IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE ANTONY DOMINIC THURSDAY, THE 24TH JULY 2008 / 2ND SRAVANA 1930 WP(C).No. 15194 of 2008(H) -------------------------------------- PETITIONER: ------------------ P.K.VIJAYAN, PUTHENKANDATHIL HOUSE, KUNNAPPALLY, PERUVA P.O, KOTTAYAM. BY ADV. SRI.P.DEEPAK RESPONDENTS: ----------------------- 1. THE GOVERNMENT OF KERALA, REPRESENTED BY THE ADDITIONAL CHIEF SECRETARY TO GOVERNMENT, SECRETARIAT, THIRUVANANTHAPURAM 2. THE KERALA STATE ROAD TRANSPORT CORPORATION, REPRESENTED BY ITS CHAIRMAN & MANAGING DIRECTOR,'TRANSPORT BHAVAN' THIRUVANANTHAPURAM. 3. THE REGIONAL TRANSPORT AUTHORITY, ERNAKULAM, REPRESENTED BY ITS SECRETARY, ERNAKULAM 4. THE SECRETARY, REGIONAL TRANSPORT AUTHORITY, ERNAKULAM. ADV. SRI.K.PRABHAKARAN, SC, K.S.R.T.C. FOR R2 BY SPL. GOVERNMENT PLEADER SRI.P.SANTHOSH KUMAR THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 11/06/2008, ALONG WITH WPC. NO.19774/2008 WPC. NO.16167/2008 THE COURT ON 24/07/2008 DELIVERED THE FOLLOWING: W.P.(C) NO.15194/2008 APPENDIX PETITIONERS EXHIBITS EXT.P1:- COPY OF THE REGULAR PERMIT VALID TILL 11.9.2006. EXT.P2:- COPY OF THE TEMPORARY PERMIT VALID TILL 31.5.08. EXT.P3:- COPY OF THE APPLICATION FOR TEMPORARY PERMITDT. 15.5.08. EXT.P4:- COPY OF THE PROPOSAL DT. 9.5.07( NO.12951/B1/2001/TRAN). EXT.P5:- COPY OF THE NOTIFICATION G.O.(P) NO.20/2008 TVM. DT. 6.5.08. EXT.P6:- COPY OF THE ORDER OF THE 4TH RESPONDENT DT. 26.5.2008. /TRUE COPY/ P.S. TO JUDGE tss ANTONY DOMINIC, J. = = = = = = = = = = = = = = = = = = = W.P.(C) Nos.15194, 17813, 18104, 17868, 17987, 17815, 19006, 19824, 19774, 21725, 17876, 16167, 15826, 16430, 21793 and 21093 OF 2008 = = = = = = = = = = = = = = = == = = Dated this the 24th July 2008 J U D G M E N T These writ petitions are filed praying for quashing the notification dated 06.05.2008 and for directing to consider and pass orders on the application for renewal of permit submitted by the petitioners, untrammelled by the aforesaid notification. In this judgment, facts as pleaded in W.P.(C) No. 15194 & 17813 of 2008 alone are referred and the exhibits referred to are in the order in which they are marked in W.P.(C)No.15194/2008. 2. Petitioner in W.P.(C) 15194/08 is the registered owner of stage carriage KL-5Q 4050, operating on the long distance inter- district route Kottayam-Banthadukka. Ext. P1 permit was originally granted to one Shaji Kuruvilla and was valid for the period from 12.9.1996 to 11.9.2001 and was subsequently renewed for a further W.P.(C) No. 15194 OF 2008 -: 2 :- period of 5 years upto 11.9.2006. In the meanwhile, with effect from 16.4.1998 the permit was transferred to the petitioner. Petitioner sought renewal of the permit for a further period of 5 years by submitting his application as early as on 10.6.2005. Since orders renewing the permit have not been passed, petitioner was operating his service on the strength of temporary permits issued under Section 87(1)(d) of the Motor Vehicles Act, 1988, the last of which is Ext. P2, valid till 31.5.2008. As the period of Ext. P2 was expiring, petitioner submitted Ext. P3 application for temporary permit, but however, the 4th respondent is refusing to consider Ext. P3 since the petitioner had not submitted a no objection certificate from the 2nd respondent, K.S.R.T.C. It is stated that according to the 4th respondent, in view of the finalised scheme published vide Ext. P5 notification dated 6.5.2008 issued under Section 100 (3) of the Motor Vehicles Act, 1988 (hereinafter referred to as the Act, for short) renewal of permit, either regular or temporary, can be granted only on obtaining an NOC from the KSRTC, the State Transport Undertaking. 3. The contentions urged is that the 1st respondent, exercising its power under Section 99 of the Act read with Rule 236 W.P.(C) No. 15194 OF 2008 -: 3 :- of the Kerala Motor Vehicles Rules (hereinafter referred to as the Rules, for short) had published Ext.P4, a proposal on 9.5.2007 relating to 31 routes in the State in supercession of the existing notification in relation to those enumerated routes. Clauses 4, 5 and 19 of the schedule to Ext. P4 being relevant, are extracted below for reference: 4. Whether the services are to be operated by the State Transport Undertaking to the exclusion of other persons or otherwise. In the Private Sector, permits, regular and temporary existed on or prior to 18-4-2007 alone will continue as such. Fresh permit will be given to the State Transport Undertaking only. 5. If the operation shall be to the exclusion of other services: (a) Whether such exclusion shall be complete or partial; (b) Is such exclusion shall be partial, the sectors of the route from where other services are to be excluded; and (c) Whether it is proposed to allow other service to pick or set down passengers between any two places on the route covered by the scheme. Partial As in schedule 4 above Yes, on portions of the route, permitted to operate W.P.