K. Jagadeesh Reddy vs Karnataka State Transport Authority

B.S. Patil, J.—Petitioner had filed application for grant of interstate stage carriage permit on the route Thirupathi to Bangalore before the concerned Authority in the state of Andhra Pradesh. The State Transport Authority, Andhra Pradesh, granted permit on 07.02.2004, subject to counter signature by the State Transport Authority, Karnataka. The application filed by the petitioner for counter signature was objected by the 2nd respondent-KSRTC contending that the route overlapped the notified routes of BTS, Bangalore and Kolar scheme, for about 250 Kms. Reliance was placed on the prohibition contained in Section 104 of the Motor Vehicles Act for granting permit/counter signature on the notified route.

The State Transport Authority, Karnataka, granted counter signature on 15.09.2004. This was challenged before the KSTAT, Bangalore. R.P. No. 659/2003 was filed by G.V. Chandrashekar - 3rd respondent herein, whereas the 2nd respondent-KSRTC filed R.P. No. 537/2003. By order dated 12.01.2005, the Tribunal has allowed both the revision petitions and has set aside the counter signature for the stage carriage permit No. 1/STA/2004 valid upto 23.03.2009. The Tribunal has placed reliance on the judgment of the Apex Court in the case of T.N. Raghunatha Reddy Vs. Mysore State Transport Authority, , to hold that as the petitioner herein was not a saved operator under Kolar Pocket Scheme or modified Kolar Pocket Scheme and was not a saved operator as on 27.05.2003, counter signature granted for the portion of the route lying in the State of Karnataka was without jurisdiction and against the ruling of the Apex Court. The Tribunal has also held that the entire stretch of the route from State Border upto Bangalore overlapped the approved Kolar scheme as modified from 27.05.2003. Aggrieved by the order of the Tribunal, these writ petitions are filed.

Mr. P.S. Rajagopal, learned Senior Counsel appearing for the petitioner has raised the following contentions.

i) The revision petitioner before the Tribunal (respondents 2 & 3 herein) were not the aggrieved persons. They had no claim for the route reserved for Andhra Pradesh operator. Hence, they had no locus standi to challenge the grant of counter signature. He relied on the judgments in the case of Ramegowda Vs. The State of Karnataka and Others, , and Dr. N.C. Singhal Vs. Union of India (UOI) and Others, ;

ii) As no previous approval of the Central Government was granted to the Kolar Pocket Scheme, it was not a notified interstate route in terms of the proviso to sub-clause (3) of Section 100 of the Motor Vehicles Act. Reliance is placed on the decisions of the Apex Court in the case of Ch. Khazan Singh and Others Vs. State of U.P. and Others, (paras 5 & 6); Goverdhan Lal Dhawan Vs. State of Bihar and Others, (para 5); and A. Venkatakrishnan Vs. State Transport Authority, Kerala - (2004) 11 SCC 207 (paras 11 & 12), in this regard.

iii) It is also urged by him that as the 3rd respondent has filed a Memo dated 25.07.2005 conceding to set aside the order of the Tribunal, what remained was only the challenge made by the KSRTC to the counter signature.

Mr. Prakash Shetty, learned Counsel for the 2nd respondent-KSRTC has strongly refuted the contentions of the petitioner. He has urged that validity of Kolar Pocket Scheme has been upheld, therefore it is not open to the petitioner to contend that the said scheme is not valid as it does not have prior approval of the Central Government. Reliance is placed by him on the judgment in the case of T.N. Raghunatha Reddy Vs. Mysore State Transport Authority, (para 15). He refers to Section 98 of the Act to urge that it gives overriding effect to the provisions of Chapter-VI and to the notifications and scheme framed thereunder.

It is further urged by Mr. Prakash Shetty that proviso to sub-clause (3) of Section 100 of the Act would be applicable where an ''interstate route'' is to be notified, whereas in the instant case, there being only an interstate agreement, no interstate route has been notified. He emphasizes that the notifications that are relevant in the present case are regarding routes inside the State of Karnataka such as BTS, Anekal and Kolar Pocket Schemes. In this regard, he urges that as per Section 103 of the Act, the State undertaking has right to apply and operate in a route falling in approved scheme.

