U.P. State Road Transport Corporation vs Sandeep Kumar Jain .

NON-REPORTABLE IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.11194 OF 2017 (Arising out of SLP(C) No.35947 OF 2010)

U.P. State Road Transport Corporation …..Appellant

Versus

Sandeep Kumar Jain & Ors. ..Respondents

WITH CIVIL APPEAL NO.11195 OF 2017 (Arising out of SLP(C) No.69 of 2011)

JUDGMENT

MOHAN M. SHANTANAGOUDAR, J.

Leave granted.

2. These appeals are filed questioning the validity of the

judgment dated 30.7.2010 passed by the High Court of

Judicature at Allahabad, Lucknow Bench in W.P. No. 2161 of

2007 by which the Lucknow Bench has allowed the writ petition.

3. Learned counsel for the appellant/corporation argued Signature Not Verified

mainly relying upon the Division Bench judgment of the Digitally signed by ASHOK RAJ SINGH Date: 2017.09.06 11:46:34 IST Reason:

Allahabad High Court in the case of Smt. Kanchan & Ors. Vs.

State Transport Appellate Tribunal and Ors. (in Civil 2

Miscellaneous Writ Petition No. 48624 of 2002 decided on 4 th

April 2003) that the matter involved in this petition is fully

covered by the aforementioned judgment of the Division Bench

which was confirmed by this Court in Civil Appeal Nos. 7305-

7306 of 2003 disposed of on 17 th January 2006, wherein it is

observed that the findings on the Mala fides of the State

Transport Authority (STA) are clearly borne out from the records

seen by the Tribunal. In the said case the route involved was a

notified route, as involved in this matter, i.e. 11 kilometers’

stretch lying between Dewal-Bijnor. In Civil Appeal

Nos. 7305-7306 of 2003, this Court had confirmed the Order of

the High Court by which 48 permits of the State Route issued by

the State Transport Authority on the route in question were

cancelled.

Per contra, the Learned Counsel appearing on behalf of the

operators/respondents contended that they are the existing

operators and therefore they are protected under the scheme of

the notified route including the portion between Dewal-Bijnor.

4. For the purpose of convenience, the facts in brief are

gathered from Civil Appeal arising from SLP Civil No. 35947 of 3

2010. The facts of the case in brief are that the respondents in

SLP (C) No.35947 of 2010 are holders of regular state carriage

permits awarded by the State Transport Authority on the route

known as Meerut-Mawana-Behsuma-Meeranpur-Bijnore via

Dewal Bridge. The permits were granted in favour of the some of

the respondents on 4/5-9-1989 and to certain other respondents

on 11.5.1994. Meerut-Bijnore was a non-notified route when the

permits were granted to the respondents, so also the other route

Muzaffarngar-Bopa-Morna-Revali Ghat-Bijnore was a

non-notified route when the permits were granted to the

respondents. Muzaffarnagar-Bhopa-Morna-Revali-Ghat-Bijnore

route came into existence in 1960 and the operators on the said

route had to cover the route through a pantoon bridge which had

been constructed on Revali Ghat. The Scheme under Section

68-C of the Motor Vehicles Act, 1939 was published in the year

1962 in respect of the concerned route. However, on 15.11.1977,

the Scheme in respect of another route under Section 68-C of the

Motor Vehicles Act, 1939 was also published.

5. A pucca bridge was constructed at Dewal in the year 1985

for crossing the Ganga River. In view of the said development,

another route i.e., Muzaffarnagar-Bijnore was diverted as 4

Muzaffarnagar-Bhopa-Morna-Bera Sadat to Bijnore. Thereafter

21 permits were granted by the Regional Transport Authority,

Meerut vide order dated 4/5-9-1989 and one permit was granted

vide order dated 17.5.1990 which had been challenged before the

State Transport Appellate Tribunal, the High Court as well as in

this Court. This Court vide its judgment dated 10.5.1993 in SLP

(C) No.6625 of 1993 upheld those 21 permits.

