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Judgment
Sardar Ali Khan, J.—These two Writ Petitions, viz., W. P. Nos. 1709/90 and 1735/90 raise common questions of law and fact and are, therefore, disposed of by a common judgment. It would be in the fitness of things to take the facts as stated in W.P: No. 1709/90 as the basis for a decision in both the writ petitions.
The brief facts of the matter are as follows:-- The petitioners are the existing operators. They filed W.P. No. 1709/90 for the issue of an appropriate writ or order directing respondents 1 and 2, viz., the Government of India, represented by its Secretary, Transport Department, Central Secretariat, New Delhi and the Government of Andhra Pradesh represented by its Secretary, R&B Department, Secretariat, Hyderabad; to implement sub-section (3) of Section 71 of the Motor Vehicles Act, 1988 (Act No. 59 of 1988), hereinafter referred to as the "Act of 1988", by limiting the number of stage carriages operating on the town service routes in Bhimavaram Town, West Godavari District and further to direct the 3rd respondent herein, viz., the Regional Transport Authority, West Godavari District represented by its Secretary not to entertain any application for the grant of stage carriage permits on the route Bhimvaram to Deyyalathiappa via Dirsumarru Ferry on city routes till action is taken by respondents 1 and 2 under subsection (3) of Section 71 of the Act of 1988. Respondents 4 and 5, who are the new entrants, who have applied for the stage carriage permits, were impleaded by virtue of court order dated 20-11-1990 in W.P. M.P, No. 20667/90.
The prayer in the second writ petition, viz., W.P. No. 1735/90 is almost identical to the one in W.P. No. 1709/90, referred to above, except with the slight change in regard to the route. The route concerned in this writ petition is Bhimavaram to Aravalli via Kumudavalli, Palakoderu, Mogallu, Gava-rapalem, Unikili.
It may also be noted that after the admission of the writ petitions, the petitioners have filed amendment petitions in both the writ petitions seeking to amend the prayer in the writ petitions as follows :--
W.P. No. 1709/90
"To issue a writ, order or direction, directing the 3rd respondent to ascertain the need on the town service route Bhimavaram to Deyyalathippa via Dirsumarrau Ferry and grant permits on the said route if there is need for the grant of stage carriage permits and to pass such other order or orders as this Hon''ble Court may deem fit and proper in the circumstances of the case."
W: P. No. 1735/90
"To issue a writ, order or direction, directing the 3rd respondent to ascertain the need of the town service route Bhimavaram to Aravalli via Kumudavalli, Palakoderu, Mogallu, Gavarapalem, Unikili and grant permits on the said route if there is need for the grant of stage carriage permits; and to pass such other order or orders as the Hon''ble Court may deem fit and proper in the circumstances of the case."
We would like to clear the initial argument advanced in this case on behalf of the respondents that the amendment in question is not sustainable in the eye of law as it seeks to introduce an entirety different case from what was originally pleaded in the writ petitions. It is, of course, true that the petitioners initially prayed for the issue of a writ directing the respondents to implement sub-section (3) of Section 71 of the Motor Vehicles Act by limiting the number of stage carriages operating on the town service routes in question. Later on, however, now the amendment sought to be made is for a direction to the 3rd respondent to ascertain the "Need" on the town service routes specified above. After hearing the learned counsel on both sides, we have come to the conclusion that in the interests of deciding the general controversy arising in this matter, the amendment petitions can be allowed so that the legal question sought to be raised in both the writ petitions may be decided in this matter. Therefore, taking a broad view of things as they exist, the amendment petitions are allowed.
The Motor Vehicles Act, 1988 (Act No. 59 of 1988) came into force with effect from 1-7-1989 by virtue of the repealing Section 217 according to which the Motor Vehicles Act, 1939 and any law corresponding to that Act in force in any State immediately before the commencement of the Act of 1988 have been repealed. The questions arising for consideration in these two writ petitions are, therefore, to be viewed and decided in accordance with the relevant provisions of the Act of 1988.
