Case: V.C. K. Bus Service Ltd Vs. The Regional Transport Authority, Coimbatore

1. These are appeals against the judgment of the High Court of Madras on a certificate given under Art. 133 (1)(c) of the Constitution, and they raise a question of some importance as to the true legal character of a permit when it is renewed under the provisions of the Motor Vehicles Act, 1939 (Act No. IV of 1939) hereinafter referred to as the Act.2. In order to appreciate the contentions of the parties, it is necessary to state the material facts leading up to the present dispute. Towards the end of 1952, the appropriate authorities under the Act decided to grant two additional permits for stage carriages in the Ondipudur-Agricultural College route in the town of Coimbatore in the State of Madras, and invited applications therefor under S. 57 of the Act. There were as many as 39 applicants, and by his order dated 3rd December 1952, the Regional Transport Authority granted one permit to applicant No. 24, the Thondamuthur Trading Company Ltd., and another to applicant No. 30, the V. C. K. Bus Service. There were appeals by some of the unsuccessful applicants to the Central Road Traffic Board, which by its order ,dated 19th February 1953, set aside the order of the Regional Transport Authority and granted the permits, one to States Transports Ltd., and another to Thirumalaiswami Goundar. Revisions were preferred against this order by the aggrieved applicants under S. 64-A of the Act, and by its order dated 9-7-1953, the Government confirmed the grant of the permit to Stanes Transports Ltd., but set aside the permit given to Thirumalaiswami Goundar, and granted it instead to Annamalai Bus Transport, Ltd.3. Thereupon, applicants Nos. 24 and 30 moved the High Court of Madras under Art. 226 for a writ of certiorari to quash the order of the Central Road Traffic Board dated 19-2-1953 and of the Government dated 9-7-1953; but the applications were dismissed by Rajagopala Ayyangar, J. on 8-3-1954. Against the orders of dismissal, Writ Appeals Nos. 31 and 32 of 1954 were preferred, and they were dismissed by Rajamannar, C. J. and Panchapakesa Ayyar, J. on 21-3-1956. It should be mentioned that the operation of the order dated 19-2-1953 was stayed pending the disposal of the revision under S. 64 A and the writ proceedings in the High Court, with the result that both Thondamuthur Trading Company Ltd.. and V.C.K. Bus Service which had been granted permits by the Regional Transport Authority on 3-12-1952 continued to run their buses notwithstanding cancellation of those permits onIt should also be mentioned that in June 1954 the business of the V.C.K. Bus Service which was the grantee of one of the permits under the order of the Regional Transport Authority dated 3-12-1952 was taken over by a Company called the V.C.K. Bus Service Ltd., which is the appellant before us, and by an order of the Regional Transport Authority dated 7-7-1954 it was recognised as the transferee of the permit granted to V.C.K. Bus Service.4. To continue the narrative, the permit which was the subject matter of the litigation aforesaid was for a period of one year and a half, and it expired on 30-6-1954. Before its expiry, the appellant applied on 15-4-1954, for a renewal thereof for a period of three years. This application was duly notified under S.57, and objections to the grant were preferred by both Stanes Transports Ltd., and Annamalai Bus Transport Ltd. On 5-9-1954 the Regional Transport Authority granted a permit to the appellant for a period of one year from 1-7- 1954 to 30-6-1955 obviously in the expectation that Writ Appeals Nos. 31 and 32 of 1954 would by then have been decided. On 19-3-1955, the appellant again applied for a renewal of the permit, and that was also notified under S.57, and no objections having been filed to the grant thereof, the Regional Transport Authority by his order dated 23-6-1955 renewed the permit for a period of three years from 1- 7-1955 toIt is this permit that forms the subject matter of the present litigation.

Court's reasoning:
Thus, there is no legal obstacle to implying a condition that the renewal should stand cancelled if the right of the appellant to the original permit was negatived by the High Court.Court.15. It is of the utmost importance in this connection to bear in mind that the appellant applied not for a fresh permit but for a renewal and in sanctioning it, the Regional Transport Authority expressly acted in exercise of his powers under R. 134-A read with S.58 of the Act, and if he did not expressly provide that it was subject to the decision of the High Court, it must be because he must have considered that that was implicit in the fact of its being only a renewal. That that is how the appellant understood it is clear beyond doubt from the proceedings taken by it immediately after the High Court pronounced its judgment.But it is argued for the appellant on the strength of the decision in VeerappaPillai v. Raman and Raman Ltd., 1952 S.C.R. 583: (A.I.R. 1952 S.C. 192)(E) that the mere knowledge on the part of the authorities that the rights of the parties were under litigation is not a sufficient ground to import a condition in the permit that it is subject to the result of that litigation, when in its terms it is unconditional. We do not read that decision as authority for any such broad contention. There, the question related to five permits, which had been originally granted to one Balasubramania Raman and Raman Ltd. obtained a transfer of the relative buses, and applied to the transport authorities for transfer of the permits to itself. Then Veerappa having subsequently obtained a transfer of the same buses from Balasubramania, applied to have the permits transferred in his name. On 3rd October 1944 he also instituted a suit in the Sub-Court, Kumbakonam, to establish his title to the buses against Raman and Raman Ltd., and that was decreed in his favour on 2nd May 1946. Raman and Raman Ltd., appealed against this decision to the Madras High Court, which by its judgment dated 2nd September 1949, reversed the decree of the Sub-Court, and held that it was entitled to the buses. While these proceedings were going on, the transport authorities suspended on 28th March 1944 the permits which had been granted to Balasubramaia and instead, they were issuing temporary-permits from time to time to Veerappa, who had been appointed receiver in the suit in the Sub-Court, Kumbakonam. On 29th March 1949 the Government decided to discontinue the policy of granting temporary permits indefinitely, and accordingly granted permanent permits to Veerappa. Then on 14th October 1949 Veerappa applied for renewal of these permanent permits, and that was granted by the Regional Transport Authority on 3rd January 1950. The question was whether this order was bad on the ground that it was inconsistent with the decision of the High Court that it was Ramon and Raman Ltd., that had obtained a valid title to the buses. This Court held that the ownership of the buses was only one of the factors to be taken into account in granting the permits, and that as the Regional Transport Authority granted the renewal on an appreciation of all the facts, his decision was not liable to be questioned in proceedings under Art. 226. It should be noted that the renewal which was granted on 3rd January 1950 was of permanent permits granted in pursuance of the order of the Government dated 29th March 1949, which had quite plainly declared as a matter of policy that notwithstanding the pendency of litigation between the parties, permanent permits should be granted to Veerappa. There can be no question of implying thereafter a condition that they were subject to the decision of the Court. Moreover, the renewal was granted on 3rd January 1950 after the litigation had ended on 2nd September 1949, and any attack on that order could only be by way of appeal against it, and that had been done. We are of opinion that the decision in 1952 S.C.R. 583: (A.I.R. 1952 S.C. 192) (E) is of no assistance to the appellant.