TaxTMI 
TaxTMI 
1983 (2) TMI 328
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....pect of routes or areas for which schemes have been published under Section 68-C of the Motor Vehicles Act, 1939) to all eligible applicants: Now, therefore, in exercise of the powers under Section 43-A of the Motor Vehicles Act, 1939, the Governor of Uttar Pradesh is pleased to direct that the stage carriage permits (except in respect of routes or areas for which schemes have been published under Section 68-C of the Motor Vehicles Act, 1939) shall be granted according to the provisions of the Act to all eligible applicants and there shall be no upper limit to the number of stage carriages for which permits may be granted. By Order Karnail Singh, Sachiv II. Notification No. 241 T/XXX-4-15-P/79 Dated : January 23, 1981 The Governor being satisfied that it is expedient in the public interest so to do, is pleased to direct in exercise of the powers under Section 43-A of the Motor Vehicles Act, 1939 (Act No. 4 of 1939) that while considering applications for stage carriage permits, the State Transport Authority or a Regional Authority: (i) shall have regard only to matters referred to in Clauses (a), (b), ....
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....tenance of motor vehicles, control of traffic, insurance of motor vehicles against third party risks and offences, penalties and procedure. The State Governments were entrusted with the duty of framing rules on various matters connected with the topics dealt with by the Act. The subject of regulation of motor vehicles being within the scope of Entry 35-mechanically propelled vehicles including the principles on which taxes on such vehicles are to be levied-in List III of the Seventh Schedule to the Constitution, various amendments were made from time to time by several State Legislatures with the assent of the President of India either adding to or modifying the provisions of the Act. Chapter IV of the Act which includes Section 42 to Section 68 contains provisions pertaining to the control of motor vehicles. Section 42 of the Act provides that no owner of a transport vehicle shall use or permit the use of the vehicle in any public place whether or not such vehicle is actually carrying any passenger or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or the Commission authorising the use of the vehicle in t....
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....ce arising from journeys not being broken; (c) the adequacy of other passenger transport services operating or likely to operate in the near future, whether by road or other means, between the places to be served. (d) the benefit to any particular locality or localities likely to be afforded by the service; (e) the operation by the applicant of other transport services, including those in respect of which applications from him for permits are pending; (f) the condition of the roads included in the proposed route or area; and shall also take into consideration any representations made by persons already providing passenger transport facilities by any means along or near the proposed route or area, or by any association representing persons interested in the provision of road transport facilities recognised in this behalf by the State Government, or by any local authority or police authority within whose jurisdiction any part of the proposed route or area lies: Provided that other conditions being equal, an application for a stage carriage permit from a cooperative society registered or deemed to have been registered under any enactment....
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....rt Appellate Tribunal which should consist of a whole time judicial officer not below the rank of a District Judge. An order of a Regional Transport Authority or of a State Transport Authority against which no appeal can be filed is subject to revision by the State Transport Appellate Tribunal under Section 64-A of the Act. Sub-section 1 of Section 43 of the Act which confers power on the State Government to control transport reads thus: 43. Power to State Government to control 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 coordinating road and rail transport, (c) the desirability of preventing the deterioration of the road system, and (d) the desirability of preventing uneconomic competition among motor vehicles, may, from time to time, by notification in the Official Gazette, issue directions to the State Transport Authority: (i) regarding the fixing of fares and freights (including the maximum and minimum in respect thereof) for stage carriages, contract carriages and public carriers; (....
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....s for which schemes have been published under Section 68(C) or contract carriage permits or public carrier permits to all eligible applicants, it may by notification in the Gazette issue a direction accordingly, and thereupon all transport authorities as well as the State Transport Appellate Tribunal constituted under Section 64 shall proceed to consider and decide all applications, appeals and revisions in that behalf (including any pending applications, appeals and revisions) as if- (a) in Section 47- (i) for Sub-section 1 the following Sub-sections were substituted: (ii) A Regional Transport Authority shall in considering an application for a stage carriage permit, have regard to the following matters, namely- (a) the interest of the public generally; (b) the advantage to the public of the service to be provided including the saving of time likely to be effected thereby and any convenience arising from journeys not being broken; (c) the benefit to any particular locality or localities likely to be afforded by the service; and shall also take into consideration any representation made by any local authority or police ....