Mr. M. V. Ramana Reddy, learned Counsel appearing for the petitioners in both the writ petitions, has taken us to the provisions of Sections 66 - 70 and Section 80 of the Act of 1988. Section 66 merely speaks about the necessity of permits without which no owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place. This section has nothing to do with the controversy arising in this matter as it is concerned only with the question of necessity of permits which a owner of motor vehicle shall have before he puts his vehicle as a transport vehicle in a public place. Similarly, Section 67 of the Act deals with the question of power of the State Government to control road transport. It is provided that the State Government, having regard to the advantages offered to the public, trade and industry by the development of motor transport and for various other reasons which have been enumerated therein, shall exercise its power to control road transport in the interests of the general public. Section 68 is concerned with the question of constituting transport authorities by the State Government. Section 69 deals with the question of application for stage carriage permit and gives the details as to how an application is to be made for a stage carriage permit and the contents of such an application have been enumerated therein. Moreover, there is nothing which is really of any material value for the purpose of this case in the provision of Section 70.
However, coming to Section 71 of the Act of 1988, it may be seen that procedure of Regional Transport Authority in considering application for stage carriage permit has been provided u/s 71. It would be fit and proper to reproduce hereunder the provisions of Section 71(3) which read as follows :--
"Section 71(3)(a): The State Government shall, if so directed by the Central Government having regard to the number of vehicles, road conditions and other relevant matters, by notification in the Official Gazette, direct a State Transport Authority and a Regional Transport Authority to limit the number of stage carriages generally or of any specified type, as may be fixed and specified in the notification operating on city routes in towns with a population of not less than five lakhs.
(b) Where the number of stage carriages are fixed under clause (a), the Government of the State shall reserve in the State certain percentage of State carriage permits for the scheduled castes and the scheduled tribes in the same ratio as in the case of appointments made by direct recruitment to public services in the State.
(c) Where the number of the stage carriages are fixed under clause (a) the Regional Transport Authority shall reserve such number of permits for the scheduled castes and the scheduled tribes as may be fixed by the State Government under clause (b).
(d) After reserving such number of permits as is referred to in clause (c) the Regional Transport Authority shall in considering an application have regard to the following matters, namely :--
(i) financial stability of the applicant;
(ii) satisfactory performance as a stage carriage operator including payment of tax if the applicant is or has been an operator of stage carriage service; and
(iii) such other matters as may be prescribed by the State Government :
Provided that, other conditions being equal, preference shall be given to applications for permits from :--
(i) State transport undertakings;
(ii) co-operative societies registered or deemed to have been registered under, any enactment for the time being in force; or
(iii) ex servicemen."
Thus, a reading of this section clearly reveals that the Regional Transport Authority is under an obligation while considering, an application for a stage carriage permit, to have regard to the objects of the Act. Furthermore, it is provided u/s 71(2) that a Regional Transport Authority shall refuse to grant a stage carriage permit if it appears from any time-table furnished that the provisions of this Act relating to the speed at which vehicles may be driven are likely to be contravened. Clause (a) of sub-section (3) of Section 71 provides the crucial rule of reservation which must be observed by the State Government on the directions given by the Central Government. It is provided therein that the State Government shall, if so directed by the Central Government, having regard to the number of vehicles, road conditions and other relevant matters, by notification in the Official Gazette, direct the State Transport Authority and the Regional Transport Authority ''to limit the number of stage carriage generally or of any specified type, as may be fixed and specified in the notification operating on city routes in towns with a population of not less than five lakhs. In clause (b) of sub-section (3) of Section 71 it is provided that where the number of stage carriages are fixed under clause (a), the Government of the State shall reserve in the State certain percentage of stage carriage permits for the scheduled castes and the scheduled tribes in the same ratio as in the case of appointments made by direct recruitment to public services in the State. In clause (c) of sub-section (3) of S. 71 it is provided that where the