Kerala High Court
Kerala Bus Transport Association vs Government Of Kerala
Author: P.B.Suresh Kumar
Bench: P.B.Suresh Kumar
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR. JUSTICE P.B.SURESH KUMAR
TUESDAY, THE 10TH DAY OF JANUARY 2017/20TH POUSHA, 1938
WP(C).No. 16046 of 2016 (E)
----------------------------
PETITIONER(S):
-------------
1. KERALA BUS TRANSPORT ASSOCIATION
(REG. NO. TCR 710/2006), SALU COMPLEX,
MISSION QUARTERS JUNCTION, T.B.ROAD,
THRISSUR REPRESENTED BY ITS PRESIDENT,
JOHNSON PADAMADAN.
2. KERALA TAURUS TIPPER ASSOCIATION,
(REG.NO. TSR/TC/211/2015),
BUILDING NO.357A, VIIITH DIVISION,
MAVELIPURAM, THRIKKAKKARA PO,
KOCHI 682 030, REPRESENTED BY ITS
SECRETARY, M.V.ANTONY.
3. K.J.SHIJO, S/O.JACOB, AGED 34 YEARS,
KALAYIL HOUSE, CHUVANNUMANNU, PEECHI,
THRISSUR.
4. P.T.SIJO, AGED 30 YEARS, S/O.THOMMAN,
PALOLICKAL HOUSE, MULAYAM, THRISSUR.
BY ADV. SRI.P.DEEPAK
RESPONDENT(S):
--------------
1. GOVERNMENT OF KERALA,
REPRESENTED BY SECRETARY TO GOVERNMENT,
MINISTRY OF TRANSPORT,
GOVERNMENT SECRETARIAT,
THIRUVANANTHAPURAM.
2. THE TRANSPORT COMMISSIONER,
TRANS TOWERS,
THIRUVANANTHAPURAM.
--2--
--2--
WP(C).No. 16046 of 2016 (E)
---------------------------
*ADDL. R3 IMPLEADED
3. POTHUGATHAGATHA SAMRAKSHANA SAMITHI,
REG.NO.KKDCA/92/2013,
REP. BY ITS PRESIDENT, DEJO KAPPEN,
AGED 58, S/O.LATE K.C.JOSEPH,
KAPPIL HOUSE, MENACHIL.P.O., PALAI,
KOTTAYAM DIST.- 686 589.
ADDL. R3 IS IMPLEADED AS PER ORDER
DATED 10.01.2017 IN IA.9249/2016.
R1,R2 BY SPECIAL GOVT. PLEADER SRI.P.SANTHOSH KUMAR
ADDL. R3 BY ADV. SRI.JOHNSON MANAYANI
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD
ON 16-12-2016 ALONG WITH WPC.16333/2016 & CONNECTED
CASES, THE COURT ON 10-01-2017 DELIVERED THE FOLLOWING:
mbr/
WP(C).No. 16046 of 2016 (E)
----------------------------
APPENDIX
PETITIONER(S)' EXHIBITS:
-----------------------
P1 : A TRUE COPY OF THE NOTIFICATION DATED 18.4.2016
(G.O) (P) NO.35/2016/TRAN).
P2 : A TRUE COPY OF THE CIRCULAR NO.17/2011
DATED 26.8.2011.
P3 : A TRUE COPY OF THE JUDGMENT REPORTED IN
2013(1) KLT 440.
P4 : A TRUE COPY OF THE JUDGMENT DATED 24.7.2015 IN
WA NO.740 OF 2013.
P5 : TRUE COPY OF THE CHARGED MEMO DATED 19.11.2015
ADDRESSED TO THE 3RD RESPONDENT.
P5A : TRUE COPY OF THE REPLY DATED 27.11.2016 GIVEN BY THE
3RD RESPONDENT.
P6 : A TRUE COPY OF THE ORDER DATED 18.2.2016 COMMUNICATED
TO THE 4TH PETITIONER.
RESPONDENT(S)' EXHIBITS:
-----------------------
EXT.R1A: TRUE COPY OF THE DRAFT NOTIFICATION
NO.9455/B2/2015/TRAN DATED 25.1.2016.
//TRUE COPY//
P.S. TO JUDGE
mbr/
C.R.
P.B.SURESH KUMAR, J.
= = = = = = = = = = = = = =
WP.(C).No.16046, 16333, 16714, 18520,18527,
18528, 18529, 18532, 18535, 18536, 18544, 19269, 19578,
20492, 20748, 21538, 21539, 21550, 22087, 22128, 22334,
22347, 22348, 23510, 22513, 24520, 27114 27261, 27631,
27632, 27633, 27770, 28001, 28245, 28782, 29087, 29474,
29976, 30193, 30979, 31888, 31892, 31898, 32037, 32614,
32662, 33187, 33483, 33869, 33870, 33873, 33893, 34040,
35663, 36451, 36729, 36730, 36893, 36894, 38326, 38459,
39798, 39923, 39933, 40766, 40933 & 40864 of 2016
& W.P.(C) Nos.60 and 554 of 2017
= = = = = = = = = = = = = =
Dated this the 10th day of January, 2017.