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....ed by some motor operators in the High Court of Allahabad. Those petitions were dismissed. On appeal this Court upheld the validity of Section 43-A of the Act as well as the Notification by its judgment in Hans Raj Kehar and Ors. v. The State of U.P. and Ors. [1975]2SCR916 which was delivered on December 4, 1974. Within about three and half years from the date of the above said notification the Government of Uttar Pradesh realised that it was necessary to review the whole question of issuing permits to all eligible applicants. Accordingly the State Government issued a Notification on September 24, 1975 which ran as follows: Whereas, in exercise of the power conferred by Section 43-A of the Motor Vehicles Act, 1939 the State Government was by notification No. 1188-T/XXX-4, dated March 30, 1972, pleased to direct that stage carriage permits (except in respect of routes or areas aforesaid) contract carriage permits and public carrier permits shall be granted according to the provisions of the said Act to all eligible applicants: And whereas, on further consideration the State Government is of opinion that the policy of granting such permits to all eligible applicants requires re....
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....port Authority, and such Transport Authority shall give effect to all such directions. (2) Without prejudice to the generality of the provisions of Sub-section (1) such directions may be given in respect of any of the following matters, namely: (a) the number of stage carriage or contract carriage permits that may be granted in respect of any route or area. (b) the preference or the order of preference to be given to or the quota to be fixed for, specially deserving categories, such as Ex. Army personnel, educated unemployed persons, such persons holding driving licences as are members of cooperative societies formed for passenger transport business, persons belonging to the Scheduled castes and Scheduled Tribes. (c) the procedure for grant of permits, and for selection from among the applicants, including selection by drawing of lots from among persons belonging to the same category. (3) Any direction under Sub-section 1 may be issued with retrospective effect. (4) Where any direction is issued under Sub-section 1 to any Transport Authority, then any appeal or revision pending before the State Transport Appellate Tribunal shall....
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....vernor is pleased to direct: (1) That the S.T.A. and R.T. As. while fixing the number of Additional Stage Carriage permits to be issued at a given time on non-notified routes, shall in addition to the consideration of the matter mentioned in Sub-section 1 of Section 47 of the M.V. Act, ensure that the operation of the total number of stage carriages on any route, taking into consideration the existing as well as the additional permits proposed to be issued, would be economically viable on the existing fare-structure as per the norms as laid down by the State Government from time to time.... 13. The above notification also contained directions regarding the principle to be followed in determining the number of permits that could be issued and reservation of permits for operators displaced by nationalisation, educated unemployed, members belonging to the Scheduled Castes, the Scheduled Tribes and other backward classes, unemployed army drivers and cooperative societies. 14. These directions were superseded by the issue of a fresh notification under Section 43-A by the State Government on October 12, 1977 which was superseded by a Notification dated October 15, 1978. ....
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....ent of land (whether in one class or in different classes), held by such person together with that, if any, held by the members of his family; or (c) the annual income and the extent of land aforesaid, does, or do not exceed such limit as may be prescribed. Explanation II.-For the purposes of Explanation I, "family", in relation to an individual, means the wife or husband, as the case may be, of such individual and the minor children of such individual. (1D) The number of permits reserved under Sub-section (1B) and Clause (a) of Sub-section (1C), shall not exceed fifty percent of the total number of stage carriage permits granted during a calendar year. (1E) In giving effect to the provisions of Sub-section (1B) and Clause (a) of Sub-section (1C) the Regional Transport Authority or the State Transport Authority may, if it considers necessary or expedient so to do, group the various routes within its jurisdiction, (1F) Where any stage carriage permit is to be granted from the quota reserved under Sub-section (1B) or Clause(a) of Sub-section (1C) to any cooperative society registered or deemed to have been registered under any enactment in....
