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PETITIONER: CAPITAL MULTI-PURPOSE CO-OPERATIVE SOCIETYBHOPAL AND OTHERS

       Vs.

RESPONDENT: THE STATE OF M.P. & OTHERS

DATE OF JUDGMENT: 30/03/1967

BENCH: WANCHOO, K.N. BENCH: WANCHOO, K.N. BACHAWAT, R.S. RAMASWAMI, V.

CITATION:  1967 AIR 1815            1967 SCR  (3) 329  CITATOR INFO :             1970 SC1102  (17)             1971 SC1986  (10)             1977 SC  24  (8)             1977 SC 441  (20)             1981 SC 660  (4,7,9)

ACT: Motor  Vehicles Act (4 of 1939)-Ss. 68A, 68-C and  68D-State Road Transport Corporation publishing schemes for  take-over of certain routes-Particulars to be given in the scheme  for validly  originating proceedings-Whether authority  to  hear objections  can  be appointed under the  Rules  of  Business under  Article 166(3) of the Constitution or only  under  s. 68-D  (2-A)-Whether express finding necessary  by  authority that scheme would fulfil four-fold purposes mentioned in  s. 68-C-Authority  not summoning documents or witnesses at  the instance  of objectors regarding past records  or  financial position to consider ability of the State Undertaking to run nationalised transport services and to consider  comparative merits  of  undertaking and private  operators-Whether  such evidence  relevant-Therefore, whether hearing of  objections adequate and real.

HEADNOTE: On  May  11, 1964, the Madhya Pradesh State  Road  Transport Corporation  published two schemes for the take-over by  the corporation  of  certain routes under Chapter  IV-A  of  the Motor  Vehicles  Act  4  of 1939 to  the  exclusion  of  the existing  private operators on those routes  and  objections were invited within 30 days.  After the objections filed  by various private operators were heard by a Special  Secretary to the State Government empowered under s. 68-D of the  Act, he  passed orders on June 8, 1965, modifying the schemes  in certain  particulars.   The modified and  corrected  schemes were  finally  published on June 18, 1966.   Writ  petitions were thereafter filed by the appellants challenging the  two schemes but were dismissed by the High Court. In  the appeal to this Court it was contended on  behalf  of the  appellants:(i)  that the proposed schemes were  bad  as they were not in compliance with s. 68-C of the Act and  the rules  framed  thereunder for they did  not  give  necessary

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particulars  which would enable the appellants to  formulate their  objections to the proposed schemes in respect of  the fourfold  purposes mentioned in s. 68-C i.e., that a  scheme should  be  for  the purposes of  providing  an  "efficient, adequate, economical and properly coordinated Road Transport Service"  and that as the proposed schemes  were  themselves bad,  the  entire proceedings initiated by  them  must  fall through;  (ii)  that  the Special Secretary  who  heard  the objections on behalf of the State Government was not validly authorised to do so as he had been appointed under the Rules of  Business  framed under Art. 166(3) of  the  Constitution while  the appointment should have been under s. 68-D  (2-A) of  the  Act;  (iii) that the order  approving  the  schemes passed  on June 8, 1965 was invalid as it did not  say  that the  schemes fulfilled the purposes mentioned in a 68-C  and an express finding to this effect was necessary to  validate the schemes; (iv) that the hearing given by the authority to the  objectors was not adequate -and real as required  under s.  68-D  of the Act : the authority  wrongly  rejected  the appellants   application  to  summon  documents   from   the Corporation  to show that the Corporation did not  have  the equipment  and finances to carry out the schemes.  and  that the  Corporation’s past record of running its  services  was worse 330 than  that  of the private Operators;  and  furthermore  the authority  had  also wrongly refused  to  summons  witnesses sought  to  be  called to show that the  schemes  would  not fulfil the four-fold purposes stated in s. 68-C. HELD:     Dismissing the appeal : (i)  S. 68-C requires two things, namely, (1) the nature  of the  services  proposed to be rendered and (2) the  area  or route proposed to be covered; it further requires that  such other  particulars respecting the schemes as the  rules  may prescribe  should  be given.  The particulars given  in  the present proposed schemes were clearly in compliance with the provisions  of  s,  68-C and that  was  enough  for  validly originating the proceedings. [334B, G] (ii) The   first  part  of  s.  68-D(2-a),  which   is   the substantive  part, lays down that the person who is to  hear the  objections  cannot  be an officer  below  the  rank  of Secretary to the Government.  The second part is  procedural and  states how the officer should be appointed, namely,  by notification  in the official gazette.  In the present  case as  the  person  appointed  was  a  Special  Secretary,  the substantive  part of the provision had been  complied  with. As far as the second and procedural part was concerned,  the appointment  of  the authority could be by  notification  as provided  in the Section or by an order under the  Rules  of Business   under   Art.   166(3)   of   the    Constitution. Accordingly,  the  appointment  of  the  authority  to  hear objections  in  the  present case could  not  be  considered invalid. [335H; 336C-D] (iii)     There is no express provision in Section 68-C read with Section 68-D that the authority hearing objections must come to a finding that the scheme under examination provides an efficient, adequate, economical and’ properly coordinated road transport service.  In the absence of such a provision, the very order of the State Government or the authority  ap- pointed  must  be held to mean either, where the  scheme  is approved  or  modified,  that  it  subserves  the   purposes mentioned  in s. 68-C or where it is rejected, that it  does not. [337B, D-E] (iv) The authority had rightly held the documentary and oral evidence  proposed  to  be called  was  irrelevant  and  the