number of stage carriages are fixed under clause (a), the Regional Transport Authority shall reserve such number of permits for the scheduled castes and the scheduled tribes as may be fixed by the State Government under clause (b). An analysis of the above Section 71(2) and (3)(a) and (3)(b) leads to the following conclusion, viz., firstly that the Regional Transport Authority shall, while considering an application for a stage carriage permit, have regard to the objects of the Act. Secondly, it is provided under subsections (2) and (3) (a) and (3)(b) that the State Government shall carry on the directions of the Central Government having regard to the number of vehicles, road conditions and other relevant matters which may be given in connection with the operating of the city routes in towns with a population of riot less than five lakhs. This is obviously done with a view to provide the rule of reservation which is mentioned in clause (b) of subsection (3) of Section 71. This, in effect, means that if there is a town having more than five lakhs of population and if the Central Government so directs, the State Government shall limit the number of stage carriages generally or of any specified type by virtue of a notification and where the number of stage carriages are so fixed the Government of the State shall reserve certain percentages of the stage carriages for the Scheduled Castes and the Scheduled Tribes in the same ratio as in the case of appointments made by direct recruitment to the public services in the State. The main object of Section 71 is, therefore, to preserve the rule of reservation and to provide for the reservations in the same proportion as they are obtained in regard to public services in the State.
With regard to the objects of the Act, referred to u/s 71(1), a reference may be made to the statement of objects and reasons given in the Act. Some of the more important modifications which have been suggested in the Act of 1988 are contained in clauses (a) to (f) of para 3 which are to the following effect :--
"Some of the more important modifications so suggested related for taking care of-
(a) the fast increasing number of both commercial vehicles and personal vehicles in the country;
(b) the need for encouraging adoption of higher technology in automotive sector;
(c) the greater flow of passenger and freight with the least impediments so that islands of isolation are not created leading to regional or local imbalances;
(d) concern for road safety standards and pollution-control measures, standards for transportation of hazardous and explosive materials;
(e) simplification of procedure and policy liberalisations for private sector operations in the road transport field; and
(f) need for effective ways of tracking down traffic offenders."
Apart from the above, it is also provided in clause (g) of para 5 of the Statement of Objects and Reasons that the proposed legislation has been prepared with a view to provide for liberalised schemes for grant of stage carriage permits on non-nationalised routes all India Tourist permits and also national permits for goods carriages.
Thus, a reading of Section 71, in the light of the objects and reasons, discussed above, leads to the conclusion that the Regional Transport Authority is bound to have regard to the objects of the Act before granting stage carriage permits.
Section 80 of the Act of 1988 prescribes the procedure in applying for and granting of permits and is in the following terms :
"80. Procedure in applying for and granting permits :-- (1) An application for a permit of any kind may be made at any time.
(2) A Regional Transport Authority shall nor ordinarily refuse to grant an application for permit of any kind made at any time under this Act;
Provided that the Regional Transport Authority may summarily refuse the application if the grant of any permit in accordance with the application would have the effect of increasing the number of stage carriages as fixed and specified in a notification in the Official Gazette under clause (a) of sob-section (3) of Section 71 or of contract carriages as fixed and specified in a notification in the Official Gazette under clause (a) of sub-section (3) of Section 74;
Provided further that where a Regional Transport Authority refuses an application for the grant of permit of any kind under this Act, it shall give to the applicant in writing its reasons for the refusal of the same and an opportunity of being heard in the matter.
(3) An application to vary the conditions of any permit, other than a temporary permit, by the inclusion of a new route or routes or a new area by altering the route or area covered by it, or in the case of a stage carriage permit by increasing the number of trips above the specified maximum or by the variation, extension or curtailment of the route or routes or the area specified in the permit shall be treated as an application for the grant of a new permit :
Provided that it shall not be necessary so to treat an application made by the holder of stage carriage permit who provides the only service on any route to increase the frequency of the service so provided without any increase in the number of vehicles.
