K. Kumar vs The Secretary, State Transport Authority, Pondicherry

D. Murugesan, J.—The petitioner is a holder of a contract carriage permit to operate within Union Territory of Pondicherry in respect of the

vehicle bearing Regn. No. TN-49-A-2223. The said vehicle had a seating capacity of 57 in all. Since the vehicle was very old and the seating

arrangement in the vehicle was crumbled one and the public did not like the seating arrangement which resulted in a thin traffic potential in the

vehicle, the petitioner applied on 30-1-2001 lor replacement of the said vehicle by a later model vehicle with seating capacity of 36 in all. The said

application for replacement of the vehicle was rejected by the respondent on 7-3-2001. The petitioner has approached this Court challenging the

said order of the respondent dated 7-3-2001 and for a consequential direction to the respondent to receive the application of the petitioner dated

30-1-2001 for replacement of vehicle and allow the replacement.

The impugned order of the respondent reads as follows :--

With reference to his application cited on the subject mentioned above. Thiru K. Kumar. permit holder of Permit No. CC/279/ PY/95 (valid up

to 12-12-2005) covered by vehicle Regn. No. TN49/A2223 is hereby Informed that the proposal for replacement of vehicle with lesser seating

capacity than that of the existing vehicle (21 seats lesser) cannot be considered favourably at present, taking into account of the fall of revenue to

Government.

Fees paid by the permit holder for the present proposal under reference, towards replacement of vehicle, will be refunded, on a requisition from

him. The records received in original, are returned herewith.

(By Order)

Sd/- 7-3-2001

Assistant Secrelary-II

State Transport Authority

Mr. M. Palani, learned counsel for the petitioner submitted that the Impugned order of the respondent is totally outside the power vested in him

while considering the application for replacement u/s 83 of the Motor Vehicles Act, 1988 (hereinafter called as ""the Act"") read with Rule 75 of the

Pondicherry Motor Vehicles Rules, 1989 (hereinafter called as ""the Rules""). It is the submission of the learned counsel for the petitioner that as per

Section 83 of ""the Act"", the holder of a permit may with the permission of the authority by which the permit was granted, replace any vehicle

covered by the permit by any other vehicle of the same nature. While such permission is sought from the authority for replacement of the vehicle u/s

83 of ""the Act"", the authority is empowered to consider the same with reference to Rule 75 of ""the Rules"". As per Rule 75(2) of ""the Rules"", the

State Transport Authority, on receipt of an application under Sub-rule (1) of Rule 75, subject to the provisions of these rules, grant permission for

replacement, notwithstanding the fact that the replacer vehicle differs in material respects and capacity from the vehicle to be replaced. Hence, the

learned counsel submitted, when the power of the State Transport Authority is restricted only in regard to Rule 75, any reliance placed by the

Authority outside the scope of Rule 75 would render the order illegal. When the petitioner submitted his application, it was returned on the ground

that the same cannot be considered favourably at present taking into account of the fall of revenue to the Government as the proposal for

replacement of vehicle with lesser seating capacity than the existing vehicle. The learned counsel would further contend that the respondent had

also granted permission for replacement of the vehicles which had lesser seating capacity than the previous models to at least in three cases. One

M. Perumal, a permit holder in respect of the vehicle bearing Regn. No. TN-27-W-0027 with a total seating capacity of 50 was permitted to

replace the vehicle by another model bearing Regn. No. TN-01-J-0234 having a seating capacity of 37 by proceedings dated 19-1-2001.

Similarly, the respondent has permitted the replacement of the vehicle bearing Regn. No. KL-9-B-5544 having a total seating capacity of 50 to be

replaced by another vehicle bearing Regn. No. PY-01-L-0199 with a total seating capacity of 37 by proceedings dated 29-12-2000. Similarly,

the respondent has permitted the replacement of the vehicle bearing Regn. No. TN-33-W-3939 with a total seating capacity of 40 to be replaced

by another vehicle bearing Regn. No. TN-01-K-2453 with a total seating capacity of 33 by proceedings dated 7-3-2000. However, in the case

of the petitioner the replacement of the vehicle with a total seating capacity of 57 by a new model vehicle with a total seating capacity of 36 was

rejected on the ground of fall of revenue to the Government. According to the learned counsel, the said action of the respondent would amount to

discrimination.