(C) No. 15194 OF 2008 -: 4 :- 4. Whether the services are to be operated by the State Transport Undertaking to the exclusion of other persons or otherwise. In the Private Sector, permits, regular and temporary existed on or prior to 18-4-2007 alone will continue as such. Fresh permit will be given to the State Transport Undertaking only. 19. Any other information the State Transport Undertaking may desire to be furnished in this connection. The right to operate any new service and to increase the trips in the above routes will be reserved exclusively for Kerala State Road Transport Corporation. Private permits in any of the routes, will be replaced by Kerala State Road Transport Corporation by Notification as and when KSRTC is able to operate exclusively on such route. It is stated that while the proposal published, was as above, on 6.5.2008 the 1st respondent published the approved scheme, as required under Section 100(3) of the Act. Clauses 4, 5 and 19 of Ext. P5 being relevant, are extracted below for reference: “4. Whether the services are to be operated by the State Transport Undertaking to the exclusion of other persons or otherwise. Yes. The regular and temporary permits issued in the private sector on or prior to 9.5.2006 alone will be allowed to continue for the time being. Such permits will be renewed only if the STU is not willing to provide substitute bus in its vacancy. New permits will be issued in favour of State Transport Undertaking only Permits issued after 9.5.2006 shall not be renewed at any circumstance. W.P.(C) No. 15194 OF 2008 -: 5 :- 5. If the operation shall be to the exclusion of other services: (a) Whether such exclusion shall be complete or partial; (b) Is such exclusion shall be partial, the sectors of the route from where other services are to be excluded; and (c) Whether it is proposed to allow other service to pick or set down passengers between any two places on the route covered by the scheme. Partial As in schedule 4 above Yes. On the portion of the route permitted to operate as in clause 4 above 19. Any other information the State Transport Undertaking may desire to be furnished in this connection Right to operate any new service and to increase number of trips in the above routes will be reserved exclusively for Kerala State Road Transport Corporation. KSRTC will be free to replace any existing private permit in the above route on its expiry on the basis of last come first go.” 4. It is contended that clauses 4, and 19 of Ext. P5 presents a clear departure from the corresponding clauses in Ext. P4 proposal. According to counsel, while Ext. P4 envisaged saving and retention of all permits which existed on or prior to 18.4.2007, Ext. P5 provides for continuation of permits issued prior to a still W.P.(C) No. 15194 OF 2008 -: 6 :- anterior date, viz., 9.5.2006 and that too, only as a temporary measure. It is also contended that the renewal of the said permits would again be subject to obtaining a no objection certificate from the KSRTC as and when application for renewal of permit is considered. It is submitted and that all permits granted between the period from 9.5.2006 to 18.4.2007 would be liable to be terminated on the expiry of its validity without any renewal. According to the petitioner this has been done without any notice to the permit holders. 5. Similarly in so far as clause 19 of Ext. P5 is concerned, it is stated that this provision confers on the KSRTC an absolute discretion to pick and choose any private operator and demand on his vacating the route while at the same time ensuring continuance of other favoured persons. It is contended that though the replacement is to be made following the principle last come first go, in view of the insistence of the no objection of the KSRTC for renewal of permits, the power conferred is arbitrary and will lead to discriminatory treatment. According to the petitioners this is clearly at variance from the method for displacement contemplated by Ext. W.P.(C) No. 15194 OF 2008 -: 7 :- P4 proposal where the KSRTC could exercise its power by appropriate notification, and only when it could exclusively operate on the route. It is generally on the aforesaid basis, complaining that the statutory provisions have been violated and that natural justice has been denied to operators W.P. (C) No. 15194/08 has been filed seeking to quash Ext. P5 approved scheme. 