Capital Multi-Purpose Co-Operative
Society Bhopal and Other Vs. The State of M.P. & Ors [1967] INSC 78 (30
March 1967)
30/03/1967 WANCHOO, K.N.
WANCHOO, K.N.
BACHAWAT, R.S.
RAMASWAMI, V.
CITATION: 1967 AIR 1815 1967 SCR (3) 329
CITATOR INFO :
1970 SC1102 (17) 1971 SC1986 (10) 1977 SC 24
(8) 1977 SC 441 (20) 1981 SC 660 (4,7,9)
ACT:
Motor Vehicles Act (4 of 1939)-Ss. 68A, 68-C
and 68D-State Road Transport Corporation publishing schemes for take-over of
certain routes-Particulars to be given in the scheme for validly originating
proceedings-Whether authority to hear objections can be appointed under the
Rules of Business under Article 166(3) of the Constitution or only under s. 68-D
(2-A)-Whether express finding necessary by authority that scheme would fulfill
four-fold purposes mentioned in s.
68-C-Authority not summoning documents or
witnesses at the instance of objectors regarding past records or financial
position to consider ability of the State Undertaking to run nationalised
transport services and to consider comparative merits of undertaking and
private operators-Whether such evidence relevant-Therefore, whether hearing of
objections adequate and real.
HEADNOTE:
On May 11, 1964, the Madhya Pradesh State
Road Transport Corporation published two schemes for the take-over by the
corporation of certain routes under Chapter IV-A of the Motor Vehicles Act 4 of
1939 to the exclusion of the existing private operators on those routes and
objections were invited within 30 days. After the objections filed by various
private operators were heard by a Special Secretary to the State Government
empowered under s. 68-D of the Act, he passed orders on June 8, 1965, modifying
the schemes in certain particulars. The modified and corrected schemes were
finally published on June 18, 1966. Writ petitions were thereafter filed by the
appellants challenging the two schemes but were dismissed by the High Court.
In the appeal to this Court it was contended
on behalf of the appellants:(i) that the proposed schemes were bad as they were
not in compliance with s. 68-C of the Act and the rules framed there under for
they did not give necessary particulars which would enable the appellants to
formulate their objections to the proposed schemes in respect of the fourfold
purposes mentioned in s. 68-C i.e., that a scheme should be for the purposes of
providing an "efficient, adequate, economical and properly coordinated
Road Transport Service" and that as the proposed schemes were themselves
bad, the entire proceedings initiated by them must fall through; (ii) that the
Special Secretary who heard the objections on behalf of the State Government
was not validly authorised to do so as he had been appointed under the Rules of
Business framed under Art. 166(3) of the Constitution while the appointment
should have been under s. 68-D (2-A) of the Act; (iii) that the order approving
the schemes passed on June 8, 1965 was invalid as it did not say that the
schemes fulfilled the purposes mentioned in a 68-C and an express finding to
this effect was necessary to validate the schemes; (iv) that the hearing given
by the authority to the objectors was not adequate -and real as required under
s. 68-D of the Act : the authority wrongly rejected the appellants application
to summon documents from the Corporation to show that the Corporation did not
have the equipment and finances to carry out the schemes. and that the
Corporation's past record of running its services was worse 330 than that of
the private Operators; and furthermore the authority had also wrongly refused
to summons witnesses sought to be called to show that the schemes would not fulfill
the four-fold purposes stated in s. 68-C.
HELD: Dismissing the appeal :
(i) S. 68-C requires two things, namely, (1)
the nature of the services proposed to be rendered and (2) the area or route
proposed to be covered; it further requires that such other particulars
respecting the schemes as the rules may prescribe should be given. The
particulars given in the present proposed schemes were clearly in compliance
with the provisions of s, 68-C and that was enough for validly originating the
proceedings. [334B, G] (ii) The first part of s. 68-D(2-a), which is the
substantive part, lays down that the person who is to hear the objections
cannot be an officer below the rank of Secretary to the Government. The second
part is procedural and states how the officer should be appointed, namely, by
notification in the official gazette. In the present case as the person
appointed was a Special Secretary, the substantive part of the provision had
been complied with.
