty v. John [1992 (2) KLT 883], considered the scope of the words 'from time to time' appearing in Rule 212. It was held that it can only mean 'as occasion may arise' and that occasion should be evident by a change in situation or circumstance. If timings could be altered at the ipse dixit of the statutory authority, then that was held to clothe the authority with uncanalized and unguided power, which then would be violative of Article 14 of the Constitution. If that is so, can such authority be WP(C).Nos.22693/2013 & - 28 - 28394/2013 granted to the DTO of an STU, to settle timings at their will and alter it according to their whim? This Court would answer the question with an emphatic, 'No'.
31. The contention of the KSRTC that the RTA, under Section 71, can only refuse a permit in the event of a conflict with the speed limits notified, cannot stand in the teeth of the declaration made in Thomas Lucka (supra). The extracted paragraphs of the above decision would make it clear that sub-section (1) of Section 72 empowers the authority to make such modifications as it deems fit, even with respect to the time-table suggested by the applicant. The power of settlement of timings having been validly delegated to the Secretary, RTA, necessarily the said authority would have the power to make modifications in the timings proposed in an application, whether it be of a private operator or that of the KSRTC. That is the clear mandate of the Act. The right of opportunity to make objections with respect to the operation of another stage carriage in the same route, is always available to a competitor in the same route, whether it be a private operator or an STU. The Division Bench also emphasized the need for the authority granting a permit, to ensure elimination of unhealthy competition between the operators, which definitely was a WP(C).Nos.22693/2013 & - 29 - 28394/2013 declaration made in public interest. Hence, definitely the contention of the KSRTC that the refusal to grant permit can only be made for reasons of the proposed timings being in conflict with the speed limits cannot be sustained.
32. It is evident, by the proviso to clause (d) of sub-section (3) of Section 71, that there is only a preference granted, but no special privilege, exemption or reservation, granted to the KSRTC under Chapter V. When the State sought to reserve 40 permits for the KSRTC by way of a notification and sought to sustain it as permissible under Section 74(3) of the Act, this Court struck down the notification. The vehicles of a 'specified type' mentioned in Section 71(3) and Section 71(4) was held to be referring to the nature/type/model of a vehicle and not those owned by the STUs, in Ajith Kumar v. Regional Transport Authority [2002 (1) KLT 775].
33. The exclusion in Rule 212 cannot be said to be in the nature of a preference as is argued by the learned Standing Counsel for the KSRTC. Nor can it be said to be a policy of the Government, wherein an exemption is granted to the STU, in a non-notified route covered under Chapter V. Dealing with the matter of preference, it has to be noticed that what is provided for in the proviso to clause (d) of WP(C).Nos.22693/2013 & - 30 - 28394/2013 sub-section (3) of Section 71 is a preference when other conditions are found to be equal. That the KSRTC, under Chapter IV of the old Act, has to conform with the provisions of that Chapter and "enter the arena like any other applicant and face the competition and come-up to the level of other private operators" (sic) has been laid down by the unreported judgment in P.M.Devassia (supra), which is in consonance with the Supreme Court decision in Sher Singh (supra). It was also held that though certain preferences are granted to the STUs, there is no special treatment in respect of a route or an area that does not fall under Chapter IVA of the Act of 1939. What has been said about, there being no special treatment available under Chapter IV of the old Act, is equally applicable to Chapter V of the new Act. Such declaration, under risk of repetition, is also in consonance with the Supreme Court judgments cited above, which postulate a level playing field so far as the private operators and the STUs, seeking for permits under Chapter V, in non-notified routes, subject only to a preference conferred; that too, only on all other things being equal.
