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Judgment
Jagadisan, J.—This writ petition under Article 226 of the Constitution arises out of proceedings under the Motor Vehicles Act, 1939, as
amended by the Central Act C of 1956 hereinafter referred to as the Act. The problem to be solved is as regards the scope of Section 60, Sub-
section (3) of the Act. Srinivasan J., who heard the writ petition in the first instance, was apparently not inclined to agree with some of the decisions
of this Court relating to the interpretation of the said provision, and was also of the opinion that there is a conflict of authority on the subject. On
this expression of opinion, the papers were placed before the Hon''ble the Chief Justice and the writ petition has been directed to be posted before
a Division Bench. The matter is certainly of some importance to transport operators, and it must be said that the point involved for decision is of
frequent occurrence. Even at the outset, the learned Advocate-General appearing for the Petitioner pressed for reference to a Full Bench, as, in his
submission, the view taken by the Division Bench consisting of Rajamannar C.J., and Venkatadri J., in Writ Appeal No. 153 of 1960 required
reconsideration. It was also pointed out to us that the decision of another Division Bench of this Court in Natarajan v. State Tr. Appellate Tribunal
(1964) 1 M.L.J. 367 (Ganapatia Pillai and Kailasam JJ.) has expressed a view which is somewhat contrary to the view taken in Writ Appeal No.
153 of 1960. After careful consideration of ail the decisions on the subject to which our attention has been drawn and to the relevant statutory
provisions we do not think that there is any necessity for the matter being referred to a Full Bench.
The undisputed facts giving rise to the writ petition are as follows. The Petitioner is a transport operator in Salem district. He held stage carriage
permits, one permit in each of the three routes; (i) Edappadi to Velur (via) Kenganapuram, (ii) Salem to Jalakandapuram (via) Attayampatti, and
(iii) Namakkal to Nangavalli (via) Rasipuram. On charges of failure to perform the services regularly, the Regional Transport Authority, Salem,
asked the Petitioner to show cause why the permits in the three routes should not be cancelled u/s 60, Sub-section (1), Clause (a) of the Act. The
Petitioner showed cause, and the Regional Transport Authority heard him ''through his Counsel. The Regional Transport Authority, then, issued an
order cancelling the permits, as the Authority was not convinced by the explanation offered by the operator, in the matter of running the service
properly. The Petitioner filed an appeal from the order of cancellation to the State Transport Appellate Tribunal, and the Tribunal, by its order,
dated 28th April 1958, affirmed, the order of the Regional Transport Authority. The Petitioner moved this Court under Article 226 of the
Constitution seeking to quash the order of the Subordinate Tribunals in Writ Petition No. 365 of 1958. Rule nisi was issued, and stay of operation
of the order of cancellation was also granted. The writ petition was, however, dismissed, at the final hearing, and, thereupon, the Petitioner filed an
appeal in Writ Appeal No. 118 of 1960. During the pendency of the appeal, stay of operation of the order of cancellation continued. By
Judgment, dated 31st January 1962, the appeal also stood dismissed. The Petitioner was called upon to surrender the permits. Under Rule 194 of
the rules framed under the Act, a permit holder should surrender the permit, on receipt of a demand in writing by the Transport Authority, and the
Transport Authority should record in Parts A and B of the permit the order of cancellation or suspension. Thus, the Authority wanted to give effect
to the order of cancellation. At that stage, the Petitioner filed an application to the Regional Transport Authority, Salem, for permission to
compound the offence, which entitled the cancellation, and this he purported to do invoking the aid of Section 60, Sub-section (3) of the Act We
shall refer to the terms of the section a little later. The Regional Transport Authority dismissed the application, mainly on the ground that the power
to compound cannot be exercised after an order of cancellation is passed. In its view, if the permit had already been cancelled, the Authority which
cancelled the permit must be deemed to have exercised its discretion u/s 60(3) against the permit-holder, and that there is no provision for the
Authority to reopen the matter and consider the request for composition. The Petitioner took up the matter in revision, as no appeal is provided for
from such orders, to the State Transport Appellate Tribunal, which confirmed the order of the Regional Transport Authority. The Revisional
Authority recorded its opinion in the following words:
In my opinion, the application of the Petitioner for compounding (when the right to compound was impliedly negatived by the Regional Transport
Authority in its orders, dated 9th and 10th December 1957 which orders have been confirmed by the State Transport Appellate Tribunal and the
High Court) was rightly rejected by the Regional Transport Authority.