It is next contended by him that Section 88(5) of the Act, which deals with interstate agreements is subject to Section 104 of the Act. Therefore, merely on the strength of interstate agreement, petitioner cannot operate on a notified route to which Chapter-VI is applicable. Reliance is placed on the judgment in the case of Karnataka State Road Transport Corporation Vs. Ashrafulla Khan and Others, (paras 6 & 19). Dealing with the effect of Section 98 and the provisions in Chapter VI, he has placed reliance on the judgment in the case of Ram Krishna Verma and Others Vs. State of U.P. and Others, (para 13). Attention of the Court is also invited to the order dated 16.10.2006 passed in W.P. No. 12353/2006 confirmed in W.A. No. 1733/2006 disposed of on 04.01.2007 to contend that petition is not a saved operator under the Kolar Pocket Scheme.

Having heard the learned Counsel for both parties and on perusal of the pleadings and documents on record, the question that falls for consideration is,

whether the findings recorded by the Tribunal holding that grant of counter signature to the State Carriage Permit of the petitioner for the route Thirupathi to Bangalore and back, was illegal as it overlapped the approved Kolar Pocket Scheme as modified from time to time, warranting interference by this Court?

Undisputed facts would reveal that the State Transport Authority, Andhra Pradesh, granted permit to the petitioner on 07.02.2004 for the route in question, subject to counter signature. The State Transport Authority in Karnataka, counter signed the permit on 15.09.2004 referring to the exemption in Kolar Pocket Scheme. The Kolar Pocket Scheme was first published on 10.01.1968. This scheme was later modified by the notification published on 11.01.1980. The same was further modified on 07.11.2003. As per clause (d) of the modified Kolar Pocket Scheme, benefit of exemption was provided to the following extent.

"(d) In the case of permit holders to whom permits are already granted and issued by Transport Authorities after modification of the Scheme dated 10.01.1980 on Inter-State, Inter-District and Intra-Districts routes overlapping the road section of the notified routes lying in the scheme of Kolar as on 31.07.1999 and also on the date of the Draft Notification i.e., 27.05.2003, they are exempted to operate their service, notwithstanding anything contained in the Bangalore and Anekal Schemes, with a condition that they shall not be entitled to pickup or set down passengers in such portion of the notified route lying in the Scheme of Kolar."

It is clear from the exemption granted as referred above in Kolar Pocket Scheme, permits already granted valid as on 31.07.1999 and also on 27.05.2003 were exempted to operate their services. It is made very clear in the exemption clause that in order to be a saved permit, it ought to be current on 27.05.2003 also. Therefore, the State Transport Authority clearly fell in error in granting counter signature proceeding on the basis that the petitioner was a saved operator. In fact, as it is not in dispute that the petitioner was granted permit on 07.02.2004, question of extending the exemption under the Kolar Pocket Scheme would not at all arise to the case of the writ petitioner. It is also necessary to state at this stage that the validity of Kolar Pocket Scheme has been upheld in the case of T.N. Raghunatha Reddy Vs. Mysore State Transport Authority, . Dealing with the effect of interstate agreements vis-a-vis the provisions of Chapter IV-A of the Act, the Apex Court has observed in paragraph 15 as under:

"15. Regarding the third point, we were unable to appreciate how an inter-State agreement overrides the provisions of Chapter IV-A. The inter-State agreement is not law and to hold that an inter-State agreement overrides Chapter IV-A would be to completely disregard the provisions of Section 68B of the Act which provides that "the provisions of this Chapter and the rules and orders made thereunder shall have effect notwithstanding anything inconsistent therewith contained in Chapter IV of this Act or in any other law for the time being in force or in any instrument having effect by virtue of any such law." In this connection, reference was made to Article 162 and Article 298 of the Constitution. But we were unable to appreciate what relevance these articles have to the point at issue. Assuming that a State has power to enter into agreement with another State in exercise of its executive powers under Article 162, and under Article 298 it can carry on trade or business, we are unable to see what light these facts throw on the question before us."

Chapter VI of the Act deals with special provisions relating to State Transport Undertakings. Section 98 of the Act enacts that the provisions of Chapter VI and the rules and orders made thereunder shall have effect notwithstanding anything inconsistent therewith contained in Chapter V or in any other law for the time being in force or in any instrument having effect by virtue of any such law.

