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CASE NO.: Appeal (civil)  1725 of 2001

PETITIONER: Captain Sube Singh & Ors.                                        

RESPONDENT: Lt. Governor of  Delhi & Ors.                                    

DATE OF JUDGMENT: 30/04/2004

BENCH: R. C. Lahoti, B. N. Srikrishna & G. P. Mathur  

JUDGMENT: J U D G M E N T

SRIKRISHNA, J.

       This appeal by special leave is directed against the judgment of the  High Court of Delhi dated 19th October, 2000  dismissing the writ petition of  the appellants under Article 226 of the Constitution of India challenging the  notification dated  31st December, 1999 issued by the Lt. Governor of the  National Capital Territory of Delhi.

       Appellant Nos. 1 to 4 are transport operators who have been issued  stage carriage permits by the State Transport Authority, Delhi under various  schemes.  Appellant No. 5 is an association of bus operators in Delhi, whose  members have been granted permits under various schemes for upliftment of  different sections of society.  

Respondent Nos. 1 to 3 represent the Government of the National  Capital Territory of Delhi and Respondent No. 4  is a statutory corporation  set up under Section 3 of the Road Transport Corporation Act, 1950.  

Respondent No. 4, Delhi Transport Corporation (DTC), was  continuously making losses and found itself unable to handle the volume of  work required for providing efficient transport facilities for the public in  Delhi.  The work of transport was opened up to private operators like the  appellants, who were granted stage carriage permits under the provisions of  the Motor Vehicles Act, 1988 read with the Rules made thereunder  (hereinafter referred to, respectively,  as ’the Act’ and ’the Rules’). Under  the new policy, which was adopted in or about 1991-92,  about 3000 private  buses were permitted to operate within the territory of Delhi.  These private  operators were granted permits to run buses under the provisions of the Act.   

       The permit conditions were notified under a Scheme for grant of State  Carriage Permits to private bus operators in Delhi by the State Transport  Authority.  The Scheme was framed for augmentation of  the public  transport in Delhi. The Scheme was formulated and publicised and also  freely available to all persons intending to seek permits for operating stage  carriages. Although, there was some dispute as to which were the exact  permit conditions under which the stage carriages were operated, at our  instance, the Secretary-cum-Commissioner of State Transport Authority,  Department of Transport, Government of N.C.T. of  Delhi has filed an  affidavit dated 13th April, 2004 and also remained present before the Court  and answered the queries put by the Court. On the material placed before  us, we are satisfied that the said affidavit reflects the correct factual  situation.

       Sometime in the year 1992, when the scheme was first formulated,     the permit condition stipulated in the scheme was as under:         "13.  The permit holder shall ensure that concessional passes  issued to various sections authorized for these buses shall be

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honoured."

In the year 1995, another scheme was launched by the S.T.A., Delhi  for granting 392 stage carriage permits to the private operators. A copy of  this scheme is produced and marked as Annexure \0262 to the affidavit of Mr.  Rajeev Talwar, Secretary-cum-Commissioner, S.T.A.  Apart from indicating  the fare structure, the scheme provided that "there shall be a provision for  free passes for freedom fighters only. There may be a provision for  monthly/quarterly passes valid in all the private buses on a particular route."  The permits for stage carriage operations of private buses were, inter alia,  made subject to the following conditions:

"13.  The permit holder shall ensure that concessional  passes issued to various sections authorised for these  buses shall be honoured.                                   ....

17.   Permit holder shall ensure that the bus stops to pick  up and allow the passengers to get off at the authorised  DTC bus stops and no passengers is allowed to board or  to get down at a non-prescribed bus stop.  The operators  will have to pay service charges @ Rs. 250/- per bus on  monthly basis to the DTC for using DTC bus stops as  determined by STA in consultation with the DTC.

....

"25.  The State Transport Authority, may after giving  notice of not less than one month:

(a)  Vary the conditions of the permit. (b)  Attach to the permit further conditions."