6. A counter affidavit has been filed by the 1st respondent and a statement has been filed on behalf of the 2nd respondent. According to the 1st respondent, the Government had published Ext.P4 draft scheme pursuant to the undertaking given before the Hon'ble Supreme Court in Civil Appeal No. 4994/02. It is stated that the draft scheme was published in accordance with Section 99 of the Act and that in terms of Section 99(2) when a proposal is published, then from the date of publication of such proposal no permit shall be granted to any person, except a temporary permit in the manner as provided therein. It is stated that Section 100 of the Act requires publication of the proposal for filing objections and that as per sub section (2), the State Government may, after considering the objections and after giving an opportunity to the W.P.(C) No. 15194 OF 2008 -: 8 :- objector or his representatives and the representatives of the State Transport Undertaking to be heard in the matter, if they so desire, approve or modify such proposal. 7. It is stated that it was in exercise of this power that after considering the objections that the 1st respondent had approved the scheme with suitable modifications. It is stated that the provisions of Chapter VI of the Act have got overriding effect over Chapter V and other laws and once the scheme has been finalised and published under Section 100(2) it is a law and is binding on all parties. In the counter affidavit, the grounds on which Ext. P5 is challenged are all denied by the 1st respondent and the 1st respondent submits that the scheme is liable to be upheld by this Court. 8. In the statement filed on behalf of the 2nd respondent they would contend that once a proposal is notified inviting objections, the State Government is bound to consider the objections and thereafter approve and publish the scheme in the manner as provided under Section 100(2) of the Act. While finalising the draft scheme the State Government is entitled to either approve the same as such or approve the draft with modifications. It is stated that the W.P.(C) No. 15194 OF 2008 -: 9 :- modifications made to Ext. P4 are in exercise of the power under Section 100(2) of the Act and that the contentions raised in the writ petition have no substance. 9. The petitioners in W.P.(C) No. 17813/08 submits that the consequence of the Division Bench judgment in Rahul Tom v. K.S.R.T.C. {2001(3) KLT 261} in which the 1st petitioner herein was the petitioner, was abrupt stoppage of more than 17,000 private stage carriage operators in the private sector. Against the aforesaid judgment, appeals were filed before the Apex Court and by Ext. P1 order, the parties were directed to maintain status quo pending further orders in the appeal. It is stated that subsequently leave has been granted and Civil Appeal No. 4994 of 2002 and connected matters are pending consideration of the Apex Court. The Apex Court subsequently passed Ext. P2 order directing that the KSRTC and the private operators shall give their suggestions to the State Government as to how workable arrangements can be worked out to prevent unnecessary inconvenience to the travelling public. It was directed that the concerned authorities of the State Government will have discussions with the parties and find out a solution, if W.P.(C) No. 15194 OF 2008 -: 10 :- possible. Petitioners submit that in implementation of Ext. P2 order, suggestions were made to the State Government and that discussions were also held on various occasions. It is stated that finally the State Government issued Ext. P3 Order dated 31.12.2005 where it was stated that “the Private Stage Carriage Operators as on 2.11.05 are permitted to operate their service buses along with the KSRTC. The Transport Commissioner will forward necessary proposals to Government for the amendment of the supplementation scheme forthwith.” It is stated that it was in pursuance to Ext. P3 Govt. Order that when draft notification was issued on 9.5.2006 under Section 99 of the Motor Vehicles Act, 1988, clause 4 thereof provided that the existing private operators will be permitted to continue. However, objections were raised against clauses 4 and 19 of Ext.P4 and as a result thereof, the State Government appointed an expert committee consisting of Transport Minister, Industries Minister, Labour Minister, Transport Commissioner and Secretary to Government, Transport to consider the entire aspects of the matter. According to the petitioners, report was submitted by the aforesaid committee, with a suggestion W.P.(C) No. 15194 OF 2008 -: 11 :- to retain all existing services without any interruption. Petitioners submit that it was accepting this recommendation that when preliminary notification was issued on 9.5.2007, clauses 4 and 19 were suitably modified safeguarding the interests of the existing private operators. It is stated that in view of the safeguards that were incorporated in the notification dated 9.5.2007, petitioners had no cause to raise any objection. 