Provided further that,--
(i) in the case of variation, the termini shall not be altered and the distance covered by the variation shall not exceed twenty-four kilometres;
(ii) in the case of extension, the distance covered by extension shall not exceed twenty-four kilometres from the termini;
and any such variation or extension within such limits shall be made only after the transport authority is satisfied that such variation will serve the convenience of the public and that it is not expedient to grant a separate permit in respect of the original route as so varied or extended or any part thereof. XXX xxx xxx
It is provided in'' this section that an application for a permit of any kind may be made at any time. This obviously corresponds to Section 57(1) of 1939 Act. In clause (2) of Section 80 of the 1988 Act it is provided that the Regional Transport Authority shall not ordinarily refuse to grant an application for permit of any kind made at any time under the Act provided that the Regional Transport Authority may summarily refuse the application if the grant of any permit in accordance with the application would have the effect of increasing the number of stage carriages as fixed and specified in a notification in the Official Gazette under clause (a) of subsection (3) of Section 71 or of contract carnages as fixed and specified in a notification in the Official Gazette under clause (a) of sub-section (3) of Section 74. This obviously means that while the Regional Transport Authority is under an obligation not to ordinarily refuse to grant a permit, it may, however, refuse to grant such a permit if the notification in the Official Gazette made in pursuance of the provisions of sub-section (3) of Section 71 in regard to reservation is infringed or if the number is increased to that which has been mentioned in the notification in the official gazette published thereon. The main thrust of the argument of Sri M. V. Ramana Reddy, learned counsel appearing for the petitioners in this case is that under sub-sections (1) and (2) of Section 80 the authorities have been vested with an unbridled power to grant permit without having due regard to the fact that whether there is any need for the grant of such permits. The crucial submission made by the learned counsel for the petitioners is that it shall be incombent upon the authorities before granting the permits u/s 80(2), to assess the need to grant such a permit before issuing such a permit. He seeks to substantiate this argument by referring to Section 47(3) of the 1939 Act under which the procedure of Regional Transport Authority in considering application for stage carriage permits is mentioned. Under sub-section (1) of Section 47 of the 1939 Act the Regional Transport Authority shall, while considering an application for a stage carriage permit, have regard to (a) the interests of the public generally; (b) the advantages to the public of the service to be provided and (c) the adequacy of other passenger transport services operating or likely to operate in the near future, whether by road or other, means between the places to be served. The learned counsel, Mr. M. V. Ramana Reddy draws sustenance mainly from the provisions of subsection (c) of Section 47 of the 1939 Act and submits that it was incumbent on the authorities to make an assessment of the adequacy of other passenger transport services existing at a particular time before the grant of permits which has been completely done away u/s 80(2) of the 1988 Act. Furthermore, he has drawn our attention repeatedly to subsection (3) of Section 47 of the 1939 Act, which is in the following terms :
"47(3) A Regional Transport Authority may, having regard to the matters mentioned in sub-section (1), limit the number of stage carriages generally or of any specified type for which stage carriage permits may be granted in the region or in any specified area or on any specified route within the region."
The end product of the argument advanced by Sri M. V. Ramana Reddy, therefore, is that as it was provided u/s 47(3) the Regional Transport Authority, having regard to the interests of the public, the adequacy of other passenger transport services etc., shall limit the number of stage carriages, under the new Act of 1988. The Regional Transport Authority shall have regard to the adequacy of other passenger transport services, which, in effect, means the existing transport services and limit the number of the stage carriage permits of any type. Taking an extreme example, the learned counsel submits that it is not open to the authorities, for instance, to grant 50 permits when there is a real need for only 10 permits running on a particular route.
He submits that such a course of action will lead to a situation which will neither be in the public interests nor in the interest of any one and will result in the complete ruination of the existing operators.
