Roadways Moga Tr. Gen. Manager Vs. Punjab Sahib Bus & Transport Co.&
Ors.  INSC 311 (27 April 2010)
SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.3879 OF 2010
(Arising out of SLP (C) No. 14318 of 2007) Punjab Roadways Moga through its
General Manager ... Appellant (s) Versus Punja Sahib Bus and Transport Co.
& Ors. ...Respondent(s) WITH CIVIL APPEAL NO.3880 OF 2010 (Arising out of
SLP (Civil) No.14319 Of 2007) State of Punjab ...Appellant(s) Versus Majhi
Express Transport Service Regd. & Ors. ...Respondent(s) WITH CIVIL APPEAL
NO.3881 OF 2010 [Arising out of SLP(C) No.20753 of 2007] Punjab Roadways
Hoshiarpur ... Appellant (s) Versus Joginder Singh ...Respondent(s) .... WITH CIVIL
APPEAL NO.3882 OF 2010 [Arising out of SLP(C) No.21409 of 2007] The General
Manager, Punjab Roadways Pathankot ...Appellant(s) Versus Bajwa Coop. Bus
Service Batala & Ors. ...Respondent(s) WITH CIVIL APPEAL NO.3883 OF 2010
[Arising out of SLP(C) No.2407 of 2008] Punjab Roadways Nawanshahar
...Appellant(s) Versus Patiala Bus Highways Pvt. Ltd. & Ors.
...Respondent(s) WITH CIVIL APPEAL NO.3884 OF 2010 [Arising out of SLP(C)
No.2408 of 2008] The General Manager, Punjab Roadways Amritsar II
...Appellant(s) Versus Bajwa Coop. Bus Service Batala & Ors.
...Respondent(s) WITH CIVIL APPEAL Nos.3885-86 OF 2010 [Arising out of SLP(C)
Nos.2409-2410 of 2008] Punjab Roadways Batala Etc. ...Appellant(s) Versus
Amandeep Travels (Regd.) Patiala & Anr. ...Respondent(s) ....3/- - 3 -
granted in all these special leave petitions.
the first two appeals.
will first deal with the first two appeals which arise out of a common order
dated 21.8.2000 passed by the State Transport Commissioner (in short "the
Commissioner") exercising the powers conferred on the Regional Transport
Authorities of Jalandhar, Patiala and Ferozpur. The order of the Commissioner
was confirmed by the State Transport Appellate Tribunal (in short "the
Tribunal") vide its order dated 27.4.2005, but interfered with by the High
Court in C.W.P No.8483/2005 and C.W.P. No.11768 of 2005 respectively with a
positive direction to the Commissioner to grant Stage Carriage Permits to the
private operators rejecting the claims of the State Transport Undertakings
(STUs). The legality of the order of the High Court is under challenge in these
two cases filed by the State of Punjab through the Commissioner and the Punjab
Roadways, Moga, represented by its General Manager.
Secretary, Regional Transport Authority, Jalandhar, published a notice in the
Motor Transport Gazette, Weekly, Chandigarh in its issue dated 22.2.1999
inviting applications for the grant of four Stage Carriage Permits for ....4/-
- 4 - plying two return trips daily in the Pathankot - Faridkot via Mukkerian,
Dasuya, Jalandhar Nakodar, Moga, Talwandi Bhai, Mudki route a substantial portion
of which falls within the National and State Highways. As per the scheme
published on 9th August, 1990 (in short the `1990 Scheme') modified by the
Punjab Government on 21.10.1997 (in short the `1997 modified scheme'), the
routes on the National as well as State Highways have to be shared by the STUs
and private operators in a specified ratio.
response to the notice, 112 applications were received which included the
applications from the General Manager, Punjab Roadways, Moga as well as from
the Pepsu Road Transport Corporation, Faridkot, (STUs).
contents of the applications were published in the Motor Transport Gazette
Weekly, Chandigarh in its issue dated 22.4.1999 inviting
representations/suggestions from the general public, but there was no response.
6. Out of
the 112 applicants, 31 applicants failed to respond. Out of four permits, it
was decided by the Commissioner that two permits with one return trip daily be
allotted to STUs and other two trips to the private operators.
