http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 11  

PETITIONER: RAM KRISHNA VERMA ETC. ETC.

       Vs.

RESPONDENT: STATE OF U.P. AND ORS. ETC. ETC.

DATE OF JUDGMENT31/03/1992

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. KASLIWAL, N.M. (J)

CITATION:  1992 AIR 1888            1992 SCR  (2) 378  1992 SCC  (2) 620        JT 1992 (2)   545  1992 SCALE  (1)762

ACT:      Motor Vehicles Act 1939 :      Sections 68-C, 68-D and 68-F Motor Vehicles Act,  1988- Sections  80 and 98-Grant of permit to private operators  on nationalised  routes-Draft scheme published under  old  Act- Private operators obtaining permits under new Act for routes covered by the scheme-Grant of permit to any other  operator for  the  routes covered by the scheme-Whether  illegal  and without     jurisdiction-Whether     corridor     protection permissible.      Constitution of India 1950 :      Article  136, 141, 142 and 226 Court should  neutralise any undeserved and unfair advantage gained by party invoking its jurisdiction.      Precedents-Practice  and  Procedure-Supreme  Court  two Judge bench not to over rule decision of three judge bench.      Administrative Law.      Natural   Justice-Principle   of  right   to   hearing- Forfeiture   of-When  party  obtains  undue   advantage   by protracting proceedings and nullifying objective.

HEADNOTE:      To nationalise the Saharanpur - Shahdara - Delhi  route a draft scheme dated 26 th February, 1959 was published, and the  approved  scheme published on September  29,  1959  was quashed  by  the high Court by judgments dated  October  31, 1961 and February 7, 1962 as against 50 operators and  being upheld  against  other 50 operators.  The  State  Govt.  was permitted to given fresh hearing to the 50 objectors, on the basis  of the original proposal which was upheld  in  Jeewan Nath Bahl & Ors. v. State of U.P.      Out of the 50 operators some filed successive suits and obtained                                                        379 injuction  from different courts scuttling the  hearing  and keeping it pending for well over 25 years.      A writ petition was filed in this Court assailing, that the  delay  in approving the scheme amounts to an  abuse  of process  of law, and that public interest thereby  suffered, and  the  Court held in Shri Chand etc. v. Govt. of  U.P.  & Ors., [1985] Suppl. 2 SCR 688 that the delay of 26 years  in

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 11  

disposing  of  the  objections  resulted  in  violation   of Articles   14   and  19(1)(g)  of  the   Constitution,   and accordingly  quashed  the draft scheme  dated  February  26, 1959.   The  Government  was directed to  frame  the  scheme afresh, if necessary.      Pursuant  thereto  the  U.P.  State  Road   Corporation published  the draft scheme on February 13, 1986.  While  it was  pending  the Motor Vehicles Act 59 of  1988  came  into force  with effect from July 1, 1989.  Bulandshahr to  Delhi route was also nationalised in the approved scheme published in the State Gazette dated September 27, 1986.      After  the  1988 Act came into force,  the  respondents applied  for  and  were granted permits  for  Saharanpur  to Ghaziabad via Shahdara routes etc.      The  appellants  filed the writ petitions in  the  High Court and the same were dismissed by judgment dated July 23, 1990.  The  draft scheme published in 1986 was held  by  the hearing  authority  to  have been  lapsed  by  operation  of Section 100(4) of the Act.      In the writ petition filed by the S.T.U. the High Court by  its  judgment dated March 16, 1990 held that  the  draft scheme  stood  lapsed within one year from the date  of  the publication of the draft scheme, and accordingly upheld  the order  of  the hearing authority.  S.L.P.  No.  6300/91  was filed against this judgment.      Special  Leave  Petition  Nos.  9701/90,  9702/90   and 2083/91  were  filed  against  the  High  Court’s   judgment dismissing  the  writ petitions in which  grant  of  permits under   Section  80  of  the  Motor  Vehicles  Act  on   the Muzaffarnagar - Chausana; Ghaziabad to Shahdra.   Saharanpur to  Ghaziabad  covered and partly  overlapping  nationalised routes were questioned.      On the questions : (1) what is the effect of Shri Chand etc. v. Govt.                                                        380 of  U.P. over Jeevan Nath Bahl & Ors. v. State of  U.P.  and (2)  whether the draft scheme dated February 13, 1986  stood lapsed under Section 100(4) of the Act.      Granting  special  leave and allowing the  appeals  the Court,      Held  : 1(a) Consistent law laid down by this Court  is that  draft  scheme under Section 68-C  and  approved  under Section 68-D of Chapter IVA of the Repealed Act (Chapter  VI of  the  Act), is a law and it has  overriding  effect  over Chapter  IV of the repealed Act (Chapter V of the  Act).  It operates  against  everyone  unless  it  is  modified.    It excludes  private  operators  from the area or  route  or  a portion  thereof  covered  under the scheme  except  to  the extent  excluded  under that scheme itself.   The  right  of private  operators to apply for and to obtain permits  under Chapter  IV of the repealed Act (Chapter V of the  Act)  has been frozen and prohibited. [389B-C]      (b)  The  nationalisation of Saharanpur  -  Shahdara  - Delhi  route  approved and published on September  29,  1959 became  final and to that extent it cannot be said  to  have been  quashed  by  this  Court in  Sri  Chand’s  case.   The approved scheme is law operating against everyone except  50 objectors/operators and the writ issued by this Court cannot have  the effect of annuling the law.  What was quashed  and issue of fresh draft scheme pursuant thereto, relate to only of    original   draft   scheme   operative    against    50 objectors/operators  and  no more.  Even no  principle,  the decision of a Bench of two Judges cannot have the effect  of overruling  the  decision of a Bench of three  Judges.   The fresh  draft  scheme under Section 68-C dated  February  13,

