Shri Hans Raj Goel And Ors. vs Govt. Of Nct Of Delhi And Anr.
2004 Latest Caselaw 868 Del

JUDGMENT

Sanjay Kishan Kaul, J.

1. The right of a State Transport Authority to vary/abolish the route of a permit under the Motor Vehicles Act, 1988 (hereinafter referred to as 'the said Act') has given rise to this batch of writ petitions.

2. The petitioners in these petitions were all allotted Route No. 247 for the route area of Krishna Vihar to Inter State Bus Terminus. The grievance of the petitioners is in respect of the impugned order/notice issued in all these matters in exercise of Section 72(2)(xxii) of the said Act in the following terms:

''NOTICE UNDER SECTION 72(2)(xxii) OF THE MOtor VEHICLES ACT, 1988

Whereas with the coming-up of Metro Operation between Shahdara - Tri Nagar, an uneconomic competition between the Metro and bus operation is growing on the parallel stretch of Metro Line.

And whereas the STA is of the considered view that this uneconomic competition should be stopped to encourage the mass Transport System of Metro Rail run on electricity in the larger interest of cleaner air and pollution free environment.

And whereas it is further felt by the STA that there should be proper coordination between rail and bus transport as envisaged under section 67 of the M.V. Act, 1988 for serving the public convenience.

Now, therefore, notice is given under section 72(2)(xxii) to vary the permit condition in regard to specified route given to you on bus No. DL1P-8868 covered by Stage Carriage Permit No. SC/3000/GE/0633/92 of route No.247 for a period of one month from the date of issue of this notice ordering that after the period of this notice comes to an end, the operation of above vehicle will be stopped from the route No. 247.

However, from the period of notice you are free to apply for a permit on a fresh route from the available basket of vacant routes with the STA as enclosed with this notice.

This has approval of the Competent Authority.''

3. The dispute has arisen on account of the fact that in view of the Metro Rail project starting, Route No.247 was sought to be changed/abolished. There was a dispute about the alternative route being suggested by the State Transport Authority which was not being found viable by some of the permit holders. The matter in issue was referred to the UTT Committee (Unified Time Table Committee) which opined in favor of the route suggested by the operators. The respondents, however, issued a Memorandum in March 2004 asking the permit holders to surrender the permit as they have been inadvertently renewed. The reason for this was stated to be the fact that the route was parallel to the Delhi Metro Rail and all permits of this route were abolished. Some of the permit holders filed Writ Petition (Civil) No.4050-55/2004 seeking quashing of an earlier order dated 19.12.2003 whereby the route was sought to be abolished and these writ petitions were disposed of on 22.3.2004 with the direction to the respondents to take a decision in pursuance to the Minutes of the Meeting dated 5.1.2004 of the UTT Committee.

4. The matter was considered by the respondents but did not find favor in terms of the Memorandum dated 26.5.2004 The decision is in the following terms:

''MEMORANDUM

All the operators who were plying their buses on route No.247 were served with the legal notice dated 1.12.2003 under relevant proviso of the Motor Vehicles Act, 1988 directing them to stop their operation from the route after 30 days period of notice is over and also offering them alternative basket of routes to pick up routes in lieu of route No. 247.

In this regard, UTT Committee, of its own, had suggested a different route to be offered to the operators of Route No.247. Many operators of Route No. 247 wanted to have this newly suggested route.