General Manager, Punjab Roadways, Moga applied for the ....5/- - 5 - grant of
two stage carriage permits with one return trip daily in the notified route and
the General Manager, Pepsu Road Transport Corporation, Faridkot applied for the
grant of four stage carriage permits for plying two return trips daily on that
representatives of the STUs submitted that due share of mileage be allotted to
them. The Commissioner heard the rest of the applicants who had applied for
permits in the private sector. It was decided that the applications of existing
operators be not considered in the interest of healthy competition and for
maintaining balanced transport service and also to ensure that monopoly of
individuals or a group be not allowed to develop in the particular route/ area.
Applications from the new entrants were considered by the Commissioner and it
was resolved vide order dated 21.8.2000 to grant one stage carriage permit for
plying one return daily trip each on the notified route to the Punjab Roadways,
Moga and to Pepsu Road Transport Corporation, and one permit to Gurbhajan Singh
and Jagdev Singh jointly and the other to Metro Transport Registered Sangrur
for a period of five years. The grantees were allowed three months' time to
obtain the permits.
Aggrieved by the order of the Commissioner, three appeals -- Appeal
Nos.391/2000, 233/2001 and 147/2004 were preferred by the private applicants
before the Tribunal under Section 89 of the Motor Vehicles Act, 1988 (in short
the `Act') challenging the grant of permits to the private operators and the
STUs. Before the Tribunal, it was represented that STUs though granted the
permits, were not operating the services and, therefore, those permits be
granted to the appellants so that public would not be put to inconvenience. On
their request, reports were called for from the Regional Transport Authority
(in short the `RTA') to ascertain as to whether the STUs were in fact operating
services. The Secretary, RTA, Jalandhar vide his reports dated 5.4.2005 and
20.4.2005 reported that the permit granted to Pepsu Transport Corporation was
surrendered by it on 1.6.2002 and that the Punjab Roadways had so far not
utilized the permit. The Tribunal considered the comparative merits of the
applicants and found no illegality in the order granting the permits to the
private operators and found no reason to disturb the grant of permits to STUs.
Appeal No.223/2007 was also rejected on the ground of delay so also on the
ground that applicant cannot be treated as a new entrant since its sister
concern was already granted permit. All the three appeals were therefore
rejected by the Tribunal vide its order dated 27.4.2005.
Aggrieved by the said order, Majhi Express Transport Service Corporation,
preferred Writ Petition C.W.P.
and Punja Sahib Bus Transport Corporation preferred Writ Petition C.W.P.
No.11768 of 2005 before the Punjab and Haryana High Court. The Writ Petition
C.W.P. No.8483/2005 came up before a Division Bench of the Punjab and Haryana
High Court on 24.10.2005. It was represented before the Court that since STUs
had failed to operate the two permits granted to them, those permits be granted
to the Writ Petitioner. The High Court took the view that the Tribunal was not
justified in declining grant of permit to the Writ Petitioner on the ground of
delay and on the ground that its sister concern had already been granted a
permit on 9.11.2004.
the High Court also took the view that due to non user of the permit by the
STUs, public will be the sufferer. The Court noticed that the permit granted to
STUs was neither utilized nor operated and, hence, it was not open to the STUs
to raise any objection regarding the grant of permit to the writ petitioner.
The High Court, therefore, gave a positive direction to the Commissioner to
grant one stage carriage permit with half return trip daily to the said writ
petitioner. The permits granted to the other private operators were not
C.W.P. No.11768/2005 later came up for hearing before the Division Bench on
1.12.2006 and following the judgment in Writ Petition no. 8483/2005, the Court
ordered that one stage carriage permit be granted to the writ petitioner
therein also with half return trip daily in the notified route since the STUs
were not operating the permits granted. Permits granted to the private
operators were not interfered with.