10. Referring to page 7 of the counter affidavit filed by the State in W.P.(C) No. 17876/08 it was contended that though the Government admits the constitution of the expert committee, no reason whatsoever has been stated for ignoring the recommendations made by the committee. On the other hand, as rightly contended by counsel for the petitioners all that is stated that “even though the Government constituted the above said expert committee, the Government is not bound to accept all the suggestions of the said Committee.” Petitioners also pointed out that from what is stated in paragraph 20 of the affidavit, it was only on account of the objections from the State Transport Undertaking and its employees, deviations were made from the notification W.P.(C) No. 15194 OF 2008 -: 12 :- dated 9.5.2007, ignoring the recommendations of the expert committee. 11. I heard the counsel for the petitioners, the learned Govt. Pleader and the Standing Counsel for the K.S.R.T.C. 12. The relevant statutory provisions which are required to be noticed are those contained in Chapter VI of the Act and the Rules 236 to 248of the Kerala Motor Vehicles Rules. Sections 99 and 100 of the Act being relevant for the disposal of this case, are extracted below for reference: “Sec. 99: Preparation and publication of proposal regarding road transport service of a State Transport undertaking: (1) Where any State Government is of opinion that for the purpose of providing an efficient, adequate, economical and properly co-ordinated road transport service, it is necessary in the public interest that the road transport services in general or any particular class of such service 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 Government may formulate a proposal regarding a scheme giving particulars of the nature of the services proposed to be rendered, the area or route proposed to be covered and other relevant particulars respecting thereto and shall publish such proposal in the Official Gazette, of the State formulating such proposal and in not less than one newspaper in the regional language circulating in the area or route proposed to be covered by such scheme and also in such other manner as the State Government formulating W.P.(C) No. 15194 OF 2008 -: 13 :- such proposal deem fit. (2) Notwithstanding anything contained in sub section (1), when a proposal is published under that sub section, then from the date of publication of such proposal, no permit shall be granted to any person, except a temporary permit during the pendency of the proposal and such temporary permit shall be valid only for a period of one year from the date of its issue or till the date of final publication of the scheme under Section 100, whichever is earlier”. “Sec.100: Objection to the proposal:- (1) On the publication of any proposal regarding a scheme in the Official Gazette and in not less than one newspaper in the regional language circulating in the area or route which is to be covered by such proposal any person may, within thirty days from the date of its publication in the Official Gazette, file objections to it before the State Government. (2) The State Government may, after considering the objections and after giving an opportunity to the objector or his representatives and the representatives of the State transport undertaking to be heard in the matter, if they so desire, approve or modify such proposal. (3) The scheme relating to the proposal as approved or modified under sub-section (2) shall then be published in the Official Gazette by the State Government making such scheme and in not less than one newspaper in the regional language circulating in the area or route covered by such scheme and the same shall thereupon become final on the date of its publication in the Official Gazette and shall be called the approved scheme and the area or route to which it relates shall be called the notified area or notified route: Provided that no such scheme which relates to any inter-State route shall be deemed to be an approved scheme W.P.(C) No. 15194 OF 2008 -: 14 :- unless it has the previous approval of the Central Government. (4) Notwithstanding anything contained in this section, where a scheme is not published as an approved scheme under sub-section (3) in the Official Gazette within a period of one year from the date of publication of the proposal regarding the scheme in the Official Gazette under sub- section (1), the proposal shall be deemed to have lapsed”. 