M. Sivarama Krishna Reddy vs The Secretary, Regional Transport Authority, Guntur and others

This batch of writ petitions raises a common question as regards application of principles of natural justice in relation to an existing operator at the pre-decisional stage of granting stage carriage permits by the Regional Transport Authority. It is not necessary to refer to the facts in all these cases; illustratively I shall refer to the facts in W. P. No. 14979 of 1989.

The petitioner in W. P. No. 14979 of 1989 is an existing operator holding a pucca stage carriage permit on the route Market Yard to Venigandala viz.. R.T.C. Bus Stand, Autonagar and Kakani in Guntur town, a distance covering 12 Kms. He is plying 20 singles a day. Another stage carriage operator plies his vehicle in the opposite direction with 20 singles a day. There are 8 other vehicles plying on longer routes overlapping this particular route and making 240 singles daily. Some persons have applied to the Regional Transport Authority, Guntur seeking stage carriage permits on several routes in Guntur Town. The Secretary, Regional Transport Authority on 21-10-1989 notified the agenda specifying the matters to be taken up at the meeting of the Regional Transport Authority scheduled to be held on 27-10-89. The petitioner submitted an application on 18-10-89 before the Secretary, R.T.A. requesting him to furnish certified copies of applications filed by persons seeking stage carriage permits covering either fully or partly his route. He made this request in order to file representations before the Regional Transport Authority. The Secretary R. T. A. by an endorsement dated 21-10-89 in R. No. 20986/A3/89 negatived the request of the petitioner stating that it is not possible:

"......as there are number of applications received for grant of stage carriage permits on various sectors of the town. He may as well can ascertain the information from the copy of the agenda published on the notice board of this office."

The relief sought by the petitioner is for a writ of certiorari to call for records relating to the said endorsement and quash it with a direction to the Secretary Regional Transport Authority to furnish certified copies of all the applications filed for the grant of pucca stage carriage permits on the town service routes in Guntur having common sector with the route -- Market Yard to Venigandla Via R. T. C. bus stand, Autonagar and Kanani -- in respect of which he holds a pucca stage carriage permit.

By an interim order dated 24-10-89, the Regional Transport Authority was directed to proceed with consideration of the applications received on or before 15-10-89 but not to issue final orders. That order was modified on 26-12-89 to the effect that the R. T. A. may proceed with consideration of applications received even after 15-10-89 but it shall not pass any final orders. Some of the applicants who applied for pucca stage carriage permits got themselves impleaded as respondents in several of the writ petitions.

Shri Venkataramana, learned counsel for the petitioners contends that although the procedure obtained under the provisions of the A. P. Motor Vehicles Act 1939 (for short, old Act) is no longer in force, the right of the existing operator to make representations before the Regional Transport Authority with regard to granting of permits is not taken away by the Motor Vehicles Act, 1988 (for short, new Act). There is no specific provision excluding application of principles of natural justice in relation to an existing operator and, therefore, no inference can be drawn that the existing operator is not entitled to make any representation before the Regional Transport Authority at the pre-decisional stage regarding granting of permits.

In opposition to this the learned Government Pleader contends that the right to representation and right to oral hearing enjoyed by the existing operator under the old Act are specifically omitted under the new Act; it necessarily implies that the principles of natural justice in so far as the existing operators are concerned are excluded.

Shri K. N. Jwala, learned counsel for some of the impleaded respondents advanced arguments supporting this view.

Shri Sikhamani, learned counsel for some other impleaded respondents also advanced arguments in support of the plea taken by the learned Government Pleader.

Section 47 of the Old Act contains the procedure to be followed by the Regional Transport Authority in considering application for stage carriage permits. Sub-section (1) lays down the matters the R. T. A. shall take into account while considering the application for stage carriage permit inter alia, it says that the R. T. A. shall also :

"take into consideration any representations made by persons already providing passenger transport facilities."

Under sub-section (3) of Sec. 57, the Regional Transport Authority was required to make available the applications for inspection and also publish the applications or the substance of the applications in the prescribed manner. The representations received in respect of the applications notified under sub-sec. (3) shall be in writing as per sub-section (4). Sub-section (5) enjoins that the Regional Transport Authority shall dispose of the applications.

