Case: The Mor Modern Cooperative Transport Society Ltd Vs. Financial Commissioner and Secretary to Govt. Haryana &amp; Another

2. The appellant herein is a cooperative society duly registered under the Haryana Cooperative Societies Act. It deals in the business of passenger transport and for that purpose obtains stage carriage permits issued through the Regional Transport Authority, Hissar, Presently, it holds one permit to operate four return trips on Hansi - Bad Chhappar route which falls within the District of Hissar.3. The case of the appellant pleaded in the writ petition was that the Haryana Roadways is a department of the State of Haryana. It also carries on business of providing passenger transport facility. It competes with private stage carriage operators and owns and operates a fleet of motor vehicle. The Haryana Roadways is also subject to the provisions of the Motor Vehicles Act (hereinafter referred to as "the Act") and the rules framed thereunder. State carriage permits are issued by concerned Regional Transport Authority constituted under Section 68 of the Act.4. It was contended that for about two decades the entire passenger transport service in the State of Haryanan remained nationlized and stage carriage service was operated only by the State Transport Undertaking known as the Haryana Roadways. However, in the year 1993 by Notification issued under Section 100 of the Act, a provision was made for grant of stage carriage permits of private operators but confined to cooperative societies. Under the Notification, the routes falling within the districts with not more than 10 kilometers falling on the National of State High ways, were available for operation by cooperative societies. Accordingly, stage carriage permits are being granted to cooperative societies under Chapter V of the Act by the concerned Regional Transport Authorities of which the Transport Commissioner, Haryana was, and again is, the Chairman. By Notification dated March 27, 1998 the Government of Haryana in exercise of the powers conferred by Section 68 of the Act, in supersession of its earlier Notification dated December 30, 1996 constituted Regional Transport Authorities for each of the regions of Ambala, Hisar, Faridabad, Rohtak, Karnal and Rewari consisting of Transport Commissioner as Chairman and Secretary, Regional Transport Authority of the concerned region as member to exercise and discharge the powers and functions conferred by or under Chapter V of the Act on such authorities in the areas specified in the Notification. The aforesaid Notification of March 27, 1998 was challenged by the appellant cooperative society on the ground that the Notification was illegal in as much as Section 68(2) of the Act was a complete bar to the appointment of the Transport Commissioner as Chairman of The Regional Transport Authority, he being an employee of the State Government having financial interest in the Government undertaking namely, Haryana Roadways, within the meaning of Section 68(2) of the Act. In the writ petition the High Court issued a show cause notice to the respondents by order dated 5.12.1998. However, on 31.12.1998 another Notification was issued in supersession of the Notification dated March 27, 1998 whereunder the Secretary, Regional Transport Authority of concerned region was appointed as Chairman of the Regional Transport Authority and the Traffic Manager concerned of the office of General Manager, Haryana Roadways at District Headquarters as member of the authority. Another member was appointed who was a representative of the District Administration to be nominated by the Deputy Commissioner concerned.5. The High Court by the impugned judgment and order of February 21, 2000 dismissed the writ petition challenging the validity of the Notification dated 31.12.1998 on the ground that the appellant had failed to show that the appointment of Traffic Manager as a member of the Regional Transport Authority had adversely affected the business of the appellant. It was not averred that the Regional Transport Authority consisting of Traffic Manager as a member had passed any order adversely affecting the interest of the appellant or had acted in any manner prejudicial to their interest. In such circumstances the High Court was of the opinion that the challenge to the Notification was purely academic and did not warrant exercise of writ jurisdiction by the High Court. On these findings the High Court did not consider it necessary to examine the question as to whether the appointment to Traffic Manager, working in the office of General Manager, Haryana Roadways as a member of the authority was illegal, being in breach of the provisions of Section 68, particularly Section 68 (2) of the Act.6. During the pendency of this appeal another Notification has been issued by the Government of Haryana of February 20, 2001 superseding the Notification dated 31.12.1998. Under the latest Notification the Transport Commissioner. Haryana has again been appointed the Chairman of the Regional Transport Authorities, and the District Transport Officer concerned as the Secretary of the Regional Transport Authority of the concerned region as member to exercise and discharge the powers and functions conferred by or under Chapter V of the Act.

Court's reasoning:
In our view the High Court should have considered the challenge to the appointment of the officials concerned as members of the Regional Transport Authority on the ground of breach of statutory provision. The mere fact that they had not acted in a manner prejudicial to the interest of the appellant could not lend validity to their appointment, of otherwise, the appointment was in breach of statutory provisions of a mandatory nature. It has, therefore, become necessary for us to consider the validity of the impugned Notification said to have been issued in breach of statutoryapplying the dictionary meaning of the word "undertaking", an entity such as the Haryana Roadways, which is engaged in the business of providing transport service to the people must be held be an "undertaking". The use of the words "any undertaking" also making it abundantly clear that the undertaking may be either a private undertaking or a Government or public sector undertaking including a statutory corporation. We have, therefore, no hesitation in holding that a State undertaking such as Haryana Roadways is within the contemplation of sub-section (2) of Section 68 of theCourt must ascertain the intention of the Legislature by directing its attention not merely to the Clauses to be construed but to the entire statute; it must compare the Clause with the other parts of the law, and the setting in which the Clause to be interpreted occurs. The rules is of general application as even plainest terms may be controlled by the context. Expression used in a statute should ordinarily be understood in a sense in which they best harmonize with the object of the statute, and which effectuate the object of the Legislature. Therefore, when two interpretations are feasible the Court will prefer that which advances the remedy and suppress the mischief as the Legislature envisioned. Keeping these principles in mind we shall now consider what meaning has to be given to the expression "financial interest" in sub-section (2) of Section 68 of theare of the considered view that the fact that the Transport Commissioner has no personal financial interest in the State undertaking is of no consequence. Section 68(2) in express terms refers to a person having "any financial interest" as proprietor, employee or otherwise in any transport undertaking. The words employed are of the widest amplitude and expressly include an "employee" of an undertaking. If a very narrow meaning is given to the expression "any financial interest" as contended by the respondents, the word "employee" will be rendered redundant, because in all cases it may be argued that an employee has no personal financial interest in the undertaking and his interest, whatever it may be, financial or otherwise, is his official interest and duty to protect the interest of his employer, including his financial interest. The wide sweep of the language employed in Section 68(2) particularly the use of the word "any" before "financial interest" leads us to hold that the financial interest of the person concerned need nor be direct personal financial interest, but includes the financial interest which he may have even as an employee of thewe have found that the Transport Commissioner is an official of the Haryana Roadways and has a financial interest in that undertaking within the meaning of that expression in Section68(2) of theAct, the Notification in so far it relates to the appointment of Transport Commissioner as Chairman, Regional Transport Authority must be quashed. We may however record that counsel for the appellant did not challenge before us the appointment of the District Transport Officer to act as Member Secretary of the Regional Transport Authority.