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hearing  of the objections was therefore both  adequate  and real. Chapter (IV-A) of the Act was enacted for nationalisation of road  transport  services  in accordance  with  the  amended Article  19(6) of the Constitution.  The  nationalised  road transport  under  the  Chapter can only be run  by  a  State Transport  Undertaking  defined by s. 68-A (b)  of  the  Act which  would always be under the control of the  Central  or State  Government.  In this context, it would be futile  for any  object  to  show that the  undertaking  backed  by  the Central or State Governments could not have the equipment or finances  to carry out the schemes.  Furthermore, as only  a State Transport Undertaking can run a nationalised  service, there  was  no  necessity for  considering  the  comparative merits of the undertaking and individual private  operators. [341C-E, G] If  a  party  concerned wishes to produce  any  document  or produce any witness, the authority may take the  documentary evidence  into  consideration or take the  evidence  of  the witness,   if  it  considers  such  evidence  relevant   and necessary.  But there is in the absence of any provision  in the Act or the Rules, no power in the authority or the State Government  to compel attendance of witnesses or  to  compel production  of  documents.  This is not to say that  if  the authority wants any party before it to produce any  document for satisfying itself whether the scheme is for the  purpose mentioned  in  s. 68-C it cannot so ask; and  if  the  party asked to produce 331 documents does not do so, the authority would be entitled to draw such inferences as it might consider justified from the non-production of documents.  But apart from this, there  is no  power  conferred on the authority under the Act  or  the Madhya  Pradesh  Rules to compel production  of  documentary evidence or to summon any witness. [339H-340c] Gullapalli Nageswara Rao, v. Andhra Pradesh Road  Transport. [1959]  1  S.C.R.  319, Malik Ram v.   State  of  Rajasthan. [1962]  1 S.C.R. 978 and Nehru Motor Transport  Co-operative Society, Limited v. The State of Rajasthan, [1964] 1  S.C.R. 220, referred to.

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeals Nos. 2201 and 2202 of 1966. Appeals from the judgment and order dated September 15, 1966 of  the Madhya Pradesh High Court in Misc.   Petitions  Nos. 351 and 311 of 1965 respectively. M.N.  Phadke,  Naunit  Lal, Y. S. Dharmadhikari  and  M.  N. Puranik, for the appellants (in both the appeals). A.P. Sen, Advocate-General for the State of Madhya Pradesh and  I.N.  Shroff,  for the respondent No. 1  (in  both  the appeals). S.V.  Gupte,  Solicitor-General, K. A .  Chitale,  Rameshwar Nath  and Mahinder Narain, for respondents Nos. 5 and 6  (in C.A. No. 2201 of 1966) and respondents Nos. 4 and 5 (in C.A. No. 2202 of 1966.) The Judgment of the Court was delivered by Wanchoo, J. These are two appeals on certificates granted by the  Madhya Pradesh High Court.  The appeals  are  connected and  will be dealt with together.  The Madhya Pradesh  State Road  Transport Corporation (hereinafter referred to as  the Corporation),   constituted   under   the   Road   Transport Corporation  Act, (No. 64 of 1950), came into  existence  in