34. Though such preference is available as per the Act itself, that is not what has been crystallized in the Rules made, specifically Rule 212. Rule 212 confers power on the State or the RTA WP(C).Nos.22693/2013 & - 31 - 28394/2013 from time to time to prescribe a schedule of timings for stage carriages other than those belonging to the STUs running on specified routes. It is to be pointedly noticed that the exemption granted is in "specified routes" and not "notified routes". Admittedly notified routes would be covered by Chapter VI and what is intended by Rule 212 is to exclude the power of the STA and the RTA to provide for a schedule of timings, with respect to stage carriages which are intended to be operated by an STU. Obviously permits are always issued on specified routes and what the rule intends to do is to usurp the power of the RTA, in the matter of settlement of timings, when such settlement is to be made in the case of stage carriages, for which permit is sought for by an STU under Chapter V. That cannot be said to be a power which could be validly conferred by Rules on an officer of the STU, herein the DTO of the KSRTC. No such conferment is specifically made by the Statute or even the Rules; and on the basis of the exclusion in Rule 212, the DTO arrogates to itself the authority conferred on the RTA by the Statute. Such a power does not flow from Section 96 of the Act, since the power conferred is only to make rules, so as to effectuate the provisions of Chapter V. An usurpation of power conferred on an authority and conferment of such power on an officer of the STU is not WP(C).Nos.22693/2013 & - 32 - 28394/2013 within the contours of the rule making power conferred, and definitely divorced from the executive power. Ishwar Singh Bagga (supra) can be usefully referred to, in support of the proposition. The exclusion in Rule 212 cannot also be termed as a mere preference, since in effect, it is more and that effect cannot be ignored.
35. The learned Standing Counsel for the KSRTC would rely on Rai Sahib Ram Jawaya Kapur and others v. The State of Punjab [AIR 1955 SC 549] to contend that even without a legislation the executive Government could carry on trade or business. In the said case while amounts were appropriated and sanctioned by the Legislature and Appropriation Acts passed, the question was whether the Government could carry on the business of printing and publishing text books without separate legislative sanction. While holding that "ordinarily the executive power connotes the residue of Governmental functions that remain after legislative and judicial functions are taken away" (sic) (para 12); the contention that to enable the executive; to utilize the funds appropriated with legislative sanction, there must be a law already in existence was negatived. It was held that the executive function comprises both the determination of the policy as well as carrying it into execution. There can be no dispute to this proposition WP(C).Nos.22693/2013 & - 33 - 28394/2013 laid down by a Constitution Bench of the Hon'ble Supreme Court. But, here the challenge is not against the business carried on by the STU; which course was upheld by the Full bench of the Allahabad High Court in Moti Lal (supra) which majority decision was approvingly noticed by the Hon'ble Supreme Court in Rai Sahib Ram Jawaya Kapur (supra). Herein this Court is concerned with the power of the State Government to provide a rule by which the provisions of the Statute are overridden; when the rule making power is to further such provisions. Such a rule cannot also be sustained as an executive decision putting into effect the policy of the Government.
36. Laghu Udyog Bharati v. Union of India [(1999) 6 SCC 418] was a case in which a rule in the Service Tax Rules, 1994 seeking to shift the liability for collection of tax, was challenged. As per the Finance Act, 1994, under which the Rules were framed, the charge of tax and the responsibility to collect the service tax was on the service provider. Section 68(1-A) provided that the service tax shall be collected from such person and in such manner, as may be prescribed. With respect to Clearing and Forwarding Agents and goods transporters, the definition of "person responsible" for collecting the service tax was sought to be shifted to the customer or the client, WP(C).Nos.22693/2013 & - 34 - 28394/2013 i.e., the person who receives the service. This was found to be clearly in conflict with the charging section. The provisions for filing of returns and assessment were also looked into, to hold that, it is the service provider who has the responsibility to collect the tax and merely because sub-section (1-A) of Section 68 provided for collection "by such person and in such manner as may be prescribed ...", the shift in the responsibility for collection of tax could not be fastened, by the Rules. It was the service provider who was charged with the levy, and who was obliged to file returns and on whom assessment could be made. The Rule was found to be ultra vires the Act itself and was found to be not one framed to carry out the purpose of the Act for reason of it being in conflict with the provisions of the Act. In the instant case too the exclusion provided in the Rule, on the above reasoning, would have to be struck down as ultra vires.
37. Bajaj Hindustan Ltd. v. Sir Shadi Lal Enterprises Ltd. [(2011) 1 SCC 640] reiterated the contours of the jurisdiction to be exercised in judicial review. The challenge before the High Court was again a notification of the Central Government under the Industries (Development and Regulation) Act, 1951, by which the sugar industry was delicensed. It was held so in paragraph 40: WP(C).Nos.22693/2013 & - 35 - 28394/2013
"40. Economic and fiscal regulatory measures are a field where Judges should encroach upon very warily as Judges are not experts in these matters. The impugned policy parameters were fixed by experts in the Central Government, and it is not ordinarily open to this Court to sit in appeal over the decisions of these experts. We have not been shown any violation of law in the impugned notification or press note".