J U D G M E N T
The Kerala Motor Vehicles (1st amendment) Rules, 2016 is under challenge in this batch of writ petitions. By virtue of the said Rules, a new proviso is introduced to sub-rule (2) of Rule 105 of the Kerala Motor Vehicles Rules, 1989 ('the Rules'). The newly introduced proviso directs that no officer of the Motor Vehicles Department shall accept an application for the grant of or renewal of certificate of fitness or other services, except for remittance of tax with respect to a transport vehicle, unless the WP.(C).No.16046/2016 & con.cases.
2 same is accompanied by a clearance certificate in the prescribed form from the original registering authority to the effect that there are no Government dues or arrears of Motor Vehicles Tax in respect of the vehicle and that no legal action is pending in respect of the vehicle in that office. It is stated in the Explanatory Note to the amending rules that there is no provision at present in the Rules insisting that an application for grant of or renewal of certificate of fitness in respect of a transport vehicle will not be entertained unless check reports or other Government dues in respect of the vehicle are cleared; that absence of such a provision causes delay in clearing check reports and Government dues by the operators; that the same results in revenue loss and that therefore, the Government have decided to amend the Rules. The petitioners are individuals who own transport vehicles and their associations. It is alleged by the petitioners that check reports are issued to transport vehicles for violation of the provisions contained in the Motor Vehicles Act ('the Act') and the rules made thereunder, such as, non-fitment of speed governors, trip curtailments, over weight etc.; that going by the practice prevailing, proceedings initiated based on check reports are not WP.(C).No.16046/2016 & con.cases.
3 finalised within a reasonable time by the statutory authorities and that if check reports are not cleared on the spot by the operators or their crews by agreeing to pay compounding fee, only the compounding fee agreed to by the parties can be realised as per the provisions of the Act, in the event violation is found by the competent authority at a later stage. According to the petitioners, the impugned proviso is, therefore, intended to coerce the petitioners and other similarly placed persons to clear check reports in respect of their vehicles by remitting compounding fee before an adjudication is made by the competent authority as to the alleged violation of the statutory provision. It is pointed out by the petitioners that the Transport Commissioner had earlier issued a circular incorporating provisions similar to the provisions contained in the impugned proviso and the said provisions were found by a learned Single Judge of this Court to be arbitrary and violative of the right guaranteed to the petitioners and similarly placed persons to carry on their avocation under Article 19(1)(g) of the Constitution and the said decision has been confirmed in appeal. According to the petitioners, the impugned proviso is, therefore, one WP.(C).No.16046/2016 & con.cases.
4 introduced without any bona fides also with a view to negate the binding decisions of this Court. It is also contended by the petitioners that the impugned proviso is arbitrary even otherwise also, for, the various expressions used therein like 'other services', 'Government dues' and 'any other legal action pending' are so vague that it cannot be predicted with certainty as to what is intended by those expressions. In short, according to the petitioners, the direction in the impugned proviso that operators of transport vehicles shall wait till check reports issued in respect of the vehicles are finalised/cleared for availing services in respect of their vehicles, including renewal of certificate of fitness, is violative of the fundamental right guaranteed to the individual petitioners under Articles 14 and 19(1)(g) of the Constitution.
2. A counter affidavit has been filed by the Government in WP(C).No.16046 of 2016 supporting the impugned amendment. It is contended by the Government in the counter affidavit that check reports are issued for violation of the provisions of the Act and the rules made thereunder; that vehicle owners in the State are not in the habit of compounding the WP.(C).No.16046/2016 & con.cases.
5 breach of the provisions of the Act on their part by paying compounding fee; that the Accountant General has stated in the audit reports submitted to the Government about the reduction in the collection of compounding fee and that it is in the said circumstances that the impugned amendment was introduced to the Rules. It is also asserted in the counter affidavit that the Government is empowered under Section 65 of the Act to make rules in the nature of one impugned in the writ petition.
3. Heard the learned counsel for the petitioners and the learned Special Government Pleader for the State.
4. The petitioners challenge the newly introduced proviso in the Rules mainly on the grounds; (1) that it is ultra vires the Act, for, the same goes beyond the rule making power conferred on the State Government under Section 65 of the Act; (2) that it is violative of the fundamental rights guaranteed to the individual petitioners under Articles 14 and 19(i)(g) of the Constitution and (3) that it is actuated by mala fides, for, the same is intended to negate the binding judgments of this Court covering the issue.