In the year 2002, another scheme for grant of stage carriage permits to  private CNG bus operators in Delhi was formulated and published by the  respondent authorities. A copy of this scheme is marked as Annexure \0263 to  the aforesaid affidavit.  Apart from indicating the fare structure, the scheme  also says, "there shall be a provision for free passes for freedom fighters  only.  There may be a provision of monthly/quarterly passes valid in all the  private buses on a particular route."  The relevant permit conditions  indicated in this scheme are as follows: "13.  The permit holder shall ensure that concessional  passes issued to various sections authorised for these  buses shall be honoured.                                   ....

17.   Permit holder shall ensure that the bus stops to pick  up and allow the passengers to get off at the authorised  DTC bus stops and no passenger is allowed to board or to  get down at a non-prescribed bus stop.  The operators will  have to pay service charges for using DTC bus stops &  bus terminals as determined by STA in consultation with  the DTC from time to time.

....

"25.  The State Transport Authority, may after giving  notice of not less than one month:

(a)  Vary the conditions of  permit. (b)  Attach to the permit further conditions."

Sometime in the year 1997, both the DTC and the private operators

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appealed to the State Transport Authority (STA) for revision in the fares on  the ground that the cost of  various inputs like diesel, oil, staff salary and  wages, insurance, road tax, permit fee, repair charges, apart from increase  in capital investment for replacement and interest rates of borrowed capital,  had increased between 25 per cent to 300 per cent. The State Transport  Authority did not accede to the request.  Repeated and continued  representations together with an unprecedented 35 per cent hike in diesel  price in October, 1999 brought about a rethinking on the part of the STA as  a result of which a decision was taken on 16th October, 1999 by the State  Government to revise the fare structure applicable to the DTC and the  private operators with effect from the said date on the same lines as  proposed by the DTC in the year 1998.  It was also decided that the fare  structure should be uniform for both the DTC and the private operators. On  21st December, 1999, the State Government issued an order to the STA  directing that along with the upward revision of fare the private operators  would be required to:  (a) pay Rs. 2500/- p.m. as Bus Shelter charges to DTC;  (b) pay Rs. 5000/- p.m. for using the Bus Terminus to DTC; and that (c) passes issued by DTC would be applicable to all Private Stage       Carriages.

This decision was made applicable to all Private Stage Carriages with  immediate effect. The appellants and other stage carriers challenged the said  order before the Delhi High Court  on various grounds. While the petition  was pending before the Delhi High Court, on 31st December, 1999,  purportedly in exercise of its power under Section 67(1) of the Act, the State  Government issued a notification in the following terms: " TRANSPORT DEPARTMENT NOTIFICATION Delhi, the 31st December 1999. No. F.189/Secy/STA/99/2832 \026 In exercise of the powers  conferred by clause (i) of sub-section (1) of Section 67 of the  Motor Vehicles Act, 1988 (59 of 1988), the Lt. Governor of the  National Territory of Delhi, having regard to clauses (a) to (d)  of the said sub-section (1) hereby issues the following  directions to the State Transport Authority of Delhi, namely:

Directions:

1.  The fares chargeable by the operators of stage carriages/city  buses plying in the National Capital Territory of Delhi shall be  as follows :

Distance                                        Fare

Upto  4 kilometers                              Rs. 2.00 From 4 kilometers upto 8 kilometers   Rs.  4.00 From 8 kilometers upto 12 kilometers  Rs. 6.00 Above 12 kilometers                      Rs. 8.00

For the ’LTD’, ’Green Line’ and ’Railway Spl.’ Buses the fare  structure shall be ten rupees instead of six rupees.

2.   For concessional bus passes the following rates shall be  applicable.

Type of pass                                    New Rate

General Destination                     Rs. 200/- General All-Route                               Rs. 400/- General All route (Ltd)                 Rs. 450/-

               In the case of ’General Destination Pass’ the route shall  be specified in the pass itself and one change of bus shall be  allowed rates of all other passes including ’student’, ’Re-

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settlement Colony’, ’Press’ and ’Old age’ shall remain the  same.