As far as the second and procedural part was
concerned, the appointment of the authority could be by notification as
provided in the Section or by an order under the Rules of Business under Art.
166(3) of the Constitution.
Accordingly, the appointment of the authority
to hear objections in the present case could not be considered invalid. [335H;
336C-D] (iii) There is no express provision in Section 68-C read with Section
68-D that the authority hearing objections must come to a finding that the
scheme under examination provides an efficient, adequate, economical and'
properly coordinated road transport service. In the absence of such a
provision, the very order of the State Government or the authority appointed
must be held to mean either, where the scheme is approved or modified, that it
sub serves the purposes mentioned in s. 68-C or where it is rejected, that it
does not. [337B, D-E] (iv) The authority had rightly held the documentary and
oral evidence proposed to be called was irrelevant and the hearing of the
objections was therefore both adequate and real.
Chapter (IV-A) of the Act was enacted for
nationalisation of road transport services in accordance with the amended
Article 19(6) of the Constitution. The nationalised road transport under the
Chapter can only be run by a State Transport Undertaking defined by s. 68-A (b)
of the Act which would always be under the control of the Central or State
Government. In this context, it would be futile for any object to show that the
undertaking backed by the Central or State Governments could not have the
equipment or finances to carry out the schemes. Furthermore, as only a State
Transport Undertaking can run a nationalised service, there was no necessity
for considering the comparative merits of the undertaking and individual
private operators.
[341C-E, G] If a party concerned wishes to
produce any document or produce any witness, the authority may take the
documentary evidence into consideration or take the evidence of the witness, if
it considers such evidence relevant and necessary. But there is in the absence
of any provision in the Act or the Rules, no power in the authority or the
State Government to compel attendance of witnesses or to compel production of
documents. This is not to say that if the authority wants any party before it
to produce any document for satisfying itself whether the scheme is for the
purpose mentioned in s. 68-C it cannot so ask; and if the party asked to
produce 331 documents does not do so, the authority would be entitled to draw
such inferences as it might consider justified from the non-production of
documents. But apart from this, there is no power conferred on the authority
under the Act or the Madhya Pradesh Rules to compel production of documentary
evidence or to summon any witness. [339H-340c] Gullapalli Nageswara Rao, v.
Andhra Pradesh Road Transport.
[1959] 1 S.C.R. 319, Malik Ram v. State of
Rajasthan.
[1962] 1 S.C.R. 978 and Nehru Motor Transport
Co-operative Society, Limited v. The State of Rajasthan, [1964] 1 S.C.R.
220, referred to.
CIVIL APPELLATE JURISDICTION : Civil Appeals
Nos. 2201 and 2202 of 1966.
Appeals from the judgment and order dated
September 15, 1966 of the Madhya Pradesh High Court in Misc. Petitions Nos. 351
and 311 of 1965 respectively.
M.N. Phadke, Naunit Lal, Y. S. Dharmadhikari
and M. N. Puranik, for the appellants (in both the appeals).
A.P. Sen, Advocate-General for the State of
Madhya Pradesh and I.N. Shroff, for the respondent No. 1 (in both the appeals).
S.V. Gupte, Solicitor-General, K. A .
Chitale, Rameshwar Nath and Mahinder Narain, for respondents Nos. 5 and 6 (in
C.A. No. 2201 of 1966) and respondents Nos. 4 and 5 (in C.A.
