HON’BLE THE CHIEF JUSTICE SRI G.S. SINGHVI AND HON’BLE SRI JUSTICE C.V. NAGARJUNA REDDY Writ Appeal No.692 of 2007 Between: V. Venkataramana … Appellant And The State Transport Appellate Tribunal, Andhra Pradesh, Hyderabad, represented by its Presiding Officer and two others. … Respondents :: J U D G M E N T :: Counsel for the appellant : Sri T. Venkataramana Counsel for respondent No.3 : Sri K. Srinivasa Rao October 11, 2007 Per G.S. Singhvi, C.J. This is an appeal for setting aside order dated 19-7-2007 of the learned Single Judge, whereby he rejected the appellant’s challenge to order dated 30-4-2002 passed by the State Transport Appellate Tribunal (for short, ‘the Tribunal) in R.P.No.7/2000. The Facts: 1) On an application made by the appellant, State Transport Authority, Karnataka (for short, ‘STA, Karnataka’) granted him stage carriage permit No.2/87-88 under the Motor Vehicles Act, 1939 to operate bus on B. Kothakota to Chintamani route, which is an Inter-State route falling in the States of Karnataka and Andhra Pradesh. The total length of the route is 44 k.m. Of this, 9.5 k.m. is in the State of Andhra Pradesh. The permit was duly countersigned by State Transport Authority, Hyderabad (for short, ‘STA, Hyderabad’). 2) After ten years, the appellant applied for renewal of the existing permit. However, he was granted fresh permit No.58/1998 to operate the bus for a period of five years commencing from 25-11- 1998. 3) On 29-9-1998, the appellant submitted an application to STA, Karnataka for variation in the conditions of permit by way of grant of one additional single trip from B. Kothakota to Chintamani and inclusion of one more vehicle to the permit for performing seven single trips from Chintamani to B. Kothakota and assignment of fresh timings. 4) By an order dated 28-11-1998, STA, Karnataka granted the variations applied for by the appellant. The relevant portions of that order are extracted below: “By way of reply, Sri S.V. Krishna Swamy, learned counsel submitted that the applicant has already obtained new permit No.58/98 valid upto 24-11-2003 in place of old permit according to the decision of the Hon’ble Supreme Court of India referred to above and that there will be no legal impediments for the grant of the application. He further submitted that the portion of route lying in the State of Karnataka is a non-monopoly route except a portion of 5 kms. overlapping in Andhra Pradesh State for which the applicant being an existing operator is exempted from the purview of the scheme to traverse upto 8 kms. on the notified route. In support of his submission, the learned counsel Sri S.V. Krishnaswamy, also relied upon the decision of the Hon’ble Supreme Court of India in the case of Sri Dibaker Sahu v. State Transport Appellate Tribunal, West Bengal and others reported in AIR 1991, Calcutta 261, wherein under the provisions of M.V.Act, 1988, no specific restrictions are imposed for inclusion of one more vehicle in the permit. It was also submitted that the applicant is only operator, operating his service on the route in question to cater to the need of the commuters of rural villages situated enroute. If the additional vehicle is allowed to make 7 more single trips on the route, the travelling public will be very much benefited. He, therefore, prayed for the grant of the application as applied for in the larger interest of travelling public. The State Transport Authority after hearing the submissions of the parties, perused the records and the reply furnished by the learned counsel for the applicant one duly taken note of. In the circumstances of the case narrated above, taking a positive stand in the matter, the variation sought for by the applicant as proposed in the application is granted along with the timings as proposed in the application subject to the following conditions: a) The grant is on payment of tax basis to A.P. State. b) The grantee shall obtain endorsement of variation in the existing permit and also to obtain permit for the additional vehicle by producing the documents of vehicle, which is of below 10 years old, within 30 days from the date of receipt of this proceedings failing which the grant shall stand revoked unless extension of time is obtained from the Secretary, under Rule 654 of KMV Rules, 1989.” 5) Thereafter, vide its proceedings dated 16-10-1999, STA, Hyderabad, while rejecting the objection raised by the Andhra Pradesh State Road Transport Corporation (for short, ‘the Corporation’) that in view of the schemes notified by the State Government vide G.O.Ms.No.767, dated 3-6-1975 and G.O.Ms.No.1125, dated 7-12-1976, the appellant, who was granted fresh permit in 1998, is not entitled to operate the service, countersigned the permit with variations granted by STA, Karnataka. 6) The Corporation challenged the decision of STA, Hyderabad in Revision Petition No.7/2000. The Tribunal, vide its order dated 30-4-2002, allowed the revision and quashed the decision of STA, Hyderabad to countersign the permit of the appellant. The appellant challenged the order of the Tribunal in Writ Petition No.13324 of 2002 by contending that grant of variation by STA, Karnataka cannot be equated with grant of new permit and being an existing operator, he is entitled to ply on the routes notified vide G.O.Ms. No.767, dated 3-6-1975 and G.O.Ms.No.1125, dated 7-12- 1976. The learned Single Judge relied on the judgments of the Supreme Court in Pandiyan Roadways Corpn. Ltd. v. Thiru M.A. Egappan[1] and of the Full Bench of this Court in L. Raghuraman v. State Transport Appellate Tribunal, A.P., Hyd.