The notification was also held to be proper and valid, since the I.D.R.Act by Section 29-B; conferred power on the Central Government to exempt the provisions of the Act in special cases, inter alia taking into account "the stage of development of any scheduled industry". The notification was found to provide such exemption, which the executive Government was held to have decided on valid and cogent grounds taking into account the situation of the sugar industry which was included in the schedule to the Act. No such conferment of power on the State or on the DTO can be found, in the instant case.
38. The KSRTC's contention is that the exclusion provided in Rule 212 is in the nature of a preference and in any event, such exclusion could be provided invoking the executive powers conferred under Article 162 of the Constitution, since Entry 35 being "mechanically propelled vehicles" and Entry 21 being "commercial and WP(C).Nos.22693/2013 & - 36 - 28394/2013 industrial monopolies, combines and trusts" come under List III of the Seventh Schedule. In considering the said contention, the Full Bench decision of the Allahabad High Court in Moti Lal (supra), can be usefully referred to. That decision has its place in the legal firmament of precedents and brought in vast changes to the motor vehicles law. The brief facts of the said decision, which are to be noticed, is that the petitioners therein were stage carriage operators, who were carrying on operations on the basis of regular permits, for long. On the promulgation of the Defence of India Act, 1939, wherein the Transport Authorities were granted wider powers for issuing temporary permits as also suspending and cancelling regular permits; permanent permits issued to stage carriage operators were suspended and in lieu of that, temporary permits were issued. This practise continued even after the lapse of Defence of India Act, 1939 and the Rules framed thereunder; which had, when it was in force, overriding effect over the provisions of the MV Act, 1939.
39. The stage carriage operators were reconciled to their fate and were operating stage carriages on temporary permits alone. In the meanwhile, the Government started running buses of their own and when sufficient number of buses were put on road by the WP(C).Nos.22693/2013 & - 37 - 28394/2013 Government, notices were issued to the private bus owners threatening cancellation of their permits, resulting in cessation of their operations. These were challenged inter alia, on the grounds; that: (i) prior to the Constitution, the RTAs appointed under the MV Act of 1939 could restrict the route or number of routes, and after 26.01.1950, that power violated Article 19(1)(g) and, hence, no interference to the stage carriage operation carried on by a citizen could be made by the State;
(ii) the State's right to carry on a business without legislative sanction rendered illegal the activity undertaken by the Government itself, and that (iii) the State cannot have a better claim than a private bus owner and the provisions of the MV Act, which discriminate between State and the private owners in respect of carrying on business of motor transport, are void, being contrary to the provisions of Article 14. The first two grounds noticed herein were negatived by the majority decision. What is relevant in the instant case is the ground raised under Article 14.
40. It is to be noticed that Moti Lal (supra) eventually led to the amendment of the MV Act of 1939 by Act 100/1956, by which Chapter IVA was introduced and sub-clause (a) of sub-section (3) of Section 42 stood amended. Clause (a) of sub-section (3) of Section 42 WP(C).Nos.22693/2013 & - 38 - 28394/2013 before and after amendment read as under:
Before Amendment:
"42(3). Sub-section (1) shall not apply:
(a) to any transport vehicle owned by or on behalf of the Central Government or a Provincial Government other than a vehicle used in connection with the business of an Indian State Railway".
After Amendment:
"42(3). Sub-section (1) shall not apply:
"(a) to any transport vehicle owned by the Central Government or a State Government and used for Government purposes unconnected with any commercial enterprise".
41. The executive had, by their action of issuing permits to Government owned buses alone, created a monopoly in the stage carriage operation relying on the unamended sub-clause (a), which exempted any Government vehicle from the necessity of a permit, as mandated under sub-section (1) of Section 42. The reasoning by which, the unamended sub-section (1) providing exemption to Government vehicles, was struck down, is relevant, in so far as the argument raised by the KSRTC in the instant case. In the leading judgment of the Five Judge Bench, the then Chief Justice of the Allahabad High Court found it unnecessary to decide whether Section WP(C).Nos.22693/2013 & - 39 - 28394/2013 42(3)(a) of the Act of 1939 becomes void by reason of the provisions of Article 14 of the Constitution. Nevertheless, it was held that without a legislation permitting nationalization the Government, when carrying on a commercial undertaking by way of transport business should be required to obtain permits so that the RTAs "may have the same control over the Roadways as they have over private bus owners" (sic) (para 76).