3 (a)  The Private Stage Carriage with the upward revision of           fares shall pay with effect from 16th October, 1999.

      (i) Rs. 2500/- per month as bus queue shelters to DTC       (ii) Rs. 5000/- per month for using the bus terminal to DTC.

 (b)   All DTC passes shall be applicable to all            private Stage Carriages."

       Being aggrieved by the notification, the appellants filed a writ petition  before the High Court of Delhi which came to be dismissed by the judgment  of the High Court dated 19th October, 2000 upholding the legality and  validity of the said notification. Hence, this appeal by special leave.

       Learned counsel for the appellants contends that the impugned  notification is ultra vires the powers of the State Government under Section  67 of the Act, apart from being arbitrary and imposing unreasonable  restrictions on the fundamental right to trade and business guaranteed under  Article 19(1)(g) of the Constitution of India. It is also contended that, as far  as the provisions of the Act are concerned, DTC is just an operator and  private operators cannot be put into a situation where they are required to  subsidise the losses made by DTC for any reason.  It is also urged that  neither the State Government nor the State Transport Authority (STA) has  the statutory authority under Section 67 of the Act to impose conditions,  other than fixing of fares, which are highly onerous and discriminative  against the private operators.

       It is also submitted that the operational statistics filed by the DTC  before the High Court clearly brings out that more than two thirds of the  passengers travelling by the DTC buses have been issued concessional  passes and it would be unfair and unjust to expect the private operators to  give service in respect of holders of such passes even though the revenue  generated therefrom is appropriated by the DTC.   

Learned counsel for the  respondents have reiterated their contentions  which weighed with the High Court. They submit that, in the interest of  discharging its ’social obligations’  the DTC has already constructed several  bus shelters and terminals, which are permitted to be used by  private  operators and that in discharge of its social obligations the DTC has issued  concessional passes to several sections of society and thereby incurs huge  losses.  Since differential fare structures  cannot be fixed in respect of   different operators, it is but fair,  just and reasonable that a portion of this  cost of social obligations is imposed upon the private operators by an order  made under the provisions of the Act and the Rules.  

Respondents also contend that the impugned notification is fully  justified as it is pursuant to ’the desirability of preventing uneconomic  competition among holders of permits’ within the meaning of Section  67(1)(d) of the Act.

       Clause (xxi) of  sub-section (2) of Section 96 empowers the State  Government to make rules to ensure that stage carriages halt only at  designated places. Clause (xxii) of sub-section (2) of Section 96 empowers  the State Government to prescribe rules with regard to the construction or  use of any duly notified stand or halting place and the fees, if any, which  may be charged for the use of such facilities. Correspondingly, we have  Rules 75 and 76.

No transport vehicle can be plied without a permit under Section 66  of the Act. Section 69 provides for making of applications for  permits to the  Regional Transport Authority.  Such permits in respect of stage carriages are  issued under Section 70 after following the procedure prescribed in Sections

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71 and 72. Section 72(2) of the Act empowers the Regional Transport  Authority to grant a stage carriage permit subject to any rule that may be  made under the Act and by attaching to the permit any one or more of the  conditions enumerated in Clauses (i) to (xxiv). Clauses (xx), (xxii) and  (xxiv) of Section 72(2) are relevant for our purposes and read as under: "(xx) that any specified bus station or shelter maintained  by Government or a local authority shall be used and that  any specified rent or fee shall be paid for such use. \005.

(xxii) that the Regional Transport Authority may, after  giving notice of not less than one month,-

(a) vary the conditions of the permit; (b) attach to the permit further conditions

Provided that the conditions specified in pursuance  of clause (i) shall not be varied so as to alter the distance  covered by the original route by more that 24 kilometres,  and any variation within such limits shall be made only  after the Regional Transport Authority is satisfied that  such variation will serve the convenience of the public  and that it is not expedient to grant a separate permit in  respect of the original route as so varied or any part  thereof.