Aggrieved by the judgments in C.W.P. No.8483/2005 and 11768/2005, the State of
Punjab and the Punjab Roadways Moga respectively have filed the first two
the other appeals.
shall now refer to the facts of the other connected appeals since some of the
issues which arise for consideration in all those appeals are common. The
Punjab Roadways has preferred all these appeals challenging the common judgment
dated 1.5.2007 of the Punjab and Haryana High Court in C.W.P. No.11916/2006,
CWP No.123/2006, 11332/2006, 12982/2006, 9085/2005 and 5824/2006. The Punjab
Roadways was the petitioner in all those writ petitions challenging the orders
passed by the Tribunal on 28.10.2005, 17.12.2004, 25.8.2005, 3.10.2005 and
1.8.2005 directing grant of permits to private operators in various notified
routes on the ground that Punjab Roadways was not operating services inspite of
grant of permits. In these appeals, the Punjab Roadways has contended that the
Tribunal as well as the High Court has erred in granting regular permits to
....9/- - 9 - the private sector over-looking the claims of STUs in gross
violation of 1990 scheme as modified in the year 1997 and the provisions of
Chapter VI of the Act.
learned counsel for the appellants submitted that the High Court was not
justified in directing the Commissioner to grant permits to the private
operators on the ground that the STUs had either not utilized the permits,
surrendered the permits or not applied for the permits.
counsel submitted that substantial portions of the notified route fall under
the National/State Highways and as per the provisions of the 1990 scheme as
amended in the year 1997 the mileage of different types of routes in the State
of Punjab has to be shared by the STUs along with private operators in the
prescribed ratio mentioned in the scheme.
counsel submitted that the STUs could not operate services due to insufficiency
of fleets and dearth of staff and now STUs are in possession of sufficient
number of buses and are in a position to operate services on the notified
counsel submitted that granting permits falling in the share of STUs to the
private operators would be against the provisions of the Act and the Rules and
the provisions of notified scheme. Learned counsel submitted that even if STUs
had failed to utilize the permits or surrendered the permits, or had failed to
apply for permits on the notified routes those vacancies could be filled up
only by inviting fresh applications and only temporary permits could be granted
in - 10 - case if there is a public need. Learned counsel submitted that the
Tribunal and the High Court have committed a grave error in directing the RTA
to grant regular permits to the private operators on the notified routes
upsetting the ratio fixed by the scheme in gross violation of the proviso to
Section 104 of the Act.
Jawahar Lal Gupta, learned senior counsel appearing for the contesting respondents
submitted that there is no illegality in the order passed by the High Court in
directing the grant of stage carriage permits to the private operators since
there was failure on the part of STUs in operating the services in spite of
grant of permits. Learned senior counsel referred to Rule 128(5) of the Punjab
Motor Vehicles Rules, 1989 and submitted that if the grantees fail to utilise
the permit for a period of more than six months, the permit would lapse and the
grantee is debarred from raising further claims on the grant of permit to the
senior counsel also submitted that the High Court was justified in directing
the grant of permits to the private operators under Article 226 of the
Constitution of India in public interest. Learned senior counsel also referred
to the 1990 scheme and submitted the route i.e. Pathankot - Faridkot does not
find a place in the annexures to scheme and is not a notified route. Further,
it was also pointed out that the Pathankot - Faridkot is not a monopoly route
of the STUs and no portion of the route partly overlaps any of the monopoly -
11 - routes. It was also pointed out that with reference to the appeal by
Punjab Roadways, Nawanshahar, that the route in dispute that is Ludhiana to
Mahilpur is also not a monopoly route and is not a part of the list annexed
with the 1990 scheme. Various other infirmities have also been pointed out.
first question for our consideration is whether the Tribunal and the High Court
are justified in directing the Commissioner exercising the powers of RTAs to
grant regular permits to the private operators on the ground that the STUs had
either failed to utilize the permits granted or surrendered the permits or had
not applied for the permits in the notified routes. In order to examine that
question it is necessary to refer to the 1990 Scheme as amended in the year
Government of Punjab, in exercise of the powers conferred under Section 100 of
the Act, formulated a scheme so as to provide an efficient, adequate,
economical and properly co-coordinated road transport service in the State of
Punjab. Notification to that effect was published in Punjab Government Gazette
(Extra Ordinary ) dated 9th August, 1990 stipulating areas and routes to be
operated by the STUs to the complete or partial exclusion of other persons.