6. Subsequently major developments had taken place, as a

result of which the Muzaffarnagar-Bijnore route had been

diverted to Muzaffarnagar-Jansath-Meeranpur-Dewal Barrage-

Bijnore, and in that regard a scheme was published. Pursuant to

the newly published scheme, the Regional Transport Authority,

Meerut took decisions in its meetings held on 08.05.1995 and

02.06.1995 that the permits granted in pursuance of the scheme

dated 03.09.1994 will remain in operation. In respect of permits

granted prior to 03.09.1994 by Regional Transport Authority,

Meerut after coming into force of the Notification dated

03.09.1994, it was said to have been clarified by the High Court

in Civil Misc. Petition No. 37607 of 1995 vide order dated

03.03.1997 with regard to the operation of buses on the portion

between Dewal-Bijnore. It is relevant to mention herewith that 5

the State Transport Authority, U.P. Lucknow granted 48 permits

vide order dated 29.9.1989 under the route in question. The said

order was challenged in Revision No.68 of 1999 before the State

Transport Appellate Tribunal which came to be allowed by the

judgment dated 23.10.2002. Consequently, the order passed by

the State Transport Authority dated 29.09.1989 was set aside, in

effect thereto, the 48 permits granted by the State Transport

Authority on the route in question stood cancelled. Aggrieved by

the order of the State Transport Appellate Tribunal, the permit

holders filed Civil Misc. Writ Petition No.46223 of 2002 (titled

M.K. Jain and 27 others vs. State Transport Appellate Tribunal,

U.P. Lucknow) as well as Civil Misc. Writ Petition No. 48624 of

2002 (Smt. Kanchan & Ors. Vs. State Transport Appellate

Tribunal & Ors.). These writ petitions were dismissed by the High

Court on 04.04.2003. The judgment of the High Court was

confirmed by this Court in Writ Petition No.7306 of 2003 (Smt.

Kanchan & Ors. Vs. State Transport Appellate Tribunal & Ors.)

on 17.1.2006. In effect, 48 permits granted on the route in

question stood cancelled.

7. In the meanwhile, the Regional Transport Authority,

Meerut had issued show cause notices on 26.12.2005 to the 6

respondents as to why the permits granted in their favour should

not be cancelled in view of the another judgment of this Court

dated 05.04.2005 in Civil Appeal Nos. 6716-6818 of 1999 (titled

U.P. State Road Transport Corporation vs. Omaditya Verma and

Ors., 2005 (4) SCC 424). As mentioned supra, the Civil Appeal

No. 7306 of 2003 was heard by this Court and was dismissed on

17.1.2006 confirming the judgment passed by the High Court

cancelling the 48 permits. This Court concluded that the State

Transport Authority while granting 48 permits as per order dated

29.9.1989 on the route in question has mala-fidely exercised its

jurisdiction.

8. Pursuant to said judgment of this Court, the Regional

Transport Authority as well as the State Transport Authority

cancelled the permits of the respondents after hearing them. The

orders of the Regional Transport Authority as well as the State

Transport Authority were questioned by the respondents before

the High Court of Judicature at Allahabad in W.P. No.2161 of

2007 which was allowed by the judgment dated 30.7.2010 and

the same is impugned in these appeals.

7

9. This Court on facts has ruled in the aforementioned

judgments particularly in Civil Appeal No.7306 of 2003 that the

route in question is a notified route and therefore the permits

granted for the same route are bad in law. It is also concluded by

this Court in the case of Smt. Kanchan & Ors. Vs. State

Transport Appellate Tribunal & Ors. (Civil Appeal No.7306 of

2003) that the exercise of jurisdiction by State Transport

Appellate Tribunal in granting 48 permits is mala fide exercise of

power based on the judgment of this Court. The action was taken

by the Regional Transport Authority as per law issuing

show-cause notices etc. for getting 25 permits cancelled which

were issued after the year 1985 as was done by this Court in Civil

Appeal Nos. 7305-7306/2003. The Regional Transport Authority

had rightly cancelled the permits issued on the ground that the

route Dewal to Bijnore is a notified route.

10. The Allahabad High Court in the aforementioned judgment

in detail on facts had dealt with as to how the private operators

were not entitled to ply their vehicles on the notified route i.e. 11

kilometers’ stretch lying between Dewal to Bijnor. Though the

respondents herein were existing operators they cannot be shown

leniency in view of the fact that the route over which they were 8

plying earlier did not include Dewal to Bijnor. Since they have

now been plying the vehicles on the notified route Bijnor-Dewal

they cannot be permitted to do so. Though the judgment of the

Division Bench of Allahabad High Court mentioned supra is

confirmed by this Court in Civil Appeal Nos. 7305-7306 of 2003

on different grounds, the fact remains that the judgment of the

Allahabad High Court stood confirmed. Hence, in our opinion,

the State Transport Authority is justified in relying upon the

judgment of Allahabad High Court mentioned supra in Civil

Miscellaneous Writ Petition no. 48624 of 2002 and the judgment

of this Court in Civil Appeal Nos. 7305-7306 of 2003 inasmuch

as the very route in question that were Dewal-Bijnor was a

subject matter.

11. It is well settled law and it is reiterated by this Court in the

case of U.P. State Road Transport Corporation vs. Omaditya

Verma and Ors., 2005 (4) SCC 424 that the private operators

cannot be permitted to ply the vehicles on notified/nationalized

route unless permitted by the Scheme. The High Court while

passing the impugned judgment had not properly appreciated the

impact of the judgment of this Court in the case of U.P. State

Road Transport Corporation vs. Omaditya Verma and Ors., 2005 9

(4) SCC 424. After construction of Ganga Barrage in the year

1985; after diversion of both the routes i.e.

Muzaffarnagar-Bijnore and Meerut-Bijnore, the common strip

from Dewal to Bijnore i.e. for a portion of 11 km. is being used.

As the route has become a notified route pursuant to the

Nationalization Scheme dated 05.11.1997, and since it is a

settled principle of law that no private operators can be permitted

to operate/ply vehicles on the notified route except as permitted

by the Scheme, the respondents cannot be permitted to ply the

vehicles on the notified route.