It is to quash these orders that the present writ petition has been filed.
The learned Advocate-General appearing for the Petitioner raised the following contentions : (i) The Regional Transport Authority and the State
Transport Appellate Tribunal were in error in holding that the power to order composition u/s 60(3) became extinct after the order of cancellation
or suspension of the permit. (ii) The terms of Section 60, Sub-section (3) of the Act necessarily imply that the right or benefit of composition can
be invoked only after the authorities hold that the permit is liable to be cancelled or suspended for violation of the provisions in Clause (a), (b) or
(c) of Sub-section (1) of Section 60, and that it would not be a proper construction of the Act to deprive a permit-holder of the remedy of
composition, merely because he bona fide pleaded that there was no case against him to justify cancellation or suspension, and failed, (iii) The
section does not prescribe any formality like making an application or request, orally or in writing, by the permit-holder for composition, and that
the Authority can, in the exercise of its discretion, pass such an order suo motu. Therefore the view that composition cannot be had after an order
of cancellation or suspension is not tenable, (iv) If the section were to be construed as meaning that the option of compounding has to be exercised
before '' the authority adjudicates on the charge, it would operate as coercion on the ''operator to plead guilty without a fair chance to defend
himself, and would also effectively take away its right of appeal from revocation or suspension of permit u/s 64(1)(6) of the Act.
These contentions need not be considered individually or separately. They set out several aspects which have a bearing on the question of the
proper interpretation of Section 60, Sub-section (3). The essential and the only point that arises is, whether it is open to the Transport Authority to
levy composition, in lieu of cancellation or suspension of permit, after the order of such cancellation or suspension is passed. If it is so open, it
would imply a power in the Authority to modify or rescind its previous order. It would also mean that it can be done at any time till perhaps the
order is implemented. The acceptance of the position that the composition is only an aftermath of the punishment by way of cancellation or
suspension would necessarily enable the delinquent operator to have two rounds of fight, the first in which he occupies himself in defending the
charge, and the second in which he claims composition, not by throwing himself on the mercy of the Authority, but in exercise of a statutory
privilege.
Is that the true scope of Section 60(3)? The answer of the learned Advocate-General is in. the affirmative, and this he has sought to support with
his characteristic vigour, great learning and erudition.
At the outset, we wish to point out that the writ of certiorari prayed for in this case does not seem to be quite appropriate. When a Tribunal
declines jurisdiction, be it on the ground of lack of power, the aggrieved suppliant should, if so advised, move this Court for the issue of a
mandamus to direct the Tribunal to hear and determine. The scope of certiorari is to wipe out the offending order. Certiorari may in some cases,
have the effect of restoring the application, from out of which the writ arose, to the file of the Tribunal, but the failure of the Tribunal to restore and
deal with it can only be corrected by issuing a mandamus. Article 226 of the Constitution does not comprise only of the prerogative writs of the
Crown in England. It is of wide amplitude and overflows the bounds of such prerogative writs, and it is designed to be elastic, to enable the Court
to do justice in its essential and most comprehensive sense, justice of course in the concrete and not in the abstract. This jurisdiction of the Court
ought not, however, to be whittled down by too much adherence to forms and labels or be transmitted by technical considerations. To quote the
observation of Venkatarama Ayyar J., in Hari Vishnu Kamath v. Syed Ahmad Ishaque and Ors. (1955) 1 S.C.R. 1104, 1119:
Looking at the substance of the matter, when once it is held that the intention of the Constitution was to vest in the High Court a power to
supervise decisions of the Tribunals by the issue of appropriate writs and directions, the exercise of tint power cannot be defeated by technical
consideration of form and procedure.
This Court can, therefore, ignore the form of relief sought by the Petitioner, and grant him the necessary redress by issuing the appropriate writ, if
the facts and circumstances would warrant and justify it. We are, therefore, proceeding to dispose of this petition, as if the prayer is one for the
issue of mandamus, to direct the Regional Transport Authority, Salem, to hear and dispose of the application u/s 60, Sub-section (3) in conformity
with law.
Section 60, Sub-section (3) is the section that has to be construed. That reads:
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.
Section 60(1) provides that the Transport Authority which granted a permit may cancel the permit or may suspend it for such period as it thinks fit,
for any one or the other of the following reasons contained in Clauses (a), (b) or (e) referred to also in Sub-section (3).