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 11  

1986 must, therefore, be construed to be only in relation to 50 existing operators as per the directions that  ultimately emerged in Jeevan Nath Bahl’s case. [389D-E]      Mysore  State  Road Transport  Corporation.  v.  Mysore Transport  Appellate  Tribunal,  [1975] 1  SCR  615;  Adarsh Travels Bus Service v. State of U.P. & Ors., [1985] Suppl. 3 SCR 661; H.C. Narayanappa & Ors. v. State of Mysore &  Ors., [1960]  3 SCR 742; Nehru Motor Transport Co-op. Soc. &  Ors. V.  State of Rajasthan & Ors.,[1964] 1 SCR 220 and S.  Abdul Khader  Saheb v. Mysore Revenue Appellate Tribunal  &  Ors., [1973] 1 SCC 357, referred to.      2(a)  On  harmonious construction of  ss.217(2)(e)  and 100(4) of the Act, the draft scheme published under s.  68-C of the Repealed Act would                                                        381 stand lapsed only if it is not approved within one year from the date when the Act came into force i.e. with effect  from July 1, 1989 by which date it was pending before the hearing authority  and  one  year  had  not  expired.   The  hearing authority,  therefore,  wrongly  concluded  that  the  draft scheme stood lapsed.  The High Court also equally  committed illegality following its earlier view which stood  overruled by  this  court in Krishana Kumar’s case.  The view  of  the High  Court and the hearing authority is  therefore  clearly illegal. [389H-390B]      Krishna  Kumar v. State of Rajasthan & Ors.,  [1991]  4 SCC 258, referred to.      (b)  The  nationalisation of Saharanpur  -  Shahdara  - Delhi  route  by  publication  of  the  approved  scheme  on September  29, 1959 is operating to the total  exclusion  of every  private  operator except U.P.  State  Road  Transport Corporation and 50 operators including the appellants  whose objection  were  upheld  by  the High  Court  in  the  first instance and merged in the judgment of this Court in  Jeevan Nath Bahl’s case. [390C]      (c) Under Section 80 of the Act no private operator has right  to  apply  for and obtain permits to  ply  the  stage carriages on the approved or notified route/routes or  areas or  portion  thereof.  The grant of permits to  the  private operators  on  the  respective routes or  part,  or  portion thereof  to provide transport service is  therefore  clearly illegal and without jurisdiction. [390E]      Mithlesh Garg & Ors. v. Union of India & Ors., [1992] 1 SCC 168, referred to.      (d)  By operation of Section 98 of the Act, Chapter  VI overrides  Chapter  V and other law and  shall  have  effect notwithstanding  anything inconsistent therewith   contained in Chapter V or any other law for the time being inforce  or any  instrument  having effect by virtue of such  law.   The result is that even under the Act existing scheme under  the repealed Act or made under Chapter VI of the Act shall  have over-riding  effect on Chapter V notwithstanding  any  right given  to  private operators in Chapter V of  the  Act.   No corridor  protection  to private operators  is  permissible. [390G-391A]      (e)  The 50 operators including the  appellants/private operators have been running their stage carriage by  blatant abuse of the process of the                                                        382 court  by  delaying the hearing as directed in  Jeevan  Nath Bahl’s case and the High Court earlier thereto.  As a  fact, on the expiry of the initial period of grant after September 29,  1959  they lost the right to obtain renewal or  to  ply their  vehicles,  as this court declared the  scheme  to  be operative.   However, by sheer abuse of the process  of  law