5. Before I proceed to examine the contentions WP.(C).No.16046/2016 & con.cases.
6 raised by the petitioners, it is apposite to refer to the principles governing the field as reiterated by the Apex Court in Supreme Court Employees' Welfare Association v. Union of India [(1989) 4 SCC 187). It is held in the said case that where the validity of a subordinate legislation is in question, the court has to consider the nature, object and scheme of the statute as a whole, and, on the basis of that examination, it has to consider what exactly was the area over which and the purpose for which the power has been delegated by the governing law. It is also held by the Apex Court in the said case that rules must be intra vires the parent law under which the power has been delegated and must also be in harmony with the provisions of the Constitution and other laws. It is further held in the said case that if the rules do not tend in some degree to the accomplishment of the objects for which power has been delegated to the authorities, courts will declare them to be unreasonable. It is also held in the said case that rules are liable to be declared invalid if they are manifestly unjust or outrageous or directed to an unauthorised end or violative of the general principles of the law of the land or so vague that it cannot be WP.(C).No.16046/2016 & con.cases.
7 predicated with certainty as to what is prohibited by them or so unreasonable that they cannot be attributed to the power delegated or otherwise disclosed bad faith. A remarkable passage from Kruse v. Johnson (1898 (2) QB 91) was also quoted with approval by the Apex Court in the said case. It was held in the said case that if the rules are manifestly unjust, unreasonable or actuated by mala fides, the court might well say that the legislature never intended to give authority to make such rules and that therefore, they are ultra vires in that sense. The relevant paragraphs of the judgment of the Apex Court in the said case are quoted below :
98. x x x x x x Rules, whether made under the Constitution or a statute, must be intra vires the parent law under which power has been delegated.
They must also be in harmony with the provisions of the Constitution and other laws. If they do not tend in some degree to the accomplishment of the objects for which power has been delegated to the authority, courts will declare them to be unreasonable and, therefore, void.
xxx xxx
xxx xxx
100. Where the validity of a subordinate legislation (whether made directly under the Constitution or a statute) is in question, the WP.(C).No.16046/2016 & con.cases.
8
court has to consider the nature, objects and scheme of the instrument as a whole, and, on the basis of that examination, it has to consider what exactly was the area over which, and the purpose for which, power has been delegated by the governing law.
101. Rules are liable to be declared invalid if they are manifestly unjust or oppressive or outrageous or directed to an unauthorised end or violative of the general principles of the law of the land or so vague that it cannot be predicated with certainty as to what is prohibited by them or so unreasonable that they cannot be attributed to the power delegated or otherwise disclose bad faith. In the words of Lord Russel of Killowen, C.J., in Kurse v. Johnson:
"If for instance, they were found to be partial or unequal in their operation as between different classes; if they were manifestly unjust; if they disclosed bad faith; if they involved such oppressive or gratuitous interference with the rights of those subject to them as could find no justification in the minds of reasonable men, the court might well say, `Parliament never intended to give authority to make such rules; they are unreasonable and ultra vires'."
xxx xxx xxx xxx
105. Any arbitrary exercise of power by a public authority, whether or not it is in the nature of subordinate legislation, is liable to be condemned as violative of Article 14. As stated in E.P. Royappa v. State of T.N.37: (SCC p. 38, para 85) "... equality and arbitrariness are sworn enemies; one belongs to the rule of law in a republic while the other, to the whim and WP.(C).No.16046/2016 & con.cases.
9
caprice of an absolute monarch."
See also Maneka Gandhi v. Union of India38, Ajay Hasia v. Khalid Mujib39 and D.S. Nakara v. Union of India."
The aforesaid principles are seen endorsed by the Apex Court consistently in the later decisions as well.
6. As indicated in Supreme Court Employees' Welfare Association's case (supra), it is necessary to refer to the relevant provisions of the Act and the Rules made thereunder to deal with the contentions of the petitioners. Chapter IV of the Act titled "REGISTRATION OF MOTOR VEHICLES", comprising Sections 39 to 65, deals with registration of motor vehicles, of which Section 56 dealing with certificate of fitness of transport vehicles reads thus:
"Certificate of fitness of transport vehicles:- (1) Subject to the provisions of Sections 59 and 60, a transport vehicle shall not be deemed to be validly registered for the purposes of Section 39, unless it carries a certificate of fitness in such form containing such particulars and information as may be prescribed by the Central Government, issued by the prescribed authority, or by an authorised testing station mentioned in sub- section (2), to the effect that the vehicle complies for the time being with all the requirements of this Act and the rules made thereunder:
WP.(C).No.16046/2016 & con.cases.
10
Provided that where the prescribed authority or the "authorised testing station" refuses to issue such certificate, it shall supply the owner of the vehicle with its reasons in writing for such refusal.
(2) The "authorised testing station" referred to in sub-
section (1) means a vehicle service station or public or private garage which the State Government, having regard to the experience, training and ability of the operator of such station or garage and the testing equipment and the testing personnel therein, may specify in accordance with the rules made by the Central Government for regulation and control of such stations or garages.
(3) Subject to the provisions of sub-section (4), certificate of fitness shall remain effective for such period as may be prescribed by the Central Government having regard to the objects of this Act.
(4) The prescribed authority may for reasons to be recorded in writing cancel a certificate of fitness at any time, if satisfied that the vehicle to which it relates no longer complies with all the requirements of this Act and the rules made thereunder; and on such cancellation the certificate of registration of the vehicle and any permit granted in respect of the vehicle under Chapter V shall be deemed to be suspended until a new certificate of fitness has been obtained.