(xxiv) any other conditions which may be prescribed."  

       The State Government has made the Delhi Motor Vehicles Rules,  1993 in exercise of its powers under the Act.  Of relevance to the present  discussion are Rules 75 and 76. Rule 75 provides for the manner of halting  of stage carriages. Under sub-rule (2) of Rule 75 the District Magistrate may  direct that in any street or any road in an urban area notified by him in this  behalf, no stage carriage shall take up or get down passengers except at a  place appointed by him at a bus stop or at a  stand.  Rule 76 deals with  construction and control of stands and provides that the District Magistrate  may in consultation with the local authority having jurisdiction in the area  concerned, make an order permitting any place to be used as a stand and  that, without such an order no place shall be so used as a stand.  When a  privately owned place is to be so notified, the rule provides that the District  Magistrate shall, from time to time, fix the fees or the maximum fees  payable at any stand.  

       Section 67 of the Act empowers the State Government, inter alia, to  fix the fares and freights for such stage carriages, contract carriages and  goods carriages. The relevant provision reads as under:         "67. Power to State Government to control road transport.-

               (1) A State Government, having regard to-                      (a) \005                           (b) \005                    (c) \005                        (d) the desirability of preventing uneconomic                                 competition among holders of permits. may, from time to time, by notification in the Official  Gazette, issue directions both to the State Transport  Authority and Regional Transport Authority \026

(i) regarding the fixing of fares and freights (including  the maximum and minimum in respect thereof) for stage  carriages, contract carriages and goods carriages:  

(ii) \005

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(iii) \005"

       It was the case of the respondents before the High Court, and it is  their case before us, that the notification has been issued by the State  Government in exercise of its power under Section 67(1)(d) read with sub- clause (i).  In other words, it is contended that the notification is one which  fixes the fares and freights of the stage carriages, having regard to the  desirability of preventing uneconomic competition among holders of  permits. The submission is that DTC had already invested capital in  construction of bus shelters and terminals; if the private operators are  permitted to use these facilities without compensation to the DTC, the DTC  would be put in a situation of uneconomic competition, that DTC being a  statutory corporation, and aware of its social responsibility, had issued a  large number of concessional passes to students, war widows and their  dependents, freedom fighters, disabled persons and such others, which  caused a heavy economic burden to DTC; the private operators are not by  law obliged to discharge this social responsibility, as a result of which there  is uneven playing field and uneconomic competition as far as the DTC is  concerned.  Hence, it is just, fair and reasonable that private operators are  made to honour the concessional passes issued by DTC,  which can be done  by recourse to Section 67 of the Act.

The learned counsel for the appellants may be justified in his  contention that, apart from the concessions, which  are expressly made  available under the Act in favour of State Transport Undertakings (see in  this connection Chapter VI of the Act), there are no special considerations in  favour of DTC which must be treated as any other operator. Reliance was  placed on the observations of this Court in Ishwar Singh Bagga and Ors.   v.  State of Rajasthan , at paragraphs 7 and 11. That, however, is not  conclusive of the matter.

       The action of the respondent authorities was not merely about giving  a preferential or favourable treatment to D.T.C. as an operator. The peculiar  circumstances under which the running of stage carriage permits within the  N.C.T. of Delhi were thrown open to private operators and the specific  conditions imposed in the permits would have to be kept in mind for  adjudging the legality of the impugned notification.  With these factors in  mind, the respondent had appropriately prescribed  permit condition No. 17  in the scheme published in the year 1992 which reads as under:         "17.  Permit holder shall ensure that the bus stops to pick up  and allow the passengers to get off at the authorised DTC bus  stops and no passengers is allowed to board or to get down at a  non prescribed bus stop.  The operators will have to pay service  charges @ Rs. 250/- per bus on monthly basis to the DTC for  using DTC bus stops as determined by STA in consultation  with the DTC."