We have considered the submission made by the learned counsel Mr. M. V. Ramana Reddy in all its dimensions and have come to the inevitable conclusion that this submission is devoid of any substance. u/s 80(2) of the Act of 1988 it is not as if that the Regional Transport Authority can grant permits of any kind made at any time without regard to anything which may have a bearing on the matter. Under sub-section (3) of Section 71 of the new Act of 1988 the overall restriction on the discretion so exercised by the Regional Transport Authority is that it shall, before granting of the permits, have regard to the objects of the Act. Any grant of permit, which is not in consonance with the objects of the Act, will be in contravention of sub-section (3) of Section 71 of the Act of 1988. Moreover, Section 80(2) of the new Act provides that the Regional Transport Authority shall not ordinarily refuse to grant an application for permit of any kind made at any time under this Act with the exception that the Regional Transport Authority may refuse the application if the grant of such a permit would have the effect of increasing the number of stage carriages as fixed and specified in a notification in the Offical Gazette under clause (a) of sub-section (3) of Section 71 of the Act of 1988, which is also a safeguard with regard to permits which may be granted in contravention of the above said section. The validity of sub-section (2) of Section 80 and the reason behind the promulgation of such a provision in the Act will have to be judged in the the light of the change in law which has been brought about by the repeal of Section 47 under the Act of 1939. The relevant question to be asked is what was the situation existing u/s 47 of the Act of 1939 which was sought to be changed by bringing in a new legislation in the form of Section 80(2). It is a well settled proposition of law that the overall consideration in all these matters is the general interests of the travelling public. The Supreme Court time and again has held that the public interest is the touchstone of judging the reasonableness and validity of legislation in regard to transport matters. u/s 80(2) of the Act of 1988 it is no doubt quite tres that the Regional Transport Authority has been invested with the power to grant any permit and not to refuse ordinarily the grant of such a permit unless it infringes the interests of the travelling public. The question to be considered here is whether the increase in the number of buses by virtue of grant of additional permits will result in affecting the public interests adversely. It is easy to understand that the limitation of the number of buses, which, in effect, means limitation of the number of stage carriage permits, which are to be issued, will be in the interests of the existing operators, but to say that the increase in the number of buses will not be in the interests of the general travelling public does not hold water. It is an accepted fact that the frequency of services and the adequacy of a bus-fleet are some of the basic factors which go to contribute to the convenience of the travelling public.
Moreover, it is only when there is a need for a further bus or a permit that a new entrant in the field will be an applicant for the grant of a permit. The risk by making an entry into the field is taken by him, with his eyes wide-open, knowing the density of the population in the area, the traffic potential and the necessity for another bus. When such a person comes forward, prime facie, there does not appear to be any reason why the Regional Transport Authority should, in the interests of the general public, refuse to grant him a permit. There is another angle to the problem. Before the granting of a permit under Rule 179 of the A.P. Motor Vehicles Rules, 1989, which is applicable for the grant of permits u/ S. 80 of the Act of 1988, certain guiding principles for grant of stage carriage permits have been provided. Under this rule, provision ha� been made for the classification of routes into short routes, medium routes and long routes. As far as the short routes are concerned, preference is to be given to the new entrants and the comparison of marks shall be considered from among the new entrants. Of course, if there are no new entrants, then, perhaps, the existing operators could also be considered, In so far as the medium route is concerned, other things being equal, preference for medium route is to be given to the existing operators holding one to four stage carriage permits. Similarly under clause (c) of sub-rule (2) of Rule 179 other things being equal, preference is to be given for long routes to the existing operators holding five or more stage carriage permits. It is, therefore, clear that as per the above classification, preference is to be given to the new entrants in so far as short routes are concerned and to the existing operators having a specified number of permits in so far as the medium and long routes are concerned. The point to be emphasised here is that by the guiding principles of Rule 179 it is not as if that the existing operators are totally extinct from the realm of consideration by the authorities, but, indeed, they very much exist on a preferential basis in so far as medium and long routes are concerned.