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May  1962 to operate as a State Transport Undertaking  under s.  68-A  of  the  Motor  Vehicles  Act,  No.  4  of   1939, (hereinafter  referred  to  as the  Act).   The  Corporation passed  two  resolutions in April and May 1964 by  which  it decided  to take over certain routes under Chapter  IV-A  of the  Act to the exclusion of the existing private  operators on those routes.  Two schemes, namely, Nos. 16 and 22  dated May  11,  1964, were published by the  Corporation  inviting objections  within  30 days.  The schemes  appeared  in  the Government  Gazette of May 22, 1964 and  objections  thereto were filed by private operators affected thereby within  the period  prescribed.  Thereafter the authority  empowered  to hear objections under s. 68-D of the Act gave notices fixing a date for hearing.  The hearing was to begin on September 332 4,  1964, but it was postponed a number of times.   Finally, arguments were heard on May 20, 1965.  The authority  passed orders  on  June 8, 1965 modifying the  schemes  in  certain particulars.   On June 11, 1965, the modified  schemes  were published,  but  as there were mistakes in  them,  corrected schemes as modified were finally published on June 18, 1965. Then  followed  writ petitions to the High Court  in  August 1965  by  private operators who were dissatisfied  with  the order of the -authority concerned.  The High Court dismissed the  writ petitions rejecting all the contentions raised  by the  petitioners before it.  Thereafter the High Court  gave certificates  to appeal to this Court, and that is  how  the appeals have come before us. It  is unnecessary to set out all the points  raised  before the High Court, for learned counsel for the appellants  have raised only some points before us out of those raised before the  High  Court.   It is enough therefore to  set  out  the points  that have been raised before us and to indicate  the decision  of the High Court thereon.  The  first  contention raised  before us is that the proposed schemes published  on May  22,  1964  were  bad  inasmuch  as  they  were  not  in compliance  with  s. 68-C of the Act and  the  rules  framed thereunder,  for  they did not  give  necessary  particulars which  would  enable  the  appellants  to  formulate   their objections  to the proposed schemes in respect of the  four- fold purposes mentioned in s. 68-C.  The High Court rejected this contention holding that there was sufficient compliance with  the  provisions contained in s. 68-C  and  the.  rules framed  thereunder  and  there was enough  material  in  the proposed   schemes,  to  enable  the  appellants   to   file objections  thereto.   The  second contention  is  that  the Special Secretary who heard the objections on behalf of  the State  Government  was  not  validly  authorised  to  do  so inasmuch  as  he  had  been appointed  under  the  Rules  of Business framed under Art. 166 (3) of the Constitution while appointment should have been under s. 68-D(2-a) of the  Act, which  was  inserted therein by the Motor  Vehicles  (Madhya Pradesh  Amendment) Act, No. 2 of 1963.  The High Court  re- jected this contention holding that the provision in s. 68-D (2-a)  was  supplementary  to  the  power  which  the  State Government had under the Rules of Business and therefore  it was open to the State Government to act under either of  the provisions.    The  third  contention  is  that  the   order approving  the  schemes passed on June 8, 1965  was  invalid inasmuch  as it did not say that the schemes  fulfilled  the purposes mentioned in s. 68-C.  The High Court rejected this contention  also  holding  that as  soon  as  the  authority approved  the  schemes, it must be held  to  have  impliedly decided that the schemes fulfilled the purposes mentioned in s.  68-C.  The last contention is that the hearing given  by