Provided that no such cancellation shall be made by the prescribed authority unless such prescribed authority holds such technical qualification as may be prescribed or where the WP.(C).No.16046/2016 & con.cases.
11
prescribed authority does not hold such technical qualification on the basis of the report of an officer having such qualifications on the basis of the report of an officer having such qualifications.
(5) A certificate of fitness issued under this Act shall, while it remains effective be valid throughout India." It is explicit from the provisions contained in Section 56 of the Act that a transport vehicle cannot be put use without a certificate of fitness issued by the prescribed authority. Section 64 in Chapter IV of the Act deals with the power of the Central Government to make rules to provide for all or any of the matters referred to therein. Clauses (m), (n), (o) and (p) of Section 64 which are relevant in the context read thus:
(m) the form in which the certificate of fitness shall be issued under sub-section (1) of Section 56 and the particulars and information it shall contain;
(n) the period for which the certificate of fitness granted or renewed under Section 56 shall be effective;
(o) the fees to be charged for the issue or renewal or alteration of certificates of registration, for making an entry regarding transfer of ownership on a certificate of registration, for making or cancelling an endorsement in respect of agreement of hire-purchase or lease or hypothecation on a certificate of registration, for certificates of fitness for registration marks, and for the examination or inspection of motor vehicles, and the refund of such fee.
WP.(C).No.16046/2016 & con.cases.
12
(p) any other matter which is to be, or may be, prescribed by the Central Government."
The Central Motor Vehicles Rules, 1989 ('the Central Rules') have been framed, among others, in exercise of the powers conferred on the Central Government under Section 64 of the Act also. The relevant portion of Rule 62 and Rule 73 of the Central Rules reads thus:
"62.Validity of certificate of fitness:- (1) A certificate of fitness in respect of a transport vehicle granted under Section 56 shall be in Form 38 and such certificate when granted or renewed shall be valid for the period as indicated below:
(a) new transport vehicle two years
(b) renewal of certificate of fitness in
respect of vehicles mentioned in (a)
Above (xxxxx) one year
(ba) renewal of certificate of fitness in
respect of E-rickshaw and E-cart three-years
(c) renewal of certificate of fitness in
respect of vehicles covered under
Rule 82 of these rules one year
(d) fresh registration of
imported vehicles same period as in
WP.(C).No.16046/2016 & con.cases.
13
the case of
vehicles
manufactured
in India having
regard to the
date of
manufacture:
Provided that the renewal of a fitness certificate shall be made only after the Inspecting Officer or authorised testing stations as referred to in sub-section (1) of Section 56 of the Act has carried the tests specified in the Table given below, namely:-
Xx xx xx
Xx xx xx
Provided further that in case of E-rickshaw and E-cart, the renewal of fitness certificate shall be made only after carrying out tests specified in the Table given below:-
Xx xx xx
Xx xx xx
Explanation: "Inspecting Officer" means an Officer appointed by the State Government under Section 213 of the Act.
xx xx
xx xx
WP.(C).No.16046/2016 & con.cases.
14
73. Tax clearance certificate to be submitted to the testing station:- No authorised testing station shall accept an application for the grant or renewal of a certificate of fitness unless the same is accompanied by a tax clearance certificate in such form as may be specified by the State Government, from the Regional Transport Officer or Motor Vehicle Inspector having jurisdiction in the area to the effect that the vehicle is not in arrears of motor vehicle tax or any compounding fee referred to in sub-sections (5) and (6) of Section 86."
In order to understand the scope of Rule 73 of the Central Rules, it is necessary to refer to Section 86 in Chapter V of the Act also. Chapter V of the Act titled "CONTROL OF TRANSPORT VEHICLES"
comprising Sections 66 to 96, deals with control of transport vehicles, of which Section 86 dealing with cancellation and suspension of permits reads thus:
"Cancellation and suspension of permits:- (1) The transport authority which granted a permit may cancel the permit or may suspend it for such period as it thinks fit -
a) on the breach of any condition specified in Section 84 or of any condition contained in the permit, or
b) if the holder of the permit uses or causes or allows a vehicle to be used in any manner not authorised by the permit, or WP.(C).No.16046/2016 & con.cases.
15
c) if the holder of the permit ceases to own the vehicle covered by the permit, or
d) if the holder of the permit has obtained the permit by fraud or misrepresentation, or
e) if the holder of the goods carriage permit, fails without reasonable cause, to use the vehicle for the purposes for which the permit was granted, or
f) if the holder of the permit acquires the citizenship of any foreign country:
Provided that no permit shall be suspended or cancelled unless an opportunity has been given to the holder of the permit to furnish his explanation.
(2) The Transport Authority may exercise the powers conferred on it under sub-section (1) in relation to a permit granted by any authority or person to whom power in this behalf has been delegated under sub-section (5) of Section 68 as if the said permit was a permit granted by the Transport Authority.
