Case: R. M. Subbaraj Vs. Kodaikanal Motor Union (P) Ltd

The High Court issued a writ quashing the order of the State Transport Appellate Tribunal, Madras and directed the Appellate Tribunal to determine the question of grant of permit outside the ambit of the impugned Government Order No. 2265, dated August 9, 1958.      2. The appellant and the respondent applied to the Regional Transport Authority for the grant of six stage carriage permits. The respondent alleged to have maximum operational communication. The Regional Transport Authority directed the grant of one permit each on two out of six routes to the respondent.      3. The appellant filed an appeal to the State Transport Appellate Tribunal. The State Transport Appellate Tribunal considered the appellant to be the only qualified medium route operation. The State Transport Appellate Tribunal set aside the grant of two permits to the respondent and directed the grant of one to the appellant and the other to another appellant before the State Transport Appellate Tribunal.      4. The respondent filed a writ petition in the High Court of Madras. Among the various grounds on which the respondent impeached the order of the State Transport Appellate Tribunal it was said that the Tribunal over-looked the superior claims of the appellant by treating the preference mentioned in the Government Order as an absolute preference.      5. The learned Single Judge held that though the State Transport Appellate Tribunal gave preference to the appellant because he was a medium operator the Tribunal gave certain additional reasons for the grant of permit to the appellant. The learned Single Judge held that a mere reference to the Government Order could not be magnified reasonably into a principal ground on the basis of which the Tribunal reached the conclusion in favour of the appellant.      6. The respondent took up the matter on appeal. The High Court accepted the appeal. The reason given by the High Court was that the Government Order entered into the decision of the State Transport Appellate Tribunal as a major factor in the decision. It was observed that one of the substantial grounds for the grant was that the respondent was the most qualified medium route operator.      7. The order of the State Transport Appellate Tribunal specifically mentions the Government Order No. 2265, dated August 9, 1958 and incorporates the same as a part of the speaking order in the determination of the controversy. The Government direction was that preference will be given for short routes to new entrants and for medium routes to applicants with one or more buses. The State Transport Appellate Tribunal referred to the fact that the appellant was a four permit-holder and on that basis the State Transport Appellate Tribunal gave the appellant one mark and the said that the appellant was the only qualified medium route operator. The High Court quashed the order of the State Transport Appellate Tribunal because the Government order entered into the decision of the Tribunal.      8. for the repeated the submission made before the High Court that the State Transport Appellate Tribunal made reference to other grounds for the grant of permit to the appellant, and, therefore, the order of the Appellate Tribunal could be sustained as valid.

Court's reasoning:
9. This Court has in several decisions held that the Regional Transport Authority discharges quasi-judicial function in dealing with applications for permits and evaluating the rival claims of the parties for the grant of permit. Section 43-A of the Motor Vehicles Act, 1939 as inserted by the Madras Amending Act 20 of 1948 confers power on the State Government to issue orders and directions to the State Transport Authority only in relation to administrative functions. It is also held by this Court that the decision of the Regional Transport Authority must be absolutely unfettered by any extraneous guidance by the executive or administrative wing of the State10. The relevant Government Order No. 2265, dated August 9, 1958 was held invalid by this Court in R. Lakshminarayanan v. T. H. Vythilingam Pillai and Another. (Civil Appeal No. 1792 of 1966, decided on August 27, 1969)11. It is manifest that the State Transport Appellate Tribunal not only referred to the Government Order as indicating the basis for giving preference for the grant of permits but also applied the Government Order in assessing the competing claims of the contenders for permits. Once it is found that a Tribunal which under the statute has to deal with applications for permits in a judicial manner is directed by the Government to adopt any specified method for assessing the merits of the applicants and the Tribunal takes into consideration such direction of the executive, the judicial determination by the Tribunal is polluted12. The High Court was right in directing that the applications must be dealt with and disposed of outside the ambit of the impugned Government Orders or their constraining interference.