       This condition came to be modified in the scheme of 2002. Thus, the  private operators were granted stage carriage permits only on the condition  that they shall have to ensure that the passengers are picked up and dropped  up at authorised DTC bus stops and not elsewhere.  They were also required  to pay service charges to use DTC bus stops and bus terminals "as  determined by STA in consultation with the DTC from time to time".   

       The respondents contend that though, initially, the service charges for  use of DTC bus stops was fixed at Rs. 250/- per bus per month, they have  been revised by STA in consultation with the DTC and the revision is  reflected in the notification dated 31st December, 1999. As a result of the  said notification, the permit conditions stood revised. Clause 3 of the  impugned notification revises permit conditions and consequently the  private stage carriage operators have to pay with effect from 16th October,  1999, Rs. 2,500/- per month as charges for using bus queue shelters to DTC  and Rs. 5,000/- per month for using the bus terminal to DTC.

       As already noticed, Section 72(2) of the Act gives power to the

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Regional Transport Authority to attach conditions to stage carriage permits  which are required to be followed by the stage carriage operators.  The  condition in clause (xx) would require that any specified bus station or  shelter maintained by Government or a local authority shall be used and that  any specified rent or fee shall be paid therefor.  A stage carriage operator  has no liberty in the manner of halting of the motor vehicle in public places  by reason of the directions made under Rule 75.  Consequently, the stage  carriage operator  is required to stop the bus only at such places as directed  by the conditions of the permit.  It so happens that, in the case of the  appellants before us, they were directed to stop their buses only at the bus  stations and terminals of DTC.  Thus, they have no choice in the matter and  are obliged to halt  their buses at such specified places.

It is settled law that the condition of a permit can be varied by a  notification issued by the Government under Section 67 of the Act.  (See in  this connection B. Srikantiah and Ors.  vs.  The Regional Transport  Authority, Anantapur and Ors.   and Sree Gajanana Motor Transport  Co. Ltd.  vs.  The State of Karnataka and Ors. )                  The appellants have not challenged the legality of condition No. 17.  Their only grievance is about the steep increase in the charges.  Condition  No. 17 requires the private stage carriage bus operators to make payment of  such charges as shall be determined by the STA in consultation with the  DTC from time to time.  This was the very  condition subject to which the  permit was issued to the appellants.  The fact that originally the service  charges payable were @ Rs. 250/-, or that it has subsequently been revised,  does not make the condition of the permit illegal or ultra vires the powers of  the respondent authorities, as contended by the appellants. We find no merit  in the contention that the increase in the service charges payable to the DTC  are unauthorised or ultra vires the powers of the STA and the State  Government.      

       The next contention urged by the appellants is that  Paragraph 3(b) of  the notification which provides, "all DTC passes shall be applicable to all  private stage carriages," is illegal and ultra vires. There appears to be some  merit in this contention. As we have noticed, the permit condition in the  1992 scheme merely provided : "there shall be a provision for free passes  for freedom fighters only. There may be a provision of monthly/quarterly  passes valid in all the private buses on a particular route." Even the permit  condition No. 13 declared : "the permit holder shall ensure that concessional  passes issued to various sections authorised for these buses shall be  honoured." A fair reading of these conditions of permit would be that the  STA would approve the issuing of concessional passes by the transport  operator and indicate the conditions subject to which such concessional  passes are approved.  Even in the Scheme of  2002, the relevant condition of  the permit reads as under:         "13.  The permit holder shall ensure that concessional passes  issued to various sections authorised for these buses shall be  honoured."