No. 2202 of 1966.) The Judgment of the Court
was delivered by Wanchoo, J. These are two appeals on certificates granted by
the Madhya Pradesh High Court. The appeals are connected and will be dealt with
together. The Madhya Pradesh State Road Transport Corporation (hereinafter
referred to as the Corporation), constituted under the Road Transport
Corporation Act, (No. 64 of 1950), came into existence in May 1962 to operate
as a State Transport Undertaking under s. 68-A of the Motor Vehicles Act, No. 4
of 1939, (hereinafter referred to as the Act). The Corporation passed two
resolutions in April and May 1964 by which it decided to take over certain
routes under Chapter IV-A of the Act to the exclusion of the existing private
operators on those routes. Two schemes, namely, Nos. 16 and 22 dated May 11,
1964, were published by the Corporation inviting objections within 30 days. The
schemes appeared in the Government Gazette of May 22, 1964 and objections
thereto were filed by private operators affected thereby within the period
prescribed. Thereafter the authority empowered to hear objections under s. 68-D
of the Act gave notices fixing a date for hearing. The hearing was to begin on
September 332 4, 1964, but it was postponed a number of times. Finally,
arguments were heard on May 20, 1965. The authority passed orders on June 8,
1965 modifying the schemes in certain particulars. On June 11, 1965, the
modified schemes were published, but as there were mistakes in them, corrected
schemes as modified were finally published on June 18, 1965.
Then followed writ petitions to the High
Court in August 1965 by private operators who were dissatisfied with the order
of the -authority concerned. The High Court dismissed the writ petitions
rejecting all the contentions raised by the petitioners before it. Thereafter
the High Court gave certificates to appeal to this Court, and that is how the
appeals have come before us.
It is unnecessary to set out all the points
raised before the High Court, for learned counsel for the appellants have
raised only some points before us out of those raised before the High Court. It
is enough therefore to set out the points that have been raised before us and
to indicate the decision of the High Court thereon. The first contention raised
before us is that the proposed schemes published on May 22, 1964 were bad
inasmuch as they were not in compliance with s. 68-C of the Act and the rules
framed there under, for they did not give necessary particulars which would
enable the appellants to formulate their objections to the proposed schemes in
respect of the fourfold purposes mentioned in s. 68-C. The High Court rejected
this contention holding that there was sufficient compliance with the
provisions contained in s. 68-C and the. rules framed there under and there was
enough material in the proposed schemes, to enable the appellants to file
objections thereto. The second contention is that the Special Secretary who
heard the objections on behalf of the State Government was not validly
authorised to do so inasmuch as he had been appointed under the Rules of Business
framed under Art. 166 (3) of the Constitution while appointment should have
been under s. 68-D(2-a) of the Act, which was inserted therein by the Motor
Vehicles (Madhya Pradesh Amendment) Act, No. 2 of 1963. The High Court rejected
this contention holding that the provision in s. 68-D (2-a) was supplementary
to the power which the State Government had under the Rules of Business and
therefore it was open to the State Government to act under either of the
provisions. The third contention is that the order approving the schemes passed
on June 8, 1965 was invalid inasmuch as it did not say that the schemes
fulfilled the purposes mentioned in s. 68-C. The High Court rejected this
contention also holding that as soon as the authority approved the schemes, it
must be held to have impliedly decided that the schemes fulfilled the purposes
mentioned in s. 68-C. The last contention is that the hearing given by the
authority was not adequate and real and therefore the approval given was
invalid. The 333 High Court rejected this contention also holding that in the
circumstances of the case the hearing given was sufficient for the purpose. In
the result the High Court dismissed the writ petitions after rejecting other
points which were raised before the High Court but are not raised before us.
We shall now proceed to deal with the four
contentions raised before us in that order.
The first contention relates to the
invalidity of the proposed schemes published on May 22, 1964, on the ground
that they are not in compliance with S. 68-C, and the argument is that if the
proposed schemes which initiate the proceedings leading to final approval
thereof are themselves bad, the entire proceedings must fall through. Now
section 68-C lays down that where any State Transport Undertaking is of opinion
that it is necessary in the public interest that road transport services in
general or any particular class of such services in relation to any area or
route or portion thereof should be run and operated by the State Transport Undertaking,
whether to the exclusion, complete or partial, of other persons or otherwise,
the State Transport Undertaking has to prepare a scheme. Further the State
Transport Undertaking forms this opinion for the purposes of providing "an
efficient, adequate, economical and properly coordinated road transport
service". Section 68-C further provides that where the State Transport
Undertaking is of this opinion for the purposes mentioned above it has to
prepare a scheme and cause it to be published in the official gazette and in
such other manner as the State Government may direct. The publication is for
the purpose of inviting objections to the proposed scheme by those affected
thereby Section 68-C further provides that the proposed scheme should give
particulars of the nature of the services proposed to be rendered, the area or
route proposed to be covered and such other particulars respecting thereto as
may be prescribed. It is not the case of the appellants that the proposed
schemes published on May 22, 1964 did not give particulars of the nature of the
services proposed to be rendered, and the area or route proposed to be covered.