The matter was considered and placed before the Commissioner (Transport) who is also the Chairperson (STA). It was observed:

i) That there was no mandate given to the UTT Committee for suggesting/ formulating new routes. UTT Committee's role as per their terms of reference was just to suggest change of routes from non-rationalized to rationalized routes and in case of single buses on a particular route. In any case, UTT Committee was never entrusted with the task of suggesting formulation of new routes altogether. This is for the reason that formation of a new route structure requires an in-depth study of requirement of outer by the commuters in the area and availability of other routes in the area on which buses are already plying.

ii) With a view to stop the uneconomic competition between Metro and Bus Transport, as a matter of policy, Department had issued notice for stoppage of such operation both on route No.247 and 832 by offering them available vacant routes. Most of the operators of Route No.832 have already taken an alternative route offered by the Department from the vacant slots. It is now unfair to apply different policy for the operators of route No.247 especially when operators of both the Route No.247 and 832 were required to be treated on the same footing.

iii) Even if the suggestion for formulation of new route of the UTT Committee is given some consideration, it is important to see the effect of the newly created route on the adjoining routes as it may be affecting the earnings of the buses of adjoining routes. The proper procedure needs to be followed whenever a new route is created.

iv) UTT Committee has transgressed its mandate and moreover the suggestions given by the UTT Committee are mere recommendatory in nature and not obligatory on the STA to be accepted.

In view of the above, Commissioner (Transport) / Chairman (STA) has finally rejected the recommendations of the UTT Committee for formulation of new routes for the operators of route No.247. You are, therefore, informed that your permit henceforth will not be renewed on route No.247 and also advised to choose any route from the basket of vacant slots already offered to you vide notice dated 1.12.2003.

sd/-

(P.W. Desai)

Asstt. Secretary (STA)''

5. A reading of the aforesaid Memorandum thus shows that the recommendation of the UTT was not accepted and the decision was taken to abolish Route No.247 and 832. It may be noted that there has been no challenge to the abolition of Route No. 832 as the alternative route/s has/have been accepted by the permit holders and even in respect of Route No.247, a number of permit holders have availed of the alternative route from a basket of routes.

6. The grievance of the petitioners is that the impugned order is without jurisdiction since the power has been exercised by the State Transport Authority under Section 72(2)(xxii) of the said Act while there is no such power to abolish a route under the said sub-section. Section 72 deals with the grant of the Stage Carriage Permit and the conditions which may be attached for the same. There are 24 conditions stipulated and the relevant ones are reproduced herein below.

''72. Grant of stage carriage permit.-- (1) Subject to the provisions of section 71, a Regional Transport Authority may, on an application made to it under section 70, grant a stage carriage permit in accordance with the application or with such modifications as it deems fit or refuse to grant such a permit:

Provided that no such permit shall be granted in respect of any route or area not specified in the application.

(2) The Regional Transport Authority, if it decides to grant a stage carriage permit, may grant the permit for a stage carriage of a specified description and may, subject to any rule that may be made under this Act, attach to the permit any one or more of the following conditions, namely:-

(i) That the vehicles shall be used only in a specified area, or on a specified route or routes;

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(xxii) that the Regional Transport Authority may, after giving notice of not less than one month, --

(a) vary the conditions of the permit;

(b) attach to the permit further conditions;

Provided that the conditions specified in pursuance of clause (i) shall not be varied so as to alter the distance covered by the original route by more than 24 kilometres, and any variation within such limits shall be made only after the Regional Transport Authority is satisfied that such variation will serve the convenience of the public and that it is not expedient to grant a separate permit in respect of the original route as so varied or any part thereof;

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(xxiv) any other conditions which may be prescribed.''

7. Learned counsel for the petitioners contend that what is permissible under clause (xxii) aforesaid is only the variation of the conditions of the permit and not its abolition. Not only this, it is submitted that the said clause (xxii) has to be read with other clauses and such power of variation can be exercised only in respect of matters enumerated in earlier clauses. In so far as the variation in the route is concerned, the proviso to clause (xxii) stipulates that there cannot be a variation so as to alter the distance covered by the original route by more than 24 kms and that too can be made only if the authority is satisfied that such variation will serve the convenience of the public.

8. It is the further submission of the learned counsel for the petitioners that this power under Section 72(2) cannot be utilised to remedy any alleged problem of uneconomical alternative method of transport as is sought to be done in terms of the impugned order/notice. It is submitted that such power is vested only with the State Government and the Central Government and has to be exercised in accordance with the methodology specified in the Act.