42. Two learned Judges of the Full Bench, who delivered a common judgment, having found that there was nothing illegal per se in the State Government running a bus service on a public highway, noticed the contention of the stage carriage operators with respect to violation of Article 14 in paragraph 114:-
"It is, however, contended that what the State has obtained for itself is a monopoly of the business of conveying passengers for reward on certain routes; and that it has been able to do this by the control which it exercises over the Regional Transport Authorities. A monopoly secured in this way unquestionably interferes with the right of others to carry on their trade or business. Where such a right is that of a citizen of India the monopoly is prima facie void under the Constitution, for such interference can only be justified if it constitutes a reasonable restriction, imposed by law in the interests of the general public, within the meaning of Art.19(6)". WP(C).Nos.22693/2013 & - 40 - 28394/2013
Having then noticed Section 42 and after extracting the unamended sub-clause (a) of sub-section (3) of Section 42, it was held so:
"This provision, in our opinion so far as it purports to exempt from the application of sub-s.(1) of that section transport vehicles owned by or on behalf of the State Government, is in conflict with Art.14 of the Constitution ... (para 115).
xxx xxx xxx The creation of a monopoly is not something for which, in our opinion, justification can be found in the terms of the Motor Vehicles Act, an Act which, as we have pointed out, was not passed for the purpose of giving the State any form of monopoly. If the Act is so misused, a question may arise whether these provisions which are fair on the face of them are not repugnant to Art.14 as well as Art.19(1)(g) of the Constitution (para 117)".
43. Another learned Judge delivered a separate judgment, wherein, in paragraph 228, it was found that the user of the power of regulation of motor traffic by issuance of permits resulting in creation of virtual monopoly, constitutes misuse of the Act. The executive Government was found to have no power to create such a monopoly affecting the service of others without legislative sanction. It was held so in paragraph 246 and paragraph 248:
"From the following discussions it is clear that the position of the State as a 'great juristic person' is not identical WP(C).Nos.22693/2013 & - 41 - 28394/2013 with that of a juristic person in all respects. at the same time it is further clear that when the State engages itself in a commercial undertaking, trade or business or enters into a contract, it is acting, to use the language of Prof. Holland, as a quasi private juristic person, who should have in that sphere of business no more rights than any other private citizens.
xxx xxx The conclusion that this discussion has led me to is that S.42 (3)(a) is invalid inasmuch as it makes a distinction in the provision requiring permits between a Central Government or a Provincial Government vehicle and a transport vehicle owned by a private owner. This distinction can have vast effects upon the fortunes of concerns in the same business, i.e., the same category".
44. There is no necessity to delve upon another separate minority judgment by yet another learned Judge, wherein it was found that the operation of stage carriage carried on by the Government itself was illegal, which also did not find approval with the Hon'ble Supreme Court. As is discernible from what is noticed above, the Full Bench by majority, categorically found the provision that resulted in creation of a virtual monopoly on the State Government owned buses as violative of Article 14 of the Constitution of India. It was WP(C).Nos.22693/2013 & - 42 - 28394/2013 categorically laid down that without legislative sanction in the form of nationalization, the monopoly created could not be sustained. It is in this context of the Full Bench decision, that specific amendments were brought into the Motor Vehicles Act, where the exemption in sub-clause (a) of sub-section (3) of Section 42 was restricted to vehicles used for Government purposes specifically excluding commercial enterprise. A separate Chapter, numbered as Chapter IVA, was brought in, to facilitate nationalization of routes, wherein a monopoly could be created for STUs, again as has been indicated in the aforesaid Full Bench judgment.
45. The reasoning adopted by the Full Bench, by a majority, in striking down sub-clause (a) of sub-section (3) of Section 42 would be equally applicable here. The distinction between Chapter IV and Chapter IVA which was noticed by the Supreme Court in the judgments cited earlier by this Court is in consonance with the dictum laid down by the Full Bench of the Allahabad High Court. As was noticed, Chapter V and Chapter VI of the Act of 1988 stands on the same footing as Chapter IV and IVA of the old Act. Chapter V deals with "Control of Transport Vehicles" and it has been categorically held that an STU and a private stage carriage operator cannot be treated WP(C).Nos.22693/2013 & - 43 - 28394/2013 differently in so far as the provisions of Chapter V are concerned. Chapter V, on a reading of the provisions, would indicate that an STU also requires a permit, since it is definitely a commercial enterprise and the vehicles are not operated for Government purposes. There is no exemption or reservation to STUs; nor is even preference granted to the STUs unless in accordance with the proviso to sub-clause (d) of sub-section (3) of Section 71, wherein the RTAcould give a preference in the case of an STU, on all other conditions being equal.