In reply to the above submissions. Mr. R. Natarajan learned Additional Government Pleader (Pondicherry) submitted that the order challenged

in this writ petition was passed by the respondent in exercise of power u/s 83 of the ""the Act"". As against the said order, the petitioner has the

efficacious remedy of appeal u/s 89 of ""the Act"". The petitioner has filed this writ petition without availing the alternative remedy by filing appeal

and hence the writ petition is liable to be rejected. On merits, the learned Additional Government Pleader submitted dial the issue for grant of

permission for replacement of vehicle came to be considered by the Secretary, Transport Department, Union Territory of Pondicherry during the

month of February, 2001. The subject was discussed and it was brought to the notice of the Government that an amount of Rs. 300/- is charged

as road tax per seat per quarter for contract carriage/omni bus irrespective of seating capacity and if the proposed replacement vehicle having

lesser capacity is allowed, variation of tax, for the number of seats, reduced in the replacement vehicle at Rs. 300/- per seat per quarter will

correspondingly affect the revenue of tax. Insofar as the application of the petitioner for replacement of the vehicle, the seating capacity of the

existing vehicle is 57 and the tax accrued from the vehicle is Rs. 17,100/- per quarter at the rate of Rs. 300/- per seat. If the replacement of vehicle

with 36 seating capacity is allowed, the revenue of tax for replacing the vehicle will be only Rs. 10,800/- per quarter. Hence, it was decided to

reject the application of the petitioner along with three other application for replacement by the respondent on the ground of loss of revenue to the

Government The learned Additional Government Pleader also submitted that the Government is empowered to issue directions to the State

Transport Authority u/s 67 of ""the Act"" and when such directions are issued, the State Transport Authority is bound to follow. Hence, the request

of the petitioner for replacement was rejected on the ground of loss of revenue to the Government as directed by the Secretary. Transport

Department. Union Territory of Pondicherry. The learned Additional Government Pleader also produced the files in this regard. According to the

learned Additional Government Pleader, in the Interest of revenue, the request of the petitioner for replacement of the vehicle need not be

considered and hence the Impugned order cannot be said as one outside the powers under Rule 75 of ""the Rules"". Hence, the learned Additional

Government Pleader submitted that the writ petition has to be dismissed.

Before adverting to the rival contentions, it would be appropriate to extract the relevant section and rule of the Act and Rules respectively.

Section 83. Replacement of vehicles.--The holder of a permit may, with the permission of the authority by which the permit was granted, replace

any vehicle covered by the permit by any other vehicle of the same nature.

Rule 75. Replacement of a vehicle covered by a permit.-- (1) If a holder of a permit desires at any time to replace any vehicle covered by the

permit by another vehicle, he shall forward the permit and apply in Form P. Rep. A, to the State Transport Authority by which the permit was

granted, stating the reasons why the replacement is desired and shall also simultaneously.--

(i) if the replacer vehicle is in his possession, forward the certificate of registration of that vehicle: or

(ii) if the replacer vehicle is not in his possession, state any material particulars in respect of which the replacer vehicle will differ from the vehicle to

be replaced.

(2) On receipt of an application under Sub-rule (1), the State Transport Authority may subject to the provisions of these rules, grant permission for

replacement, notwithstanding the fact that the replacer vehicle differs in material respects and capacity from the vehicle to be replaced.

