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PETITIONER: S.V. SIVASWAMI SERVAI

       Vs.

RESPONDENT: HAFEZ MOTOR TRANSPORT (FIRM) AND ORS.

DATE OF JUDGMENT17/08/1990

BENCH: VERMA, JAGDISH SARAN (J) BENCH: VERMA, JAGDISH SARAN (J) SHARMA, L.M. (J)

CITATION:  1991 AIR  911            1990 SCR  (3) 802  1990 SCC  (4) 459        JT 1990 (3)   518  1990 SCALE  (2)275

ACT:     Motor  Vehicles Act, 1939: Section 47(3)--Grant of  per- mit----Basis    for--Permits    in    excess    of    routes determined--Whether   permissible-Agreement  between   rival parties in a lis--Whether can be basis for.

HEADNOTE:     The appellant and 14 others, including respondent No.  1 applied  for  grant of a stage carriage permit.  The  R.T.A. rejected  the  applications  of respondent No.  1  and  some others on the only ground that each of them had been granted one other permit in the same sitting, and granted the permit to  the appellant for a period of three years. On appeal  by respondent No. 1 and some others, the State Transport Appel- late Tribunal, set aside the R.T.A.’s order and granted  the permit  in  favour of respondent No. 1.  The  appellant  and another  unsuccessful  applicant filed  two  civil  revision petitions.  The High Court, by an interim order, stayed  the Tribunal’s order and directed that the appellant as well  as respondent  No.  1 be allowed to operate on the  route,  but ultimately dismissed both the revision petitions.     The appellant filed a special leave petition before this Court.  By virtue of this Court’s interim order, the  appel- lant and respondent No. 1 were continuing to operate on  the route throughout; as a result, though the permit granted for three  years expired long back, both the claimants had  been operating on the route all these years.     On  behalf  of the parties common request was  made  for remanding  the  matter to the R.T.A. for fresh  decision  on merits and for a direction to allow both the parties to  ply their stage carriages on the route on the ground that  there was necessity for two permits on the route. Allowing the appeal, this Court,     HELD:  1.1  The grant of a permit is to be made  by  the R.T.A. primarily with reference to the object of serving the interests of the general public and other relevant  factors. It  cannot  be treated as a dispute relating to grant  of  a permit  between the rival claimants only. It is not  in  the nature of a lis for adjudication of conflicting interests of 803 private  individuals alone. That apart, under Section  47(3)

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of  the  Motor Vehicles Act, 1939, the R.T.A. is  first  re- quired  to determine the number of stage carriages  for  the route and then to grant permits according to that determina- tion made earlier. Grant of any permit in excess thereof was not  permissible without first making a fresh  determination and increasing the number, if necessary. [807E-G]     1.2  Therefore, an order allowing two claimants, to  ply their  stage  carriages on a single route on  the  basis  of agreement  between  them  that there is  necessity  for  two permits cannot be made unless the grant of a permit to  both the  rival claimants would be within the limit fixed by  the R.T.A. at the relevant time. The grant of a permit is not  a matter which can be decided merely on the basis of an agree- ment between the two rival claimants who alone out of sever- al claimants remain in the lis at this stage. [807H & F]     M.  Chinnaswamy  v. M/s. Dhandayuthanpani  Roadways  (P) Ltd., [1977] 2 SCC 629; Civil Appeal No. 1133 of 1970 decid- ed on 9.12.1981 and Civil Appeal No. 136 of 1980 decided  on 13.7.1990, distinguished.     1.3  The  fact  that the claimants had  the  benefit  of plying their stage carriages for several years on the  basis of  interim  orders of the Court or other  authorities  long after  the period of the permit had expired, is not a  valid reason  for  perpetuating that act and confining  the  grant only  to the litigants before the court when  claimants  for the  permit were many and are likely to be many in case  the question  of grant at this point of time is decided  afresh. Admittedly, the appellants for permit before the R.T.A. were many more and when the matter is to be considered afresh  by the R.T.A. everyone of them is entitled to a fresh consider- ation of his claim on merits. [808B-D]     1.4  The grant of permit by the R.T.A. to the  appellant refusing to consider the claim of respondent No. 1 and  some other  applicants on merits solely on the ground  that  they had  been  granted one other permit in the same  sitting  is clearly  untenable. The grant of a permit for another  route to  the  respondent No. 1 and some others could  only  be  a relevant  circumstance,  while  assessing  the   comparative merits of all the applicants, but by itself it could not  be decisive  or  sufficient to refuse  consideration  of  their claim.  The orders of the R.T.A. the Tribunal and  the  High Court  are set aside and the matter remanded to  the  R.T.A. for  a fresh consideration and decision of the claim of  all the  applicants on merits in accordance with  law.  [805C-D; 808F1 804     [The  Court  vacated the interim  order  permitting  the appellant and respondent No. 1 to ply their stage  carriages on the route and directed the R.T.A. to make arrangement for operation of the route till the matter is decided afresh, to avoid inconvenience to the traveling public.] [808F-G]

JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil Appeal No. 1407 of 1983.     From  the  Judgment  and Order dated  1.12.1983  of  the Madras High Court in C.R.P. No. 2978 of 1981. G. Ramaswamy and S. Srinivasan for the Appellant. A.T.M. Sampath for the Respondents. The Judgment of the Court was delivered by     VERMA,  J.  Applications were invited  by  the  Regional Transport Authority, Pudukkottai (in short ’the R.T.A.’) for grant  of one stage carriage permit on the route,  Pudukkot-

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tai--Kottaipattinam, the total length of the route being  70 kms.  There were in all 15 applicants including  the  appel- lant,  S.V.  Sivaswami Servai, and respondent No.  1,  Hafez Motor  Transport (firm). On 26.10.1979, the R.T.A.  took  up the case of all the applicants for consideration. The R.T.A. rejected the application of respondent No. 1 and some  other applicants  on  the only ground that each of them  had  been granted one other permit in the same sitting and, therefore, the  R.T.A. did not deem it fit to consider their claim  for grant  of  the permit. Out of the remaining  applicants  who were  allotted equal marks, the R.T.A. found  the  appellant more suitable for the grant. Accordingly, the R.T.A. granted the  permit to the appellant for a period of three years  on 26.10.1979.  The respondent No. 1 and some  others,  feeling aggrieved  by  the  R.T.A.’s Order  in  appellant’s  favour, preferred  the  appeals  to the  State  Transport  Appellate Tribunal,  Madras  (in short ’the S.T.A.T.’). By  the  Order dated  5.9.1981, the S.T.A.T. set aside the  R.T.A.’s  Order granting, the permit to the appellant and granted the permit in  favour of respondent No. 1. This led to two civil  revi- sion  petitions  in the High Court  of  Madras  (hereinafter referred  to as ’the High Court’), one by appellant and  the other by another unsuccessful applicant. The High Court,  by an  interim Order dated 22.9.1981, stayed operation  of  the S.T.A.T.’s Order and directed that the appellant as well  as respondent  No. 1 be allowed to operate on the route.  Ulti- mately, the High Court dismissed 805 both  the revision petitions by its Order  dated  1.12.1983. The appellant filed a petition for grant of special leave on 7.12.1983  which was allowed giving rise to this appeal.  By virtue  of  the interim Order of this Court,  the  situation existing  during pendency of the revision in the High  Court has  been  continued with the result that the  appellant  as well as respondent No. 1 have been continuing to operate  on the  route throughout obviously on account of renewal  being granted  to them from time to time because of  this  Court’s interim  Order.  The result is that the  permit  granted  in October  1979 for three years expired long back and yet  not merely  one of these claimants for the permit, but  both  of them have been operating on the route all these years.     It is obvious that the grant of permit by the R.T.A.  to the  appellant refusing to consider the claim of  respondent No.  1  and some other applicants on merits  solely  on  the ground  that they had been granted one other permit  in  the same sitting is clearly untenable. The grant of a permit for another route to the respondent No. 1 and some others  could only be a relevant circumstance while assessing the compara- tive  merits of all the applicants, but by itself  it  could not  be  decisive or sufficient to refuse  consideration  Of their  claim.  The  S.T.A.T. would have  been  justified  in interfering  with  the  R.T.A.’s Order on  this  ground  and either remanding the matter to the R.T.A. or considering the same itself on merits. The S.T.A.T. missed this aspect, even though it made a comparison of the merits of all the  appli- cants. Shri G. Ramaswamy, learned counsel for the  appellant showed  that  the S.T.A.T. has committed several  errors  in making the comparison which include a misreading of the past operational record described as ’history-sheet’ of the rival claimants.  The  High  Court, while  deciding  the  revision petitions, has also not proceeded on the correct basis. Shri A.T.M.  Sampath,  learned counsel for the respondent  No.  1 made  an attempt initially to support the  S.T.A.T.’s  Order granting the permit to the respondent No. 1 which was upheld by  the  High  Court. However, after  some  arguments,  both

