Holding

Section 68‑F(1‑D) applies to applications for variation of permits, and the approved scheme excludes all private operators not named in Annexure II from operating on any part of the notified route.

Summary

PANDIYAN ROADWAYS CORPORATION LTD, a State Transport Undertaking, had an approved scheme published under s.68‑D of the Motor Vehicles Act, 1939 for the Madurai‑Kumuli route, excluding all private operators except those listed in Annexure II. M.A. EGAPPAN, not listed, obtained two variations of his existing permit to operate stage‑carriage services on sectors of that notified route. The High Court held that s.68‑F(1‑D) did not bar such variations, but the Supreme Court reversed, holding that the provision does apply to permit variations and that the scheme freezes the number of services on the route. Consequently, the respondent could not be permitted to operate on any part of the notified route, and the variation orders were set aside.

Issues considered

Whether s.68‑F(1‑D) of the Motor Vehicles Act, 1939 bars the grant of a variation of a permit for a route covered by a scheme published under s.68‑C/68‑D.
Whether a draft scheme, still in force, can operate as a bar to such variations.
Whether the exclusion in the approved scheme applies only to operators of the entire route or also to those operating on any portion of the route.

Legislation cited

Motor Vehicles Act, 1939s. 64-B, s. 68-C, s. 68-D, s. 68-F(1-D), s. 68-FF

Subjects

Motor Vehicles Actpermit variationroute schemestate transport undertakings.68-Fexclusive rightsstage carriage

Judgment

PANDIYAN ROADWAYS CORPORATION LTD.
A
v.
THIRU M.A. EGAPPAN

FEBRUARY 24, 1987

[E.S. VENKATARAMIAH & K.N. SINGH, JJ.] B

-
Motor Vehicles Act, 1939--Section 68-F(l-D)-Principle
underlying provision is that number of services on such route to be
frozen on publication of scheme under Section 68C-No justification to
limit provision to applications for fresh permit or their renewal and to
leave out applications for variation of a permit.
, c
The appellant is one of the State Transport Undertakings. On
June 30, 1976 an approved scheme was published under s.68-D of the
f i Motor Vehicles Act, 1939 in respect of the route Madurai to Kumuli
authorising the appellant to run its stage carriages and proposing to
exclude completely all other persons from operating their stage carriage D
services under permits covering the entire route except those persons
mentioned in Annexure II to the scheme, who were existing operators
on the different sectors of the notified route on the date of the publica-
tion of the scheme.

The respondent's name was not mentioned in Annexure II as he E
was operating on a non-scheme route. On February 28, 1981 the

- respondent secured the variation of his permit from the Regional
Transport Authority enabling him to operate on a sector of the notified
routes. The appeal against the said order was dismissed and no revision
petition was filed against that order.
F
On December 23, 1982 the respondent obtained from the Regional
Transport Authority a second variation of his permit which authorised
him to operate his stage carriage service on the route which was also a
part of the notified route. An appeal med against that order was dismis-
sed by the State Transport Appellate Tribunal.
G
The High Court dismissed the revision petition taking the view
that s.68-F(l-D) of the Act could not be considered as a bar for enter-
taining an application for the variation of a permit since such an appli-
cation was neither an application for a permit nor for its renewal.

In the appeal to this Court on behalf of the appellant it was H
39!
392 SUPREME COURT REPORTS [1987] 2 S.C.R.

contended I.hat a draft scheme published under s.68-C of the Act on
A
June 4, 1976, which was still in force was a bar to the grant of variation
of the permit authorising the respondent to operate his stage carriage
on a sector of the route iu respect of which the scheme had been
published.

B On behalf of the respondent it was contended that on a true con-
struction of the scheme only persons who were operating their stage
carriages under permits issued in respect of the entire route from 1
Madurai to Kumuli alone have been excluded under the approved
scheme and not those who were operating between any two places on the
notified route or between any place lying outside the notified route and ··--<" -
a place on the notified route even though they might be operating on a
c portion of the notified route.