9. In this behalf, learned counsel referred to the provisions of Section 67 of the said Act which are as under:

''67. Power to State Government to control road transport.--(1) A State Government, having regard to --

(a) the advantages offered to the public, trade and industry by the development of motor transport,

(b) the desirability of co-ordinating road and rail transport,

(c) the desirability of preventing the deterioration of the road system, and

(d) the desirability of preventing uneconomic competition among holders of permits.

may, from time to time, by notification in the Official Gazette, issue directions both to the State Transport Authority and Regional Transport Authority -

(i) regarding the fixing of fares and freights (including the maximum and minimum in respect thereof) for stage carriages, contract carriages and goods carriages:

Provided that the fares and freights in respect of such stage carriages, contract carriages and goods carriages operated by battery, compressed natural gas or solar energy shall be fixed by the owner or operator;

(ii) regarding the prohibition or restriction, subject to such conditions as may be specified in the directions, of the conveying of long distance goods traffic generally, or of specified classes of goods by goods carriages;

(iii) regarding 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 or the Government of any other country relating to the regulation of motor transport generally, and in particular to its coordination with other means of transport and the conveying of long distance goods traffic:

Provided that no such notification in respect of the matters referred to in clause (ii) or clause (iii) shall be issued unless a draft of the proposed directions is published in the Official Gazette specifying therein a date being not less than one month after such publication, on or after which the draft will be taken into consideration and any objection or suggestion which may be received has, in consultation with the State Transport Authority, been considered after giving the representatives of the interests affected an opportunity of being heard.

(2) Any direction under sub-section (1) regarding the fixing of fares and freights for stage carriages, contract carriages and goods carriages may provide that such fares or freights shall be inclusive of the tax payable by the passengers or the consignors of the goods, as the case may be, to the operators of the stage carriages, contract carriages or goods carriages under any law for the time being in force relating to tax on passengers and goods.''

10. Learned counsel submitted that clause (d) of sub-section (1) of Section 67 authorises the State Government to issue directions to the State Transport Authority and the Regional Transport Authority by the notification in the official Gazette on account of desirability of preventing uneconomic competition among holders of permits. The further sub-clause (iii) refers to ''coordination with other means of transport''.

11. Learned counsel submitted that in case of such directions being made in terms of sub-section (3) of Section 68, the Transport Authority was required to give effect to the directions made under Section 67.

12. A reference was also made to the provisions of Section 71(3)(a) providing as under:

''71. Procedure of Regional Transport Authority in considering application for stage carriage permit.--

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(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 and a Regional Transport Authority to limit the number of stage carriages generally or of any specified type, as may be fixed and specified in the notification, operating on city routes in towns with a population of note less than five lakhs.''

13. It is thus submitted that the Central Government may also issue notification in the Official Gazette and in such a case, the State Government will issue directions to the Transport Authorities to comply with the same. In so far as the cancellation of permit is concerned, the same is provided for in Section 86 and can be done on account of the reasons specified therein which do not apply in the present case.

14. In so far as the issue of grant of permits is concerned, it was submitted that such permits were granted for five years' period of time. It was submitted that there are only two kinds of permits envisaged - a permit under Section 81 for five years and a temporary permit under Section 87 for four months. The present cases are all ones which were granted for five years. A permit fee of Rs. 1100/- was paid at the stage of issuance of the permit and a further payment of Rs. 2,500/- per month is payable.

Receipts for the payments of this amount are made available and the permit is issued for the relevant period on production of such receipt. Thus, the complete fee for five years may be paid at one go or in broken-up periods of a few months. It may, however, be noted that according to the respondents now, the practice being followed is of payment of a six-monthly period or the full payment.