"at a public hearing at which the applicant and the person making representation shall have an opportunity of being heard either in person or by a duly authorised representative."

The right of existing operators not only to make representations but also to be heard orally by the Regional Transport Authority at the pre-decisional stage was thus specifically provided under the old Act. The new Act (Act No. 59/88) came into force on 1-7-88. Para3 of the Statement of Objects and Reasons, inter alia, mentions some of the more important modifications suggested by the Working Group constituted in 1984 for reviewing the provisions of the old Act which include the simplification of procedure and policy liberalisation for private sector operations in the road transport field. Para mentions among other things that the proposed legislation provides.

"liberalised scheme for grant of stage carriage permits on non-nationalised routes, all-India Tourist permits and also national permits for goods carriages.

Chapter V deals with control of Transport Vehicles. It contains 30 sections 66 to 96. Section 70 concerns with applications for stage carriage permits. It lays down the particulars an application for stage carriage permit should contain. The procedure for considering the application is laid down in Sec. 71 Sub-sec. (1) says that while considering an application for stage carriage permit the R. T. A. shall have regard for the objects of the Act. The proviso lays down that permit for a route of fifty kilometres or less shall be granted only to an individual or a State transport undertaking. Sub-sec. (2) says that if it appears to the R. T. A. that granting of stage carriage permit is likely to result in the controvention of the time-table relating to the speed at which the vehicles should be driven it shall not grant permission. Sub-sec. (3) which is relevant reads :

"(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 to limit the number of stage carriages generally or of any special 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 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.

(c) Where the number of stage carriages are fixed under Clause (a), the R. T. A. shall reserve such number of permits for the Scheduled Castes and the Scheduled Tribes as may be fixed by the State Government under sub clause (b).

Corresponding Law : S. 47 (1-A) & (1-B) of Act IV/39

(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

(viii) ex-servicemen."

Rule 179 of the A. P. Motor Vehicles Rules, 1989 contains the guiding principles for grant of stage carriage permits. This is the relevant rule by which the State Government . has prescribed the "others matters" referred to in Section 71 (3) (d) (iii). The Rule reads :

"179. Guiding principles for grant of stage carriage permits: (1) Routes shall be classified-

(a) Short routes which cover a distance of not more than 64 Kms.

(b) Medium routes which cover a distance of over 64 Kms but not exceeding 160 Kms.

(c) Long routes which cover a distance of more than 160 Kms.

(2)(a) Preference on short routes shall be given to new entrants whenver there is an application or applications from new entrants. The comparison of marks shall be considered from among the new entrants only :

Provided that where there are no new entrants, applicants holding one to four stage carriage permits (excluding spare stage carriage permits and temporary stage carriage permits) shall be considered;

(b) Other things being equal, preference for medium route shall be given to applicants holding one to four stage carriage permits excluding spare stage carriage permits Excluding spare stage carriage permits and temporary stage carriage permits;

(c) Other things being equal, preference on long route shall be given to applicants holding five or more stage carriage permits excluding spare stage carriage permits and temporary state carriage permits :

Provided that nothing in this clause shall apply to applicants for renewal of permits.

(3) Notwithstanding anything contained in clause (2) where in respect of a route for which grant of permit or permit''s has to be decided consequent on denationalisation of the said route or its sector, other things being equal, first preference shall be given to an applicant or applicants who were displaced on the same route or its sector.

(4) The Transport Authorities shall in deciding the applicants for grant of stage carriage permits have regard to the following matters subject to S.71.

(1) The applicants shall first be screened on one or more of the following principles and those who have been found unsuitable shall be disqualified, reasons being given for the decision of the Transport Authority,--

(a) If there" is a financial instability as evidenced by insolvency of undischarged decrees :

Provided that the purchase of a vehicle by money borrowed or under hire-purchase agreement shall not be a disqualification by itself.

(b) If his history sheet is not clean and contains more than six entries relating to offences of the following nature adjucicated within twenty four months preceding the date of grant of the permit-

(1) Overload;

(2) Plying without permit;

(3) Plying without payment of tax;

(4) Plying on unauthorised route and making unauthorised trips.