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 11  

they are continuing to ply their vehicles pending hearing of the objections. [391D]      (f) While exercising its jurisdiction this Court  would do  complete  justice and neutralise  the  unfair  advantage gained  by  the  50 operators  including  the  appellant  in dragging  the litigation to run the stage carriages  on  the approved  route  on area or portion  thereof  and  forfeited their  right to hearing of the objections filed by  them  to the draft scheme dated February 26, 1959. [391F]      (g)  Moreover, since this court in Jeevan  Nath  Bahl’s case upheld the approved scheme and held to be operative the hearing  of objections would be a procedural formality  with no tangible result.  Therefore, the objection outlived their purpose.   They are, therefore, not entitled to any  hearing before the hearing authority. [391G-H]      Grindlays  Bank  Ltd.  v. Income Tax  Officer  &  Ors., [1980] 2 SCC 191, referred to.      3. The grant of permits to all the  respondents/private operators and respondents Nos. 7 to 28 in S.L.P. No. 9701/90 under Section 80 of the Act or any others on the  respective routes,  parts  or portions of the  nationalised  routes  of February  13,  1986 draft scheme are quashed.   The  hearing authority  shall  lodge the objections of the  50  operators including  the  appellants in the  appeals.   The  competent authority  shall approve the drafts scheme of 1986 within  a period  of  30 days and publish the approved scheme  in  the gazette.   The  permits granted to the 50 operators  or  any others  shall stand cancelled from that date, if not  having expired  in  the meanwhile.  No permits  shall  be  renewed. Action  should be taken by respondents 3 to 4 in S.L.P.  No. 9701/90  to  see  that all the permits  granted  to  the  50 operators including the appellants are seized and cancelled. The  U.P.  State  Transport  Corporation  shall  obtain  the required  additional permits, if need be, and put the  stage carriages on the routes to provide transport service to  the travelling public immediately on publication of the approved draft scheme in the State Gazette. [392A-D]                                                   383

JUDGMENT:      CIVIL APPELLATE JURISDICTION : Civil Appeal Nos.  1198, 1199, 1200 & 1201 of 1992.      From the Judgment and Orders dated 2.5.1990, 16.3.1990 & 5.10.1990  of the Allahabad High Court in W.P.  NO.  212/90. C.M.W.P.  No. 7735/89 C.M.W.P. No. 15865/86 and C.M.W.P.  No nil of 1990.      Raja Ram Aggarwal, H.N. Salve, V.J. Francis, B.B. Singh Gaurav Jain, N.K. Goel, Ms. Abha Jain, Raju Ramachandran and Sunil Kr. Jain for the Appellants.      B.S. Chauhan and Mrs. Rani Chhabra for the Respondents.      The Judgment of the Court was delivered by      K. RAMASWAMY, J. Special leave granted.      These  four cases have behind chequered history of  the draft  scheme dated February 26, 1959 published  under  Sec. 68-C  of  the  Motor  Vehicles Act,  1939,  for  short  ‘the repealed  Act’  was kept hanging for 25 to  35  years.   The draft  scheme  dated 26th February, 1959  was  published  to nationalised  Saharanpur  -  Shahdara -  Delhi  route.   The approved scheme published on September 29, 1959 was  quashed by  the Allahabad High Court by judgments dated October  31, 1961  and February 7, 1962 as against 50 operators  and  was upheld against other 50 operators.  It was further held that the State Govt. was at liberty to give fresh hearing to  the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 11  