       The contention of the respondents that by reason of the aforesaid  condition of permit the concessional passes issued by the DTC would  automatically become enforceable and binding upon private operators who  were issued stage carriage permits, does not appear to be sustainable. In Anjum M.H. Ghaswala  a Constitution Bench of this Court  reaffirmed the general rule that when a statute vests certain power in an  authority to be exercised in a particular manner then  the said authority has  to exercise it only in the manner provided in the statute itself. (See also in  this connection Dhanajaya Reddy  v.  State of Karnataka ) The statute in  question requires the authority to act in accordance with the rules for  variation of the conditions attached to the permit.  In our view, it is not  permissible to the State Government to purport to alter these conditions by  issuing a notification under Section 67(1)(d) read with sub-clause (i) thereof.

The contention of the respondents is that the power to enforce the

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binding nature of the concessional passes issued by the DTC on the private  stage carriage operators can be spelled from the provisions of Section  67(1)(d) of the Act.  In our view, such a power cannot be subsumed under  the powers of the State Government to fix fares and freights for stage  carriages having regard to the desirability of preventing uneconomic  competition among holders of permits. Permit condition No. 13 merely  stipulates that the permit holder shall ensure that concessional passes issued  to various sections authorised for these buses shall be honoured.  The  authorisation has to come from the STA.  In other words, only concessional  passes which are authorised by the STA would be binding on the operators.   We see no power in Section 67(1)(d) of the Act or otherwise by which a  concessional pass issued by the DTC could be made binding upon  private  stage carriage operators, particularly when there was no such condition  imposed in the permit issued.  Hence, we are of the view that Paragraph 3(b)  of the impugned notification is clearly ultra vires the powers of the State  Government under Section 67 of the Act and, therefore, liable to be quashed  and set aside.

       Appellants contend that the condition imposed upon the appellants of  honouring all DTC passes is nothing but a covert attempt to subsidise the  losses being incurred by  DTC.  Even if we assume that the losses are not on  account of mismanagement or inefficiency  of the DTC, and are really  attributable to the so called honouring of its "social obligations", we see no  warrant or justification, under the provisions of the Statute as it stands,  for  transferring this assumed responsibility to competing transport operators. If  the state authorities are of the view that the fare structures should be  identical for all operators including the DTC, we see no justification for this  indirect method of passing on the costs to the appellant operators.   

In the first place, we are unable to accept that all concessional passes  issued are necessarily in the discharge of "social obligations", as claimed. A  perusal of the operational statistics of the DTC, which is placed on record as  Annexure P-9 to the writ petition filed before the High Court, (pp. 64, 66  and 68) justifies the contention of the appellants. From the operational  statistics we notice that nearly 48 per cent of the persons travelling in the  DTC buses were pass holders in April, 1998 and this figure has gone to  about 68 per cent in November, 1999. While it may be possible to say that  granting of concessional passes to war widows and their dependants,  disabled persons, freedom fighters and such categories may be in discharge  of "social obligations",  it would not hold true with regard to a large number  of  other holders of concessional passes.  In the writ petition before the High  Court, the appellants pointed out that ’destination passes’, ’general passes’  and ’all route’ passes are nothing but smart exercises designed to catch  captive commuters. These passes are really intended to collect advance fares  which would save commuters the trouble of frequently going to the office of  the operator for paying for their passes by offering a marginal concession. In  other words, a large amount of the fare gets collected, much in advance, and  what the DTC has to forego is only a small amount designed to cut down the  collection cost, get money in advance and catch captive commuters.  We,  therefore, agree with the contention of the appellants that such concessional  passes are nothing but advance tickets with marginal concessions giving  services to the captive commuters. The attempt of the DTC through the STA  and  the State Government now appears to be to ensure that even service is  not required to be given to all the captive commuters holding such  concessional passes by DTC, by requiring the private operators to provide  service to the pass holders who have paid to the DTC. We see no discharge  of "social obligations", nor even the shadow of Article 38 of the  Constitution, in this arrangement which is sought to be brought into force by  resort to the purported power under Section 67 of the Act.  If the DTC  incurs losses in its running, it is bailed out by the State Government by  subsidies and convenient loans which are written off;  but,  on the other  hand,  private operators have to raise capital at enormous servicing cost and  do not have finance or subsidy on tap. The learned counsel for the appellants  is right in contending that this is clearly an attempt to rob Peter to pay Paul.   In our view, the condition imposed in Paragraph 3(b) of the impugned