Clause 5, 6 and 7 of the Scheme are relevant for our purpose and hence
extracted hereunder :- - 12 - (5) All future operations of routes on the
National Highways falling within the State shall be undertaken by the State
Transport Undertakings and the private operators in the ratio of 30:30 which
shall be determined on the basis of the passenger road transport needs, as so
assessed by the State Transport Commissioner, Punjab, from time to time.
existing operations of the State Transport Undertakings on the National
Highways falling within the State are given in Annexures `D' and D-1.
future operations of routes on the State Highways other than the routes
specified in clauses 2, 3 and 4 shall be undertaken by the State Transport
Undertakings and private operators in the ratio of 50:50 which shall be
determined on the basis of the passenger road transport needs, as so assessed
by the State Transport Commissioner, Punjab, from time to time. The existing
operation of routes of the State Transport Undertakings on the State Highways
are given in Annexure `E' and `E-1'.
future operations of routes other than the routes specified in clauses 2,3 and
4 on District and other roads shall be undertaken by the State Transport
Undertakings and private operators in the ratio of 50:50 on the basis of the
passenger road transport roads, as to assessed by the State Transport
Commissioner, Punjab, from the time to time." [Page 8 of the Written Notes].
Annexure 'A' of the Scheme deals with monopoly routes operated by the STUs
viz., Punjab Roadways and Pepsu Road Transport Corporation. Annexure 'B' of the
Scheme deals with the list of National Highways. Annexure 'C' of the Scheme
deals with a list of State Highways Roads. Annexure 'D' deals with the list of
routes falling on National Highways (Punjab Roadways). Annexure `D-1' deals
with list of routes falling on National Highways (Pepsu Road Transport
Corporation). Annexure `E' deals with list of routes falling on State Highways
(Punjab Roadways) and Annexure `E-1' deals with list of routes falling - 13 -
on State Highways (Pepsu Road Transport Corporation). Future operations of
services on the above mentioned routes have to be undertaken by the STUs and
private operators in the prescribed ratio mentioned in the Scheme.
1990 Scheme was modified by the Government of Punjab in exercise of the powers
conferred under Section 102 of the Act and a notification to that effect was
published in the Punjab Government Gazette (Extraordinary) dated 21.10.1997.
of the 1990 Scheme was amended and the ratio 30:30 was substituted by 75:25 and
the ratio 50:50 mentioned in Clauses 6 and 7 was substituted by 50:50 are 40:60
respectively as per the amended scheme dated 21.10.1997. The Tribunal in its
orders dated 27.04.2005 as well as on 28.10.2005 has stated that the routes for
which applications were preferred by the STUs for the grant of permits were
notified routes under the Scheme. All the parties had proceeded as if the
routes in question were included in the 1990 Scheme. Before the Tribunal it was
represented by the private operators that though the Pepsu Transport
Corporation was granted a Stage Carriage Permit on the route notified, the same
was surrendered by the Corporation on 1.6.2002 and the Punjab Roadways though
was granted permit had failed to utilize the permit. Few other instances were
also pointed out where inspite of grant of permits the STUs had either
surrendered the permits or were not operating the permits on the routes
notified. A copy of such an order dated 19.7.2007 passed by the Secretary RTA,
- 14 - Jullandhar was produced before this Court and it was submitted that
Punjab Roadways, Pathankot had surrendered 29 return trips on the route between
Amritsar and Pathankot. Further it was also contended that due to surrendering
of large number of return trips on the route, the public of that area was put
to considerable hardships and inconvenience. Consequently it was pointed out that
there is no illegality in granting regular permits to the private operators in
the vacancies occurred either due to surrender of permits or not utilizing the
permits or on omission to apply for permits in the notified routes.
Tribunal in Appeal No. 46 of 2000 and connected matters, decided on 28.10.2005
has taken a view that where an STU applies for permit and if it is granted and,
thereafter the STUs fail to operate the services inspite of grant, they will
lose their right and share of the permits unless the route in question is
Inter-state or monopoly routes.
it was also held if the permit is not utilized within the maximum period of six
months under Sub-rule 5 of Rule 128 of the Punjab Motor Vehicles Rules, 1989
the RTA could revoke the sanction of the permit. Further it was also held in
such a case RTA has a right to issue regular permits and not temporary permits
as provided in the proviso to Section 104 of the Act.