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counsel  made a common request to remand the matter  to  the R.T.A.  for a fresh decision on merits taking  into  account the  comparative  merits of all the  applicants.  They  also requested  that  in view of the remand to the R.T.A.  for  a fresh  decision  on  merits, no observations  need  be  made herein  on  the comparative merits of the claimants  or  the merits of the rival contentions initially advanced to us. We are  of the opinion that in the circumstances of this  case, this  would  be the appropriate course to  adopt.  We  have, however,  some  difficulty  in accepting  the  other  common request made by both the learned counsel. Both sides  agreed that  there is necessity for two permits on the  route  and, therefore, we may direct that both 806 parties,  who have been operating on the route by Orders  of the High Court or this Court, should be allowed to ply their stage carriages on the route. Reliance is placed by them  on M.  Chinnaswarny v.M/s. Dhandayuthanpani Roadways (P)  Ltd., [1977]  2  SCC 629 wherein a similar Order was made  on  the basis  of an agreement of both the sides. The Order made  in this  case is a brief order based entirely on the  agreement of the parties, the relevant portion of which is as under: "It is represented by Shri M.K. Ramamurthi appearing for the appellant that from about 1960, for the last 16 years,  both the  parties  had been plying their stage carriages  on  the said route. Although the permit to be granted was only  one, but  by orders of court or other authority both the  parties had  been  allowed  to ply their buses. It seems  to  be  so obvious that in public interest if two stage carriages  have been  plying on the route for the last 16 years there is  no reason to confine it to one. Both sides agree that there  is necessity  for  two permits on the route. In  that  view  we consider  the  dispute to be academic. We  direct  that  the status quo of both parties being allowed to ply their  stage carriages  on the route taking appropriate permits from  the authorities  concerned will continue. With  this  direction, the appeal is dismissed." It was stated at the Bar that this decision was followed  in Civil  Appeal No. 1133 of 1970 decided on 9.12.1981  wherein the Order made is as under: "We have heard learned counsel for the parties and it  seems to us that having regard to the particular circumstances  of this case, the order should be that which was passed by this Court  in M. Chinnaswamy v. M/s.  Dhandayuthanpani  Roadways (P)  Ltd.,  AIR  1977 SC 2095. During the  pendency  of  the appeal in this Court, this Court made an order on April  21, 1970,  directing  that the appellant and  respondent  No.  1 should  be  permitted to ply their stage  carriages  on  the route,  and  ever since the order of 1970  these  two  stage carriages have been plying continuously under permits  which have been renewed from time to time under the Motor Vehicles Act. There is every justification for permitting the present situation to continue. In the circumstances, we direct  that the  status quo shall continue and both the parties will  be allowed to ply their stage 807 carriages  in accordance with law under appropriate  permits issued  in their favour pursuant to the interim order  dated April 21, 1970."     Recently,  a  similar  Order has been  passed  in  Civil Appeal  No. 136 of 1980 decided on 13.7.1990 which reads  as under: "The  authorities  concerned will consider the case  of  the parties  herein for grant of permit in accordance  with  law and  also in accordance with the directions in the  decision