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the  authority was not adequate and real and  therefore  the approval given was invalid.  The 333 High Court rejected this contention also holding that in the circumstances  of the case the hearing given was  sufficient for the purpose.  In the result the High Court dismissed the writ  petitions  after  rejecting other  points  which  were raised  before the High Court but are not raised before  us. We  shall  now  proceed to deal with  the  four  contentions raised before us in that order. The  first  contention  relates to  the  invalidity  of  the proposed  schemes published on May 22, 1964, on  the  ground that  they  are  not in compliance with  S.  68-C,  and  the argument is that if the proposed schemes which initiate  the proceedings leading to final approval thereof are themselves bad, the entire proceedings must fall through.  Now  section 68-C lays down that where any State Transport Undertaking is of opinion that it is necessary in the public interest  that road  transport services in general or any particular  class of such services in relation to any area or route or portion thereof  should be run and operated by the  State  Transport Undertaking, whether to the exclusion, complete or  partial, of   other  persons  or  otherwise,  the   State   Transport Undertaking  has  to prepare a scheme.   Further  the  State Transport Undertaking forms this opinion for the purposes of providing  "an efficient, adequate, economical and  properly coordinated  road transport service".  Section 68-C  further provides  that where the State Transport Undertaking  is  of this  opinion  for the purposes mentioned above  it  has  to prepare  a  scheme  and  cause it to  be  published  in  the official  gazette  and  in such other manner  as  the  State Government  may direct.  The publication is for the  purpose of  inviting  objections  to the proposed  scheme  by  those affected  thereby   Section 68-C further provides  that  the proposed scheme should give particulars of the nature of the services proposed to be rendered, the area or route proposed to be covered and such other particulars respecting  thereto as may be prescribed.  It is not the case of the  appellants that the proposed schemes published on May 22, 1964 did  not give  particulars of the nature of the services proposed  to be  rendered, and the area or route proposed to be  covered. Nor  is it the case of the appellants that it did  not  give such other particulars respecting thereto as were prescribed by  rules.  The argument is that the proposed  schemes  must disclose data in support of the four purposes which are  the basis  of  what  may  be  called  nationalisation  of   road transport  service, namely, the providing of  an  efficient, adequate, economical and properly coordinated road transport service.  Now the two schemes with which we are concerned in these  appeals have given detailed particulars of  what  the State  Transport  Undertaking considered was  in  compliance with  S.  68-C  and the rules framed  thereunder.   But  the argument is that more particulars should have been given  to disclose  how the schemes were for the purpose of  providing an efficient, adequate, economical and properly co-ordinated road  transport service, and in particular it is urged  that the 334 timings  on  which services would be run  should  have  been indicated  in  the  schemes as  that  would  have  indicated whether the services to be provided by the Corporation  were coordinated services. Now the section itself requires two things, namely, (i)  the nature of the services proposed to be rendered, and (ii) the area  or route proposed to be covered.  Further the  section

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provides  that such other particulars respecting the  scheme should  be given as the rules prescribe, and that  has  been done.   But  the argument seems to be that even  though  the section and the rules have been complied with, certain other things  should  have been mentioned in order to  enable  the private  operators to show that the schemes did not  provide an efficient, adequate, economical and properly  coordinated road  transport  service.   We  are  of  opinion  that  this argument   must  be  rejected.   The  schemes   have   given sufficient  details to enable the appellants to  file  their objections.   The four purposes mentioned in s. 68-C are  so all-embracing  in  their  nature that  it  would  always  be possible  for a private operator to put forward  some  small particular  and  say that this particular should  also  have been given in the proposed scheme and as it is not given  it is  not  possible for him to make a  proper  objection  with respect to the four purposes mentioned in the section.   The result of accepting the argument on behalf of the appellants would  be  that no scheme would ever get through,  for  some small particular or other can always be, put forward by some person or other as not included in the scheme and  therefore the  whole  proceeding should be invalidated on  account  of defect  in the proposed scheme originating  the  proceeding. We  are  of opinion that so long as a scheme gives  the  two things  which the section itself prescribes and  such  other particulars  which the rules prescribe, that is  enough  for the purpose of validly originating the proceeding, resulting in  eventual  nationalisation  of the  routes  and  services concerned.   Thereafter it is open to the objectors to  take such  objections to the proposed scheme in the light of  the four  purposes already indicated and the  proceedings  being quasi  judicial,  the  State  Government  or  the  authority concerned can consider the objections and finally approve or modify  the  scheme, or if necessary reject  it  altogether. The  particulars  given  in  the  present  proposed  schemes published  on  May 22, 1964, are undoubtedly  in  compliance with the provision of s. 68-C a,-, well as the rules  framed thereunder,  and that in our opinion was enough for  validly originating  the  proceeding.   We  therefore  reject   this contention raised on behalf of the appellants. The  second  contention is that the  Special  Secretary  who heard  the objections on behalf of the State Government  was not validly authorised.  Now s. 68-D. (2) provides that "the State  Government may, after considering the objections  and after   giving  an  opportunity  to  the  objector  or   his representatives and the representatives 335 of  the  State  Transport Undertaking to  be  heard  in  the matter,if  they  so desire, approve or modify  the  scheme". The  State Government obviously is not a natural person  and therefore  some  natural person has to give the  hearing  on behalf  of  the State Government.  Article 166  (3)  of  the Constitution  gives power to the Governor to make rules  for the  more  convenient  transaction of the  business  of  the Government  of  the State, and Rules of Business  have  been framed under this power for the performance of duties  which have to be performed under the law by the State  Government. It is not in dispute that the Special Secretary who gave the hearing  in the present case was authorised under the  Rules of  Business.   But  what is urged is that in  view  of  the introduction  of  S. 68-D (/’--a) in the Act by  the  Madhya Pradesh  Amendment  it  is  no  longer  open  to  the  State Government to act under the Rules of Business, and that  the appointment  should have been made under the new  provision. That provision is in these terms :-