Section 88(5) of the Act which provides for inter-State agreements and Section 88(6) of the Act which provides for publication of the counter signature are found in Chapter V and therefore, they are subject to the provisions of Chapter VI which have overriding effect. The Kolar Pocket Scheme is the result of the notification issued under Section 100 of the Act falling in Chapter VI. Therefore, the notification and the scheme framed thereunder will have overriding effect on the inter-State agreement reached between the State of Karnataka and Andhra Pradesh. The proviso to Section 100(3) of the Act has no application to the instant case. It would be applicable when an inter-State route is to be notified. In the instant case, we are concerned with an inter-State agreement. The relevant notifications that have overriding effect in terms of Section 98 and the provisions of Chapter VI of the Act, are the notifications issued regarding routes inside the State of Karnataka framing certain schemes such as BTS scheme, Anekal Scheme and Kolar Pocket Scheme. The 2nd respondent-KSRTC has right to apply and operate in these routes falling in the approved scheme. This is clear from the provisions contained in Section 103 of the Act pertaining to issue of permits to State Transport Undertakings.

It cannot be disputed that by virtue of the counter signature granted to the petitioner, petitioner would be entitled to operate his service over the notified route to an extent of about 250 Kms. This will certainly affect the interest of the 2nd respondent-KSRTC, which has right under Section 103 of the Act to apply and operate its services over the notified area. Indeed it is for this reason, the State Transport Undertaking raised objection for the counter signature, but the State Transport Authority erroneously overruled the objections referring to the so-called exemption provided in the Kolar Pocket Scheme. Hence, the contention of the learned Senior Counsel Mr. Rajagopal, that the 2nd respondent is not an aggrieved person and hence it had no locus standi to challenge the grant of counter signature is unsustainable.

Reliance placed by him on the judgment in the case of Ramegowda Vs. The State of Karnataka and Others, , is not apposite to the facts of the present case. Similarly, the judgment in the case of Dr. N.C. Singhal Vs. Union of India (UOI) and Others, will also not come to the aid of the petitioner. Both these judgments deal with entirely different set of facts and circumstances.

As the Kolar Pocket Scheme has been duly approved and its validity has been upheld and as the question raised is not as to whether it was a notified inter-State route in terms of the proviso to Section 100(3) of the Act, the contention urged by the learned Senior Counsel in this connection are untenable.

The question pertains to the inter-State Agreement entered into between the two States regarding the route in question. Therefore, the argument constructed on the basis of Section 100(3) of the Act and reliance placed on several judgments in that connection are wholly unnecessary. It is relevant to notice here provisions of Section 104 of the Act which impose restriction on grant of permits in respect of notified area or notified route. It lays down that where a scheme has been published under Section 100(3) of the Act in respect of any notified area or notified route, the State Transport Authority or the Regional Transport Authority, as the case may be, shall not grant any permit except in accordance with the provisions of the scheme. In the instant case, as already referred to above, the notifications that are issued exercising power under Section 100(3) of the Act pertained to the route inside the State of Karnataka, particularly the Kolar Pocket Scheme. Over these notified routes, as per Section 103 of the Act, the State Undertaking has right to apply and operate and as per the prohibition and restriction contained in Section 104 of the Act, the State Transport Authority or the Regional Transport Authority as the case may be shall not grant any permit except in accordance with the provisions of the scheme. Such being the position, the counter signature granted by the State Transport Authority was in violation of the prohibition/restriction contained in Section 104 of the Act.

In the case of Adarsh Travels Bus Service and Another Vs. State of U.P. and Others, , the Apex Court after considering the provisions of Sections 68C, 68D(3), 68FF & 2(28A) of the Act, in the light of the definition of the expression ''route'' in Section 2(28A), has held that the said provisions made it manifestly clear that once a scheme was published under Section 68D in relation to any area or route or portion thereof, whether to the exclusion, complete or partial of other persons or otherwise, no person other than the State Transport Undertaking may operate on the notified area or notified route except as provided in the scheme itself. The Apex Court has further observed in the same paragraph that necessary consequence of the said provisions was that no private operator can operate his vehicle on any part or portion of a notified area or notified route unless authorized so to do by the terms of the scheme itself.

In the case of Karnataka State Road Transport Corporation Vs. Ashrafulla Khan and Others, , the Apex Court dealing with Kolar Pocket Scheme, has held that the scheme excluded private operation of stage carriage permits on notified route and no permit could be granted to private operators on such notified route or portion thereof excepting an intersection.

Therefore, having regard to the above, I have no hesitation to hold that there is no substance in any of the contentions urged by the petitioner. The order passed by the Tribunal does not, therefore, suffer from any apparent illegality or error of jurisdiction warranting interference from this Court. Hence, this writ petition is dismissed.