15. Apart from the plea of lack of jurisdiction in the State Transport Authority to exercise the power for such abolition of the route, it was submitted by the learned counsel for the petitioners that the UTT Committee was constituted in pursuance to the Public Notice dated 10.10.2002. It is admitted that there was no specific mention in the Public Notice about the power of this Committee to go into the issue of routing but the fact remained that this Committee did go into the issue of routing and all the recommendations of the Committee have been accepted except in respect of Route No. 247. The Minutes of the Meeting of the UTT Committee held on 5.1.2004 in respect of Route No.247 are as under:

''2. Route no. 247 (Krishna Vihar to ISBT) has been abolished by STA, the route being parallel to Metro stretch. A basket of routes was offered to the displaced operators of Route no.247. However, most of the operators didn't opt for these routes. Instead they have requested STA to allot them a route proposed by them. STA has referred the matter to UTT Committee.

The operators had requested for an alternate route having code no. 247 (Rama Vihar to ISBT) having the following via:-

''Budh Vihar, Avantika, Madhuban Chowk, Pitampura, TV Tower, Prembari Pul, Kanihya Nagar, Shahjada Bagh Power House, Shakti Nagar, Sabzi Mandi, Clock Tower, Roshanara Road, Ice Factory, Tis Hazari, ISBT.''

The committee recommends that the route suggested by the operators may be considered to be issued to them after exhausting all the remedies, as mandated in the law.''

16. The proposals submitted by permit holders were thus duly considered in the meeting of the UTT dated 5.1.2004 In so far as the Route No.832 is concerned, it is submitted that the same was curtailed but not abrogated and thus fell within the clause (xxii) of sub-section (2) of Section 72. It may be noticed at this stage that the matters considered by the UTT Committee on 5.1.2004 were other than for such routes on account of Metro service except Routes 247 and 832. In respect of Route 832, the chanes were accepted and in respect of Route 247, more than half of the permit holders are stated to have accepted alternative routes.

17. Learned counsel for the petitioners referred to the judgment of the Supreme Court in Mithilesh Garg v. Union of India and Ors., to emphasise that there is a guaranteed right under Article 19(1)(g) of the Constitution of India to carry on the business of plying of motor vehicles within limits imposed by State regulations. A reference was made to the judgment of the Karnataka High Court in P. Subbarayappa v. The Regional Transport Authority, Mandya and Anr., which dealt with the issue of principles of natural justice to be followed while varying the Stage Carriage Permits by reference to the provisions of Section 47 of the Act. It was held that the notice may be issued not only to permit holders in respect of whose route the curtailment and deviation is to be ordered but also to existing operators whose rights are likely to be affected as a result of the proposed action. The last judgment referred to is of the learned Single Judge of the Kerala High Court in Mohammed v. RTA, Malappuram, II (1993) ACC 332 which inter alia dealt with the jurisdiction of the Regional Transport Authority under Section 72(2). It was held that the authority could not impose conditions other than those mentioned under the said sub-section. In case further conditions other than those mentioned in Section 72(2) are to be imposed, the same can be done after giving notice to the parties. Thus, further conditions that can be attached to the permit can be only those enumerated under sub-section (2) and not any condition of its choice and outside the purview of sub-section (2).

18. Learned counsel for the respondents, however, defended the decision taken by the respondents and submitted that the UTT Committee was dealing only with the individual adjustment of routes even though it had been actually constituted for the purposes of the time table. However, the recommendation in respect of route 247 of the UTT Committee amounted to creation of a new route which suggestion could not be accepted. It was submitted that before a new route is to be considered, a number of aspects are likely to be taken into account like the requirement of a plan, the rights of other permit holders etc.

19. Learned counsel for the respondents further submitted that in some of the cases even the initial period of five years of the permit was over. It was thus submitted that once the total period of permit under Section 81 of the Act has expired, there can be no rights in favor of the petitioners. It was, however, not disputed that there was a practice of taking fee for broken periods as submitted by learned counsel for the petitioners and that on the expiry of the period of five years, a fresh permitee was also taken.