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             "(2-a).    The   State  Government   may,   by               notification, authorise any officer not  below               the rank of a Secretary to Government for  the               purpose  of  hearing  objections  under   sub-               section (2)." Further  as  under S. 2 (25) of the Madhya  Pradesh  General Clause$  Act,  (No. 3 of 1958), the word  "notification"  as used  in Madhya Pradesh Acts means a notification  published in   the  official  gazette,  the  officer  who  heard   the objections  should  have  been  appointed  by  means  of   a notification in the State Gazette under this new provision. Now  this new provision may be divided into two parts.   ’Me first part may be called substantive and lays down that  the person  who  is to hear objections on behalf  of  the  State Government  cannot  be  an  officer  below  the  rank  of  a Secretary to Government.  The second part is procedural  and states  how  the  officer  may  be  appointed,  namely,   by notification  in  the  official  gazette.   So  far  as  the substantive part of the new provision is concerned, it  cer- tainly  limits  the power of the State  Government  when  it proceed  to  appoint some one to hear  objections  and  such person  in  view  of the limitation  contained  in  the  new provision cannot be an officer below the rank of a Secretary to  Government.   This  means, that for  example,  a  Deputy Secretary  or  an Under Secretary to  Government  cannot  be appointed  to  hear  objections.  In the  present  case  the person appointed is a Special Secretary to Government  i.e., an officer not below the rank of a Secretary to  Government. Therefore  the  substantive  part of the  new  provision  is complied  with by the appointment made in this  behalf,  and that in our opinion is mandatory and limits the power of the State  Government  as  to  the rank  of  the  person  to  be appointed to hear objections on its behalf.  But the  second part is merely proce- 336 dural,  namely, how the appointment is to be made.  The  new provision indicates that it may be made by a notification in the  official gazette.  But that does not mean that  if  the Constitution  provides  for any other method of  making  the appointment that method is made nugatory.  Such a procedural provision may be mandatory if action is taken under the  new provision; but there are no words in the new provision which exclude  the procedure provided under the Rules of  Business under Art. 166(3) of the Constitution.  Therefore we are  of opinion  that where the State Government proceeds under  the new provision it has to make a notification in the  official gazette  appointing  a  person  not  below  the  rank  of  a Secretary to Government to hear objections.  But it may  act under the Rules of Business so long as under those rules  it appoints  a  person  not below the rank of  a  Secretary  to Government  for  the  purpose of  hearing  objections.   The limitation  under  the new provision is only this  that  the person  appointed cannot be below the rank of  a  Secretary. But  so  far  as  the  procedural  part  is  concerned,  the appointment may be by notification as provided under the new provision  or by an order under the Rules of Business.   The objection therefore that the authority in this case was  not appointed  under the new provision but was  appointed  under the  Rules  of Business and therefore  the  appointment  was invalid, must fail. The  third contention raised on behalf of the appellants  is that the orders approving and modifying the schemes in  this case do not show that the authority had applied its mind  to the  question whether the schemes were such as  to  subserve the purposes of providing an efficient, adequate  economical