(a) On the breach of any condition specified in Sub-section (3) of Section 59 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 authorized by the permit, or
[Clauses (c) and (d) omitted.]
(e) if the holder of the permit, not being a private carrier''s permit fails without reasonable cause to use the vehicle or vehicles for the purposes Of
which the permit was granted;....
For certain of the breaches of the provisions of the Statute, the holder of a permit, in respect of a transport vehicle, incurs the liability of
cancellation or suspension of the permit. Cancellation deprives a holder permanently of the permit, while suspension will only prevent him from
operating the vehicle for such period as the authority may think fit. The authority cannot (sic) the punishment of cancellation or suspension, unless
an opportunity has been given to the holder of the permit to furnish his explanation in respect of the charge or charges against him. The proceedings
u/s 60(1) of the Act are certainly of a quasi-judicial nature. A permit is a valuable right, more or less in the nature of a property right, and any
proceedings calculated to affect such a right cannot be described as administrative in character. Now, Section 60, Sub-section (3) enables the
Authority not to cancel or suspend a permit in the circumstances mentioned therein. The ingrediants of this Sub-section are : (i) The permit should
be liable to be cancelled or suspended for contravention of Clause (a), (b) or (e) of Sub-section (1) of Section 60. (Be it noted that contravention
of the other sub-clauses in Section 60(1) would not attract Section 60, Sub-section (3); (ii) The Transport Authority should be of the'' opinion that,
in the circumstances of the case, it would not be necessary or expedient to cancel or suspend the permit, if the permit-holder agrees to pay a
certain sum of money : and (iii) If the transport authority decides not to direct cancellation or suspension of the permit, in view of the agreement of
the operator to pay money, it may, instead of cancelling or suspending the permit, recover from the holder of the permit an agreed sum of money.
The foundation of this section is the guilt of the operator in violating certain of the provisions of the Statute. The normal punishment which should
follow the establishment of the guilt against the operator is cancellation or suspension. But this punishment need not be awarded, the matter being
left to the discretion of the transport Authority, if two conditions are present. The first condition is that the authority should be of opinion that,
having regard to the circumstances of the case (triviality of the offence or the consistent good conduct of the operator for over a large number of
years or other facts may be a few such circumstances), it would not be necessary or expedient to cancel or suspend the permit. The second
condition is that the operator must agree to pay a sum of money. If any of these conditions is not present, the sub-section cannot operate. The
agreement on the part of the operator to suffer money payment, instead of cancellation or suspension, is certainly the most vital part of the sub-
section and, at any rate, it is not less important than the opinion which the Transport Authority might entertain as regards the necessity for or
expediency or imposing the punishment by way of cancellation or suspension. The language of the Statute seems to indicate that there can be no
question of compelling the operator to pay any amount instead of cancellation or suspension. The Statute prescribes the modes of punishment
against an operator found to be guilty of the charges under Clause (a), ''(b) or (e) of Sub-section (1) of Section 60. The punishment may be either
what may be termed an extreme punishment by way of cancellation, or a medium punishment by way of suspension, or the least rigorous
punishment of levying something in the nature of a fine. The last punishment cannot be inflicted without the concurrence and consent of the transport
operator. Ex necessitate rei, the levy of composition, by which an operator undertakes to pay a certain sum of money can only arise at the stage of
awarding punishment in respect of a proved charge. Otherwise, the whole scheme of Section 60 of the Act would become impractical and
unworkable. We are unable to construe Section 60(3) as clothing the operator with a subsequent fresh and independent right to have a previous
punishment by way of cancellation or suspension commuted into a punishment of money compensation. We are not impressed with the argument of
the learned Advocate-General that such a construction would be harsh or oppressive. By adopting the construction that a composition
arrangement should precede the penalty of cancellation or suspension, the operator is not between the horns of dilemma to confess and pay
composition or to lose that privilege and take the risk of action against the permit. It is certainly open to him to defend himself against the charges
levelled against him, and he can do so not merely before the Transport Authority, which decides the matter in the first instance, but also in appeal
provided for under the statute before the prescribed authority. He can certainly taka up the matter further by way of a writ petition to this Court,
and, by way of appeal, to the Supreme Court of India. The Statute does not deprive him of such redress as he may have against what he may feel
to be an unfounded charge. But it is, however, clear that, if he wants to avail himself of the provisions of compounding u/s 60(3), he must do so
before actually the punishment is imposed upon him, and the fact that he agrees to composition, which would amount to a practical confession of
the guilt would not really affect the question. The benefit can be had only by an operator who is frank and bona fide, and who pleads for the
imposition of a lower punishment than the one by way of cancellation or suspension. We see nothing strange or anomalous in such a construction of
the statute though we must observe that the phraseology of the sub-section is neither precise nor felicitous.