(3) Where a Transport Authority cancels or suspends a permit, it shall give to the holder in writing its reasons for the action taken.
WP.(C).No.16046/2016 & con.cases.
16
(4) The powers exercisable under sub-section (1) (other than the power to cancel a permit) by the Transport Authority which granted the permit may be exercised by any authority or person to whom such powers have been delegated under sub-section (5) of Section 68.
(5) Where a permit is liable to be cancelled or suspended under clause (a) or clause (b) or clause (e) of sub- section (1) and the Transport Authority is of opinion that having regard to the circumstances of the case, it would not be necessary or expedient so to cancel or suspend the permit if the holder of the permit agrees to pay a certain sum of money, then, notwithstanding anything contained in sub-section (1), the Transport Authority may, instead of cancelling or suspending the permit, as the case may be, recover from the holder of the permit the sum of money agreed upon.
(6) The powers exercisable by the Transport Authority under sub-section (5) may, where an appeal has been preferred under Section 89, be exercised also by the appellate authority.
(7) In relation to a permit referred to in sub-section (9) of Section 88, the powers exercisable under sub-section (1) (other than the power to cancel a permit) by the Transport Authority which granted the permit, may be exercised by any Transport Authority and any authority or persons to whom power in this behalf has been delegated under sub-section (5) of Section 68, as if the said permit was a permit granted by any such authority or persons."
It is evident from Section 86 of the Act that when the competent WP.(C).No.16046/2016 & con.cases.
17 authority under the Act is of the opinion that having regard to the circumstances of the case it would not be necessary or expedient so to cancel or suspend the permit, if the holder of the permit agrees to pay a certain sum of money, then, the competent authority may recover from the holder of the permit the compounding fee agreed upon, instead of cancelling or suspending the permit. It has to be mentioned here that the compounding fee referred to in Rule 73 of the Central Rules extracted above is the compounding fee agreed to be paid by the holder of the permit as indicated in Section 86(5) or 86(6) of the Act, as the case may be.
7. Section 65 in Chapter IV of the Act deals with the power of the State Government to make rules for the purpose of carrying into the provisions of the said Chapter other than matters specified in Section 64. Section 65(1) of the Act which makes the said position clear reads thus:
"Power of State Government to make rules:- A State Government may make rules for the purpose of carrying into effect the provisions of this Chapter other than the matters specified in Section 64."
Section 65 of the Act, among others, confers power on the State WP.(C).No.16046/2016 & con.cases.
18 Government to make rules providing for the issue of or renewal of certificates of registration and fitness as also the extension of the validity of certificates of fitness pending consideration of applications for renewal. Clauses (d) and (l) of Section 65(2) of the Act dealing with the same matter read thus:
"Without prejudice to the generality of the foregoing power, such rules may provide for -
xx xx xx
xx xx xx
(d) the issue or renewal of certificates of registration and
fitness and duplicates of such certificates to replace the certificates lost, destroyed or mutilated;
xx xx xx
xx xx xx
(l) the extension of the validity of certificates of fitness
pending consideration of applications for their renewal."
The Rules have been framed by the State Government, among others, in exercise of the powers conferred on it under Section 65 of the Act also. Sub-rule (2) of Rule 105 of the Rules as amended by the Kerala Motor Vehicles (1st amendment) Rules, 2016 reads thus:
WP.(C).No.16046/2016 & con.cases.
19
"(2). Form of application for grant or renewal:-
Application for the grant or renewal of a certificate of fitness shall be made to the Registering Authority, or to the Inspector of Motor vehicles, in whose functional area the vehicle is normally kept. Application for the grant of a certificate shall be in Form "CFA" and for the renewal of certificate in Form "CFRA":
Provided that no officer of the Motor Vehicles Department shall accept an application for the grant or renewal of certificate of fitness or other services, except for remittance of tax, with respect to a transport vehicle, unless the same is accompanied by a clearance certificate. "Form CC" from the original registering authority to the effect that the vehicle has no Government dues, arrears of Motor Vehicles Tax or any other legal action pending in that office.
Provided further that the Registering Authority or any other Registering Authority may, if satisfied on an application made to it in writing, that there are sufficient grounds, permit the inspection of any vehicle for the grant or renewal of a certificate of fitness by any other Inspector of Motor Vehicles." The underlined proviso in the sub-rule extracted above is the proviso under challenge. It is stated in the Kerala Motor Vehicles (1st amendment) Rules, 2016 that the underlined proviso is introduced to sub-Rule (2) of Rule 105 by the State Government in exercise of the power conferred under clause (l) of Section 65 (2) of the Act.
WP.(C).No.16046/2016 & con.cases.