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....d to in Sub-section 3 of Section 68D where the undertaking operates the service. Explanation.-For the purposes of this Sub-section, 'inter-State route' means any route lying continuously in two or more States. 17. By the amendment of Section 47 of the Act as stated above, Parliament directed that the Regional Transport Authority while considering applications for stage carriage permits should, provided that other conditions being equal, give preference to an application from a person who has a valid licence for driving transport vehicles over applications from individual owners. Parliament also provided for reservation of certain percentage of permits for stage carriages in favour of persons belonging to the Scheduled Castes and the Scheduled Tribes in the same ratio as in the case of appointments made by direct recruitment by a State Government to public services in that State. Since it was considered necessary to promote the well being of economically weaker sections of the community, the State Government was empowered under certain circumstances either to reserve certain percentage of permits for stage carriages for persons belonging to economically weaker se....
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....esentation made by the local authority or police authority within whose jurisdiction any part of the proposed route or area lay. It also directed that Section 57 should be deemed to have been complied with if the Transport Authority concerned intimated the particulars of the applications to such local authority and police authority for making representations, if any, within a period of fifteen days from the date of despatch of the intimation with the stipulation that if no representation was received within the prescribed period of time, it would be presumed that they had no representation to make and considered any representation made by such local authority and police authority. 18. A reading of these two notifications shows that the State Government ignored, first, the legislative policy underlying the Uttar Pradesh Act 15 of 1976 by which the new Sub-section 2 of Section 43-A was enacted in substitution of the former Sub-section 2 with retrospective effect. As stated earlier, the State Legislature introduced the new Sub-section 2 of Section 43-A after it realised the mistake committed by the State Government in issuing the notification in the year 1972 directing the issue of....
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.... reserve the grant of permits in their favour to the extent of 25 percent. The principle behind reservation in the grant of stage carriage permits employed by the Parliament appears to be the same as in reserving appointment in the Government service. If today government services are available in abundance, the question of reservation would not arise. It is only on account of the posts being limited that the question of reservation has arisen. So we are not able to agree with the submission of the petitioner's learned Counsel that there is a conflict between Section 43-A, as inserted by the U.P. Legislature and the amendments made in Section 47 by Parliament in the Motor Vehicles Act. 19. The High Court further proceeded to observe that though the impugned notifications did not follow the procedure prescribed by Sub-section 2 of Section 43-A as it is now in force in the State of Uttar Pradesh, they could be sustained under Sub-section 1 of Section 43-A which authorised the State Government to issue such directions of a general character as it might consider necessary or expedient in the public interest in respect of any matter relating to road transport to the State Transpor....
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.... of the former Sub-section (2) by the new Sub-section (2) in Section 43-A the Legislature clearly expressed itself against the policy of granting permits to all eligible applicants without any consideration to the needs of any particular locality or route or to the qualifications of applicants. It is a well settled rule of construction of statutes that whenever a court is called upon to interpret an amended provision it has to bear in mind the history of the provision, the mischief which the Legislature attempted to remedy, the remedy provided by the amendment and the reason for providing such remedy. Therefore, after the amendment at any rate it has to be held that Sub-section (1) of Section 43-A of the Act did not comprehend within its scope the power to issue directions for issuing permits to all eligible applicants without any sort of restriction relevant to the scheme of the Act. What does Section 43-A(1) after all say? It says that the State Government may issue such directions of a general character as it may consider necessary in the public interest. What is the meaning of the term 'public interest'? In the context of the Act, it takes within its fold several factor....
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....he State Government under Section 43-A of the Act should, therefore, be in conformity with all matters regarding which the statute has made provision. In this situation to say that any number of permits can be issued to any eligible operator without any upper limit is to overstep the limits of delegation of statutory power and to make a mockery of an important economic activity like the motor transport. 21. It is surprising that the High Court has reached the conclusion that the preferences and reservations to be observed while granting permits as stated in the proviso to Sub-section (1) to Section 47 and in Sub-sections (1A) to (1H) of Section 47 have not been contravened as there is no restriction on the number of permits to be issued. The observation of the High Court that preferences have to be shown and reservations have to be made only when there is scarcity of permits and since there are no restrictions on the number of permits to be issued there is no necessity to make any such provision really shocks us. The High Court erred in not noticing that it was dealing with a vital economic activity which could be carried on at a huge cost both to the operator and to the Governm....