Allowing the appeal, +- •
HELD: 1. In the context in which s.68-F(l-D) of the Motor
D Vehicles Act, 1939 appears it is difficult to hold that the application for
variation of a permit by including the whole or any part of route in
respect of which a scheme is published under s.68-C of the Act can be
treated as falling outside the mischief of s.68-F(l-D) of the Act. There is
no justification to limit the application of s.68-F(l-D) to only applica-
tions for fresh permits or their renewal and to leave out their applica- +-
E lion for variation of a permit by the exclusion of the route or a portion
of the route in respect of which a scheme is published. The fact that the
applicant is the holder of a permit to operate a stage carriage on
another route whose variation he is seeking by the inclusion of a route
or a part whereof in respect of which a scheme is published under
s.68-C ought not to make any difference. The principle underlying
F s.68-F(l-D) is that the number of services on such a route should be
frozen on the publication of a scheme under s.68-C. [395E-H]

2. The approved scheme excludes the operation by others of stage
carrh{ge service on the said route except those whose names are

G
mentioned in Annexure II attached thereto. The respondent is not pro-
tected by any provision under the approved scheme itself. He cannot be •
permitted to operate on any sector of the notified route in question in
view of the provisions contained in s.68-C, 68-D and 68-FF. [3968-C]

Karnataka State Road Transport Corporation, Bangalore v. B.A.
Jayaram and Others, [1984] 2 S.C.R. 768 & Adarsh Travels Bus Service
h and Another v. State of U.P. and Others, [1985] 4 S.C.C. 557, referred
to.
PANDIYAN ROADWAYSv. M.A. EGAPP~N (VENKATARAMIAH,J. J 393

CIVIL APPELLATE JURISDICTION: Civil Appeal No . 1758 A
of 1986.

From the Judgment and Order dated 22.11.1985 of the Madras
High Court in C.R.P. Np. 3117 of 1984.
. -
Dr. Y.S. Chitale , A.V. Rangarn , T.V. Ratnam and M. Palani for B
the Appellant.

K.K. Venugopal, A .T.M. Sampath and S. Srinivasan for the
_ y. Respondent.

The Judgment of the Court was delivered by
c
VENKATARAMIAH, J. The appellant is one of the State Trans-
port Undertakings established in the State of Tamil Nadu. It has
questioned in this appeal by special leave the decision of the High
Court of Madras in CRP No. 3117 of 1984 affirming an order granting
variation of a permit issued under the provisions of the Motor Vehicles D
Act, 1939 (hereinafter referred to as 'the Act') by virtue of which the
respondent is permitted to run a stage carriage on the route between
Checkanurani and Madurai which is a part of a notified route Madurai
to Kumuli via Checkanurani, Valandur, Usilampatti, and Theni.
Before the High Court the State Transport Appellate Tribunal and the
Regional Transport Authority the appellant had pleaded the publica- E
tion of a draft scheme under section 68-C of the Act on June 4, 1976 in
respect of the route Madurai to Kumuli as a bar to the grant of a
variation of the permit prayed for by the respondent. In this Court the
appellant has relied upon the existence of an approved scheme
published on June 30, 1976 in respect of the very same route Madurai
to Kumuli also as a bar to the order of variation of permit granted in F
favour of the respondent. The route is common to both the draft
scheme dated June 4, 1976 and the approved scheme dated June 30,
1976. We shall, however, consider the effect of the approved scheme
on the order granting variation of the permit first.

The facts of the case are these. On June 30, 1976, as stated G
earlier, the approved scheme was published under section 68-D of the
Act in the Tamil N adu Government Gazette in respect of the route
Madurai to Kurnuli authorising the appellant to run its stage carriages
on that route. By that approved scheme it was proposed to exclude
completely all other persons from operating their stage carriage
services under permits covering the entire route, referred to above H
394 SUPREME COURT REPORTS [1987] 2 S.C.R.