50 objectors on the basis of the original proposal which was upheld by this court in Jeewan Nath Bahl & Ors. v. State  of U.P., (C.A. No 1616 of 1968 dated April 3, 1968),  observing thus :          "The  effect of the order passed by the High  Court          in  the  two groups of writ petitions  was  clearly          that  the scheme in its essence was  not  affected,          but  it was  directed that it was not liable to  be          enforced against the 32 petitioners who applied  to          the High Court in the first round of petitions  and          against  18  petitioners  in the  second  group  of          petitions.   If  that  be the true  effect  of  the          order  there  is  in  our  judgment,  a  scheme  in          existence  which must have the statutory  operation          contemplated by Section 68-F on the Motor  Vehicles          Act."      The  record discloses that out of 50 operators some  of them  filed                                                   384 successive suits and obtined injuction from different courts scuttling  the  hearing and kept pending for  well  over  25 years.  Shri Chand and Others filed Writ Petition No.  11744 of  1985,  etc.  in this court assailing that the  delay  in approving the scheme amounts to abuse of process of law  and public  interest  thereby  suffered.  By  judgment  in  Shri Chand,  etc. v. Govt.  of U.P. & Ors., [1985] Suppl.  2  SCR 688, this court held that the delay of 26 years in disposing of  the  objections resulted in violation of Acts.   14  and 15(1)(g)  of  the  Constitution.  The  drafts  scheme  dated February 26, 1959 was accordingly quashed.  It directed  the Govt.  to  frame the scheme afresh, if  necessary,  Pursuant thereto the U.P. State Road Corporation Published the  draft scheme on February 13, 1986.  While it was pending the motor Vehicles   Act  59 of 1988, for short ‘the Act’  came   into force  with affect from July 1, 1989.  Bulandshahr to  Delhi route was also nationalised in the approved scheme published in the State Gazette dated September 27, 1956.      After the Act came into force, the respondents  applied for and were granted permits for Saharanpur to Ghaziabad via Shahdara   routes  etc.   The  appellants  filed  the   writ petitions  in  the  High  Court  of  Allahabad  at   Lucknow questioning  the  validity thereto which  was  dismissed  by judgment dated July 23, 1990.  The draft scheme published in 1986  was held by the hearing authority to have been  lapsed by operation of Sec.100(4) of the Act.  In the Writ petition filed  by  the S.T.U. the High Court by its  judgment  dated March  16,  1990  held that the draft  scheme  stood  lapsed within  one  year from the date of the  publication  of  the draft scheme and accordingly upheld the order of the hearing authority against which the appeal (S.L.P. No. 6300/91)  wad filed.   Special  Leave petition Nos. 9701/90,  9702/90  and 2083/91  arise against the High Court’s Judgment  dismissing the  writ petitions in which grant of permits under s.80  of the  Act  on  the Muzaffarnagar  -  Chausana;  Ghaziabad  to Shahdara;   Saharanpur  to  Ghaziabad  covered  and   partly overlapping nationalised routed were questioned.  Thus these appeals by special leave.      In  Jeevan  Nath Bahl’s case (C.A. No.  1616/68),  this court  held  that the scheme was not affected and  the  true effect  of the orders passed by the High Court in respect of 50 operators was deduced thus, "in our judgment a scheme  is in  existence  which  must  have  the  statutory   operation contemplated  by Sec. 68-F of the Motor Vehicles  Act......" It was further held that the judgment of the High court "was only  intended  to prohibit the enforcement  of  the  scheme