20. The crux of the controversy is the provisions of Section 72 of the Act and in this behalf it was submitted that Section 72(2) authorises the Transport Authority to grant the permit and to attach any one or more of the conditions specified therein. Sub-clause (i) of the aforesaid sub-section authorises the authority to prescribe conditions to the effect that the vehicle shall be used only in a specified area or on a specified route or routes. It is this route which has been specified. The method of variation of this route is provided in clause (xxii) which authorises variation of the conditions including condition (i). Thus, the specified route or routes in terms of clause (i) could be varied in view of the specific authorisation under clause (xxi) subject to the notice being given of not less than one month. It was thus submitted that the power has been exercised in furtherance of this clause and the case is one of curtailment of the route and offering the alternative route. The permit would not get abolished but would be valid for the re-routed route. This was of course subject to the proviso that the route would not vary by more than 24 kms. In this behalf it has been stated that the Route No.247 is of 19.5 kms and thus any change of the route was within the permissible limit of 24 kms as stated in the proviso.

21. Learned counsel for the respondents sought to submit that Section 67 of the said Act would have no application in the present case since clause (d) dealing with the desirability of preventing uneconomic competition among holders of permit is with reference to fixing of fares and freights as specified in clause (i) thereafter. In so far as clause (iii) is concerned, it refers to ''other means of transport''. It was submitted that the same related to giving effect to any agreement entered into with the Central Government or any other State Government or the Government of any other country and was thus qualified for the said purpose. It was submitted that this aspect was further qualified by sub-section (2) of Section 67 which refers to the fixing of fares and freights in respect of any direction in sub-section (1).

22. A reference was also made to the Scheme for grant of Stage Carriage Permits to private bus operators in Delhi under which the permits had been issued, more specifically under the heading of ''STA conditions for stage carriage operation of private buses

'' where in clause 26, it was provided as under:

''26. Routes once granted shall be subject to change later on.''

23. I have considered the submissions advanced by learned counsel for the parties.

24. In so far as the plea based on the recommendations of the UTT Committee is concerned, there could be no doubt that the Committee, though set up initially with the object of dealing with matters relating to unified time-table, subsequently considered matters also of routing. However, the initial Public Notice dated 10.10.2002 itself provided for the consideration of the objections/responses by the Committee and thereafter the Department to come out with its plans. There is substance in the submissions of learned counsel for the respondents that the recommendations of the Committee cannot be binding. Not only this, the recommendations of the Committee amounted to acceptance of a route suggested by the operators which was a new route. This was not acceptable to the respondents. The reason why the original route 247 was sought to be abolished/re-designed was that the same was parallel to a Metro stretch. The Metro project being new in its concept, the object sought to be achieved is that the bus route should not be run parallel to the Metro stretch but should be complementary to Metro services. The permit was not abolished but a basket of routes was offered to the operators of route 247. In my considered view, the respondents were well within their rights not to accept the recommendations of the UTT Committee.

25. The real question to be considered is one as to whether there was power to pass the impugned orders in exercise of power under clause (xxii) of sub-section (2) of Section 72. There is no doubt about the fact that there is provision for modification or alteration of the route. The real plea of the petitioner is that such modification cannot include the abolition. This is apparent from the fact that clause (i) of sub-section (2) of Section 72 clearly refers to the specified routes as a condition of the permit while sub-clause (xxii) refers to the right of the Transport Authority to vary the conditions of the permit which would include the specified routes too after giving notice of not less than one month. This is, however, hedged with the proviso that the variation should not be such so as to alter the distance covered by the original route by more than 24 kms. In the present case, the route itself is stated to be of only 19.5 kms. Thus, the total change of the route itself would fall within the parameters of the proviso.