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and  properly  coordinated transport service.   Reliance  in this  connection is placed on. certain American cases  which hold  that the lack of an express finding necessary under  a statute  to  validate an order of an  administrative  agency cannot  be supplied by implication.  When therefore such  an administrative  agency is required as a condition  precedent to  an order to make a finding of facts the validity of  the order  must rest upon the needed finding.  If it is  lacking the  order  is ineffective and the lack of  express  finding cannot be supplied by implication.  It is unnecessary for us to  refer to the American cases in detail: it is  enough  to say   that   the   principles  enunciated   above   may   be unexceptionable   where  the  existence  of  a  finding   is necessary for taking action, but that depends upon the words of  the statute and therefore we must now turn to the  words of s. 68-C and s. 68-D.  We have already indicated that  the State  Transport Undertaking publishes a scheme when it  has arrived at a certain opinion  After the scheme is  published under s. 68-C any person affected by it can object within 30 days  under  s . 68-D.(1). Thereafter the  State  Government considers  the  objections and gives an opportunity  to  the objector to be heard and 337 also  to  the State Transport  Undertaking.  Thereafter  the State  Government or the authority authorised by  it  either approves  or modifies the scheme or even rejects it.   There is  no express provision in these two sections  laying  down that  the  authority hearing objections must  come  to  some finding of fact as a condition precedent to its final order. As  such  no express finding as envisaged  in  the  American cases is necessary under S. 68-C read with s. 68-D that  the scheme  provides  an  efficient,  adequate,  economical  and properly coordinated road transport service.  Besides we are of opinion that the whole object of hearing objections under S.  68-D  is  to consider whether  the  scheme  provides  an efficient,  adequate,  economical and  properly  coordinated road transport service.  After hearing objections the  State Government,  or the officer authorised by it has  either  to approve  or modify, or if necessary, to reject  the  scheme. Where  the  scheme is approved or  modified  it  necessarily follows in our opinion that it has been found to provide  an efficient,  adequate,  economical and  properly  coordinated transport  service;  if it is not of that  type,  the  State Government  or  the authority appointed to  hear  objections would reject it.  In the absence of a provision requiring an express  finding in these two sections it seems to  us  that the  very  order of the State Government  or  the  authority appointed  by  it to hear objections must be  held  to  mean either,’  where the scheme is approved or modified, that  it subserves the purposes mentioned in S. 68-C, or, where it is rejected,  that it does not subserve the purposes.   Section 68-D  (2) does not require in our opinion any express  find- ing, and even if there is none in the present case, it would not  invalidate the orders passed by the  authority  hearing the  objections.  The argument on behalf of  the  appellants under this head is also rejected. The  last  contention is that an adequate and  real  hearing was,  not given to the appellants as required by S. 68-D  of the Act. Reliance   in this behalf is placed on a number  of decisions of this Court  Before  however  we  consider   the legal position, let us see what    exactly happened_in  this connection.  It appears that an application was made by  the appellants  requesting the authority to summon a very  large number  of documents from the Corporation in order to  prove inter  alia that the present equipment and finances  of  the

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Corporation showed that it was not in a position to run  the services  and  that  on a comparison of the  record  of  the Corporation  with that of the various private  operators  it would  appear that it was not in the interest of the  public that  the  routes in question should  be  nationalised.   It appears that some of the documents were not produced by  the Corporation,  and in particular documents, which would  have shown  the  record of the Corporation with  respect  to  its running various routes in the past, were not produced and it was contended that those documents were 338 irrelevant.  Besides this, the appellants wanted to  produce a  large number of witnesses in support of their  contention that  the schemes were not efficient,  adequate,  economical and  properly  co-ordinated.  So far as the  documents  were concerned,  the authority said in its order  dated  February 17, 1965 that the matter would be dealt with at the time  of argument.   As for the witnesses, the authority  refused  to summon  them  on  the ground that their  evidence  would  be irrelevant and in any case oral testimony was not  necessary to  prove what the appellants desired to prove.  It  appears therefore  that  no oral evidence was taken as it  was  con- sidered  irrelevant  by  the  authority  and  some  of   the documents  which  the appellants wanted the  Corporation  to produce  were not ordered to be produced.  It  appears  from the  final  order  of  the authority  that  they  were  also considered irrelevant as the authority held that no question arose  of comparing the merits of the Corporation  with  the private operators. Let  us  now turn to the legal position in  this  matter  as established by the decisions of this Court.  The first  case to  which reference may be made is Gullapalli Nageswara  Rao v.  Andhra  Pradesh State Road Transport  Corporation(1)  in which this Court by majority held that the hearing under  s. 68-D(2)   was  quasi  judicial  in  nature  and  the   State Government  acted as a quasi judicial authority  under  that section. The matter was further considered by this Court in Malik Ram v. State of Rajasthan (2) and it was held that a hearing be- fore  a  quasi  judicial authority did not  merely  mean  an argument,  and that in proper cases it might include  taking of  evidence  both oral and documentary.  It was  also  held that  in the circumstances of the provision contained in  s. 68-D  (2) and the purpose of the hearing thereunder,  taking of  evidence,  whether oral or documentary,  that  might  be produced  by either party, was necessary, before  the  State Government could arrive at a just conclusion with respect to the  objections to the draft scheme.  But it is  clear  that Malik  Ram’s case(2) only decided that if any party  desired to  produce  evidence,  whether  documentary  or  oral,  the authority should take that evidence, subject to its right to consider  whether  the evidence was relevant or not  and  to reject  such evidence as it considered irrelevant.   It  was also pointed out in that case that the authority would  have full power to control the proceedings and a party would  not be  entitled  to  prolong them by  producing  irrelevant  or unnecessary evidence. The matter was again considered by this Court in Nehru Motor Transport  Co-operative  Society  Limited v.  The  State  of Rajasthan(3).   In  that case it was pointed  out  that  the Rajasthan   Rules  did  not  provide  for   compelling   the attendance of witnesses. (1) [1959] Supp.  1 S.C.R. 319.    (2) [1962] 1 S.C.R. 978. (3)  [1964]1 S.C.R. 220. 339