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 11  

against two groups of petitioners, who had                                                        385 approached  the High Court challenging the validity  of  the orders  sanctioning  the scheme".  The result  is  that  the scheme  would  operate as against every other  person  other than  the fifty operators and the S.T.U. has  the  exclusive right  to  ply  its  vehicles on  the  notified  route.   50 operators  not  only continuted to ply there  vehicles  till expiry of their permits but managed to ply till date.      In  Mysore State Road Transport Corporation  v.  Mysore State  Transport  Appellate Tribunal, [1975] 1 SCR 615, this court held thus:          "Any  route or area either wholly or partly can  be          taken over by a State Undertaking under any  scheme          published,   approved   and  notified   under   the          provisions of Ch. IV-A of the Act inserted by  Sec.          62  of Act 100 of 1956.  If, therefore, the  scheme          prohibits  private transport owners to  operate  on          the   notified  area  or  route  or   any   portion          therefore, the Regional Transport Authority  cannot          either  renew the permit of such private owners  or          give  any fresh permit in respect of a route  which          overlaps  the notified route.  In  considering  the          question whether when one party has monopoly over a          route, a licence can be granted to any other  party          over  any  part  of  that  route,  the  distinction          between  ’route"  and  "highway"  is  not  at   all          relevant.  Where a private transport owner makes an          application  to operate on a route  which  overlaps          even  a  portion of the notified route,  then  that          application has to be considered only in the  light          of  the scheme as notified.  If any conditions  are          placed  then those conditions have to be  fulfilled          and  if  there  is a  total  prohibition  then  the          application   must  be  rejected.   There   is   no          justification for holding that the integrity of the          notified scheme is not affected if the  overlapping          is under five miles or because a condition has been          stipulated  in the permit that the  operation  will          not  pick  up  or set down any  passengers  on  the          overlapped route."      In  Adarsh Travels Bus Service v. State of U.P. &  Ors. [1985 Suppl. 3 SCR 661, this court held thus:          "Where  a route is nationalised under Chap IV-A  of          the Act, a private operator with a permit to ply  a          stage carriage permit over another route but  which          has a common overlapping sector                                                        386          with the nationalised route cannot ply his  vehicle          over  that part of the overlapping  common  Sector,          even  if  with corridor restrictions, that  is,  he          does  not  pick  up  or  drop  passengers  on   the          overlapping part of the route.          While the provisions of Chapter IV-A are devised to          override  the  provisions of Chapter IV and  it  is          expressly so enacted, the provisions of Chapter IV-          A  are clear an complete regarding the  manner  and          effect  the "take over" of the operation of a  road          transport   service   by   the   State    Transport          Undertaking  in  relation to any area or  route  or          portion  thereof.   While  on  the  one  hand,  the          paramount consideration is the public interest, the          interest of the existing operators are sufficiently          well-taken   care   of  and   slight   inconvenient          inevitable are sought to be reduced to a minimum.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 11  

        A perusal of s. 68-C, s. 68-D(3) and S.68-FF in the          light  of the definition of the expression  ‘route’          in  S.2(28A)  appears to make it  manifestly  clear          that  once a scheme is published under S.  68-D  in          relation  to any area or route or portion  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  or national 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 of portion  of  a          notified  area or notified route unless  authorised          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.  The private operator  cannot  take          the plea of inconvenience of the public.  If indeed          there  is  any need for protecting  the  travelling          public  from  inconvenience  the  State   Transport          Undertaking   and  the  Government  will   make   a          sufficient provision in the scheme itself to  avoid          inconvenience   being  caused  to  the   travelling          public."      The contention of Shri Harish Salve, the learned Senior counsel  for contesting respondents, is that the  scheme  of nationalisation  relates  to  "any area,  route  or  portion thereof".  In Shri Chand’s case this court quashed the                                                        387 draft  scheme  dated  February  26,  1959  taking  over  the Saharanpur-Shahdara-Delhi  route.   The fresh  draft  scheme dated February 13, 1986 to nationalise  Saharanpur-Shahdara- Delhi route stood lapsed by operation of s. 100(4) read with s.217(2)(e) of the Act.  Therefore, the grant of permits  to the respondents is valid in law.  In Shri Chand’s case  this court quashed the draft scheme dated February 26, 1959 as it was  an  abuse of the process of law to  keep  draft  scheme pending  for well over 26 years creating monopoly in  favour of  the  50 existing operators who compete with  the  state. The review petition filed by the U.P. Govt. in Shri  Chand’s case  was rejected by this court.  The result is that  there is  no scheme on Saharanpur to Delhi route.  The High  Court thereby was justified in dismissing the write petitions.      In H.C.  Narayanappa & Ors. v. State of Mysore &  Ors., [1960] 3 SCR 742 the Constitution Bench held that the scheme framed  under s. 68-C of the repealed Act is law within  the meaning  of  Arts.13  and 19(6)  of  the  Constitution.   It excludes  the  private  operators from  notified  routes  or areas.   It  immunes from the attack that  it  impinges  the fundamental rights guaranteed under Art. 19(1)(g).  It  also could  not be challenged as discriminatory.  In Nehru  Motor Transport  Co-op.   Society & Ors. v. State of  Rajasthan  & Ors., [1964] 1 SCR 220, another Constitution Bench held that the Act 4 of 1939 (repealed Act) does not provide for review of  an  approval once given though it may   be  entitled  to correct any clerical mistakes or inadvartent slips that  may have  crept  in  the order.  It was also held  that  once  a scheme was finally approved and published in the gazette, it is final and the approval of the scheme was as a whole.   In Jeevan  Nath  Bahl’s case a Bench of three  Judges  of  this court  held that the effect of the order passed by the  high Court  in  the  first  instanace  was  that  the  scheme  in existence  must  have statutory  operation  contemplated  by s.68-F  of the Motor Vehicles Act and that the order of  the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 11  