20
8. Now, I shall proceed to consider the contention of the petitioners one by one. The impugned proviso, to the extent it is unambiguous, indicates that the same deals with application for grant of or renewal of certificate of fitness of transport vehicles. It is provided therein that no officer shall accept an application for the grant of or renewal of certificate of fitness to a transport vehicle unless the same is accompanied by a clearance certificate from the concerned authority to the effect that there are no Government dues or arrears of motor vehicles tax and that no legal action is pending in respect of the vehicle. Certificate of fitness is insisted for transport vehicles under Section 56 contained in Chapter IV of the Act. While Section 64 in the said Chapter empowers the Central Government to make rules to provide for all or any of the matters specified therein, Section 65 in the said Chapter empowers the State Government to make rules for the purpose of carrying into effect the provisions of the said Chapter as specified therein. The specific matters mentioned in Section 64 of the Act refer only to the form in which certificate of fitness is to be issued, the period for which the certificate of fitness is granted or renewed and the fees to be WP.(C).No.16046/2016 & con.cases.
21 charged for the issue or renewal of certificate of fitness. Clause
(p) of Section 64, however, confers power on the Central Government to make rules in respect of matters not specifically mentioned in Section 64 as well. As noted above, the power conferred on the State Government under Section 65 of the Act is to frame rules in respect of matters other than matters specified in Section 64 of the Act. A combined reading of Sections 64 and 65 of the Act would thus make it clear that the State Government is empowered to make rules only in respect of matters for which rules have not been framed by the Central Government. It is also evident from the said Sections that the rules framed by the State Government shall be for the purpose of carrying into effect the provisions of Chapter IV of the Act. Rule 73 of the Central Rules insists, along with the application for the grant or renewal of certificate of fitness, a clearance certificate from the competent authority in the form prescribed by the State Government to the effect that the vehicle is not in arrears of motor vehicle tax or any compounding fee referred to in sub sections (5) and (6) of Section 86 of the Act. Reverting to the case on hand, it is explicit from the contents of Rule 73 that the same has been framed by WP.(C).No.16046/2016 & con.cases.
22 the Central Government in exercise of the power conferred under clause (p) of section 64 of the Act. Rule 73 is unambiguous in its terms that an application for grant of or renewal of certificate of fitness can be refused to be entertained by the competent authority only when there is arrears of motor vehicles tax or when there is arrears of compounding fee payable under sub sections (5) and (6) of Section 86.
9. As noted above, the compounding fee referred to in sub-sections (5) and (6) of the said Section is the compounding fee imposed after culmination of the proceedings initiated against the operator for cancellation or suspension of the permit issued to him. The impugned proviso, on the other hand, confers power on the competent authority to refuse to entertain application for grant of or renewal of certificate of fitness of transport vehicle, if there is any legal action pending. Going by the Explanatory Note, it is clear that the expression 'legal action pending' refers to the proceedings initiated based on the check reports issued in respect of the vehicle. It is, therefore, clear that in the light of the impugned proviso, if a check report is pending in respect of a vehicle, the competent authority cannot entertain an application WP.(C).No.16046/2016 & con.cases.
23 for grant or renewal of the certificate of fitness. The impugned proviso is, therefore, repugnant to Rule 73 of the Central Rules. In Shri Sitaram Sugar Co.Ltd. v. Union of India [(1990)3 SCC 223], it was held by the Apex Court that the power delegated by statute is limited by its terms and subordinate to its objects and the delegate must act in good faith in harmony with other laws for the purposes of the enabling legislation. Paragraph 47 of the judgment of Apex Court in the said case reads thus:
47. Power delegated by statute is limited by its terms and subordinate to its objects. The delegate must act in good faith, reasonably, intra vires the power granted, and on relevant consideration of material facts. All his decisions, whether characterised as legislative or administrative or quasi-judicial, must be in harmony with the Constitution and other laws of the land.
They must be "reasonably related to the purposes of the enabling legislation". See Leila Mourning v. Family Publications Service34. If they are manifestly unjust or oppressive or outrageous or directed to an unauthorised end or do not tend in some degree to the accomplishment of the objects of delegation, court might well say, "Parliament never intended to give authority to make such rules; they are unreasonable and ultra vires": per Lord Russel of Killowen, C.J. in Kruse v. Johnson35.
WP.(C).No.16046/2016 & con.cases.
24 In Laghu Udyog Bharati and another v. Union of India and others [(1999)6 SCC 418], it was held by the Apex Court that when a statute confers power on the Government to make rules, the rules are to be made for carrying out the purpose of the statute and shall not be in conflict with the same. The said case was one concerning the power conferred on the Central Government by Section 94 of the Finance Act, 1994 for carrying out the provisions contained in the Chapter dealing with taxing the services which are provided. It was held in the said case that the rules framed by the Central Government is ultra vires the statute, for, the same do not carry out the provisions of the Act in the said Chapter. Paragraphs 13 and 14 of the judgment read thus:
13. Section 94 gives the Central Government power to make the rules. These rules are to be made for carrying out the provisions of the chapter. The chapter relates to taxing the services which are provided. The tax is on the value of the services and it is only the person providing the service who can be regarded as an assessee. The rules, therefore, cannot be so framed which do not carry out the purpose of the chapter and cannot be in conflict with the same.
WP.(C).No.16046/2016 & con.cases.