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and  that it was enough if the. authority took- evidence  of witnesses  whom  the objector’ produced before it.   It  was also remarked that the authority might help the objector  to secure their attendance by issue of summonses, though in the absence of any provision in the law, the witnesses might  or might not appear in answer thereto.  These observations were made  in the context of an argument that there could  be  no effective  hearing without a provision for coercive  process compelling,  attendance  of  witnesses  and  production   of documents, and that argument was turned down. It  is urged on behalf of the Corporation that there  is  no provision  in  the Act and the Rules  framed  thereunder  in Madhya Pradesh applying the provisions of the Code of  Civil Procedure  with  respect  to  summoning  of  witnesses   and discovery or inspection of documents, to proceedings  before the, authority hearing objections under s. 68-D.   Therefore the authority was not in any case bound to summon  witnesses or order inspection or discovery of documents.  It seems  to us  that  there  is force in this  contention  and  strictly speaking,  the  authority cannot summon witnesses  or  order discovery  and inspection of documents, as the Act  has  not provided for any such thing.  Nor has any rule been  pointed out  to  us making such a provision.  But it  is  argued  on behalf of the appellants that this was not the reason  given by the authority for not summoning witnesses or not ordering production  of  documents and we should  judge  whether  the hearing  was adequate on the basis of the reasons  given  by the  authority  in the present case.  Further,  reliance  in this  connection is placed on the observation of this  Court in Nehru Motor Transport Co-operative Society’s case(1) that the authority might help the objectors by issuing summonses. This  observation  in  our opinion does  not  mean,  in  the absence  of any provision in the Act or the rules, that  the authority  was  bound to summon witnesses  even  though  the persons  summoned  were not bound to obey the  summonses  as there  was no provision in law for issue of such  summonses. The  use  of  the  words "by  issue  of  summonses"  in  the circumstances  of that case was by oversight, for  issue  of summonses presumes that there is authority to issue them and the person to whom they are issued is bound to obey.  But in the  absence of such power all that the authority can do  is to issue letters merely requesting persons to appear and  it is  open  to  those  persons to appear  or  not.   It,  this situation  if  -,in  authority decides  not  to  issue  such letters  it  cannot  be said that  there  was  no  effective hearing. In short, what the cases of this Court to which  we have  referred show is only this : It’ the  party  concerned wishes  to produce any document or produce any witness,  the authority   may   take   the   documentary   evidence   into consideration or take the evidence of the witness. if it (1) [1964] 1 S.C.R. 220. Cl/167 --9 340 considers such evidence relevant and necessary. But there is in the absence of any provision in the Act or the Rules,  no power  in  the authority or the State Government  to  compel attendance   of  witnesses  or  to  compel   production   of documents.   This  is  of  course not to  say  that  if  the authority wants any party before it to produce any  document for satisfying itself whether the scheme is for the purposes mentioned  in  s. 68-C it cannot so ask; and  if  the  party asked  to  produce documents does not do so,  the  authority would  be  entitled  to draw such  inferences  as  it  might consider  justified  from the non-production  of  documents. But  apart  from this, there is no power  conferred  on  the