find it difficult to accept the reasoning of the Tribunal. In our view, there
is complete misreading of the provisions of 1990 Scheme as amended and
provisions of Chapter VI of the Act. Provisions of this Chapter confer a
monopoly on the State in respect of transport service to the partial or
complete exclusion of other persons. Section 98 says that provisions of above
mentioned Chapter and the Rules or orders made thereunder shall have effect
notwithstanding, anything inconsistent contained in Chapter V or in any other
law for the time being in force or any instrument having effect by virtue of
any such law. Section 99 of the Act deals with preparation and publication of
proposal regarding road transport services of an STU which enables the State
Government to formulate a proposal for the purpose of providing an efficient,
adequate, economical and properly co-coordinated road transport service, by
giving particulars of the nature of the service proposed to be rendered, the
area or route proposed to be covered and other relevant particulars respecting
thereof and the Government is also empowered to publish such a proposal in the
gazette in public interest. After calling for objections to the proposed
scheme, and examining the same the scheme has to be published in accordance
with the provisions of Section 100 of the Act.
scheme once published is law and chapter VI has an overriding effect on Chapter
V of the Act and it operates against everyone unless it is modified or
cancelled by the State Government.
scheme also provides for a ratio with regard to the grant of permits on the
notified routes between STUs and private operators which is fixed based on the
assessment made by the State Transport Commissioner, Punjab on the basis of the
passenger road transport needs which is legally binding on all.
provisions of the scheme including the list of routes mentioned in the various
annexures, and the ratio fixed are statutory in character which cannot be
tinkered with by the RTAs and have overriding effect over the powers of RTAs
under Chapter V of the Act. The power to cancel the Scheme or modify the Scheme
rests with the State Government under Section 102 of the Act and the RTA and
the Tribunal have committed a grave error in tampering with the Scheme as well
as disturbing the ratio fixed by the Scheme by granting regular permits to the
private sector from the quota earmarked for STUs. Once a scheme is approved and
published, private operators have no right to claim regular permits to operate
their vehicles in the notified area, route or portion thereof upsetting the
ratio fixed. Since the scheme makes provision for partial exclusion, the
private operators are not completely excluded, they may get regular permits on
the notified route or portion thereof in accordance with the terms and conditions
laid down in the scheme and within the quota earmarked for them.
Therefore, a combined reading of Sections 99, 100 and 104 in the light of
Section 2(38) of the Act, makes it clear that once a scheme is published under
Section 100 in relation to any area or route or portion thereof, whether in
complete or partial exclusion of other persons, no persons other than STUs may
operate on the notified area or route except as provided in the scheme itself.
Reference can be made to the decisions of this Court in Adarsh Travels Bus
Service and Anr. vs. State of U.P. and Ors., (1985) 4 SCC 557, U.P.
Road Transport Corporation, Lucknow vs. Anwar Ahmad and Ors. (1997) 3 SCC 191,
Ram Krishna Verma vs State of U.P. (1992) 2 SCC 620.
Section 104 of the Act specifically restricts the grant of permits in respect
of notified area or notified route. The said provision is extracted hereunder:-
Restriction on grant of permits in respect of a notified area or notified
route---Where a scheme has been published under sub-section (3) of section 100
in respect of any notified area or notified route, the State Transport
Authority or the Regional Transport Authority, as the case may be, shall not
grant any permit except in accordance with the provisions of the scheme:
that where no application for a permit has been made by the State Transport
Undertaking in respect of any notified area nor notified route in pursuance of
an approved scheme, the State Transport Authority or the Regional Transport
Authority, as the case may be, may grant temporary permits to any person in
respect of such notified area, or notified route subject to the condition that
such permit shall cease to be effective on the issue of a permit to the State
transport undertaking in respect of that area or route.
above mentioned provision states where a scheme has been published under
Sub-section 3 of Section 100 in respect of any notified area or notified route,
STA or the RTA as the case may be shall not grant any permit except in
accordance with the provisions of the Scheme. An exception has been carved out
in the proviso to Section 104 stating, where no application for permit has been
made by the STU in respect of any notified area or notified route in pursuance
of an approved scheme, the STA or the RTA, as the case may be, may grant
temporary permits to any person in respect of any such notified area or
notified route subject to the condition that such permit shall cease to be
effective on the issue of permit to the STU in respect of that area or route.