(3) The State Transport Authority may, for reasons to be recorded and communicated to the applicant, reject any application made to it under

Sub-rule (1) if the holder of the permit has contravened any provisions thereof or has been deprived of possession of the vehicle proposed to be

replaced under any hire-purchase agreement."" u/s 83 of ""the Act"", the holder of a permit may replace any vehicle covered by the permit by any

other vehicle of the same nature with the permission of the authority by which the permit was granted. The State Government is empowered to

frame rules regarding the grant of permit Including the permission for replacement u/s 96 of ""the Act"". By virtue of the said power, Rules have been

framed, known as Pondicherry Motor Vehicles Rules, 1989. Under Rule 75(2) of ""the Rules"". If an application is filed for replacement of a vehicle

covered by a permit, the Transport Authority may subject to the provisions of the said rule grant permission for replacement notwithstanding the

fact that the replacer vehicle differs in material respects and capacity from the vehicle to be replaced. Under Sub-section (3) of Rule 75 the State

Transport Authority is empowered to reject any application for replacement of the vehicle covered by a permit for reasons recorded and

communicated to the applicant, if the holder of the permit has contravened any provisions thereof and has been deprived of the possession of the

vehicle proposed to be replaced under any hire purchase agreement. In the said rule, the circumstances under which the State Transport Authority

may grant permission for replacement or reject such application for replacement have been specifically Indicated. The impugned order rejecting the

application of the petitioner for replacement has been made on account of fall of revenue to the Government.

It is therefore now to be considered as to whether the respondent while exercising the power under Rule 75 of ""the Rules"" can reject the

application of the petitioner for replacement of the vehicle on the ground of fall of revenue. In order to decide the validity of the impugned order, it

is to be first considered as to whether while considering the application for replacement the respondent performs either quasi-judicial or

administrative functions. The issue is not res Integra. While considering the similar powers of the authorities under Sections 47, 48, 57, 60, 64 and

64A under the Motor Vehicles Act, 1939 for considering the application for stage carriage permit, grant of stage carriage permits, application for

granting permit, appeals and revisions as against the grant of permit, the Supreme Court in the judgment reported in B. Rajagopala Naidu Vs. State

Transport Appellate Tribunal and Others, has held that ""it is well settled that Sections 47, 48, 57, 60, 64 and 64-A deal with quasi-judicial powers

and functions and when the applications are made for permits under the relevant provisions of ""the Act"", they are considered on the merits,

particularly in the light of evaluation of the claim of the respective parties, the transport authorities are exercising quasi-judicial powers and are

discharging those functions by quasi-judicial orders. When the respondent acts as a quasi-judicial authority has necessarily to consider the

application within the parameters of the rules made u/s 96 of ""the Act"", published in the Official Gazette in conformity with Section 212 of ""the

Act"". When once the rules framed are published in the Official Gazette, the rules become statutory rules which have force of law. Law is well

settled that when the power is given to the authorities under a Statute, such power should be exercised in the same manner prescribed by the

Statute. Assuming any power which would render any order passed by the authorities a nullity. Applying the above ratio, it is to be held that the

respondent is empowered to consider the application filed u/s 83 of ""the Act"" only within the parameters of Rule 75 of ""the Rules"". As per Sub-rule

(2) of Rule 75, an applicant for replacement of vehicle covered by a permit is entitled to apply for the same and on receipt of such application, the

State Transport Authority grants permission for replacement notwithstanding the fact that the replacer vehicle differs in material respects and

capacity from the vehicle to be replaced. Of course, u/s 67 of ""the Act"", the State Government is empowered to issue directions to the State

Transport Authority and Regional Transport Authority by notification in the Official Gazette, having regard to the advantage offered to the public,

trade and industry by the development of motor transport, the desirability of coordinating road and rail transport, the desirability of preventing the

deterioration of the road system and the desirability of preventing uneconomic competition among holders of permits in respect of the vehicle by

fixing of fares and freights for stage carriages, contract carriages and goods carriages, the prohibition or restriction of the conveying of long

distance goods traffic generally, or of specified classes of goods by goods carriages, any other matter which may appear to the State Government

necessary or expedient for giving effect to any agreement entered into with the Central Government or any other State Government. In my view,

the reason given in the impugned order namely the loss of revenue to the Government cannot be considered as one of the reasons enumerated u/s