46. That the State Government has formulated a policy to grant preference to the KSRTC is not a contention which could hold good on the basis of the rule making power specifically conferred. That the regulation of "mechanically propelled vehicles" comes under Entry 35 of List III of the Seventh Schedule of the Constitution cannot at all be disputed. That the State has power to legislate with respect to the fields of legislation coming within List III; subject, however, to the provisions of clause (2) of Article 246 of the Constitution of India also is clear. Power is conferred on the State Legislature to make any law, even repugnant to any provision of law made by the Parliament with respect to any of the matters enumerated in the Concurrent List, which shall prevail; on the condition enumerated in clause (2) of Article 254 WP(C).Nos.22693/2013 & - 44 - 28394/2013 being satisfied. This has to be conceded to the State. Appropriate, at this point, would be a reference to the State Amendment made to Section 58 referred to in Sher Singh (supra). The power to take executive decisions under Article 162 in the absence of any legislative enactments also necessarily has to be conceded to the State. But such executive decisions cannot override or go against the provisions of the legislation by the Parliament. When, even a legislation, by the State, repugnant to the provisions of a law made by the Parliament, requires assent as provided under clause (2) of Article 254, it cannot be gainsaid that the State could devise a policy repugnant to the law and then effectuate it under Article 162.
47. In the instant case, there is in place a legislation by the Parliament, being the Act of 1988. The Rules of 1989 framed by the State does not invoke the legislative power conferred on the State under List III; nor is it in exercise of an executive power conferred under Article 162. The power invoked in framing the Rules is that granted under Section 96 of the Act. In invoking such powers, the State has to frame Rules in accordance with the power conferred and cannot transgress outside the scope of such powers and then seek to sustain it as an executive action or a policy decision. WP(C).Nos.22693/2013 & - 45 - 28394/2013
48. Rule 212, which is challenged herein, has been framed in accordance with the power conferred under Section 96 for carrying forward the purposes of that Chapter and not invoking any other power. Though monopoly, by way of nationalization, could be conferred by legislation and it is done so under Chapter VI; that cannot be extended to non-notified routes not covered by a scheme, where control is exercised by the Transport Authorities under Chapter V. In applying for permits under Chapter V, the binding precedents noticed above clearly indicate that it should be a level playing field, where the STU, involved in a commercial enterprise, competes with a private stage carriage operator on equal footing. As was noticed earlier, the provision for grant of permit, the rule relating to the procedure for application and the form prescribed therein have to be read together. An STU, while making an application, has to comply with all the conditions of the provisions including the form and attach a time-table along with the application. It cannot be gainsaid that, the time-table would serve only the purpose of effecting rejection only on the speed limits being violated.
49. Hence, while making a rule under the specific power conferred for promoting the purposes of the Chapter, a statutory WP(C).Nos.22693/2013 & - 46 - 28394/2013 mandate cannot be given a go-by; nor can the power conferred by the statute, on the Transport Authorities constituted under the statute, be usurped by a provision in the Rules framed. It is to be noticed that nowhere is it mandated that a time schedule can be settled in the case of STU by DTO of the STU. Relying on Rule 212, the procedure followed by the STU cannot even be said to be an executive action, since the STU herein is an independent Corporation engaged in commercial business. The business carried on by the Corporation is not an extension of the normal business of the State. There is no power conferred expressly by the Constitution, by legislation or even implied; to be exercised by the Corporation.
50. The subject being covered under List III, and there being a legislation by the Parliament, with respect to 'Control of Vehicles', the State cannot invoke its powers under Article 162 to provide for an exclusion in the case of STUs. That is also not the power invoked in framing Rule 212 and the power invoked is specifically that conferred under Section 96 of Chapter V of the Act of 1988. Though the executive power of the State is co-extensive with its legislative powers, Article 162 is subject to the other provisions of the Constitution and cannot be exercised in contravention of any law. WP(C).Nos.22693/2013 & - 47 - 28394/2013
51. The KSRTC has also an alternative contention that as per Section 98 of Chapter VI of the Act; the provisions framed thereunder have overriding powers and has effect notwithstanding anything inconsistent therewith contained in Chapter V. Such an argument would be misplaced, especially in the context of the permits of the STU, assailed in both the writ petitions, being not in a nationalized route, which alone would be covered under Chapter VI. A Constitution Bench of the Supreme Court in Abdul Gafoor v. State of Mysore [AIR 1961 SC 1556] considered the effect of Section 68-B of Chapter IVA of the old Act, on Chapter IV. Adopting the very same reasoning, the overriding effect given to the provisions of Chapter VI, provides negatively that if any question arises as regards any provisions of Chapter VI, then, despite it being in conflict with any or some provisions of Chapter V; would have effect. The question when it crops up under Chapter VI, has to be considered on facts and the provisions of that Chapter has to be applied de hors any inconsistency or conflict with Chapter V. But that is not to say that even when an issue arises under Chapter V, the provisions of Chapter VI ought to be taken into account, so as to efface the effect of the provisions of Chapter V. Such argument would be "fallacious" as noticed by the WP(C).Nos.22693/2013 & - 48 - 28394/2013 Hon'ble Supreme Court.
