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S.V. Sivaswami Servai Vs. Hafez Motor Transport (Firm) & Ors [1990] INSC 232 (17 August 1990)

Verma, Jagdish Saran (J) Verma, Jagdish Saran (J) Sharma, L.M. (J)

CITATION: 1991 AIR 911 1990 SCR (3) 802 1990 SCC (4) 459 JT 1990 (3) 518 1990 SCALE (2)275

ACT:

Motor Vehicles Act, 1939: Section 47(3)--Grant of per- mit----Basis for--Permits in excess of routes determined--Whether permissible-Agreement between rival parties in a lis--Whether can be basis for.

HEAD NOTE:

The appellant and 14 others, including respondent No. 1 applied for grant of a stage carriage permit. The R.T.A. rejected the applications of respondent No. 1 and some others on the only ground that each of them had been granted one other permit in the same sitting, and granted the permit to the appellant for a period of three years. On appeal by respondent No. 1 and some others, the State Transport Appel- late Tribunal, set aside the R.T.A.'s order and granted the permit in favour of respondent No. 1. The appellant and another unsuccessful applicant filed two civil revision petitions. The High Court, by an interim order, stayed the Tribunal's order and directed that the appellant as well as respondent No. 1 be allowed to operate on the route, but ultimately dismissed both the revision petitions.

The appellant filed a special leave petition before this Court. By virtue of this Court's interim order, the appel- lant and respondent No. 1 were continuing to operate on the route throughout; as a result, though the permit granted for three years expired long back, both the claimants had been operating on the route all these years.

On behalf of the parties common request was made for remanding the matter to the R.T.A. for fresh decision on merits and for a direction to allow both the parties to ply their stage carriages on the route on the ground that there was necessity for two permits on the route.

Allowing the appeal, this Court,

HELD: 1.1 The grant of a permit is to be made by the R.T.A. primarily with reference to the object of serving the interests of the general public and other relevant factors.

It cannot be treated as a dispute relating to grant of a permit between the rival claimants only. It is not in the nature of a lis for adjudication of conflicting interests of 803 private individuals alone. That apart, under Section 47(3) of the Motor Vehicles Act, 1939, the R.T.A. is first re- quired to determine the number of stage carriages for the route and then to grant permits according to that determina- tion made earlier. Grant of any permit in excess thereof was not permissible without first making a fresh determination and increasing the number, if necessary. [807E-G]

1.2 Therefore, an order allowing two claimants, to ply their stage carriages on a single route on the basis of agreement between them that there is necessity for two permits cannot be made unless the grant of a permit to both the rival claimants would be within the limit fixed by the R.T.A. at the relevant time. The grant of a permit is not a matter which can be decided merely on the basis of an agree- ment between the two rival claimants who alone out of sever- al claimants remain in the lis at this stage. [807H & F] M. Chinnaswamy v. M/s. Dhandayuthanpani Roadways (P) Ltd., [1977] 2 SCC 629; Civil Appeal No. 1133 of 1970 decid- ed on 9.12.1981 and Civil Appeal No. 136 of 1980 decided on 13.7.1990, distinguished.

1.3 The fact that the claimants had the benefit of plying their stage carriages for several years on the basis of interim orders of the Court or other authorities long after the period of the permit had expired, is not a valid reason for perpetuating that act and confining the grant only to the litigants before the court when claimants for the permit were many and are likely to be many in case the question of grant at this point of time is decided afresh.

Admittedly, the appellants for permit before the R.T.A. were many more and when the matter is to be considered afresh by the R.T.A. everyone of them is entitled to a fresh consider- ation of his claim on merits. [808B-D]

1.4 The grant of permit by the R.T.A. to the appellant refusing to consider the claim of respondent No. 1 and some other applicants on merits solely on the ground that they had been granted one other permit in the same sitting is clearly untenable. The grant of a permit for another route to the respondent No. 1 and some others could only be a relevant circumstance, while assessing the comparative merits of all the applicants, but by itself it could not be decisive or sufficient to refuse consideration of their claim. The orders of the R.T.A. the Tribunal and the High Court are set aside and the matter remanded to the R.T.A. for a fresh consideration and decision of the claim of all the applicants on merits in accordance with law. [805C-D; 808F1 804 [The Court vacated the interim order permitting the appellant and respondent No. 1 to ply their stage carriages on the route and directed the R.T.A. to make arrangement for operation of the route till the matter is decided afresh, to avoid inconvenience to the traveling public.] [808F-G]

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1407 of 1983.

From the Judgment and Order dated 1.12.1983 of the Madras High Court in C.R.P. No. 2978 of 1981.

G. Ramaswamy and S. Srinivasan for the Appellant.

A.T.M. Sampath for the Respondents.