High  Court  intended  to prohibit the  enforcement  of  the scheme  against  two groups of the petitioners in  the  High Court, namely then existing 50 operators who challenged  the scheme.   It  is seen that Bulandshahr or  Delhi  route  was nationalised  by publication of the approved scheme  in  the gazette  on October 6, 1956 and the approval of  Saharanpur- Shahdara-Delhi  route  on September  29,1959  became  final. Therefore, the routes or areas therein stood nationalised to the  complete exclusion of the private operators  except  to the  extent under the scheme therein i.e. the  50  operators against  whome  it was held not to be operative  till  their objections are heard and decided by                                                   388 the hearing authority.      In Mysore State Road Transport Corporation’s case, this court per majority held that where a part of the Highway  to be  used by private Transport owners traverse on a  line  on the   same  highway  on  the  notified  route,   then   that application has to be considered only in the light of scheme as  notiofied.   If  any conditions are  placed  then  those conditions  have  to be fulfilled and if there  is  a  total prohibition then the application must be rejected.  If there is  a  total  prohibition  then  the  application  must   be rejected.   If  there  is a prohibition to  operate  on  any notified  route or routes, no licence can be granted to  any private  operators, whose route traversed or  overlapped  in part or whole of that notified route.  The inter-section  of the  notified routes must amount to traverse or  overlapping the  routes because the prohibition must apply to the  whole or part of the route on the highway on the same line or  the route and inter-section cannot be said to be traversing  the same  line.   In  S. Abdul Khader Saheb  v.  Mysore  Revenue Appellate  Tribunal  & Ors., [1973] 1 SCC  357,  this  court approved  the  view of the Karnataka High Court  that,  when once  on  a route or a portion of the route there  has  been total  exclusion  of  the operation of  the  stage  carraige services  by  operators  other  than  the  State   Transport Undertaking, by virtue of a clause in an approved scheme the authorities  granting permit under Chapter IV of  the  Motor Vehicles  Act  should  refrain  from  granting  the   permit contrary  to  the scheme.  In Adarash  Travels’s  case  this court  by  a Constitution Bench held that there is  a  total prohibition  of  private  operators from  plying  the  state carriages on the whole or part of the notified routes,  even though  there  is partial overlapping on the said  route  or routes.  The operation of the Road Transport Service by  the State Road Transport Undertaking in relation to that area or route  or portion thereof is total and complete  prohibition of  the operation of the Road Transport Service  by  private operators.   The operation of the Road Transport Service  by the State Undertaking in relation to that area or route or a portion  thereof overrides the provisions of Chapter  IV  of the  Repealed  Act 4, 1939.  This court  also  rejected  the contention  of  the  operators  that  on  the   nationalised approved routes or overlapped route the private operator  is entitled  to ply the stage carriages without picking  up  or setting  down  any passengers on the  common  sector.   This court also negatived as lacking substance of the  contention that  complete  exclusion of private operators  from  common sector  would be violative of Art. 14 and that it  would  be ultra  vires of s. 68-D.  This court approved  the  majority view  in  M/s State Road Transport  Corporation’s  case  and Abdul Khader Shaheb’s case.                                                   389      It is unfortunate that Jeevan Nath Bahl’s case was  not