67 of ""the Act"". Moreover, the Instruction of the Secretary, Transport Department, Pondicherry has not been notified in the Official Gazette also

obviously the same was not issued by virtue of the powers conferred u/s 67 of ""the Act"". In the circumstances, it would not be proper on the part

of the respondent to consider the application of the petitioner and reject the same on the ground of loss of revenue to the Government, The duty of

the authority to consider the application shall be independent by applying its mind only with reference to Rule 75 of ""the Rules"" and the reason as to

the loss of revenue will not fall within the ambit of the said Rule. When once it is held that the reason for rejection of the application falls outside the

ambit of Rule 75, the impugned order based upon the said reason cannot be sustained as the authority who exercises the quasi-judicial power has

only relied upon the instructions given by the Secretary. Transport Department of Union Territory of Pondicherry without reference to the Rule and

such order of quasi-judicial authority cannot be sustained.

The Supreme Court in the judgment reported in P. Palaniswami Vs. Shri Ram Popular Service (P) Ltd. and Another, while considering an order

of the Transport Appellate Tribunal based on the instructions contained in the Government Order held as follows :--

Where the decision of the Transport Appellate Tribunal in respect of the application for permits is polluted because of the instructions contained in

the Government Order, the Court is justified in remanding the case to the tribunal for rehearing without considering the Government Order.

The Supreme Court in yet another judgment reported in R.M. Subbaraj Vs. Kodaikanal Motor Union (P) Ltd., . has held that the decision of the

Regional Transport Authority ""must be absolutely unfettered by any extraneous guidance by the executive or administrative wing of the State.

Therefore, I find force in the contention of the learned counsel for the petitioner and hold that the impugned order is illegal, without jurisdiction and

passed on reasons outside the powers vested in the authority under Rule 75 of ""the Act.

Coming to the submissions of the learned Additional Government Pleader as to the existence of alternative remedy to the petitioner, it is to be

seen that when the order is ex facie illegal and outside the ambit of power, the power of judicial review of this Court under Article 226 of the

Constitution of India Is not taken away. There may be force in the contention of the learned Additional Government Pleader as regard to the

alternative remedy available to the applicant when it is a case involving the disputed questions of fact. The writ petition cannot be rejected on the

ground of existence of alternative remedy when the facts are admitted and they are not required to be re-examined by the appellate authority. The

Full Bench of this Court in the judgment reported in M. Thanikachalam and others Vs. Maduranthakam Agricultural Producers co-operative

Marketing Society and others, has to say thus as to entertaining the writ petition even when alternate remedy is available.

What is necessary to be seen is, if the order passed is without jurisdiction, or before passing any order, it is required to hear the affected party, as

per the Statute, but not followed, meaning thereby, if the principles of natural Justice is not followed, or if there is any flagrant violation of law, or if

situations warrant, due to the prevailing of monstruous situation, a writ petition can lie.

When the very order is unsustainable on the face of law as the same is illegal and outside the ambit of power, this Court is empowered to entertain

a writ petition under Article 226 of the Constitution of India and decide the same on merits. Hence, I reject the said contention of the learned

Additional Government Pleader.

For all the above reasons, the impugned order is set aside and the matter is remanded back to the respondent for re-consideration of the

application filed by the petitioner dated 30-1-2001 for replacement of the vehicle bearing Regn. No. TN-49-A-2233 with another vehicle bearing

Regn. No. TN-09-X-3999 in accordance with the parameters of Rule 75 of ""the Rules"" and without reference to the loss of revenue to the

Government.

In view of my above order setting aside the impugned order on the above reasons, I am not inclined to go into the question of discrimination as

contended by the learned counsel for the petitioner. With the above observation, this writ petition is allowed. No costs. Consequently, connected

W.M.P. is closed.

After the pronouncement of the order, learned counsel for the petitioner submitted that appropriate directions may be issued to the respondent

to consider the application of the petitioner within the time fixed by this Court.

Heard learned Additional Government Pleader Pondicherry also.

In view of the submissions made by the learned counsel for the petitioner, the respondent is directed to comply with the direction made in

paragraph 9 of the order within a period of eight (8) weeks from the date of receipt of copy of this order from the petitioner.