13. A reading of Section 99 shows that where any State Government is of opinion that for the purpose of providing an efficient, adequate, economical and properly co-ordinated road transport service, it is necessary in the public interest that the road transport services in general or any particular class of such service in relation to any area or route or its portion should be run and operated by the State transport undertaking, whether to the exclusion, complete or partial, of other persons or otherwise, the State Government may formulate a proposal regarding a scheme giving particulars of the nature of the services proposed to be rendered, the area or route proposed to be covered and other relevant particulars respecting thereto and shall publish such proposal in the Official Gazette of the State and in not less than one newspaper in the regional language circulating in the area or route W.P.(C) No. 15194 OF 2008 -: 15 :- proposed to be covered by such scheme and also in such other manner as the State Government deems fit. 14. In exercise of the rule making power of under Section 107, the rules in Chapter VI of the Kerala Motor Vehicle Rules providing for special provisions relating to State transport undertakings have been framed by the State Government. Rule 236 provides that every proposal framed under Section 99 of the Act shall be in Form “A” and shall be published in the Official Gazette and in not less than one daily newspaper in the regional language circulating in the area involved. It is also provided that a copy of every scheme proposed to be published in the Gazette shall be forwarded to the State Transport Undertaking, to the Secretary of the State Transport Authority and the Regional Transport Authority concerned. Form A appended to the Rules gives a schedule containing as many as 19 columns and specify the details to be incorporated in a proposal. 15. Once draft is published in the manner as stated above, Section 100 of the Act comes into play and in terms of Section 100 (1), on the publication of any proposal in the manner provided therein, any person may, within thirty days from the date of its W.P.(C) No. 15194 OF 2008 -: 16 :- publication in the Official Gazette, file objections before the State Government. The manner in which objections are to be filed is provided under Rule 237 and it provides the particulars to be given in the objections, which shall be filed before the Secretary to Government, Public Works and Transport Department, and simultaneously copies shall be forwarded to the State Transport Undertaking, the State Transport Authority and the Regional Transport Authority concerned. Once objections are filed in the manner as provided in Section 100(1) of the Act and Rule 237 of the K.M.V. Rules, the State Government is to consider the same in terms of Section 100(2). Rule 238 provides that the Chief Minister or any other Minister nominated by him or any officer nominated by the Government in this behalf, shall be the authority to consider the objections and hear the objectors. Clause (b) of the Rule provides that the representatives of the State Transport Undertaking and the objectors or their authorised representative, if they so desire, shall be heard. The place, date and time of hearing shall be communicated to the concerned persons at least fourteen days before the date of hearing. W.P.(C) No. 15194 OF 2008 -: 17 :- 16. Once objectors are heard, it is for the State Government to consider and approve the proposal, with or without modification. Once approval is accorded, Section 100(3) and Rule 239 provides the manner of publishing the approved scheme which shall be notified in Form B in the Official Gazette and in one daily newspaper in the same manner as provided in Rule 236. Section 100(3) further provides that once publication is effected as above, the scheme shall become final on the date of its publication in the gazette and shall be called the approved scheme and the area or route to which it relates shall be called the notified area or notified route. 17. The aforesaid being the relevant statutory provisions, I shall proceed to examine the judicial precedents where the courts have dealt with the corresponding provisions in Sections 68 C and D of the Motor Vehicles Act, 1939. 18. In the context of the scheme notified by the Government of Andhra Pradesh the Supreme Court had held in G. Nageswara Rao v. Andhra Pradesh State Road Transport Corporation {AIR 1959 SC 308} that the enquiry that is contemplated under S. 68 is quasi judicial in nature and it imposes a duty on the State Government to W.P.(C) No. 15194 OF 2008 -: 18 :- decide judicially while approving or modifying the scheme. The relevant portion of paragraph 21 of the judgment is extracted below for reference: “Applying the aforesaid