A except those persons mentioned in Annexure II to the said scheme
.. ..-1'
without prejudice. to any future modifications, variations etc. of their J ...
permits. The operators whose names had been mentioned in Anne-
xure II to the scheme were persons who were existing operators on tbe
different sectors of the notified route on the date of the publication of
the_scheme. The respondent was not one of the those persons who was
8 · running a stage carriage service on any part or sector of the route in
question on the date of its publication. Hence, his name was not
mentioned in Annexure II to the scheme. He was then operating a
stage carriage service under a permit issued under the Act on the route
Batlagundu to Usilampatti which was non-scheme route. On February
28, 1981 he was able to secure the variation of the said permit from the
C Regional Transport Authority which enabled him tt> operate on the
route measuring 21.4 Kms. from Usilampatti to Checkanurani, which
formed· a sector of the notified route. The appeal filed against the said
order was dismissed and no revision petition was filed against the
order dismissing the said appeal. On 23.12.1982 he obtained from the
Regional Transport Authority a second variation of his permit under
D which he was authorised to operate his stage carriage service over a
distance of 16.6. Kms. from Checkanurani to Madurai which was also
a part of the notified route. An appeal filed against that order was
dismissed by the State Transport Appellate Tribunal. A revision peti-
tion was filed under section 64-B of the Act (as in force in the State of
Tamil Nadu) before the High Court. The High Court dismissed the
E revision petition. This appeal by special leave is filed against the above
order of the High Court.

As mentioned earlier the appellant pleaded before the High
Court that a draft scheme published on June 4, 1976 which was still in
force was a bar to the grant of variation of the permit authorising the
F respondent to operate his stage carriage on a sector of the route in
respect of which the scheme had been published. The High Court was
of the view that section 68-F( 1-D) could not be considered as a bar for
entertaining an application for the variation of a permit since such an
application was neither an application for a permit nor for its renewal.
In arriving at the said decision it relied upon section 68-F(l-D) of the
G Act which read as follows:--

"68-F(l-D). save as otherwise provided in sub-section (1-
A) or sub-section (l-C), no permit shall be granted or
renewed during the pe.riod intervening between the date of
publication, under section 68-C of any scheme and the date
H of publication of the approved or modified scheme, in
PANDIYAN ROADWAYSv. M.A. EGAPPAN [VENKATARAMIAH,J.] 395

favour of any person for any class of mad transport service
A
in relation to an area or route or portion thereof covered by
such scheme ......... "

It futher relied upon a decision of this Court in Karnataka State
Road Transport Corporation, Bangalore v. B.A. Jayaram and Others,
[1984] 2 S.C.R. 768. In that case this Court observed at page 789 thus: B

"Assuming, therefore, that an application for variation of
the conditions of a permit referred to in sub-section (8) of
section 57 is to be deemed by a fiction of law to be an
application for the grant of a new permit the question to
which we must address ourselves is for what purpose is such
an application for variation deemed to be an application for C
grant of a new permit. Reading sub-sections (3) to (8) of
section 57 as a whole, it is clear that the only purpose is to
apply to such an application for variation the procedure
prescribed by sub-sections (3) to (7) of section 57 and not
for the purpose of providing that when the application for D
variation is granted, the permit so varied would be deemed
to be a new permit. If a permit so varied were to be deemed
to be a new permit, the result would be anomalous."