52. The contention of the KSRTC that after the Act of 1988, none could object to a permit is also not relevant, since the challenge in both writ petitions is not against the grant of permit, but the non-settlement of timings with respect to the permits. Definitely without settlement of timings by the appropriate authority, no operator, including an STU, could operate under the provisions of Chapter V. It has to be reiterated that in the instant case we are not concerned with Chapter VI at all or a scheme notified under the provisions of that Chapter or such route.
53. The settlement of timings by the DTO of the STU is neither conferred by the Act nor can be delegated. Going by the procedure followed at present and assailed herein; on a granted permit, the DTO could change the timings at any time, which need not even be published , thus edging out the private operators who were operating on a valid permit with settled timings in a route. While the private operator, for revision of timings, has to approach the Secretary of the RTA, the DTO of the STU could, at his will and caprice, change the timings of the stage carriages operated by the STU. Such a discrimination is not contemplated under Chapter V and would violate WP(C).Nos.22693/2013 & - 49 - 28394/2013 Article 14 of the Constitution of India. Whenever the provisions of the Chapter relating to "Control of Transport Vehicles", whether it be in the old Act or in the new Act, came up for consideration before the Constitutional Courts, the same was held to be distinct from the power to bring out a scheme of nationalization.
54. The conclusions emanating from the discussion above as also the findings rendered are as follows: The application for grant of a permit has to contain the particulars provided under Chapter V, more specifically Sections 71 and 72 read with Rule 143 and the form prescribed, being "P.St.S.A." even in the case of an STU. Hence, a time-table necessarily has to accompany the application, which the RTA considers only for the purpose of ensuring the speed limits being maintained; but the delegated authority, being the Secretary, is enjoined upon to consider; for settlement of timings after a public notice and after hearing the objections of rival operators; which has been judicially recognized as furthering public interest. The provisions under Chapter V and VI are quite distinctive. But for a preference to the STU, that too on all other conditions being equal; there is no reservation, monopoly or exemption, under Chapter V granted to the STU. Chapter V postulates a level playing field, when permits are WP(C).Nos.22693/2013 & - 50 - 28394/2013 applied for by the STU, as also any other private operator; being a citizen or a body corporate. The RTA has been conferred with the power to settle the timings also, which is possible of delegation to the Secretary. But the exemption granted under Rule 212, being a rule promulgated to further the provisions of Chapter V, cannot confer the STU with a benefit which does not flow from the provisions of the Chapter. The exclusion provided under Rule 212 to the STUs, in respect of settlement of timings, does not have legislative sanction and cannot be sustained under Article 162 of the Constitution of India. The RTA's authority to settle the timings, and properly delegated to the Secretary, cannot be arrogated by the STU to itself on the strength of the exclusion provided. The exclusion provided in Rule 212 in so far as excluding the STUs from settlement of timings, is ultra vires. The Rule has, hence, to be read down and any settlement of timings, even for a STU, for a permit under Chapter V has to be found to be validly settled, only by the authority conferred with such power under the statute or the one delegated with such powers. The operation of the stage carriage vehicles by the KSRTC on the basis of the settlement of timings now made by its DTO is illegal. However, in public interest, the KSRTC is permitted to ply the vehicles in the routes in which the WP(C).Nos.22693/2013 & - 51 - 28394/2013 petitioners are operating for a further period of three months, within which, the timings will have to be settled as statutorily prescribed, after hearing the objections of the affected parties.
The writ petitions, hence, are allowed, leaving the parties to suffer their respective costs.
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K.Vinod Chandran Judge.
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( true copy )