The Gharaunda East Cooperative Transport Society Ltd. Gharaunda, District Karnal v. The State Transport Controller as Chairman of Regional Transport

Present: Mr.R.D. Sharma, DAG Haryana for the petitioner. Mr. H.S. Sawhney, Sr. Advocate and Mr. Lekh Raj Sharma, Advocate for respondent No.2. (in C.W.P. No.2753, 2779 & 2796 of 2009). Mr.Inder Pal Goyat, Advocate for respondent No.2 (in C.W.P. Nos.8413, 8426, 8394 and 8395 of 2009). CORAM:HON'BLE MR. JUSTICE K. KANNAN

1. Whether Reporters of local papers may be allowed to see the judgment ?

2. To be referred to the Reporters or not ? 3. Whether the judgment should be reported in the Digest? K. KANNAN J. -.-

1. The batch of writ petitions address the issue of legality of order passed by the State Transport Appellate Tribunal affording to the stage carriage permit holders their respective routes be considered for extension of stage carriage permits or additional permits as sought for by them. The State is in challenge in 7 writ C.W.P. No.197 of 2009 -3- petitions and three of the permit holders, who have secured favourable orders from the Appellate Tribunal have also approached this Court by means of independent writ petitions for enforcement of the orders of the Tribunal. The three cases relate to grant of additional permits, which are also the subject of challenge by the State through their functionaries. The following is the tabulation of cases, which this batch of writ petitions deals with:- Sr. No. Case No. (CWP) Date of order in challenge 1 2 3 4 5 6 7 8 9 2573 of 2009

16.09.2008 2796 of 2009

16.09.2008 2779 of 2008

16.09.2008 459 of 2009

16.09.2008 458 of 2009

16.09.2008 197 of 2009

16.09.2008 8395 of 2009 10/10/08 8394 of 2009 10/10/08 8426 of 2009 10/10/08 10 8413 of 2009 10/10/08 The matter challenge subject Route Additional Permit No.55 Route Additional Permit No.53 Route No.8 Additional permit Route No.55 Additional permit No.53 Route Additional permit Route No.58 Additional permit Route Extension permit No.5 Route Extension Extension Route Extension No.48 No.5

2. The subject matter of the writ petition in items No.1 to 3 filed at the instance of the State and its functionaries are the same as the subject matter in Sr. Nos.4 to 6 filed at the instance of the route permit holders seeking for enforcement of the order of the Appellate Tribunal. Items No.1 to 6 are in respect of pleas for grant of additional permits while the writ petitions in Sr. No.7 to 10 deal C.W.P. No.197 of 2009 -4- with issue of extension permits.

3. In all the above cases, the Appellate Tribunal has granted the additional permits or the extension as sought for on the basis that the Motor Vehicles Act enumerates a liberal policy for grant of permits under Section 80(3) of the Motor Vehicles Act and the prescribed authority shall not ordinarily refuse to grant the application for permit of any kind. The Tribunal, while passing the orders, has also adverted to the power vested in it as co-equal to a power of Regional Transport Authority and has, therefore, accorded favourably the pleas made by permit holders on the consideration of the fact that there could be no restriction in the grant of additional permits or extension, especially when there had been no restriction for grant of permits at the instance of any Central Government directive to the State Government as regards the number of vehicles or number of stage carriages that could be fixed in the particular routes. In all the cases, the claims for additional permits or extensions have been refused by the Regional Transport Authority on the ground that the respective routes are sufficiently serviced by enough number of vehicles that the State undertaking was plying in the routes apart from some private operators as well. It was also the contention on behalf of the State that pursuant to a writ petition filed in public interest before this Hon'ble Court in C.W.P. No.7312 of 2007, a comprehensive policy is in the process of being formulated and therefore, all the permit holders were required to wait till the announcement of the new policy for making appropriate applications after the policy is put into operation. The Tribunal has C.W.P. No.197 of 2009 -5- rejected these considerations on a view that if there had been no restriction by the State Government on any directive from the Central Government for issuance of stage carriage permits under Section 71(3), the Transport Authority ought not to fetter itself to grant additional or extension on terms under Section 80(3). The Appellate Tribunal has found that there is no scheme in place to exclude the private operators especially when the permits have been granted in the respective routes to the private operators.