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notification is ultra vires the power of the State Government under Section  67.  It is not possible for us to accept the view of the High Court that Section  67(1)(d) read with sub-clause (i) thereof clothes the State Government with  the power to impose the condition in Paragraph 3(b) of the impugned  notification dated 31st December, 1999, or that it has been imposed having  regard to "the desirability of preventing uneconomic competition among  holders of permits" within the meaning of clause (d) of  sub-section (1) of  Section 67 of the Act. The  directions which can be issued under sub-clause  (i) are only with regard to ’fares and freights’.  The expression ’fare’ has  been defined in Section 2(12) as inclusive of sums payable for a season  ticket or in respect of the hire of a contract carriage. By Paragraph 2 of the  impugned notification the Transport Department has also prescribed what  can be the fares for concessional bus passes of different categories.  This  only means that, if the permit holders were to issue concessional bus passes  for different categories including ’students’, ’re-settlement colony’, ’press’,  and ’old age’, then the fares chargeable are at the rates indicated in  Paragraph 2.  This is a perfectly permissible exercise of power.  

The High Court relied upon the judgment of this Court in Sree  Gajanana Motor Transport Co. Ltd.  v.  The State of Karnataka and  Ors. ,  arising under Section 43 of the Motor Vehicles Act, 1939, to the  effect that when the State has exercised its power under Section 43  (corresponding to the present Section 67 of the 1988 Act), then the  conditions of the permit automatically get altered. There is no doubt as to  this proposition, but the rub is that the notification must have been validly  issued in exercise of the said power. Paragraph 3(b) of the impugned  notification, however, travels much beyond the legitimate scope of the  power under Section 67(1)(d) read with sub-clause (i).  We are of the view  that the impugned notification, insofar the condition in Paragraph 3(b) is  concerned, is wholly ultra vires the powers of the State Government under  Section 67 of the Act, illegal and liable to be quashed and set aside.

       Learned counsel for the appellants stated that they too are conscious  of the "social obligations", and since the number of concessional passes  issued to disabled persons, freedom fighters and war widows and their  dependants is small, without prejudice to their legal contentions, they are  willing to honour such concessional passes issued by DTC.

       In the result, we hold that the condition imposed in Paragraph 3(b) of  the impugned notification is ultra vires of the powers of the State  Government and is, therefore, liable to be quashed and set aside.  However,  it appears to us that sudden discontinuation of the concessional passes would  seriously affect the commuters, particularly students community, holding a  large number of concessional passes issued by the DTC.  We are, therefore,  of the view that some locus poenitentia should be given to the respondents  to make alternative arrangements by formulating an appropriate scheme in  accordance with law which should take care of the student concessional  passes.  

In the result, we make the following order:-

(1)     The provisions of the impugned notification dated 31st  December, 1999, except paragraph 3(b), are held valid and  intra vires;

(2)     The condition imposed under Paragraph 3(b) of the  impugned notification is held ultra vires, illegal and  unenforceable;

(3)     The appellants, as agreed, shall continue to honour the  concessional passes issued by DTC to disabled persons,  freedom fighters, war widows, and their dependants;  (4)    The respondents shall lawfully bring forth an appropriate  scheme to provide relief to the students concessional pass  holders of DTC, within a period of four months from

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today, i.e., on or before 31st July, 2004, failing which the  condition imposed under Paragraph 3(b) of the impugned  notification shall stand quashed and set aside with effect  from 1st August, 2004.

       The judgment of the High Court is modified and the appeal is allowed  to the aforegoing extent.  

There shall be no order as to costs.