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authority  under  the  Act or the Madhya  Pradesh  Rules  to compel  production of documentary evidence or to summon  any witness. But apart from this, even if we examine the reasons given by the authority for not compelling the production of documents or for not summoning witnesses we see no reason to  disagree with  the view taken by the authority in this case.  So  far as the witnesses are concerned, the authority was of opinion that their oral evidence would be irrelevant and it said  so after  hearing arguments on the question.  Nothing has  been shown to us which would induce us to hold otherwise.  As  to documentary  evidence,  it was asked for to  show,  firstly, that the Corporation did not have equipment and finances  to carry out the schemes and, secondly, that the  Corporation’s past  record of running its services was worse than that  of the  private operators.  We think that both these  questions really  do  not  arise  in  the  context  of  a  scheme   of nationalisation  envisaged in Chapter IV-A of the  Act.   It may be mentioned that his Chapter was introduced in the  Act in  1956  after  Art. 19(6) of  the  Constitution  had  been amended by the Constitution (First Amendment) Act, 1951.  By that  amendment  the State was given power relating  to  the carrying on by it or by a Corporation owned or controlled by it, of any trade, business, industry, or service, whether to the  exclusion, complete or partial, of citizens  or  other- wise.    Chapter   IV-A  envisages  what  we   have   called nationalisation  of  transport service, and this has  to  be undertaken  by a State Transport Undertaking which under  s. 68-A (b) may be               (i)   the  central  Government  or   a   State               Government; or               (ii)  any    Road    Transport     Corporation               established   under   section3of   the    Road               Transport Corporations Act, 1950; or               (iii) the   Delhi  Road  Transport   Authority               established under section 3    of  the   Delhi               Road Transport Authority Act, 1950; or               (iv)  any  municipality or any corporation  or               company  owned  or  controlled  by  the  State               Government. It will thus be clear that nationalised road transport under Chapter IV-A would be run either by the Central  Government, or a State 341 Government  or any of the other three authorities  mentioned there  which  are  all  under  the  control  of  the   State Government   or   the   Central   Government.    In    these circumstances,  with the resources of the Government  behind those authorities it would in our opinion be futile for  any objector  to  say  that the Central  Government,  the  State Government  or the authorities backed by it could  not  have equipment  and finances to carry out the schemes.  It  seems to us that the very fact that a scheme is proposed  suggests that  the  Central Government or a State Government  or  the authorities would carry it out.  So there is no question  of asking for production of documents relating to the equipment and  financial position of a State Transport Undertaking  as defined in s. 69-A (b). We  are  further  of opinion that there is  no  question  of consideration  of comparative merits of the State  Transport Undertaking  and  the private operators in  the  context  of Chapter  IV-A.   As we have said already  Chapter  IV-A  was enacted  for nationalisation of road transport  services  in accordance  with  the amendment made in Art. 19 (6)  of  the Constitution.   The nationalised road transport  under  that

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Chapter  can only be run by the State Transport  Undertaking as defined in s. 68-A (b) of the Act.  In view of that fact, if nationalisation has to come as envisaged by the amendment of  the  Constitution,  the  only body  which  can  run  the nationalised service is the State Transport Undertaking, and in  those  circumstances we fail to see  any  necessity  for comparison between a State Transport Undertaking on the  one hand and individual operators on the other. Apart  from  this general consideration, we are  further  of opinion  that ordinarily no question of  comparative  merits based  on past record between a State Transport  Undertaking and  individual operators can arise.  Section 68-C  provides that   the  State  Transport  Undertaking  has  to  run   an efficient,  adequate,  economical and  properly  coordinated road transport service, and for doing that it does not  take up  just one route and put one transport vehicle on it.   It takes up a large number of routes and puts a large number of transport  vehicles  on them in order to run  in  integrated service  whether for passengers or for goods, or  for  both. In  these circumstances it is difficult to see how  one  can compare   such  an  undertaking  with   individual   private operators  who  are running one transport vehicle or  so  on individual  routes.  secondly, it would be unusual  for  the State Transport Undertaking co be running transport vehicles on  individual  routes  before  it  produces  a  scheme  for nationalisation  of the type provided for in  chapter  IV-A, though  it  may  be  conceded that this  may  not  be  quite impossible, for some State Transport Undertaking might  have entered  into competition with private operators  and  might have  obtained permits under Chap.  V: (see,  for  instance, Parbani Transport Co-operative Society Ltd. v. The  Regional Trans- 342 port.   Authority(1).   Even so, when  the  State  Transport Undertaking takes action under Chap.  IV-A of the Act  there can  in our opinion be no question of comparison  between  a State  Transport Undertaking running an  integrated  service and  individual operators running one transport  vehicle  or more on individual routes.  We are therefore of opinion that the  authority  cannot  be said to have gone  wrong  in  not asking  for past records of the Corporation in  the  present case  for purposes of such comparison.  It is true  that  s. 68-C  requires  that  the scheme should  be  in  the  public interest.   But  unless  the  scheme  is  shown  not  to  be efficient, adequate, economical and properly coordinated, it will  in  our  opinion generally follow that it  is  in  the public  interest.   We  do  not  think  therefore  that  the comparative merits of the Corporation as against  individual operators  requires to be judged under Chapter IV-A  in  the public  interest.   In the circumstances we are  of  opinion that the hearing in this case was both adequate and real. The  appeals  therefore fail and are hereby  dismissed  with costs one hearing fee. R.K.P.S.                          Appeals dismissed. 1) [1960]3 S.C.R. 177. 343