[2] and held that the Inter-State route from B.Kothakota to Chintamani overlapped the routes published in the two G.Os., and the writ petitioner is not entitled to operate the service on a portion of the notified route because is his not an existing operator. The learned Single Judge noted that in Karnataka State Road Transport Corporation, Bangalore v. B.A. Jayaram[3], the Supreme Court had taken the view that variation in the conditions of permit did not amount to grant of new permit, but held that in the subsequent judgment in Pandiyan Roadways Corpn. Ltd. v. Thiru M.A. Egappan (supra), a contrary view was expressed and the same has been followed by the Full Bench in L. Raghuraman v. State Transport Appellate Tribunal, A.P., Hyd. (supra). Sri T. Venkataramana, learned counsel for the appellant referred to the schemes notified by the two G.Os., relied on the judgments of the Supreme Court in Karnataka State Road Transport Corporation, Bangalore v. B.A. Jayaram (supra), M/s. Shiv Chand Amolak Chand v. Regional Transport Authority[4], M/s. Adarsh Travels Bus Service v. State of U.P.[5] and D.M. Thippeswamy v. Mysore Appellate Tribunal[6] and argued that the view expressed by the Tribunal and learned Single Judge on the appellant’s entitlement to operate on the Inter-State route and legality of the countersignatures granted by STA, Hyderabad is patently erroneous and the impugned order is liable to be set aside. Sri T. Venkataramana further argued that the variation granted by STA, Karnataka did not amount to grant of new permit and being an existing permit holder, the appellant is entitled to operate on a part of the notified route. He emphasised that in terms of the conditions embodied in G.O.Ms.No.767, dated 3-6-1975 and G.O.Ms.No.1125, dated 7-12-1976, the right of the existing operator to ply on the notified route is saved. Learned counsel for the Corporation argued that after having obtained new permit in 1998, the appellant cannot claim to be an existing operator for the purposes of the schemes notified on 3-6-1975 and 7-12-1976 and he cannot be allowed to operate bus on the notified route. He relied on the judgment of the Full Bench in L. Raghuraman (supra) and argued that in the face of variation granted by STA, Karnataka, the appellant cannot be treated as an existing operator for the purposes of the schemes notified on 3-6-1975 and 7-12-1976. We have given our most anxious consideration to the respective arguments and carefully scrutinised the orders passed by STA, Karnataka, STA, Andhra Pradesh, the Tribunal and the learned Single Judge. Before dealing with the rival contentions, we deem it proper to mention that the scheme notified vide G.O.Ms.No.767, dated 3-6-1975 covered Madanapalle to Kadiri via. B. Kothakota, Pedda Tippa Samudram and Mulakala Cheruvu Railway Station route and the scheme notified vide G.O.Ms.No.1125, dated 7-12-1976 covered the route from Madanapalle – Chowdesamudram via. Burrakayalakota, Kothakota, Kandur and Mulakacheruvu. The total length of the overlapping portion of both the routes was 5 kms. Footnotes 4 and 5 of the two schemes provided for exemption to the existing holders of stage carriage permits. In view of the above, it is to be seen whether the appellant could be treated as existing operator within the meaning of footnote-4 appearing in the two schemes. A perusal of the relevant portions of the proceedings dated 28-11-1998 recorded by STA, Karnataka, which have been extracted hereinabove, unmistakably show that as per the appellant’s own case, he was granted new permit to operate the service for a period of five years commencing from 25-11-1998. Therefore, it is not open to him to turn around and claim the status of an existing operator and STA, Andhra Pradesh committed a jurisdictional error by countersigning the permit ignoring the prohibition contained in the two schemes against the grant of new permits on the notified routes. In B. Satyam v. Secretary, S.T.A.[7], a Division Bench of this Court considered whether, after seeking variation in the conditions of permit, the permit-holder can operate bus on the notified route, and answered the same in negative by recording the following observations: “When the Scheme says that it would not touch the existing stage carriage permits in respect of the inter-state routes, we cannot countenance the argument that the existing permits can be so amended as to allow any number of vehicles to ply on the notified route any number of times. That is not clearly the intendment of the saving clause. The saving clause should be strictly construed and in a manner effectuating the purpose of the nationalisation scheme. The test to be applied is whether the scheme authorises the private operator to run the stage carnage on the notified route otherwise than in accordance with the terms and conditions of the permit held by him and if so to what extent. That question