25
14. We have no hesitation in holding that the provisions of Rule 2
(d)(xii) and (xvii), insofar as they make persons other than the clearing and forwarding agents or the persons other than the goods transport operator as being responsible for collecting the service tax, are ultra vires the Act itself. The said sub-rules are accordingly quashed.
In this context, it is apposite to refer to the decision of the Apex Court in Kumari Regina v. St. Aloysius Higher Secondary School [(1972)4 SCC 188] also. That was a case where Rules have been framed invoking the specific power conferred under the Madras Elementary Education Act concerning recognition of or aid to schools after the Chapters in the said statute dealing with recognition of and aid to schools have been repealed. It was held by the Apex Court in the said case that though the statute confers power on the State Government to make rules declaring the condition subject to which schools may be admitted to recognition or aid, such rules would not satisfy the condition precedent for the rule making, namely that they can be made only to carry out all or any of the purpose of the Act and therefore, ultra vires. The relevant portion of the judgment reads thus :
WP.(C).No.16046/2016 & con.cases.
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"Chapters II and IV of the Act., which contained provisions for recognition and aid, having been repealed, these rules, reissued and published afresh in August 1939, cannot be said to the rules "to carry out all or any of the purposes of this act", as provided by Section 56(1). No doubt, clause (h) of sub-section (2) of Section 56 was still retained even after Chapters II and IV were deleted, and, therefore, the Government could perhaps claim to have the power to frame statutory rules "declaring the conditions subject to which schools may be admitted to recognition or aid". But even if the Government were to claim to have framed rules under the sanction contained in clause (h) of Section 56(2), such rules would not satisfy the condition precedent for such rule making, namely, that they can he made only "to carry out all or any of the purposes of this Act". Such rules, therefore, even if made, would not be rules made under Section 56."
The impugned proviso which is in conflict with Rule 73 of the Central Rules, in the circumstances, can only be ultra vires Section 65 of the Act, for, the same cannot be understood to have been brought into force for the purpose of coming into effect the provisions of Chapter IV of the Act and there is no reason to think that the legislature would not have intended to confer power on the State Government to make rules in conflict with the Rules made by the Central Government.
10. As noted above, the amending rules categorically WP.(C).No.16046/2016 & con.cases.
27 provides that the same is issued in exercise of the power conferred under Clause (l) of sub section (2) of Section 65 of the Act. Clause (l) of sub section (2) of Section 65 only confers power on the State Government to make rules providing for the extension of the validity of the certificate of fitness pending consideration of application for renewal. The learned counsel for the petitioners vehemently contended that a proviso in the nature of the one impugned insisting clearance certificate to entertain application for grant of or renewal of certificate of fitness cannot be introduced invoking Clause (l). This argument of the learned counsel for the petitioners was met by the learned Special Government Pleader, relying on Clause (d) of Section 65(2) of the Act which confers power on the State Government to frame rules providing for issue of or renewal of certificate of fitness. According to the learned Special Government Pleader, when power is conferred on the State Government to frame rules concerning the issue of renewal of certificate of fitness, the amendment made to the rules cannot be impugned merely on the ground that a wrong provision has been quoted in the amending rules. I do not find it necessary to decide the aforesaid WP.(C).No.16046/2016 & con.cases.
28 contention of the petitioners, for, I am of the view that even if it is conceded that the State Government is empowered by the statute to frame rules concerning grant of or renewal of certificate of fitness, an amendment in the nature of one impugned in the writ petition, which is not consistent with the rule made by the Central Government, cannot be made by the State Government.
11. The learned Special Government Pleader also contended that authorised testing stations, as provided for in the Central Rules, have not been established in the State and therefore, Rule 73 has no application as far as the State is concerned. There is no merit in this contention as the competent authority referred to in the impugned proviso and the authorised testing stations are discharging the same function and the inconsistency in the procedure would lead to arbitrariness in the matter of grant of or renewal of certificate of fitness, once testing stations are established in the State.
12. The specific case of the petitioners is that the Transport Commissioner of the State had earlier issued a circular incorporating similar provisions as incorporated in the impugned WP.(C).No.16046/2016 & con.cases.
29 proviso; that the said provisions were held to be arbitrary and violative of the fundamental rights guaranteed to the petitioners and similarly placed persons by this Court as per Ext.P3 judgment in W.P.(C) No.16046 of 2016; that the impugned proviso is introduced to the Rules by way of amendment with a view to negate the said binding decision of this Court and the same, in the circumstances can be regarded only as one introduced in bad faith. Ext.P2 circular in WP(C).No.16046 of 2016 is the circular referred to by the petitioners. It is provided in Ext.P2 circular that if any check report is pending in respect of any vehicle, certificate of fitness and such other services shall not be extended to the same till the check reports are finalised. It is also provided in Ext.P2 circular that persons coming for renewal of certificate of fitness and registration shall obtain a certificate from the concerned section for clearance of check reports. Clauses 20 and 30 of Ext.P2 circular read thus:
"20. If any check report is pending in relation to any vehicle then renewal of permit, transfer of ownership, endorsement of hypothecation and its cancellation thereof, issue of certificate of fitness and such other services shall not be extended till such time as the proceedings on the basis of the WP.(C).No.16046/2016 & con.cases.