4. The State Authorities challenge the order of the Administrative Tribunal before this Court on the ground that the formulation of policies and issuance of Schemes under Sections 98, 99 or 100 contained in Chapter VI over-ride any of the provisions relating to grant of permits governed under Chapter V and consequently when there was a Scheme, which is proposed to regulate the issuance of permits, the liberal grant of permits under Section 80(3) will not operate. It is, further, contended in all the writ petitions that all the routes are sufficiently serviced by existing operators and by vehicles which the State Transport Undertakings have been plying and therefore, the permit holders are not entitled to obtain the relief sought for and the Appellate Tribunal was in total error in applying the liberal policy under Section 80 of the Motor Vehicles Act without minding the Schemes proposed to be framed by the State. All the counsel appearing for the permit holders have a fundamental objection to the writ petition filed by the State functionaries on the ground that a decision taken by the Administrative Tribunal in a quasi-judicial hierarchy supplants the C.W.P. No.197 of 2009 -6- decision taken by the Regional Transport Authority and the Regional Transport Authority cannot treat itself as an aggrieved party to challenge the same by means of a writ petition. Learned counsel appearing for the permit holders have a common grievance to urge that by consistent string of authorities our Courts have held that the decision of the Administrative Tribunal cannot be challenged by State functionaries. They rely on the decision in Gill Bus Service (Regd.) Amritsar VS. State of Punjab through Secretary, Punjab, Transport Department, Civil Secretariat, Chandigarh and another AIR 1993 (Punjab) 128 that held that the power of the Appellate Tribunal in the matter of grant of permits could be the same as the Regional Transport Authority and the Regional Transport Authority being a subordinate authority under the Act is bound to comply with the terms of the Appellate Tribunal. In State of Punjab Vs. Highways Bus Service Regd., Patiala and another in C.W.P. No.12918 of 2006 dated 29.02.2008, the above decision was followed up to hold that a writ petition filed by the State of Punjab at the behest of the Regional Transport Authority was not competent. In State of Punjab Vs. Patiala Bus Highways Pvt. Ltd. And others in C.W.P. No.11299 of 1992 dated 27.01.1994, the same point was reiterated when a Division Bench of this Hon'ble Court held against the competence of the State of Punjab to challenge the order of the Tribunal. The Commission, Patiala Division, Patiala- cum-Regional Transport Authority, Patiala Vs. The State Transport Appellate Tribunal, Punjab Chandigarh and another in C.W.P. No.19167 of 1991 dated 27.05.1992 reiterates the same C.W.P. No.197 of 2009 -7- position. Surinder Kaur Vs. State Transport Commissioner in C.W.P. No.16522 of 1996 dated 18.01.1998 held that non-compliance of the directions of the Appellate Tribunal is a dereliction of duty on the part of the State Transport Commissioner. Highways Bus Service Regd. Patiala and another Vs. State Transport Commissioner, Punjab, Chandigarh and another in C.W.P. No.11468 of 2006 dated 28.07.2006 is a decision of the Court that gave direction for enforcement of the decision of the Tribunal.

5. Learned counsel appearing on behalf of the State Transport Authority seeks to distinguish all these decisions by pointing out that the Court's power to interfere to set right an illegal order passed by the Appellate Tribunal cannot be defeated on the issue of locus standi. The learned counsel would also try to make out a distinction in each one of these cases, which referring to the fact that in all those cases either the State or the Secretary Transport Department had been filing writ petitions while in all these writ petition, the party who has challenged is the Regional Transport Authority himself and therefore, the bar does not apply. Learned counsel also refers to several situations where through different enactments, authorities lower in the quasi judicial tiers have challenged the actions of the Appellate Authorities. The learned counsel refers to a decision in Durga Hotel Complex Vs. Reserve Bank of India and others (2007) 5 SCC 120 that upheld the right to challenge the decision of an Ombudsman under the Banking Ombudsman Scheme by the affected bank itself. Canara Bank Vs.P.R.N. Upadhyaya and others (1998) 6 SCC 526 is further a decision on the same point of C.W.P. No.197 of 2009 -8- the entitlement of a bank to challenge the decision of an Ombudsman complaining of the error in the Ombudsman's decision in not following the Reserve Bank of India guidelines. The power of the State Bar Council to treat itself as an aggrieved when a decision of Bar Council of India was upheld in Bar Council of Maharashtra Vs. M.V. Dabholkar and others (1975) 2 SCC 702. Shama Prashant Raje Vs. Ganpatrao and others (2000) 7 SCC 522 is a decision to support the proposition that findings of inferior Tribunal could be challenged under Article 226/227 if the Tribunal had committed manifest error by misconstruing a document or appreciation of some material on record or ignored a relevant record or took into account an inadmissible material.

6. The decisions of the Division Bench of this Hon'ble Court enumerated in earlier paragraphs leave no scope for prevarication that State or its functionaries cannot challenge the decision of the Transport Tribunal but in the light of the decisions of the Hon'ble Supreme Court referred to by the learned counsel appearing for the State, an exception is always possible to be made when the order of a Tribunal shown to be illegal or in complete violation of law, it shall be possible for even a lower authority to an Appellate Tribunal to show that the order passed by the Appellate Tribunal was not in accordance with law. The jurisdiction of the Court under Article 226 and 227 is wide enough to encompass all possible challenges to be made when a decision is totally erroneous and in violation of express statutory provisions. I do not want to enter into a conrovery whether a writ petition is maintainable, especially when there are C.W.P. No.197 of 2009 -9- clear Division Bench rulings of this Court and I would leave the question to be still open in some other case, for all the batch of writ petitions can easily be disposd of on the merits.