The learned. Advocate-General relied upon Rule 194-A framed under the Act, and submitted that there is a fair indication in it that the
compounding was intended to be made only after the imposition of punishment by way of cancellation or suspension of the permit. The rule reads:
194-A. Compounding of offence--Procedure:--The Transport Authority shall, in determining the sum of money to be recovered in lieu of
cancellation or suspension of different classes of permits, have regard to the following, namely:
(a) Nature, gravity and frequency of offence committed.
(b) The quantum of punishment that would otherwise have been imposed.
(c) Carrying capacity of the vehicles with reference to the nature of the route and passenger capacity in the case of stage carriages, and average
daily mileage of the vehicle and hire charges, if any, in respect of other classes of transport vehicles:
Provided that the amount so recoverable in lieu of suspension shall in no case De less than the minimum or more than the maximum specified in the
table below:
TABLE.
Class of vehicles. Minimum Maximum,
per day of
suspension.
BS. BS.
Stage carriages- (a) For 50 3,000
plying without tax or pemit
or for overload.
(6) For other offences.... 1,000
(Items 2 and 3 omitted.)
The argument is that, because the minimum and maximum of amount is fixed as recoverable in lieu of suspension, there can be no commutation
unless the period of suspension is known which means that there must be an order of suspension before there can be a compounding. We do not
think that would be a proper interpretation of the rule. The rule itself provides that the Transport Authority should have regard to:
the quantum of punishment that would otherwise have been imposed.
The process, therefore, is that, where a stage is reached when the Transport Authority thinks that the matter is one for compounding, and the
operator agrees to pay a certain sum of money, the amount of compensation has to be fixed taking into account the punishment which ''the
Authority would have inflicted in the absence of composition. For example, if the Authority would. have suspended the permit for one month, that
circumstance could be regarded as a relevant criterion for fixing ''the amount of composition. The proviso to the rule would only cover cases where
the punishment contemplated would be suspension and not cancellation. We do not think that it would be proper to draw the inference from this
rule that a composition order could be passed after an order of cancellation'' or suspension. Stripped to its essence, the argument of the learned
Advocate-General would lead to the anomaly that the Authority would have jurisdiction to exercise the power u/s 60(3) only after imposing the
general and normal punishment. But, to be fair, this extreme contention was not advanced by him. His limited submission was that the doors are not
closed against-composition, merely because the operator did not volunteer for it even during the enquiry into the charges against him. In our
opinion the section cannot be construed in that way.
The learned Advocate-General posed the question, what would happen, if the period of suspension is reduced by the Appellate Authority, or if
a cancellation is set aside and suspension is awarded? Inasmuch as the composition amount must conform to the punishment imposed by the
Appellate Authority it would be unreasonable TO hold that the power to compound is extinguished after the adjudication u/s 60(1); so, the
argument. We do not think that this argument has any solid foundation. This proceeds on the assumption that the claim for composition survives an
order of cancellation or suspension. This cannot be relevant in construing Section 60(3).
We shall now refer to the relevant decisions of his Court construing Section 60, Sub-section (3). In Writ Petition No. 551 of 1959,
Ramachandra Ayyar J. (as he then was) observed as follows:
Under the section, the question of compounding, to use that expression, can arise only when the Regional Transport Authority is to decide about
the punishment. That cannot, therefore, arise after that Authority has decided and inflicted the punishment. In the present case the Regional
Transport Authority had passed its order suspending the permit as early as 22nd May 1958. That order was confirmed by the State Transport
Appellate Tribunal as early as 16th August 1958 and it had become final. There would, therefore, no longer be any question of considering
whether in the circumstances of a particular case there should be a cancellation or suspension of a permit or in the alternative, payment of money
by the holder of the permit, the first of the two alternatives having been already decided upon and ordered.