The Judgment of the Court was delivered by VERMA, J. Applications were invited by the Regional Transport Authority, Pudukkottai (in short 'the R.T.A.') for grant of one stage carriage permit on the route, Pudukkot- tai--Kottaipattinam, the total length of the route being 70 kms. There were in all 15 applicants including the appel- lant, S.V. Sivaswami Servai, and respondent No. 1, Hafez Motor Transport (firm). On 26.10.1979, the R.T.A. took up the case of all the applicants for consideration. The R.T.A. rejected the application of respondent No. 1 and some other applicants on the only ground that each of them had been granted one other permit in the same sitting and, therefore, the R.T.A. did not deem it fit to consider their claim for grant of the permit. Out of the remaining applicants who were allotted equal marks, the R.T.A. found the appellant more suitable for the grant. Accordingly, the R.T.A. granted the permit to the appellant for a period of three years on 26.10.1979. The respondent No. 1 and some others, feeling aggrieved by the R.T.A.'s Order in appellant's favour, preferred the appeals to the State Transport Appellate Tribunal, Madras (in short 'the S.T.A.T.'). By the Order dated 5.9.1981, the S.T.A.T. set aside the R.T.A.'s Order granting, the permit to the appellant and granted the permit in favour of respondent No. 1. This led to two civil revi- sion petitions in the High Court of Madras (hereinafter referred to as 'the High Court'), one by appellant and the other by another unsuccessful applicant. The High Court, by an interim Order dated 22.9.1981, stayed operation of the S.T.A.T.'s Order and directed that the appellant as well as respondent No. 1 be allowed to operate on the route. Ulti- mately, the High Court dismissed 805 both the revision petitions by its Order dated 1.12.1983.

The appellant filed a petition for grant of special leave on 7.12.1983 which was allowed giving rise to this appeal. By virtue of the interim Order of this Court, the situation existing during pendency of the revision in the High Court has been continued with the result that the appellant as well as respondent No. 1 have been continuing to operate on the route throughout obviously on account of renewal being granted to them from time to time because of this Court's interim Order. The result is that the permit granted in October 1979 for three years expired long back and yet not merely one of these claimants for the permit, but both of them have been operating on the route all these years.

It is obvious that the grant of permit by the R.T.A. to the appellant refusing to consider the claim of respondent No. 1 and some other applicants on merits solely on the ground that they had been granted one other permit in the same sitting is clearly untenable. The grant of a permit for another route to the respondent No. 1 and some others could only be a relevant circumstance while assessing the compara- tive merits of all the applicants, but by itself it could not be decisive or sufficient to refuse consideration Of their claim. The S.T.A.T. would have been justified in interfering with the R.T.A.'s Order on this ground and either remanding the matter to the R.T.A. or considering the same itself on merits. The S.T.A.T. missed this aspect, even though it made a comparison of the merits of all the appli- cants. Shri G. Ramaswamy, learned counsel for the appellant showed that the S.T.A.T. has committed several errors in making the comparison which include a misreading of the past operational record described as 'history-sheet' of the rival claimants. The High Court, while deciding the revision petitions, has also not proceeded on the correct basis. Shri A.T.M. Sampath, learned counsel for the respondent No. 1 made an attempt initially to support the S.T.A.T.'s Order granting the permit to the respondent No. 1 which was upheld by the High Court. However, after some arguments, both counsel made a common request to remand the matter to the R.T.A. for a fresh decision on merits taking into account the comparative merits of all the applicants. They also requested that in view of the remand to the R.T.A. for a fresh decision on merits, no observations need be made herein on the comparative merits of the claimants or the merits of the rival contentions initially advanced to us. We are of the opinion that in the circumstances of this case, this would be the appropriate course to adopt. We have, however, some difficulty in accepting the other common request made by both the learned counsel. Both sides agreed that there is necessity for two permits on the route and, therefore, we may direct that both 806 parties, who have been operating on the route by Orders of the High Court or this Court, should be allowed to ply their stage carriages on the route. Reliance is placed by them on M. Chinnaswarny v.M/s. Dhandayuthanpani Roadways (P) Ltd., [1977] 2 SCC 629 wherein a similar Order was made on the basis of an agreement of both the sides. The Order made in this case is a brief order based entirely on the agreement of the parties, the relevant portion of which is as under:

"It is represented by Shri M.K. Ramamurthi appearing for the appellant that from about 1960, for the last 16 years, both the parties had been plying their stage carriages on the said route. Although the permit to be granted was only one, but by orders of court or other authority both the parties had been allowed to ply their buses. It seems to be so obvious that in public interest if two stage carriages have been plying on the route for the last 16 years there is no reason to confine it to one. Both sides agree that there is necessity for two permits on the route. In that view we consider the dispute to be academic. We direct that the status quo of both parties being allowed to ply their stage carriages on the route taking appropriate permits from the authorities concerned will continue. With this direction, the appeal is dismissed." It was stated at the Bar that this decision was followed in Civil Appeal No. 1133 of 1970 decided on 9.12.1981 wherein the Order made is as under:

"We have heard learned counsel for the parties and it seems to us that having regard to the particular circumstances of this case, the order should be that which was passed by this Court in M. Chinnaswamy v. M/s. Dhandayuthanpani Roadways (P) Ltd., AIR 1977 SC 2095. During the pendency of the appeal in this Court, this Court made an order on April 21, 1970, directing that the appellant and respondent No. 1 should be permitted to ply their stage carriages on the route, and ever since the order of 1970 these two stage carriages have been plying continuously under permits which have been renewed from time to time under the Motor Vehicles Act. There is every justification for permitting the present situation to continue. In the circumstances, we direct that the status quo shall continue and both the parties will be allowed to ply their stage 807 carriages in accordance with law under appropriate permits issued in their favour pursuant to the interim order dated April 21, 1970." Recently, a similar Order has been passed in Civil Appeal No. 136 of 1980 decided on 13.7.1990 which reads as under:

"The authorities concerned will consider the case of the parties herein for grant of permit in accordance with law and also in accordance with the directions in the decision of this Court in M. Chinnaswamy v. M/s. Dhandayuthanpani Roadways (P) Ltd., reported in AIR 1977 SC 2095. In the meantime, status quo as on today will continue. Both the parties will ply their vehicles on the route in question.

Counsel for both the parties are present here and they have no objection to the order passed above. The appeal is disposed of in the above terms. No costs." With respect, we are unable to accept this common re- quest made to us in the present case. It is obvious from the above quoted orders on which the common request is based that in none of them, any point of law was considered or decided and the Order permitting both the claimants to operate on the route, even though the permit to be granted was only one, was made without adverting to the legal impli- cations of such an Order. In the first place, grant of a permit is to be made primarily with reference to the object of serving the interests of the general public and it cannot be treated as a dispute relating to grant of a permit be- tween the rival claimants only. It is not in the nature of a lis for adjudication of conflicting interests of private individuals alone It is, therefore, not a matter which can be decided merely on the basis of an agreement between the two rival claimants who alone out of several claimants remain in the lis at this stage. The question of grant of permit is to be decided primarily by the R.T.A. having regard primarily to the interests of the general public and other prescribed relevant factors. That apart, under Section 47(3) of the Motor Vehicles Act, 1939, the R.T.A. is first required to determine the number of stage carriages for the route and then to grant permits according to that determina- tion made earlier. Grant of any permit in excess thereof was not permissible without first making a fresh determination and increasing the number, if necessary. It is, therefore, obvious that an order of this kind cannot be made unless the grant of a permit to both the rival claimants would be within the limit fixed by 808 the R.T.A. at the relevant time. There is nothing in any of these above quoted orders to indicate that this aspect was even adverted to or that there was material to indicate that the consent order so made was within. the limit fixed by the R.T.A. If at all the indication is to the contrary that a permit which could be granted was for plying only one stage carriage on the route whereas the consent order made had the effect of permitting two stage carriages instead of one.

Moreover. if the claimants had the benefit of plying their stage carriages for several years on the basis of interim orders of the Court or other authorities long after the period of the permit had expired, that does not appear to us to be a valid reason for perpetuating that act and confining the grant only to the litigants before us when claimants for the permit were many and are likely to be many in case the question of grant at this point of time is decided afresh.

With respect, we are, therefore, unable to accede to this common request and to confine the operation of this route only to the two claimants before us in a lis between them which commenced more than a decade earlier. Admittedly, the applicants for permit before the R.T.A. were many more and when the matter is to be considered afresh by the R.T.A., everyone of them is entitled to a fresh consideration of his claim on merits. As already stated, our inability to pass a consent order in terms of the above-quoted orders is for some of the reasons already indicated. For the reasons given by us, the above-quoted consent orders cannot be treated as precedents for such a situation.

Consequently, the appeal is allowed, the impugned Orders of the R.T.A., the S.T.A.T. and the High Court are set aside and the matter is remanded to the R.T.A., Pudukkottai, for a fresh consideration and decision of the claim of all the applicants for grant of the permit on merits in accordance with law. The interim orders, permitting the appellant and the respondent No. 1 to ply their stage carriages on the route, stand vacated. However, it would be expedient that the R.T.A. decides the matter afresh at an early date and it also makes arrangement for operation of the route during the intervening period in accordance With law to avoid any inconvenience to the travelling public. No costs.

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