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 11  

brought  to  the notice of the two Judges  Bench  when  Shri Chand’s  case was decided.  Despite it being pointed out  in the  Review Petition, the same was dismissed.  The  question is  what is the effect of the decision in Sri  Chand’s  case over  Jeevan Nath Bahl’s case.  Consistent law laid down  by this  court is that draft scheme under s. 68-C and  approved under s.68-D of Chapter IVA of the Repealed Act (Chapter  VI of  the  Act), is a law and it has  overriding  effect  over Chapter  IV of the repealed Act (Chapter V of the Act).   It operates  against  everyone  unless  it  is  modified.    It excludes  private  operators  from the area or  route  or  a portion  thereof  covered  under the scheme  except  to  the extent  excluded  under that scheme itself.   The  right  of private  operators to apply for and to obtain permits  under Chapter  IV of the repealed Act (Chapter V of the  Act)  has been  frozen  and  prohibited.   The  result  that   emerges therefrom  it  that  the  nationalisation  of  Saharanpur  - Shahdara  - Delhi route approved and published on  September 29,  1959 became final and to that extent it cannot be  said to have been quashed by this court in Sri Chand’s case.  The approved scheme is law operating against everyone except  50 objectors/operators and the writ issued by this court cannot have  the effect of annuling the law.  What was quashed  and issue of fresh draft scheme pursuant thereto, relate to only of    original   draft   scheme   operative    against    50 objectors/operators  and  no more.  Even on  principle,  the decision of a Bench of two Judges cannot have the effect  of overruling  the  decision of a Bench of three  Judges.   The fresh draft scheme under s.68-C dated February 13,1986 must, therefore,  be  construed  to  be only  in  relation  to  50 existing operators as per the directions ultimately  emerged in Jeevan Nath Bahl’s case.      The  next  question is whether the draft  scheme  dated Feb. 13, 1986 stood lapsed under S. 100(4) of the Act.   The High  Court relied on its earlier judgment and held that  by operation  of  sub-sec.   4 of s.100 of the  Act  the  draft scheme  stood  lapsed  from  one year of  the  date  of  its publication.   In  Krishan  Kumar v. State  of  Rajasthan  & Ors.,  [1991] 4 SCC 258 this court considered the effect  of s.  100(4) read with s. 217(2)(e) of the Act and  held  that the rigour of one year period provided under s. 100(4) would apply  to the draft scheme published under s.100(1)  of  the Act and it would not apply to the scheme framed under s. 68- C and pending as on the date of the commencement of the Act. On harmonious construction of ss.217(2)(e) and 100(4) of the Act, the draft scheme published under s.68-C of the Repealed Act would stand lapsed only if it is not approved within                                                   390 one  year  from the date when the Act came into  force  i.e. with  effect from July 1, 1989 by which date it was  pending before  the hearing authority and one year had not  expired. The hearing authority, therefore, wrongly concluded that the draft  scheme  stood lapsed.  The High  Court  also  equally committed  illegality following its earlier view  which  now stood  overruled  by  this court in  Krishan  Kumar’s  case. Accordingly it must be held that the view of the High  Court and the hearing authority is clearly illegal.      The  result  of the above discussion will lead  to  the following conclusions :      The  nationalisation of Saharanpur - Shahdara  -  Delhi route by publication of the approved scheme on September 29, 1959  is operating to the total exclusion of  every  private operator except U.P. State Road Transport Corporation and 50 operators  including the appellants herein whose  objections were  upheld  by the High Court in the  first  instance  and