The learned Advocate-General relies upon the words:
Decided and inflicted the punishment
and submits that inflicting a punishment would really cover a ease where the punishment has taken effect. That, however, does not seem to be the
proper meaning of the words used. The learned Judge, m substance, held that once a punishment by way of cancellation or suspension had been
imposed, the Authority had no longer any jurisdiction to modify that punishment and substitute in its stead a punishment by way of collecting any
amount from the operator. This decision went up on appeal before a Division Bench (Rajamannar C.J., and Venkatadri J.) in Writ Appeal No.
153 of 1960, but was dismissed. The learned Judges observed as follows:
We are quite clear that on a proper construction of Section 60(3) of the Motor Vehicles Act, once an cider of cancellation or suspension is
passed, then there is no power in the Transport Authority to recover/from the holder of the permit any sum agreed upon, instead of cancelling or
suspending the permit.... If the Appellant had, in the first instance, pleaded in the alternative that he may be permitted to pay a certain sum of
money instead of his permit being cancelled or suspended, then the Secretary of the Regional Transport Authority should have referred the matter
to the Authority to deal with the particular prayer of the Appellant.
In Natarajan v. State Tr. Appellate Tribunal (1964) 1 M.L.J. 367, 368, a Division Bench (Ganapatia Pillai and Kailasam JJ.) stated thus:
The offer to compound could be made to the Appellate Tribunal as well. But we see no justification for holding that the Appellant was entitled 10
hold back the offer till the appeal is disposed of and then call upon the appellate Tribunal to exercise its jurisdiction to direct composition of the
offence. In one sense after the appeal is disposed of, the Appellate Tribunal is funetus Officio. The. proper stage at which the offer to compound
must come is the stage when the matter is under investigation cither by the first authority or at least when the appeal was being heard by the
Appellate Authority. Thereafter it would not be correct to hold that the authorities would be bound to entertain the offer for compounding.
The observation of the Bench that composition can be effected at the stage of appeal was no doubt obiter. All the some, it seems to be well-
founded. The Appellate Authority is seized of the entire matter and it can do what the original authority could have done. There is nothing in
Section 60(3) which confines the exercise of power only by the first authority. The appellate jurisdiction of the Tribunal over the Regional
Transport Authority is co-equal to the powers and discretion of that Authority, and so, if the Regional Authority could have effected composition,
the Tribunal also would be in a position to do so. This does not mean that the operator can seek composition at any time till the punishment is given
effect to.
A Bench of the Andhra Pradesh High Court in J. J. Ramamurthy Naidu Vs. State of Andhra Pradesh and Others, , 346, has taken the view
that the Regional Transport Authority has no power to direct composition, after the matter of the guilt of the operator had gone through all the
stages. The Learned Judges observed thus:
It is immediately plain that the power to require the holder to compound the offence should be exercised by the Transport Authority, only at the
time of deciding whether the punishment should be imposed or whether some amount of money should be recovered in lieu of punishment from the
permit holder. This discretion could be exercised by the Transport Authority only at that time if it feels that the circumstances of the case would
wan ant it. (It may be mentioned that such power cannot be exercised by the Transport Authority or an appellate authority or Government
exercising revisional jurisdiction long after the imposition of the punishment.)
This is practically in line with the decision of this Court in Writ Appeal No. 153 of 1960 referred to above, with which we respectfully agree.
The learned Advocate-General referred us to analogous provisions in the Code of Criminal Procedure, Forests Act, and the Sea Customs
Act, which also provide for compounding in certain circumstances. The provision in those statutes are not in pari materia, and we do not think that
any useful purpose will be served by referring to them. Section 345 of the Code of Criminal Procedure can certainly operate only before a
conviction is recorded. Sub-section (5) of Section 345 permits compounding of an offence even after conviction but during the pendency of an
appeal and with the leave of the Appellate Court. u/s 55 of the Forests Act, composition is permissible to avoid prosecution. This implies that even
before the charge-sheet is laid before the Magistrate, the delinquent can compound the offence. Section 183 of the Sea Customs Act requires that,
at the time of ordering confiscation cc the contraband goods, a penalty of payment of money can be levied instead of confiscation. As stated
already, the scheme of composition in each of hose cases has no parallel to Section 60, Sub-section (3) of the Act, with which we are now
concerned.
We are of opinion that the Regional Transport Authority rightly declined jurisdiction to accede to the request of the Petitioner to have the
previous punishment of cancellation compounded. The impugned orders are, therefore, correct.
In the result, the writ petition fails and is dismissed with costs.