26. The petitioners have been offered a route from the basket of available routes and the respondents have in fact contended that if the individual is not satisfied for certain reasons, he can still ask for variation and extension of the alternative route. Such matter is also considered by UTT Committee. It may be noticed that more than half of the persons running on this route have accepted routes from this basket though of course this would not be a factor which can affect the validity of the action of the respondents.

27. I am unable to accept the contention of learned counsel for the petitioners that the action of the respondents is without jurisdiction and that such power vests only with the State Government or the Central Government. There is no doubt that directions can be issued by the State Government under Section 68(3) or Section 71(3)(a) (the latter in case of directions in case of Central Government) but the same do not denude the Transport Authorities of the powers conferred under Section 72(2) of the Act.

In fact, Section 67 refers to the four aspects regarding which directions can be issued by notification in the Official Gazette. These four parameters include the desirability of preventing uneconomic competition among holders of permit. However, these directions are to be issued regarding the matters specified in clauses (i) to (iii). The first clause is regarding fixing of fares and freights. The second regarding prohibition or restriction of long distance goods traffic and the third regarding any 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 or the Government of any other country relating to the regulation of motor transport generally and in particular to its coordination with other means of transport. The question here is not even of giving effect to any such agreement. The State Transport Authority of itself has exercised power under Section 72(2) of the Act and is empowered to do so in view of the clause (i) read with clause (xxii). In fact, clause (xxiv) refers to even any other condition which may include conditions other than those mentioned in the clauses therein.

28. In my considered view, the judgments cited by learned counsel for the parties are not of much relevance in so far as they deal with the right to run the business and the principles of natural justice. The right is subject to reasonable restriction as held in Mithilesh Garg's case (supra) and there is no violation of principles of natural justice in the present case which could give rise to directions in P. Subbarayappa's case (supra). The only judgment of relevance is in Mohammed's case (supra) where reference has been made to the fact that the conditions which could be imposed are those which are specified in Section 72(2) of the Act. In the present case, it is one of such conditions being specified in clause (i) and thus the exercise of the power is not de hors the conditions.

29. The problem could have arisen if the variation was more than 24 kms since the proviso to sub-clause (xxii) of sub-section (2) of Section 72 only permitted variation up to that extent. The total route in the present case, however, is less than that which is sought to be changed to a different route from the basket of routes without abolishing the permit. The fact that the power has been exercised to encourage the mass transport system of Metro Rail run on electricity and in the larger interest of cleaner air and pollution free environment clearly shows that the same is for convenience of public. The route is sought to supplement the Metro route rather than run parallel to it. These matters have been examined by the concerned authorities who in their wisdom have come to the conclusion that it is in public interest and this court is not to sit in appeal over such decision unless it is shown that the decision was so arbitrary or unreasonable that no reasonable man could have come to the conclusion in terms of the Wednesbury's principle. The Supreme Court in Tata Cellular Vs. Union of India,, referred to the Wednesbury Principle enunciated in the Associated Provincial Picture Houses Ltd. Vs. Wednesbury Corporation, (1947) All ER 680, which is as under :-

''Wednesbury principle : A decision of a public authority will be liable to be quashed or otherwise dealt with by an appropriate order in judicial review proceedings where the court concludes that the decision is such that no authority properly directing itself on the relevant law and acting reasonably could have reached it.''

30. The Supreme Court, thus, concluded in para 94 that the Court does not sit as a court of appeal but merely reviews the manner in which the decision was made. It is not the function of the Court to substitute its own decision with that of the administrative body unless no reasonable person / authority could come to the said conclusion.

31. In the end, it may also be noted that the permits have been issued in pursuance to a scheme which was formulated for grant of carriage permits to private operators on certain routes in Delhi. The persons applied in pursuance to this brochure which provided for the conditions for operating of the private buses. The permits were for a period of five years initially and clause 26 provided for change of routes later on even once they had been granted.

32. For all the aforesaid reasons, I do not find any merit in the writ petitions which are dismissed leaving the parties to bear their own costs.