12. It would also be relevant to note the conclusions reached by

the Constitution bench in the Case of G. T. Venkataswamy Reddy

vs State Transport Authority & Ors. (2016) 8 SCC 402 which are

as under:

“Having analysed the above referred to decisions and the statutory provisions, before rendering our final answer to the question referred to this Constitution Bench, it will be worthwhile to make a reference and list out the legal propositions which we are able to discern based on our detailed consideration in this reference:

(a) Chapter IV-A supersedes any inconsistent provisions in Chapter IV.

(b) The policy of the Legislature is clear from Section 68-C that the State Transport Undertaking may initiate a scheme for the 10

purpose of providing an efficient, adequate, economical and properly coordinated road transport service to be run and operated by the State Transport Undertaking in relation to any area or route or portion thereof. It may do so if it is necessary in the public interest.

(c) Grant of variation under Section 57(8) will be as good as grant of a new permit.

(d) Section 57(8) is controlled by Section 68FF falling under Chapter IV-A, by virtue of the superseding effect of Section 68-B also falling under Chapter IVA.

(e) Once a scheme formulated under Section 68-D gets approved under 68-D(3) of Chapter IV-A, then all the permits in the route / area covered by the scheme will get frozen by virtue of operation of Section 68-FF.

(f) The effect of Section 68-FF can be altered / modified / cancelled only in the manner as provided for under Section 68-E and in no other manner.

(g) By virtue of the above, either a grant of a new permit or the variation of an existing permit of private operator cannot be ordered in respect of an area or route covered by an Approved Scheme.

(h) Increase in the number of trips or vehicles which were being run under the existing exempted permit under a Scheme will amount to grant of a new permit to operate one more Stage Carriage which is not permissible under Section 68-FF.

(i) The proposition of law, laid down by this Court in ‘JAYARAM’ impliedly stood overruled in ‘ADARSH TRAVELS’.

(j) The economy and coordination, two of the factors, which govern the Approved Scheme, will be seriously infringed if the variation is to be granted of the existing permit condition.

11 (k) Even if there is an interstate agreement under Section 63 of the Act for increasing the number of trips, such an agreement cannot override the provisions of Chapter IV-A by virtue of Section 68B of the Act.

Section 63 being in Chapter IV of the Act, the Scheme approved under Chapter IV-A will prevail over it.

(l) The Approved Scheme will exclude the operation of other stage carriage services on the Route / Area covered by the Scheme, except those whose names are mentioned in the Scheme and to the extent to which such exception is allowed.

(m) The provisions in Chapter IV-A are devised to override the provisions of Chapter IV and it is expressly so enacted, the provisions of Chapter IV-A are clear and complete regarding the manner and effect of the “takeover” of the operation of a road transport service by the State Transport Undertaking in relation to any Area or Route or portion thereof (ADARSH TRAVELS).

(n) A necessary consequence of those provisions is that no private operator can operate his vehicle on any part or portion of a notified area or notified route unless authorized so to do by the term of the scheme itself. He may not operate on any part or portion of the notified Route or Area on the mere ground that the permit as originally granted to him covered the notified Route or Area (ADARSH TRAVELS).

Having regard to the above propositions, which we are able to arrive at, we hold that the judgment reported in Karnataka State Road Transport Corporation, Bangalore Vs. B.A. Jayaram and others - 1984 (Supp) SCC 244 is no longer a good law and the decision reported in Pandiyan Roadways 12

Corporation Ltd. Vs. M.A. Egappan -

(1987) 2 SCC 47 stands approved which is in tune with the Constitution Bench decision reported in Adarsh Travels Bus Service and another Vs. State of U.P. and others - (1985) 4 SCC 557 and the observations made in R.Raghuram Vs. P. Jayarama Naidu and others – 1990 (supp) SCC 361 stands approved.”

Aforementioned conclusions are applicable to the facts of

this case. The Constitution bench while coming to the

aforementioned conclusions has considered various judgments on

the point including in the case of Adarsh Travels Bus Service vs

State of U.P. and Others (1985) 4 SCC 557 (Constitution Bench

Judgment) etc.

13. Having regard to the totality of the facts and

circumstances of the case, we are of the considered opinion that

the High Court is not justified in setting aside the orders passed

by the State Transport Appellate Tribunal and Regional Transport

Authority. Particularly, when the matter is covered by the

judgment of this Court in Civil Appeal Nos. 7305-7306 of

2003decided on 17.1.2006 cancelling 48 permits on the route in

question. Accordingly, the impugned judgment of the High Court

is set aside, the judgment and orders of the Regional Transport

Authority as well as of the State Transport Appellate Tribunal are 13

restored. Consequently, Civil Appeal arising out of SLP(C)

No.35947 of 2010 is allowed and Civil Appeal arising out of SLP

(C) No. 69 of 2011 stands dismissed. No costs.

…………………………………….J. [ARUN MISHRA]

……………………………………..J. [MOHAN M. SHANTANAGOUDAR] New Delhi.

September 05, 2017.