Nor is it the case of the appellants that it
did not give such other particulars respecting thereto as were prescribed by
rules. The argument is that the proposed schemes must disclose data in support
of the four purposes which are the basis of what may be called nationalisation
of road transport service, namely, the providing of an efficient, adequate,
economical and properly coordinated road transport service. Now the two schemes
with which we are concerned in these appeals have given detailed particulars of
what the State Transport Undertaking considered was in compliance with S. 68-C
and the rules framed there under. But the argument is that more particulars
should have been given to disclose how the schemes were for the purpose of
providing an efficient, adequate, economical and properly co-ordinated road
transport service, and in particular it is urged that the 334 timings on which
services would be run should have been indicated in the schemes as that would
have indicated whether the services to be provided by the Corporation were
coordinated services.
Now the section itself requires two things,
namely, (i) the nature of the services proposed to be rendered, and (ii) the
area or route proposed to be covered. Further the section provides that such
other particulars respecting the scheme should be given as the rules prescribe,
and that has been done. But the argument seems to be that even though the
section and the rules have been complied with, certain other things should have
been mentioned in order to enable the private operators to show that the
schemes did not provide an efficient, adequate, economical and properly
coordinated road transport service. We are of opinion that this argument must
be rejected. The schemes have given sufficient details to enable the appellants
to file their objections. The four purposes mentioned in s. 68-C are so
all-embracing in their nature that it would always be possible for a private
operator to put forward some small particular and say that this particular
should also have been given in the proposed scheme and as it is not given it is
not possible for him to make a proper objection with respect to the four
purposes mentioned in the section. The result of accepting the argument on
behalf of the appellants would be that no scheme would ever get through, for
some small particular or other can always be, put forward by some person or
other as not included in the scheme and therefore the whole proceeding should
be invalidated on account of defect in the proposed scheme originating the
proceeding.
We are of opinion that so long as a scheme
gives the two things which the section itself prescribes and such other
particulars which the rules prescribe, that is enough for the purpose of
validly originating the proceeding, resulting in eventual nationalisation of
the routes and services concerned. Thereafter it is open to the objectors to
take such objections to the proposed scheme in the light of the four purposes
already indicated and the proceedings being quasi judicial, the State
Government or the authority concerned can consider the objections and finally
approve or modify the scheme, or if necessary reject it altogether.
The particulars given in the present proposed
schemes published on May 22, 1964, are undoubtedly in compliance with the
provision of s. 68-C a,-, well as the rules framed thereunder, and that in our
opinion was enough for validly originating the proceeding. We therefore reject
this contention raised on behalf of the appellants.
The second contention is that the Special
Secretary who heard the objections on behalf of the State Government was not
validly authorised. Now s. 68-D. (2) provides that "the State Government
may, after considering the objections and after giving an opportunity to the
objector or his representatives and the representatives 335 of the State
Transport Undertaking to be heard in the matter,if they so desire, approve or modify
the scheme".
The State Government obviously is not a
natural person and therefore some natural person has to give the hearing on
behalf of the State Government. Article 166 (3) of the Constitution gives power
to the Governor to make rules for the more convenient transaction of the
business of the Government of the State, and Rules of Business have been framed
under this power for the performance of duties which have to be performed under
the law by the State Government.