has to be decided on the very terms of the Scheme rather than from the stand-point of Section 80 of the Act (old Section 57). At the same time, the object and purpose of the Scheme should be kept in view. This is the approach we have to adopt in view of what was said in Adarsh Travels case. Viewed from the angle, whatever may be the position with regard to short extension of routes (adverted to in M/s. Shiv Chand Amolakchand v. R. T. Authority, AIR 1984 SC 9) we do not think that the application of the nature with which we are concerned falls within the purview of the saving clause. If the application is granted, it would amount to substantial modification of the scope and ambit of the existing permit. The character and amplitude of the existing permit will be materially altered. By allowing the amendment to the existing permit as sought for by the petitioner, the efficacy of nationalisation scheme might to whittled down and it may result in detriment to public interest. We do not think that the saving clause authorises such a type of modification of the permit. In this context, we may point out that the judgment of the Supreme Court in M/s. Shiv Chand Amolak Chand v. R. T. Authority, AIR 1984 SC 9 (supra) (relied upon by the Supreme Court in K S R T C case {K.S.R.T.Corporation, Bangalore v. B.A. Jayaram – AIR 1984 SC 790}) is an authority for the proposition that labelling the application as an application for variation of the conditions of permit is not decisive and it could be seen whether in fact such an application is only a device to obtain a new permit.” I n L. Raghuraman v. State Transport Appellate Tribunal, A.P., Hyd. (supra), the Full Bench considered a somewhat similar issue and held: “When there exists an approved scheme an exception laid down therein must be strictly construed. When, having regard to the object and purport of Chapter IV-A of the Act, only the existing permit holders have been permitted to operate in their route, they, in our opinion, by reason of filing of an application under S. 57 (8) of the Act cannot be permitted to add new buses and operate more singles. To that extent, the legal fiction created in S. 57 (8) must be held to be a bar.” I n K. Pamanna v. The S.T.A.T.[8], a Division Bench of this Court considered the question whether, after publication of the approved scheme, variation could be granted in the existing permit, and held: “Once a scheme is published u/s. 68-D of the Act, the area to which it relates is called "notified area" and the route to which it relates is called "notified route". After the approved scheme is published the embargo under Sec.68-FF of the Act operates even to the grant of variations of a permit in respect of any notified area or notified route, except in accordance with the provisions of the scheme.” A similar view was expressed in K.G.Jagannath v. State Transport Appellate Tribunal[9]. Here it is significant to mention that while dealing with this issue, the Tribunal referred to the proceedings of STA, Karnataka and observed: “17. Page-7 is the proceedings of the State Transport Authority of Karnataka State granting stage carriage permit as required under Section 72 of M.V. Act, 1988 in place of the existing permit No.2/87-88 valid up to 21-6- 2001. In the said proceedings it is stated that as per the decision of the Hon’ble Supreme Court a fresh permit is sought by the 2nd respondent herein. Page-11 is the endorsement of variation of permit conditions containing the timings. In the said endorsement, there is a reference of old permit conditions containing the timings. In the said endorsement there is a reference of old permit bearing No.2/87-88 corresponding to new permit No.58/98-99 valid up to 24-11-2003. The said endorsement at page 11 is dt.13-1-99 and it shows that the grant of variation of permit to include one more vehicle and to operate 7 singles trips per day subject to grant of countersignature by State Transport Authority, Andhra Pradesh State and issue a separate permit No.66/98-99 valid up to 12-1-2004. 18. Thus, through permit No.58/98-99 the variation of permit conditions as sought by the 2nd respondent herein is to increase one single making total 7 singles trips is granted subject to the payment of double point tax and to obtain countersignature of State Transport Authority of Andhra Pradesh State and the said permit was valid up to 24-11-2003. After the variation of the conditions permit No.58/98-99 is granted, to include one more vehicle and to operate 7 singles trips per day a separate permit No.66/98-99 valid up to 12-1-2004 was issued. 19. Page 212 is the proceedings of the State Transport Authority, Karnataka State dt.28-11-98 granting variation of conditions of permit and the order was pronounced on 9-12-98. As per the order dt.9-12-98, the endorsement of variation of conditions of permit dt.13-1-99 was made by fixing timings for 7 single trips for 2 vehicles i.e. earlier vehicles and the vehicles for which the grant of permit by variation of conditions was allowed. 