7. In these cases, the challenge to orders of the Appellate Tribunal by the Regional Transport Authorities have been on the ground that the State Transport Authority itself operates several buses in the same route apart from some other private operators, as if to suggest that there is no need for any additional permits or extension of permits. The Appellate Tribunal has considered this objection in the light of the liberal scheme under Section 80 of the Motor Vehicles Act, 1988 and particularly in the light of the decision of the Hon'ble Supreme Court in Mithilesh Garg etc. Vs. Union of India and others etc. AIR 1992 SC 443. The particular observations of the Hon'ble Supreme Court obtaining in paragraph 5 and 6 has a tallying narration:- "A comparative reading of the provisions of the Act and the Sold Act (1939) makes it clear that the procedure for grant of permits under the new Act has been liberalised to such an extent that an intended operator can get a permit for asking irrespective of the number of operators already in the field. The scheme envisaged under Sections 47 and 57 of the old Act has been completely done away with by the Act. The right of existing operators to file objections and the provision to impose limit on the number of permits have been taken away. There is no similar provision to that of Section 47 and Section 57 under the new Act. The C.W.P. No.197 of 2009 -10- Statement of Objects and Reasons of the Act shows that the purpose of bringing in the Act was to liberalise the grant of permits. There is no threat of any kind whatsoever under the new Act from any authority to the enjoyment of the right of the existing operators under Article 19(1)(g) to carry on the occupation of transport operators. More operators mean healthy competition and efficient transport system. Overcrowded buses, passengers standing in teh aisle, persons clinging to the bus-doors and even sitting on the roof-top are some of the common sights in this counry. Moreoften one finds a bus which has noisy engine, old upholstery, uncomfortable seats and continuous emission of black-smoke from the exhaust pipe. It is, therefore, necessary that there should be plenty of operators on every route to provide ample choice to the commuter-public to board the vehicle of their choice and patronise the operator who is providing the best service. Even othewise the liberal policy is likely to help in the elimination of corruption and favouritism in the process of granting permits. Restricted licensing under the hands of few persons thereby giving rise to a kind of monopoly, adversely affecting the public interest. It cannot be said that too many operators on a route are likely to affect adversely the interest of weaker section of the profession. The transport business is bound to be ironed out ultimately by the C.W.P. No.197 of 2009 -11- rationale of demand and supply. Cost of a vehicle being as it is the business requires huge investment. The intending operators are likely to be conscious of the economics underlying the profession. Only such number of vehicles would finally remain in operation on a particular route as are economically viable. In any case the transport system in a state is meant for the benefit and convenience of the public. The policy to grant permits liberally under the Act is diercted towards the said goal. The State's contention that there was no need for additional or extension of permits was simply not justified. In the further contention raised on behalf of the State that the provisions of a Scheme under Chapter VI would override the liberal grant of permits under Chapter V, it is not the case of the respondent that there is a particular Scheme in place that excludes the private operators in particular routes. The argument, however, is that the Scheme is in contemplation pursuant to a direction given by a Division Bench of this Hon'ble Court. So long as there is no particular Scheme that excludes the private operators, the question of overriding consideration of Chapter VI does not arise. The same issue has been dealt with by the Hon'ble Supreme Court in two decisions, which again have been set forth in the orders of the Appellate Tribunal. One is a decision in Jagdip Singh Vs Jagir Chand and another Vs. Jagir Chand and another AIR 2001 SC 3027 that held that a State Government under Section 99 of the Motor Vehicles Act cannot restrict the number of permits to be granted to mini buses when a C.W.P. No.197 of 2009 -12- Nationalization Scheme made in the year 1990 providing for running mini buses on certain routes did not provide that such routes could be partially or completely nationalized. The Hon'ble Supreme Court held that the State Government under Section 99 could not restrict the number of permits to be granted to mini buses. We are not dealing with the case of permits to mini buses but I am citing it to take a lesson that so long as there was no policy or a Scheme issued under Chapter VI that excluded the private operators from the field in particular routes, the restriction of route permits could not be tenable. Subhash Chander and another Vs. State Transport Appellate Tribunal and others AIR 2002 SC 1562 takes the law further to its logical end by holding that grant of permit to mini bus operator on a particular route cannot be rejected at the behest of any rival mini bus operator operating on the route by contending that there are enough number of buses to satisfy the public interest.

8. In this case there is no Scheme which excludes the right of the permit holders to seek for either extension or additional permits. It must be remembered that a Regional Transport Authority cannot refuse the grant of permit that there are enough number of operators on the routes. Limiting the number of such carriages does not reside with authority of the State Transport Authority except in the manner contemplated under Section 71(3) of the Motor Vehicles Act. Section 80(2) itself is a statutory directive for the viewn that a Transport Authority shall not refuse to grant a sanction for permit. When there exists no scheme that the State Transport Undertaking was alone to operate services on a particular route, the refusal to C.W.P. No.197 of 2009 -13- grant extension or additional permits is indefensible.

9. The respective orders of the Appellate Tribunal are perfectly in accordance with law and the challenge to the same through several writ petitions by the State cannot survive. The petitioners in C.W.P. No.459 of 2009, 458 of 2009 and C.W.P. No.197 of 2009 shall be entitled to obtain enforcement of the orders that have been passed.

10. The above three writ petitions are allowed and the remaining writ petitions filed by the State or its functionaries are dismissed with costs assessed at Rs.5000/- in each case against the State and its functionaries. June 28, 2010 Pankaj* (K. KANNAN) JUDGE