In our view same is the situation in respect of a case where an STU inspite of
grant of permit does not operate the service or surrenders the permit granted
or not utilizing the permit. In such a situation it should be deemed that no
application for permit has been made by the STU and it is open to the RTA to
grant temporary permit if there is a temporary need. By granting regular
permits to the private operators RTA will be upsetting the ratio fixed under the
scheme which is legally impermissible.
Ahmad (supra) this Court had occasion to examine the scope of the proviso to
Section 104 and held as follows:- - 19 - "it would, therefore, be seen
that where the scheme has been published under sub-section (3) of Section 100
in respect of any notified area or notified route, the State Transport
Authority or the Regional Transport Authority, as the case may be, shall not
grant any permit except in accordance with the provisions of the scheme. Thus,
the appellant- Corporation has the exclusive right or monopoly to ply their
stage carriages and obtain the required permit as per the scheme. The proviso
gives only a limited breath of life, namely, until the Corporation puts the
vehicles on the notified routes as per the scheme, temporary permits may be
granted to private operators. Thereby, it would be clear that temporary
inconvenience to traveling public is sought to be averted till the permits are
taken and vehicles are put on the route by the appellant. Therefore, the
temporary permits will have only limited breath of life. Private operators are
attempting to wear the mask of inconvenience of traveling public to infiltrate
into forbidden notified area, route or portion thereof to sabotage the
may point out if the public is put to hardship or inconvenience due to failure
on the part of the STUs to operate services inspite of grant of permits for a
considerable long time, it is always open to the State Government to modify the
scheme and make appropriate changes in the ratio fixed on the basis of
passenger road transport needs as assessed by the State Transport Commissioner
but such a power is not conferred on the RTA and till that is done no private
operator can operate his service on any part or portion of a notified area or
notified route upsetting the ratio prescribed in the scheme except on a
temporary permit granted under the proviso to Section 104 of the Act. Reference
can be - 20 - made to the judgments of this court in UPSRTC and Another vs. Sanjidha
Banu and Ors. (2005) 10 SCC 280; M. Madan Mohan Rao & Verma (2005) 4 SCC
424 for understanding the general purport of such Schemes and the provisions of
Article 226 of the Constitution of India confers extra ordinary jurisdiction on
the High Court to issue high prerogative writs for enforcement of fundamental
rights or any other purpose, the powers are of course wide and expansive but
not to be exercised as an appellate Authority re-appreciating the finding of
facts recorded by a Tribunal or an authority exercising quasi judicial
functions. Power is highly discretionary and supervisory in nature. Grant of
stage carriage permits is primarily a statutory function to be discharged by
the RTA exercising powers under Section 72 of the Act and not by the High Court
exercising the Constitutional powers under Article 226 or 227 of the
Constitution of India.
Court seldom interferes with the orders passed by such authorities exercising
quasi-judicial functions, unless there is serious procedural illegality or
irregularity or they have acted in excess of their jurisdiction. If there is
any dispute on the proper implementation of the ratio or inclusion or exclusion
of any route or area in the Scheme, the RTA can always examine the same, if it
is moved. The direction given by the High Court to the RTA to grant regular
permits to the private operators, is therefore, patently illegal.
therefore, allow all these Civil Appeals as follows:- (i) The judgments of the
High Court in C.W.P. No.8483/2005 and in C.W.P. No.11768 of 2005 are set aside;
order dated 21.08.2000, passed by the Commissioner affirmed by the order dated
27.4.2005 of the State Transport Appellate Tribunal is upheld;
common judgment of the High Court dated 1.5.2007 in C.W.P. No.11916 of 2006 and
connected cases and also the orders dated 28.10.2005, 17.12.2004, 25.8.2005,
3.10.2005 and 1.8.2005 passed by the Commissioner directing grant of regular
permits to the private operators are set aside.
judgment would not stand in the way of RTAs in granting temporary permits if
there is temporary need in the notified routes included in the 1990 scheme as
amended in the year 1997.
..................................J. (R.V. Raveendran)
.................................J. (K.S. Radhakrishnan)
April 27, 2010.