20. The grant of variation of conditions of permit, in this case, is in substance grant of new permit since the conditions of the scheme G.O.Ms.No.767 and 1125 do not permit such variation. When the 2nd respondent herein is not entitled for grant of new permit, he is also not entitled for grant of variation of the conditions of the permit already issued to him. 21. The petitioner is not an existing operator in respect of grant of permit to ply another vehicle and 7 singles and to ply additional single to earlier permit. As stated supra, the foot-note under the above two schemes 767 and 1125 clearly prohibit the grant of permits to future operators but exempts only the existing permit holders. Therefore, so far the variation of the conditions of the permit is applicable, the 2nd respondent is not an existing permit holder.” The learned Single Judge approved the view taken by the Tribunal and held: “… The scheme conditions are very specific that grant of new permits is prohibited. Even if he is an existing operator as on the date of the approved schemes notified in G.O.Ms.Nos.765 and 1125, he is entitled to ply the vehicle as per the permit conditions existed then, but, in view of the prohibition of grant of future permits, the petitioner is not at all entitled for grant of variation for additional singles and also for addition of bus with extra singles on the same permit.” We entirely agree with the Tribunal and the learned Single Judge that after having obtained new permit in the year 1998, the appellant lost his status as an existing operator and, in any case, in view of Section 80 (3) of the Motor Vehicles Act, 1988, the application for variation in the conditions of permit by increasing the number of trips had the effect of demolishing the appellant’s status as an existing operator for the purposes of the schemes notified on 3-6-1975 and 7-12-1976. In Pandiyan Roadways Corpn. Ltd. v. Thiru M.A. Egappan (supra), the Supreme Court referred to two earlier judgments in Karnataka State Road Transport Corp., Bangalore v. B.A. Jayaram (supra) and M/s.Adarsh Travels Bus Service v. State of U.P. (supra) and held: “Where under a scheme for a route published in the gazette it was proposed to exclude completely all other persons from operating their stage carriage services under permits covering the entire route, except those persons mentioned in Annexure II to the said scheme and the operators whose names had been mentioned in Annexure II to the scheme were persons who were existing operators on the different sectors of the notified route on the date of the publication of the scheme, an operator whose name was not included in the Annexure to the scheme and operating on a non- scheme route would not be entitled to operate his stage carriage on the notified route or a portion thereof even though he might have been granted variation of his permit to operate on a sector of the notified route. It cannot be said that an application for the variation of a permit held by the operator in question was not in fact an application for a permit and does not fall within the mischief of S. 68-F (1-D). In the context in which S. 68 F (1-D) appears if cannot be said that the application for variation of a permit by including the whole or any part of route in respect of which a scheme is published under S. 68-C can be treated as falling outside the mischief of S. 68-F (1-D). There is no justification to limit the application of S. 68 F (1-D) to only application for fresh permits or their renewal and to leave out applications for variation of a permit by the inclusion of the route or a portion of the route in respect of which a scheme is published. The fact that the applicant is the holder of a permit to operate a stage carriage on another route whose variation he is seeking by the inclusion of a route or a part thereof in respect of which a scheme is published ought not to make any difference. The principle underlying S. 68-F (1-D) is that the number of services on such a route should be frozen on the publication of a scheme under S. 68-C.” Though the judgments referred to hereinabove were rendered in the context of the provisions contained in the Motor Vehicles Act, 1939, the ratio thereof is equally applicable to the corresponding provisions in the 1988 Act and we do not see any reason to take a different view. The judgments of the Supreme Court in Karnataka State Road Transport Corpn., Bangalore v. B.A. Jayaram (supra) and M/s.Adarsh Travels Bus Service v. State of U.P. (supra) have been considered in the later judgment in Pandiyan Roadways Corpn. Ltd. v. Thiru M.A. Egappan (supra). Therefore, the appellant cannot rely on those judgments in support of his claim for being allowed to operate on the notified portion of the route. On the basis of the above discussion, we hold that the Tribunal did not commit any illegality by quashing the order dated 16.11.1999 passed by the STA, Hyderabad for grant of counter-signature on the permit of the appellant so as to enable it to operate on notified portion of the route and the learned single Judge rightly declined to interfere with the order of the Tribunal. In the result, the appeal is dismissed. G.S. SINGHVI, C.J. October 11, 2007 C.V. NAGARJUNA REDDY, J. ARS/svs [1] AIR 1987 SC 958 [2] 2001 (5) ALD 711 (FB) [3] AIR 1984 SC 790 [4] AIR 1984 SC 9 [5] AIR 1986 SC 319 [6] AIR 1972 SC 1674 [7] 1994 (2) ALT 385 (DB) [8] 1992 (2) ALT 385 (FB) [9] 1998 (1) ALD 67 (DB)