30
said check report are finalised. However, facility of remittance of motor vehicles tax shall not be denied only for the reason that check report is pending in relation to the vehicle. In any event, the owner shall be informed about the pendency of the check report and advised to settled the same.
30. Persons coming for renewal of certificate of fitness and registration shall obtain a certificate from the concerned section regarding clearance of the check report."
Ext.P3 in the said writ petition is the judgment relied on by the petitioners in support of their contention. It is seen that in Ext.P3 judgment this Court found that clauses 20 and 30 of Ext.P1 circular are arm twisting tactics adopted by the State to squeeze money from operators of transport vehicles without waiting for the culmination of proceedings initiated against them and that they are wholly inequitable and arbitrary and falls foul of Article 14 of the Constitution of India, besides offending the right guaranteed to the operators to carry on the business under Article 19(i)(g) of the Constitution of India. It is also held by this Court in the said judgment that the operators of such vehicles cannot be kept on tender hooks awaiting the culmination of the proceedings pursuant to check reports for them to continue the service being operated. There cannot be any dispute to the fact WP.(C).No.16046/2016 & con.cases.
31 that the impugned proviso, if understood in the light of the Explanatory Note contained therein, would make it clear that the same is in essence clauses 20 and 30 of Ext.P1 circular in the writ petition referred to above. I have, therefore, no hesitation to hold that the impugned proviso is introduced with a view to negate Ext.P3 judgment of this Court. It is trite that when power is delegated by a statute, the delegate must act in good faith. The said proposition has been reiterated by the Apex Court in Mahalakshmi Sugar Mills Co.Ltd. and Another v. Union of India and others [(2009)16 SCC 569]. The impugned amendment is, therefore, unconstitutional, for, the same is actuated in bad faith.
13. As declared by the Apex Court in various judicial pronouncements, the rules whether made under the Constitution or a statute, must be in harmony with the Constitution in the sense that it shall not infringe the fundamental rights guaranteed to citizens. Manifest arbitrariness/unreasonableness to an extent where the court might well say that the legislature never intended to give authority to make such rules also is a ground available to challenge the rule made under a statute. [See State WP.(C).No.16046/2016 & con.cases.
32 of Tamil Nadu and another v. P.Krishnamurthy and others [(2006) 4 SCC 517]. As noted above, this Court has already found in Ext.P3 judgment that clauses 20 and 30 of Ext.P1 circular are arbitrary and falls foul of Article 14 of the Constitution of India, besides offending the rights guaranteed to the operators to carry on the business under Article 19(i)(g) of the Constitution of India. Since the impugned proviso is, in essence the provision contained in clauses 20 and 30 of Ext.P1 circular, I have no hesitation to hold that the same is invalid and unconstitutional on that ground as well.
14. That apart, this Court is of the view that the impugned proviso is invalid being vague and indefinite as well. [See Hamdard Dawakhana (Wakf) v. Union of India (AIR 1960 SC 554]. It is apposite in this context to refer to a passage of the court of appeal in Mixnam's Properties Ltd. v. Chertsey U.D.C. [(1963) 2 All E.R. 787], which reads thus:
"Some doubt is cast on the correctness of "uncertainty" as a separate ground of invalidity by the speeches in the House of Lords in the recent case of Fawcett Properties, Ltd. v. Buckingham County Council (25) but if the courts can declare WP.(C).No.16046/2016 & con.cases.
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subordinate legislation to be invalid for "uncertainty" as distinct from unenforceable, as in the case of a clause in a statute to which it is impossible to ascribe a meaning, this must be because Parliament is to be presumed not to have intended to authorise the subordinate legislative authority to make changes in the existing law which are uncertain."
As pointed out by the petitioners, the various expressions used in the impugned proviso like 'other services', 'Government dues' and 'any other legal action pending' are so vague that it cannot be predicted with certainty as to what is intended by those expressions. In the course of argument, it was contended by the learned counsel for the petitioners that though the rule made invoking Section 65 of the Act cannot cover matters not provided for in Chapter IV of the Act, if the authorities insist for clearance certificate for availing services not provided in the Chapter taking advantage of its indefiniteness, the petitioners will be helpless. I find force in the submission made in this regard by the learned counsel for the petitioners. When the rules are vague, it cannot be said that it will not be abused in the manner pointed out by the petitioners. I have, therefore, no hesitation to hold that the impugned rule is invalid for its uncertainty and indefiniteness as well.
WP.(C).No.16046/2016 & con.cases.
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For all the aforesaid reasons, the writ petitions are allowed and it is declared that the Kerala Motor Vehicles (1st amendment) Rules, 2016 is unconstitutional and consequently unenforceable. The official respondents in the writ petitions are directed to render the services requested for by the petitioners on that basis forthwith.
Sd/-
P.B.SURESH KUMAR, JUDGE.
Kvs/-
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