(5) Plying without Fitness Certificate; and

(6) Non-maintenance of State Carriage Service;

Provided that nothing in this clause shall apply to applicants for renewal of permits;

(c) If there is evidence that an applicant is trafficking in permits either benami or otherwise or that the application has been made on behalf of others in order to evade rules.

(ii) After screening the applicants in the manner laid down in sub-rule (4)(i) marks shall be assigned as follows assessing the relative merits of the applicants for the grant of permits-

(a) to (g) xx xx xx xx

(iii) Deduction of marks:-- After the award of marks to the applicants in the manner specified in Cl. (ii) above, marks shall be deducted as follows for assessing the different qualifications of the applicants for the grant of permits;

(a) One mark may bededucted for each of the offences in the history sheet of the applicant as specified in Cl. (i)(b) of the rule;

(b) One mark may be deducted for each transfer of a stage carriage permit by the applicant to others.

(iv) Applications finalised under sub-rules (4)(ii) and 4(iii) above shall be disposed of according to S.71 of the Act.

(5) All orders passed by the Transport Authorities under S. 72(1) shall be accompanied by a tabular statement containing the marks awarded to each of the applicants and shall contain the reasons for awarding the marks. Fractions of marks shall not be awarded."

The business the Regional Transport Authority has to transact at its meetings and other details are incorporated in R. 132 which read as follows:--

"132. Meeting of Regional Transport Authorities:-- The Regional Transport Authority shall meet not less than once in two months on such date and at such time and place as may be determined by the Chairman and on such other occasions so determined as may be necessary to promote despatch of business.

Provided that adequate notice of such meetings and of the business to be transacted thereat shall be given for information of such persons who being interested in the particular business to be transacted may in the opinion of the Regional Transport Authority or of its Secretary reasonably claim to be permitted to attend for the purpose of making representations:"

The change of procedure regarding grant of stage carriage permits brought about by the new Act, in my view, does not result in total exclusion of principles of natural justice. The provisions of R. 132 clearly negate such an assumption. The proviso to R. 132 unquivocally lays down that the Regional Trnasport Authority shall give adequate notice of the meetings and of the business to be transacted at the meetings :

"for information of such persons who being interested in the particular business to be transacted."

15A. Can it be said that an existing operator is a person interested in the particular business to be transacted by the Regional Transport Authority? I think the answer is in the affirmative. It was not the intention of the rule making authority that the information regarding the transaction of the business should be confined only to the applicants for stage carriage permits. If it were to be so the Rule would net have mentioned the words :

"such persons who being interested in the particular, business....."

The guiding principles for granting stage carriage permit are contained in R. 179. An existing operator can always bring to the notice of the Regional Transport Authority that any of the applicants do not fulfil the conditions laid down in the guiding principles or they are financially not suitable or their performance as stage carriage operators was not satisfactory, two of the relevant matters the Regional Transport Authority has to consider under S. 71(3)(d)of the new Act. In order to make such a representation he should know what are the contents of the applications filed for seeking stage carriage permits. If the number of vehicles are increased or timings are altered and if on that count he suffered any financial detriment he is entitled to prefer a revision petition under S. 90 of the new Act before the State Transport Appellate Authority. Any representation made by him before the authorities at the predecisional stage without knowing the contents of the applications would be ineffective; so long as R. 132 stands, the existing operators are undoubtedly persons interested in the particular business to be transacted by the Regional Transport Authority or its Secretary if the decisions to be taken are likely to affect their interests. It cannot be said that the business transacted by the R.T.A., under R. 132 is purely administrative in character without any likelihood of the interests of other being affected. Both the language of the rule and the practice now being followed militate against such an inference.

Even in respect of administrative actions involving civil consequences it was held in State of Orissa Vs. Dr. (Miss) Binapani Dei and Others, . Principles of natural justice must be complied with. "It is true", the Supreme Court observed (Para 12) :

"That the order is administrative in character, but even an administrative order which involves civil consequences, as already stated, must be made consistently with the rules of natural justice."