It is not in dispute that the Special
Secretary who gave the hearing in the present case was authorised under the
Rules of Business. But what is urged is that in view of the introduction of S.
68-D (/'--a) in the Act by the Madhya Pradesh Amendment it is no longer open to
the State Government to act under the Rules of Business, and that the
appointment should have been made under the new provision.
That provision is in these terms :"(2-a).
The State Government may, by notification, authorise any officer not below the
rank of a Secretary to Government for the purpose of hearing objections under
subsection (2)." Further as under S. 2 (25) of the Madhya Pradesh General
Clause$ Act, (No. 3 of 1958), the word "notification" as used in
Madhya Pradesh Acts means a notification published in the official gazette, the
officer who heard the objections should have been appointed by means of a
notification in the State Gazette under this new provision.
Now this new provision may be divided into
two parts. 'Me first part may be called substantive and lays down that the
person who is to hear objections on behalf of the State Government cannot be an
officer below the rank of a Secretary to Government. The second part is
procedural and states how the officer may be appointed, namely, by notification
in the official gazette. So far as the substantive part of the new provision is
concerned, it certainly limits the power of the State Government when it
proceed to appoint someone to hear objections and such person in view of the
limitation contained in the new provision cannot be an officer below the rank
of a Secretary to Government. This means, that for example, a Deputy Secretary
or an Under Secretary to Government cannot be appointed to hear objections. In
the present case the person appointed is a Special Secretary to Government
i.e., an officer not below the rank of a Secretary to Government.
Therefore the substantive part of the new
provision is complied with by the appointment made in this behalf, and that in
our opinion is mandatory and limits the power of the State Government as to the
rank of the person to be appointed to hear objections on its behalf. But the
second part is merely proce336 dural, namely, how the appointment is to be
made. The new provision indicates that it may be made by a notification in the
official gazette. But that does not mean that if the Constitution provides for
any other method of making the appointment that method is made nugatory. Such a
procedural provision may be mandatory if action is taken under the new provision;
but there are no words in the new provision which exclude the procedure
provided under the Rules of Business under Art. 166(3) of the Constitution.
Therefore we are of opinion that where the State Government proceeds under the
new provision it has to make a notification in the official gazette appointing
a person not below the rank of a Secretary to Government to hear objections.
But it may act under the Rules of Business so long as under those rules it
appoints a person not below the rank of a Secretary to Government for the
purpose of hearing objections. The limitation under the new provision is only
this that the person appointed cannot be below the rank of a Secretary.
But so far as the procedural part is
concerned, the appointment may be by notification as provided under the new
provision or by an order under the Rules of Business. The objection therefore
that the authority in this case was not appointed under the new provision but
was appointed under the Rules of Business and therefore the appointment was
invalid, must fail.
The third contention raised on behalf of the
appellants is that the orders approving and modifying the schemes in this case
do not show that the authority had applied its mind to the question whether the
schemes were such as to sub serve the purposes of providing an efficient,
adequate economical and properly coordinated transport service. Reliance in
this connection is placed on. certain American cases which hold that the lack
of an express finding necessary under a statute to validate an order of an
administrative agency cannot be supplied by implication. When therefore such an
administrative agency is required as a condition precedent to an order to make
a finding of facts the validity of the order must rest upon the needed finding.
If it is lacking the order is ineffective and the lack of express finding
cannot be supplied by implication. It is unnecessary for us to refer to the
American cases in detail: it is enough to say that the principles enunciated
above may be unexceptionable where the existence of a finding is necessary for
taking action, but that depends upon the words of the statute and therefore we
must now turn to the words of s. 68-C and s. 68-D. We have already indicated
that the State Transport Undertaking publishes a scheme when it has arrived at
a certain opinion After the scheme is published under s. 68-C any person
affected by it can object within 30 days under s . 68-D.(1). Thereafter the
State Government considers the objections and gives an opportunity to the
objector to be heard and 337 also to the State Transport Undertaking.
Thereafter the State Government or the authority authorised by it either
approves or modifies the scheme or even rejects it. There is no express
provision in these two sections laying down that the authority hearing
objections must come to some finding of fact as a condition precedent to its
final order.