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 11  

merged  in the judgment of this court in Jeevan Nath  Bahl’s case. Equally of Bulandshar to Delhi route.  Under s. 80  of the  Act  no  private operator has right to  apply  for  and obtain permits to ply the stage carriages on the approved or notified  route/routes  or areas or  portion  thereof.   The grant  of  permit to all the respondents 7  to  285  private operators  in C.A. 1198/92 S.L.P. No 9701/90) or any  others under  s.80 of the Act on the respective routes or part,  or portion  thereof  to provide transport  service  is  clearly illegal and without jurisdiction.      It is true as contended by Shri Salve that in Mithilesh Garg & Ors. v. Union of India & Ors., [1992] 1 SCC 168, this court held that the liberal policy of grant of permits under s.80  of  the Act is directed to  eliminate  corruption  and favouritism  in the process of granting  permits,  eliminate monopoly of few persons and making operation on a particular route economically viable and encourage healthy  competition to bring about efficiency in the trade.  But the free ply is confined to grant of permits under Chapter V of the Act.  By operation of s.98 of the Act, Chapter VI overrides Chapter V and other law and shall have effect notwithstanding anything inconsistent  therewith contained in Chapter V or any  other law  for  the  time result is that even under  the  Act  the existing scheme under the repealed Act or made under Chapter VI  of  the Act shall have over-riding effect on  Chapter  V notwithstanding  any  right given to  private  operators  in Chapter                                                   391 V  of the Act. No corridor protection to private  operators is permissible.      Accordingly  we  hold that the  approved  scheme  dated September  29, 1959 on Saharanpur - Shahdara -  Delhi  route shall  continue  to be valid scheme under the  Act. The U.P. State  Road  Transport  Corporation  alone  shall  have  the exclusive  right  to ply their stage carriages on  the  said route  and  Bulandshahr  -  Delhi  route/areas  or  portions thereof.  By operation of the orders passed by the Allahabad High  Court  which  merged   in  Jeevan  Nath  Bahl’s  case, protection was given only to 50 private operators  including the appellants herein to be heard of their objections.   The fresh  draft  scheme dated February 13, 1986  had  not  been lapsed  and would continue to be in operation.  It would  be confined only to 50 operators.      The  50  operators  including  the   appellants/private operators have been running their stage carriages by blatant abuse of the process of the court by delaying the hearing as directed  in  Jeevan  Nath Bahl’s case and  the  High  Court earlier  thereto.  As a fact, on the expiry of  the  initial period of grant after Sept. 29, 1959 they lost the right  to obtain  renewal  or  to ply their vehicles,  as  this  court declared  the  scheme to be operative.   However,  by  sheer abuse of the process of law they are continuing to ply their vehicles  pending hearing of the objections.  This Court  in Grindlays  Bank Ltd. v. Income-tax Officer & Ors., [1990]  2 SCC 191, held that the High Court while exercising its power under  Art.  226 the interest of justice requires  that  any undeserved  or unfair advantage gained by a  party  invoking the  jurisdiction of the court must be neutralised.  It  was further  held that the institution of the litigation  by  it should  not be permitted to confer an unfair  advantage   on the party responsible for it.  In the light of that law  and in  view of the power under Art. 142(1) of the  Constitution this  court,  while  exercising its  jurisdiction  would  do complete justice and neutralise the unfair advantage  gained by the 50 operators including the appellants in dragging the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 11  

litigation to run the stage carriages on the approved  route or  area  or protion thereof and forfeited  their  right  to hearing  of the objections filed by them to the draft scheme dated  Feb. 26, 1959.  Moreover, since this court in  Jeevan Nath  Bahl’s case upheld the approved scheme and held to  be operative,   the  hearing  of their objections  would  be  a procedural  formality with no tangible  result.   Therefore, the objections outlived their purpose.  They are, therefore, not entitled to any hearing before the hearing authority.                                                   392      The  appeals  are accordingly allowed.   The  grant  of permits   to  all  the  respondents/private  operators   and respondents  Nos. 7 to 285 in C.A. No. 1198/92  (S.L.P.  No. 9701/90)  under  s.80  of  the Act  or  any  others  on  the respective  routes,  parts or portions of  the  nationalised routes  on  Feb.  13, 1986 draft  scheme  ar  quashed.   The hearing  authority  shall  lodge the objections  of  the  50 operators  including the appellants herein.   The  competent authority  shall approve the draft scheme of 1986  within  a period of 30 days from the date of receipt of the  judgment; and publish the approved scheme in the gazette.  The permits granted  to  the  50  operators or  any  other  shall  stand cancelled  from  that  date, if not having  expired  in  the meanwhile.  No permits shall be renewed.  Appropriate action should  be  taken by respondents 3 to 4 in  CA  No.  1198/92 (S.L.P. No. 9701/90) to see that all the permits, granted to the  50  operators including the appellants are  seized  and cancelled.   The  U.P.  State  Transport  Corporation  shall obtain required additional permits, if need be, and put  the stage  carriages on the routes to provide transport  service to  the travelling public immediately on publication of  the approved  draft  scheme in the State  Gazette.   The  Appeal arising  out  of S.L.P. No. 2083/91 is  allowed  with  costs throughout   against respondents Nos. 4 to 13.  The  appeals arising  out  S.L.P. Nos. 6300/91, 9701/90 and  9702/90  are allowed without costs. N.V.K.                                      Appeals allowed.                                                   393