Case: Delhi Transport Undertaking Vs. Zamindar Motor Transport Company Private &amp; Another

1. The Delhi Municipal Corporation took over the organisation of the Delhi Transport Authority established under Section 3 of the Delhi Transport Authority Act 13 of 1950, and administered it in the name of Delhi Transport Undertakinghereinafter called D. T. U. Even though the jurisdiction of the Delhi Municipal Corporation extends only to the municipal area, by Section 288 of the Act 66 of 1957 it is authorised to set up transport services for passengers and goods in the entire Union Territory of Delhi and even outside by virtue of Sections 288 and 292 of the Act.2. The respondent Company held in 1960 permits on three routesla, (2)da. Since May 9, 1956, the Delhi Transport Authority and its successor D. T. U. were holding stage carriage permits valid for certain areas but not including the routes on which the respondent Company held permits to ply its stage carriages. On October 19, 1959 the D. T. U. addressed a letter to the Secretary State Transport Authority, Delhi, stating that it considered "it necessary to approach x x with the request to place the matter before State Transport Authority xx to validate" its road permits to cover the entire Union Territory of Delhi. The State Transport Authority treated this letter as an application for validation of the existing permits so as to cover the entire area of the Union Territory of Delhi. After considering the objections filed by existing operators on the routes outside the Municipal Corporation area, the State Transport Authority passed the following order on February 10,representatives of the D. T. U. point out that under the Municipal Act they were required to provide efficient and adequate services in the entire territory of Delhi and therefore the area of their permits should be altered accordingly. The authority considered the request the D. T. U. reasonable. It was decided to alter the permits and make them valid for entire territory of Delhi but they should be informed that they should not operate new services parallel to the existing services of the private operators without the approval of the State Transport Authority".On June 17, 1961 the D. T. U. issued a circular that it was decided to operate its services on Delhi Bawana route with effect from June 19, 1961, and informed the State Transport Authority of its intention to do so. The respondent Company lodged a protest with the State Transport Authority and asked the Authority to order that the running of the proposed service be stopped, and in the meantime the procedure under the Motor Vehicles Act be complied with, and an opportunity for making representations against the proposals of the D. T. U. be afforded. On June 20, 1961 the State Transport Authority gave notice to the respondent Company that the application made by the D. T. U. for operating services betweenwill be considered by the State Transport Authority in its meeting to be held on June 21, 1961 at 11 a. m.On June 21, 1961 the respondent Company wrote a letter to the Secretary, State Transport Authority intimating that it was not aware of the contents of the application of the D. T. U., that the application had not been published and objections and representations had not been invited, that the "notice of hearing was very short" and that proper opportunity for filing objections should be given after due publication of the application of the D. T. U. On June 21, 1961, the State Transport Authority resolvedDelhi Transport Undertaking already held permits for Delhi territory and they can ply on any route in the territory under these permits. No fresh permits are necessary. In the meeting held onthe State Transport Authority, while reviewing the requirements of services on various routes, decided that the Delhi Transport Undertaking should be asked to provide service onroute and if they are unable to do so, additional permits may be issued. Since the Delhi Transport Undertaking have started plying 2 buses x x x in public interest, the operation of such service was approved but there should be no overlapping of the timings of the services.On June 27, 1961, the respondent Company moved a petition in the High Court of Punjab at Delhi for a writ of prohibition restraining the D. T. U. from plying stage carriages on the three routes in respect of which the respondent Company was holding permits. This petition was dismissed by Pandit, J. holding that the conditions mentioned in the resolution dated February 10, 1960 that the D. T. U. would operate new services parallel to the existing services of the private operators after getting the approval of the State Transport Authority was merely in the nature of an administrative instruction and that the letter dated October 19, 1959 was validly treated as a formal application for grant of a new permit under Section 57 (8) of the Motor Vehicles Act, 1939. In appeal under the Letters Patent the judgment of Pandit J., was reversed. The High Court held that the D. T. U. had applied to vary the conditions of its permit, by the inclusion of a new route or routes or a new area within the meaning of Section 57 (8) of the Act and by the resolution dated February 10, 1960, the D. T. U. was not entitled to operate new services without the approval of the State Transport Authority; that such approval could be given after following the procedure prescribed by Sec. 57,(3), (4) and (5) and not otherwise; that there was not even substantial compliance with the provisions of Section 46 of the Motor Vehicles Act and Rule 47 of the Delhi Motor Vehicles Rules; and that in dispensing with the requirements of Section 57 the State Transport Authority acted illegally. With special leave, the D. T. U. has appealed to this Court.

Court's reasoning:
7. Rule 47 of the Delhi Motor Vehicles Rules provides that every application for a permit in respect of a transport vehicle shall be in one of the prescribed forms.By the order dated February 10, 1960 the permits were extended throughout the Union Territory of Delhi, but the D. T. U. still required the permission of the State Transport Authority to ply its stage carriages on routes covered by the permits granted to the respondent Company. Before granting that permission it was necessary to publish the application and to invite and consider objections thereto. The D. T. U. did not even ask for permission of the State Transport Authority but merely intimated by letter dated June 17, 1967 that it will start service on theroute from June 19, 1961. After the D. T. U. started plying its stage carriages, the State Transport Authority gave intimation to the respondent Company and others that the application of the D. T. U. will be considered in its meeting to be held on June 21, 1961. And disregarding the protests raised by the respondent Company and others the State Transport Authority on June 21, 1961 ordered that the D. T. U. should be asked to provide service onroute, and if it was unable to do so, additional permits may be issued. There was no application for grant of permit for plying stage carriages under Section 57; there was no publication of a request by the D. T. U.; representations or objections were not invited; and no opportunity of a hearing to the objectors in the manner contemplated by the Act was given. The proceedings of the State Transport Authority were wholly irregular.The order dated June 21, 1961, merely extended the permits to cover the Union Territory of Delhi; it did not authorise the plying of stage carriages on routes already served by private operators. The existing operators were entitled to be heard when the condition in the permits of the D. T. U. was removed.11. By Section 48 (3) (xxi) it is open to the Regional Transport Authority, after giving notice of not less than one month, (a) to vary the conditions of the permit, and (b) to attach to the permit further conditions. But an application was made by the D. T. U. for variation of the conditions of the permit including a new route or routes or a new area had to be treated as an application for the grant of a new permit under Section 57 (8) of the Act and the State Transport Authority could not ignore the provisions of Section 57(3), (4) and (5).But in exercising that power, the provisions of the Motor Vehicles Act, insofar as the exercise of the power is required to be made in consonance with the provisions of the Act, are not dispensed with.13. The D. T. U. was conscious of these requirements of the Motor Vehicles Act and had moved by an informal letter the State Transport Authority on October 19, 1959 for extension of its permits. But thereafter even without obtaining the concurrence of the State Transport Authority or its approval proceeded to start the services on the overlapping routes as from June 19, 1961.