From the above observation the High Court deduced that an appli-
cation for the variation of a permit held by the respondent was not in E
fact an application for a permit and did not fall within the mischief of
section 68-F(l-D) of the Act. In the context in which section 68-F(l-D)
appears we find it difficult to agree that the application for variation
of a permit by including the whole or any part of route in respect of
''"'" which a scheme is published under section 68-C of the Act can be
,... treated as falling outside the mischief of section 68-F(l-D) of the Act. F
There is no justification to limit the application of section 68-F(l-D) of
the Act to only applications for fresh permits or their renewal and to
j
leave out applications for variation of a permit by the inclusion of the
J route or a portion of the route in respect of which a scheme is
published. The fact that the applicant is the holder of a permit to
J_
.r -t
operate a stage carriage on another route whose variation he is seeking G
by the inclusion of a route or a part thereof in respect of which a
scheme is published under section 68-C of the Act ou~ht not to make
any difference. The principle underlying section 68-F(l-D) of the Act
is that the number of services on such a route should be frozen on the
publication of a scheme under section 68-C of the Act. It is not, how-
ever, necessary for us to pursue the applicability of section 68-F(l-D) H
!
'I
396 SUPREME COURT REPORTS [1987) 2 S.C.R.

of the Act to the present case any further since it is brought to our
A notice that the very same ronte is the subject-matter of the approved
scheme published under section 68-D of the Act on June 30, 1976 to
r
which we have already adverted. The approved scheme, as mentioned
earlier, excludes the operation by others of stage carriage services on
the above mentioned route Madurai to Kumuli except those whose
B names are mentioned in Annexure II attached thereto. The respon-
dent is not protected by any provision in the approved scheme itself. 1
He cannot be permitted to operate on any sector of the notified route
in question in view of the provisions contained in sections 68-C, 68-D
and 68-FF of the Act. The effect of these provisions has been sum- ·-~
marised by a Constitution Bench of this Court in Adarsh Travels Bus
Sel'Vice and Another v. State of U.P. and Others, (1985) 4 S.C.C. 557.
C Chinnappa Reddy, J. speaking for the Constitution Bench observed at
~~~: -~

"7. A carefully and diligent perusal of Section 68-C, Sec-
tion 68-0(3) and Section 68-FF in the light of the definition
D of the expression 'route' in Section 2(28-A) appears to
make it manifestly clear that once a scheme is published
under Section 68-D in relation to any area or route or por-
tion thereof, whether to the exclusion, complete or partial
of other persons or otherwise, no person other than the
State Transport Undertaking may operate on the notified
E area or notified route except as provided in the scheme
itself. A necessary consequence of these provisions is that
no private operator can operate his vehicle on any part or
portion of a notified area or notified route unless autho-
rised so to do by the terms of the scheme itself. He may not
operate on any part or portion of the notified route or area
on the mere ground that the permit as originally granted to
him covered the notified route or area."

In view of the above observation we have to hold that in the
instant case the respondent is not entitled to operate his stage carriage
on the notified route or a portion thereof even though he may have been
G granted variation of his permit to operate on a sector of the notified
route. j-
We do not agree with the contention urged on behalf of the
respondent that on a true construction of the scheme only persons who
are operating their stage carriages under permits issued in respect of
H the entire route from Madurai to Kumuli alone have been excluded
PANDIYAN ROADWAYS v. M.A. EGAPPAN [VENKATARAMIAH, J.] 397

under the approved scheme and not those who are operating between A
any two places on the notified route or between any place lying outside
the notified route and a place on the notified route even though they
may be operating on a portion of the notified route. We are firmly of
the vi<;:w that on the entire notified route between Madurai and
Kumuli or any part thereof apart from the State Transport Under-
taking no person other than those mentioned in Annexure II to the B
approved scheme can operate a state carriage 1service. We, therefore,
direct the respondent not to operate his stage carriage on the sector in
respect of which he has obtained the variation of his permit.

We are informed that the draft scheme published on June 4, 1976
is being considered by the authority concerned under section 68-D of c
the Act. It is open to the respondent to make any representation which
he is advised to make before the said authority regarding the incon-
venience caused to him by reason of the approved scheme referred to
above.

The above appeal is, therefore, allowed accordingly. There is no D
order as to costs.

A.P.J. Appeal allowed .
. -+