As such no express finding as envisaged in
the American cases is necessary under S. 68-C read with s. 68-D that the scheme
provides an efficient, adequate, economical and properly coordinated road
transport service. Besides we are of opinion that the whole object of hearing
objections under S. 68-D is to consider whether the scheme provides an
efficient, adequate, economical and properly coordinated road transport
service. After hearing objections the State Government, or the officer
authorised by it has either to approve or modify, or if necessary, to reject
the scheme.
Where the scheme is approved or modified it
necessarily follows in our opinion that it has been found to provide an
efficient, adequate, economical and properly coordinated transport service; if
it is not of that type, the State Government or the authority appointed to hear
objections would reject it. In the absence of a provision requiring an express
finding in these two sections it seems to us that the very order of the State
Government or the authority appointed by it to hear objections must be held to
mean either,' where the scheme is approved or modified, that it subserves the
purposes mentioned in S. 68-C, or, where it is rejected, that it does not sub serve
the purposes. Section 68-D (2) does not require in our opinion any express finding,
and even if there is none in the present case, it would not invalidate the
orders passed by the authority hearing the objections. The argument on behalf
of the appellants under this head is also rejected.
The last contention is that an adequate and
real hearing was, not given to the appellants as required by S. 68-D of the Act.
Reliance in this behalf is placed on a number of decisions of this Court Before
however we consider the legal position, let us see what exactly happened in
this connection. It appears that an application was made by the appellants
requesting the authority to summon a very large number of documents from the
Corporation in order to prove inter alia that the present equipment and
finances of the Corporation showed that it was not in a position to run the
services and that on a comparison of the record of the Corporation with that of
the various private operators it would appear that it was not in the interest
of the public that the routes in question should be nationalised. It appears
that some of the documents were not produced by the Corporation, and in particular
documents, which would have shown the record of the Corporation with respect to
its running various routes in the past, were not produced and it was contended
that those documents were 338 irrelevant. Besides this, the appellants wanted
to produce a large number of witnesses in support of their contention that the
schemes were not efficient, adequate, economical and properly co-ordinate. So
far as the documents were concerned, the authority said in its order dated
February 17, 1965 that the matter would be dealt with at the time of argument.
As for the witnesses, the authority refused to summon them on the ground that
their evidence would be irrelevant and in any case oral testimony was not
necessary to prove what the appellants desired to prove. It appears therefore
that no oral evidence was taken as it was considered irrelevant by the
authority and some of the documents which the appellants wanted the Corporation
to produce were not ordered to be produced. It appears from the final order of
the authority that they were also considered irrelevant as the authority held
that no question arose of comparing the merits of the Corporation with the
private operators.
Let us now turn to the legal position in this
matter as established by the decisions of this Court. The first case to which
reference may be made is Gullapalli Nageswara Rao v. Andhra Pradesh State Road
Transport Corporation(1) in which this Court by majority held that the hearing
under s.
68-D(2) was quasi judicial in nature and the
State Government acted as a quasi judicial authority under that section.
The matter was further considered by this
Court in Malik Ram v. State of Rajasthan (2) and it was held that a hearing before
a quasi judicial authority did not merely mean an argument, and that in proper
cases it might include taking of evidence both oral and documentary. It was
also held that in the circumstances of the provision contained in s. 68-D (2)
and the purpose of the hearing there under, taking of evidence, whether oral or
documentary, that might be produced by either party, was necessary, before the
State Government could arrive at a just conclusion with respect to the
objections to the draft scheme. But it is clear that Malik Ram's case(2) only
decided that if any party desired to produce evidence, whether documentary or
oral, the authority should take that evidence, subject to its right to consider
whether the evidence was relevant or not and to reject such evidence as it
considered irrelevant. It was also pointed out in that case that the authority
would have full power to control the proceedings and a party would not be
entitled to prolong them by producing irrelevant or unnecessary evidence.