In The Co-operative Housing Society, Civilian Employees, Defence Service Vs. Commissioner and Special Officer, Municipal Corporation of Hyderabad and Others, Kodandaramayya, J. (as he then was after referring to certain rulings on the point stated the law thus :

"(1) That the doctrine of natural justice applies both in administrative proceedings and quasi-judicial proceedings which involves civil consequences.

(2) Natural justice may be disregarded in an emergency situation where immediate action is necessary.

(3) In case of urgency a post-decisional hearing may be given.

(4) Whether the hearing is pre-decisional or post-decisional the affected party must be given a reasonable opportunity not being empty public relations exercise.

(5) Natural Justice may be excluded either by specific or necessary implication."

Even after the new Act came into force, the Regional Transport Authority continues to hear the representations. This is clear from the copy of the agenda dated 28-2-90 placed before me. Illustratively I shall refer to Item No. 85 which reads :

"Item No. 85 :--

To consider the applications of the following applicants for grant of pucca carriage permits on the town service route; Gujjanagundala to Uppalapadu Via Koritapadu, Taluk Office, A.C. College, Municipal market, old bus stand, R.T.C. bus stand and Tokkalapadu after hearing the representations.

Applicants :--

Sri Somisetty Chandrasekhara Rao, s/o. Suryanarayana, Syndicate Travels, Opp. R.T.C. Bus Stand Guntur.

Sankara Rao, s/o Subba Rao, 3/1. Arundalpet, Guntur.

Representations :--

The Divisional Manager, APSRTC, Guntur.

Sri S. Nageswara Rao, Bus owner, Guntur.

Smt. Kancheti Subbalakshmi, Bus owner, No. 14, Guntur."

The prevailing practice, therefore, is not only to hear the representations of the APSTRC but also private operators. The R.T.C. is hearing such representations because of the provisions of R. 132. The validity of the rule is not questioned by the impleaded respondent -- the applicants for stage carriage permits. The rule is not shown to be repugnant to any provisions of the Act.

Rule 166 which deals with levy of fees for supply of copies of documents reads :

"166. Levy of fees for supply of copies of documents : The Secretary, State Transport Authority, and Secretary, Regional Transport Authority, the State Transport Appellate Tribunal or any authority specified by the said Tribunal may in its discretion give any person interested in an appeal or revision a certified copy of the decision or an order or of any other relevant documents on payment of a fee of Rupees Two, such payment being made by means of Court fee stamps affixed to the application for each such copy of the decision orders, petition or document."

The applications for pucca stage carriage permits covering partly or fully the route of existing operators, in my view, are "other relevant documents" under R. 166 and they are entitled to certified copies of the same since they are "persons interested" under R. 132. At the pre-decisional stage there can be no enquiry into the question whether the existing operators are "interested in an appeal or revision": the salutory principle of natural justice adumbrated in R. 132 cannot be rendered nugatory on this score.

Unless the existing operator was supplied with certified copies of the applications filed by persons seeking stage carriage permits covering his route fully or partly, it would not be possible for him to make an effective representation. It is true that then large number of applications are filed for grant of certified copies it may cause considerable inconvenience to the administration but that cannot be a valid consideration. It is always open to the R.T.A. to evolve its own procedure for granting certified copies specifying the time limit within which the applications should be made and the time limit for making representations. The Regional Transport Authority is not denuded of such a power (vide) Dhani Devi Vs. Sant Bihari and Others, .

In view of the foregoing discussion, I am of the view, that an existing operator is entitled to have certified copies of the applications filed by third parties before the Secretary, Regional Transport Authority or the Regional Transport Authority seeking grant of pucca stage carriage permits having common sector with the route in respect of which he holds a pucca stage carriage permit. The writ petitions are accordingly allowed. The impugned orders issued by the Secretary Regional Transport Authority are set aside and he is directed to issue certified copies of the applications seeking state carriage permits as requested by the writ petitioners. The Regional Transport Authority before taking a decision to grant stage carriage permits shall consider the representations of the existing operators who are likely to be affected by reason of grant of new permits. There shall be no order as to costs.

Advocate''s fee Rs. 250/ - in each case.

Petition allowed.