With the above legislative background, it would be necessary now to have a look at the decided case law which may be having a bearing on the subject. In W.P. Nos. 17811/89 and batch, dated 5th July, 1990, a learned single Judge of this Court (Upendralal Waghray, J.) held, inter alia, while discussing the ambit and scope of S. 80 of the Act of 1988, that it confers the power on a single authority to consider an application for permit keeping in view the objects of the Act and all the relevant factors. The learned Judge further observed that in view of the above an opportunity should be given to the existing operator when his interest is affected by the grant of a stage carriage permit in favour of new entrant. This view of the learned single Judge was in consonance with the view taken by another learned single Judge in M. Sivarama Krishna Reddy Vs. The Secretary, Regional Transport Authority, Guntur and others, . When the matter came up before a Division Bench in W. A. No. 795/9 and batch against the above judgment of the single Judge in M. Sivarama Krishna Reddy Vs. The Secretary, Regional Transport Authority, Guntur and others, the Division Bench of this, court felt that since the matter was of a considerable importance, it should be decided by a Full Bench and accordingly the matter was referred to a Full Bench. It would be appropriate to reproduce in verbatim the question that the Full Bench has decided in its own words in para 29 of the judgment dated 9-8-1990, which is in the following terms:--
"The only and limited question, therefore, decided by us is that whenever fresh applications are filed u/S. 72 read with Ss. 70, 71 and 80 of the new Motor Vehicles Act, 1988, existing operators have no legal right to file representations before the R.T.A. nor can they claim any right to be heard by the R.T.A."
The Full Bench held :
".....They cannot also claim a right to be given certified copies under Rule 166 of the A.P. Motor Vehicles Rules, 1989, of any applications filed by fresh applicants who are seeking stage carriage permits on the ground that such copies are necessary for filing effective representations before the R.T.A."
This, in effect, means that the right of the existing operators to be heard before the grant of permits in favour of the new entrants has been negatived in no uncertain terms by the Full Bench. Moreover, by a judgment dated 16-1-1991 a Division Bench of this court allowed W.A. Nos. 822/90 and 823/90, preferred against the judgment of the learned single Judge (Upendralal Waghray, J.), placing reliance on the Full Bench judgment dated 9-8-1990 in The Secretary, Regional Transport Authority, Guntur and another Vs. E. Rama Rao and Others, and batch, referred to above, holding that in view of the ruling of the Full Bench it is clear that the existing operators, who were claiming right of representation and also personal hearing, have no such right.
Now, coming to the question as to whether it is necessary on the part of the Regional Transport Authority to assess the need for the issue of a stage carriage permit, it may be seen that though u/S. 47 of the old Act of 1939 there was a concept of such a need to be assessed before the issue of stage carriage permits, there is no such concept of a need being assessed now under the new Act of 1988. When the Parliament employed the language it had u/S. 80, and vested a wide power in the authorities in categorical terms, it cannot be said that the discretion so vested in the authorities should be fettered by bringing in the old concept of need existing under the Act of 1939 in the body of the legislation promulgated in 1988. The words used in sub-sec. (1) of S. 80 are that an application for a permit of any kind may be made at any time. In sub-sec. (2) it is provided that the Regional Transport Authority shall not ordinarily refuse to grant an application for permit of any kind made at any time under this Act. A grammatical interpretation of this provision would show that the authorities are free to consider any application for a permit made at any time and such a request shall not ordinarily be refused unless it is hit by the proviso to sub-sec. (2) of S. 80 resulting in the infringement of the rule of reservation in favour of the Scheduled Castes and the Scheduled Tribes. We have already stated that the paramount consideration in this matter is that of the general public. If the provisions of S. 80(2) cause even a grain of damage to the public interest, it would be open for this court to strike it down as being ultra vires the authority exercising such a power under the Act. But, if, on the facts of this case as well as from the general point of view, the provision so made is resulting in the preservation of the public interest, not to speak of its promotion, then h cannot be said that the Legislature has invested the authorities with an uncanalised and arbitrary power which needs to be curtailed by this court.
Viewed from any angle, we do not find any merit in both the writ petitions. Both the writ petitions are, therefore, dismissed, but, in the circumstances, there will be no order as to costs. Advocate''s fee Rs. 150/- in each.
Petitions dismissed.