The matter was again considered by this Court
in Nehru Motor Transport Co-operative Society Limited v. The State of
Rajasthan(3). In that case it was pointed out that the Rajasthan Rules did not
provide for compelling the attendance of witnesses.
(1) [1959] Supp. 1 S.C.R. 319. (2) [1962] 1
S.C.R. 978.
(3) [1964]1 S.C.R. 220.
339 and that it was enough if the. authority
took evidence of witnesses whom the objector' produced before it. It was also
remarked that the authority might help the objector to secure their attendance
by issue of summonses, though in the absence of any provision in the law, the
witnesses might or might not appear in answer thereto. These observations were
made in the context of an argument that there could be no effective hearing
without a provision for coercive process compelling, attendance of witnesses
and production of documents, and that argument was turned down.
It is urged on behalf of the Corporation that
there is no provision in the Act and the Rules framed there under in Madhya
Pradesh applying the provisions of the Code of Civil Procedure with respect to summoning
of witnesses and discovery or inspection of documents, to proceedings before
the, authority hearing objections under s. 68-D. Therefore the authority was
not in any case bound to summon witnesses or order inspection or discovery of
documents. It seems to us that there is force in this contention and strictly
speaking, the authority cannot summon witnesses or order discovery and
inspection of documents, as the Act has not provided for any such thing. Nor
has any rule been pointed out to us making such a provision. But it is argued
on behalf of the appellants that this was not the reason given by the authority
for not summoning witnesses or not ordering production of documents and we
should judge whether the hearing was adequate on the basis of the reasons given
by the authority in the present case. Further, reliance in this connection is
placed on the observation of this Court in Nehru Motor Transport Co-operative
Society's case(1) that the authority might help the objectors by issuing
summonses.
This observation in our opinion does not
mean, in the absence of any provision in the Act or the rules, that the
authority was bound to summon witnesses even though the persons summoned were
not bound to obey the summonses as there was no provision in law for issue of
such summonses.
The use of the words "by issue of
summonses" in the circumstances of that case was by oversight, for issue
of summonses presumes that there is authority to issue them and the person to
whom they are issued is bound to obey. But in the absence of such power all
that the authority can do is to issue letters merely requesting persons to
appear and it is open to those persons to appear or not. It, this situation if
-,in authority decides not to issue such letters it cannot be said that there
was no effective hearing. In short, what the cases of this Court to which we
have referred show is only this : It' the party concerned wishes to produce any
document or produce any witness, the authority may take the documentary
evidence into consideration or take the evidence of the witness. if it (1)
[1964] 1 S.C.R. 220.
Cl/167 --9 340 considers such evidence
relevant and necessary. But there is in the absence of any provision in the Act
or the Rules, no power in the authority or the State Government to compel
attendance of witnesses or to compel production of documents. This is of course
not to say that if the authority wants any party before it to produce any
document for satisfying itself whether the scheme is for the purposes mentioned
in s. 68-C it cannot so ask; and if the party asked to produce documents does
not do so, the authority would be entitled to draw such inferences as it might
consider justified from the non-production of documents.
But apart from this, there is no power
conferred on the authority under the Act or the Madhya Pradesh Rules to compel
production of documentary evidence or to summon any witness.
But apart from this, even if we examine the
reasons given by the authority for not compelling the production of documents or
for not summoning witnesses we see no reason to disagree with the view taken by
the authority in this case. So far as the witnesses are concerned, the
authority was of opinion that their oral evidence would be irrelevant and it
said so after hearing arguments on the question. Nothing has been shown to us
which would induce us to hold otherwise. As to documentary evidence, it was
asked for to show, firstly, that the Corporation did not have equipment and
finances to carry out the schemes and, secondly, that the Corporation's past
record of running its services was worse than that of the private operators. We
think that both these questions really do not arise in the context of a scheme
of nationalisation envisaged in Chapter IV-A of the Act. It may be mentioned
that his Chapter was introduced in the Act in 1956 after Art. 19(6) of the
Constitution had been amended by the Constitution (First Amendment) Act, 1951.