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of  this  Court in M. Chinnaswamy v.  M/s.  Dhandayuthanpani Roadways  (P)  Ltd., reported in AIR 1977 SC  2095.  In  the meantime,  status  quo as on today will continue.  Both  the parties will ply their vehicles on the route in question.           Counsel for both the parties are present here  and they have no objection to the order passed above. The appeal is disposed of in the above terms. No costs."     With  respect, we are unable to accept this  common  re- quest made to us in the present case. It is obvious from the above  quoted  orders on which the common request  is  based that  in  none of them, any point of law was  considered  or decided  and  the  Order permitting both  the  claimants  to operate  on the route, even though the permit to be  granted was only one, was made without adverting to the legal impli- cations  of  such an Order. In the first place, grant  of  a permit is to be made primarily with reference to the  object of serving the interests of the general public and it cannot be  treated as a dispute relating to grant of a  permit  be- tween the rival claimants only. It is not in the nature of a lis  for  adjudication of conflicting interests  of  private individuals  alone It is, therefore, not a matter which  can be  decided merely on the basis of an agreement between  the two  rival  claimants  who alone out  of  several  claimants remain  in the lis at this stage. The question of  grant  of permit  is  to  be decided primarily by  the  R.T.A.  having regard primarily to the interests of the general public  and other prescribed relevant factors. That apart, under Section 47(3)  of the Motor Vehicles Act, 1939, the R.T.A. is  first required to determine the number of stage carriages for  the route and then to grant permits according to that determina- tion made earlier. Grant of any permit in excess thereof was not  permissible without first making a fresh  determination and  increasing the number, if necessary. It is,  therefore, obvious that an order of this kind cannot be made unless the grant  of  a  permit to both the rival  claimants  would  be within the limit fixed by 808 the R.T.A. at the relevant time. There is nothing in any  of these  above quoted orders to indicate that this aspect  was even adverted to or that there was material to indicate that the consent order so made was within. the limit fixed by the R.T.A.  If at all the indication is to the contrary  that  a permit which could be granted was for plying only one  stage carriage on the route whereas the consent order made had the effect  of  permitting two stage carriages instead  of  one. Moreover.  if the claimants had the benefit of plying  their stage  carriages for several years on the basis  of  interim orders  of  the Court or other authorities  long  after  the period of the permit had expired, that does not appear to us to be a valid reason for perpetuating that act and confining the grant only to the litigants before us when claimants for the  permit were many and are likely to be many in case  the question  of grant at this point of time is decided  afresh. With  respect, we are, therefore, unable to accede  to  this common  request and to confine the operation of  this  route only  to the two claimants before us in a lis  between  them which commenced more than a decade earlier. Admittedly,  the applicants  for permit before the R.T.A. were many more  and when  the matter is to be considered afresh by  the  R.T.A., everyone of them is entitled to a fresh consideration of his claim on merits. As already stated, our inability to pass  a consent  order  in terms of the above-quoted orders  is  for some of the reasons already indicated. For the reasons given by us, the above-quoted consent orders cannot be treated  as precedents for such a situation.

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   Consequently, the appeal is allowed, the impugned Orders of the R.T.A., the S.T.A.T. and the High Court are set aside and the matter is remanded to the R.T.A., Pudukkottai, for a fresh  consideration  and decision of the claim of  all  the applicants  for grant of the permit on merits in  accordance with  law. The interim orders, permitting the appellant  and the  respondent  No. 1 to ply their stage carriages  on  the route,  stand vacated. However, it would be  expedient  that the R.T.A. decides the matter afresh at an early date and it also  makes arrangement for operation of the   route  during the  intervening period in accordance With law to avoid  any inconvenience to the travelling public. No costs. N.P.V.                                   Appeal Allowed ?809