By that amendment the State was given power relating to the carrying on by it
or by a Corporation owned or controlled by it, of any trade, business,
industry, or service, whether to the exclusion, complete or partial, of
citizens or otherwise. Chapter IV-A envisages what we have called
nationalisation of transport service, and this has to be undertaken by a State
Transport Undertaking which under s. 68-A (b) may be (i) the central Government
or a State Government; or (ii) any Road Transport Corporation established under
section3of the Road
Transport Corporations Act, 1950; or (iii) the Delhi Road Transport Authority
established under section 3 of the Delhi Road Transport Authority Act, 1950; or
(iv) any municipality or any corporation or company owned or controlled by the
State Government.
It will thus be clear that nationalised road
transport under Chapter IV-A would be run either by the Central Government, or
a State 341 Government or any of the other three authorities mentioned there
which are all under the control of the State Government or the Central
Government. In these circumstances, with the resources of the Government behind
those authorities it would in our opinion be futile for any objector to say that
the Central Government, the State Government or the authorities backed by it
could not have equipment and finances to carry out the schemes. It seems to us
that the very fact that a scheme is proposed suggests that the Central
Government or a State Government or the authorities would carry it out. So
there is no question of asking for production of documents relating to the
equipment and financial position of a State Transport Undertaking as defined in
s. 69-A (b).
We are further of opinion that there is no
question of consideration of comparative merits of the State Transport
Undertaking and the private operators in the context of Chapter IV-A. As we
have said already Chapter IV-A was enacted for nationalisation of road
transport services in accordance with the amendment made in Art. 19 (6) of the
Constitution. The nationalised road transport under that Chapter can only be
run by the State Transport Undertaking as defined in s. 68-A (b) of the Act. In
view of that fact, if nationalisation has to come as envisaged by the amendment
of the Constitution, the only body which can run the nationalised service is
the State Transport Undertaking, and in those circumstances we fail to see any
necessity for comparison between a State Transport Undertaking on the one hand
and individual operators on the other.
Apart from this general consideration, we are
further of opinion that ordinarily no question of comparative merits based on
past record between a State Transport Undertaking and individual operators can
arise. Section 68-C provides that the State Transport Undertaking has to run an
efficient, adequate, economical and properly coordinated road transport
service, and for doing that it does not take up just one route and put one
transport vehicle on it. It takes up a large number of routes and puts a large
number of transport vehicles on them in order to run in integrated service
whether for passengers or for goods, or for both.
In these circumstances it is difficult to see
how one can compare such an undertaking with individual private operators who
are running one transport vehicle or so on individual routes. secondly, it
would be unusual for the State Transport Undertaking co be running transport
vehicles on individual routes before it produces a scheme for nationalisation
of the type provided for in chapter IV-A, though it may be conceded that this
may not be quite impossible, for some State Transport Undertaking might have
entered into competition with private operators and might have obtained permits
under Chap. V: (see, for instance, Parbani Transport Co-operative Society Ltd.
v. The Regional Trans342 port. Authority(1). Even so, when the State Transport
Undertaking takes action under Chap. IV-A of the Act there can in our opinion
be no question of comparison between a State Transport Undertaking running an
integrated service and individual operators running one transport vehicle or
more on individual routes. We are therefore of opinion that the authority
cannot be said to have gone wrong in not asking for past records of the
Corporation in the present case for purposes of such comparison. It is true
that s. 68-C requires that the scheme should be in the public interest. But
unless the scheme is shown not to be efficient, adequate, economical and
properly coordinated, it will in our opinion generally follow that it is in the
public interest. We do not think therefore that the comparative merits of the
Corporation as against individual operators requires to be judged under Chapter
IV-A in the public interest. In the circumstances we are of opinion that the
hearing in this case was both adequate and real.
The appeals therefore fail and are hereby
dismissed with costs one hearing fee.
R.K.P.S. Appeals dismissed.
1) [1960]3 S.C.R. 177.
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