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PETITIONER: STANDARD MOTOR UNION PVT. LTD.

       Vs.

RESPONDENT: STATE OF KERALA & ORS.

DATE OF JUDGMENT: 30/07/1968

BENCH: BACHAWAT, R.S. BENCH: BACHAWAT, R.S. HEGDE, K.S.

CITATION:  1969 AIR  273            1969 SCR  (1) 464  CITATOR INFO :  D          1972 SC1674  (12)

ACT:    Motor  Vehicles  Act,  (4  of 1939),  Ss.  68C,  68D  and 68E--Scheme  nationalising route overlapped by  other  route operated  by  private  operators---Scheme  if  of   complete exclusion  or  partial  exclusion--Scheme  modified  without expressly  modifying earlier scheme--VaIidity. Kerala Motor Vehicles (State Transport Undertaking)   Rules, 1960 r. 3-

HEADNOTE:     The  respondent State approved a scheme in form  II  for nationalization  of certain specific routes after  complying with the provisions of ss. 68C and 68D of the Motor Vehicles Act, 1939.  The scheme excluded. all private operator’s from the  notified  routes.  The notified routes formed  part  of highways,  having common road sectors and private  operators continued  to  operate  on  the  highways.   The   appellant unsuccessfully  filed  writ petition in the  High  Court  to quash  the scheme.  In appeal to this Court,  the  appellant challenged  the validity of the scheme on the  grounds  that (i)  the scheme was a complete exclusion scheme  and  should have   been  in form I and as it was in form II  it  was  in contravention  of Rule 3 of the Kerala Motor  Vehicles(State Transport  Undertaking) Rules, 1960 read with s. 68C of  the Act;  and (ii) since there were earlier schemes, they  could not  be  modified by the impugned scheme  without  complying with the provisions of s. 68E.  Dismissing the appeal,  this Court:     HELD:  (i)  From  the language of s. 68C  and  r.  3  it appears that a complete exclusion scheme in relation to. any area  of route would be a scheme which  completely  excludes the existing road services of private operators on the  area or route in question. The route includes the highway over it runs.   If other existing services are allowed  to  continue over  a part of the highway relating to the notified  route, the scheme is not one of complete exclusion.     The  impugned scheme did not exclude the road  transport services  of  other existing routes  which  overlapped  many sectors of the highways relating to the notified routes.  In spite  of  the scheme the public could get services  on  the

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common road sectors from the private operators who continued to  operate the highways.  Therefore, the scheme was not  in complete  exclusion of existing road transport  services  in respect  of  notified routes and was not required to  be  in form 1. [466 G-H, 467 D]     Nilkanth Prasad & Ors. v. State of Bihar. [1962]  Suppl. 1  S.C.R. 728 at 737; Kondala Rao v. Andhra  Pradesh  S.T.C. Corporation, A.I.R. 1961 S.C. 82, followed.     (ii)  On the promulgation of the new scheme the  earlier schemes  stood  modified pro tanto.  As the  procedure  laid down in  ss. 68C  and 68D were followed the conditions of s. 68  were  satisfied. S. 68E does not require  that  the  new scheme should expressly say that it cancels or modities  the earlier schemes. [467 G]

JUDGMENT:     CIVIL  APPELLATE JURISDICTION: Civil Appeal No.  921  of 1968.     Appeal  by  special leave from the  judgment  and  order dated  January  8,  1968 of the Kerala High  Court  in  Writ Appeal No. 79 of 1967. 465 S.V. Gupte and A.S. Nambiar, for the appellant. Sarjoo Prasad and M.R.K. Pillai for respondent No. 1.     C.M.  Kuruvilla, Sardar Bahadur,  Vishnu Bhadur  Saharya Yougindra Khushalani, for respondent No. 2. The judgment of the Court was delivered by     Bachawat,   J.  The  appellant  challenges  the   scheme nationalisation  of road transport services in respect of  9 routes in the districts of Ernakulam and Kottayam.   Chapter IVA the Motor Vehicles Act, 1939 deals with  nationalisation of  road transport services.  Section 68C provides  for  the preparation   and   publication  of  a   draft   scheme   of nationalization of road transport services in general or any particular class of such service in relation to any area  or route or portion thereof whether to the exclusion,  complete or  partial,  of other persons or  otherwise.   Section  68D provides for the filing of objections of persons affected by the  scheme, for the consideration of the objections by  the government,  for modification or approval of the  scheme  by the  government  and  for publication  of  the  approved  or modified  scheme. Section 68E provides that a scheme finally settled  under  sec.  68D may at any time  be  cancelled  or modified by the State transport undertaking.  The  procedure laid  down  in secs. 68C and 68D shaH, so far as it  can  be made applicable, be followed in every case where the  scheme is proposed to be modified as. if the modification  proposed were  a separate scheme.  For the purpose  of giving  effect to  the approved scheme in respect of a notified area  or  a notified  route  sec. 68F(2) (iii) authorises  the  Regional Transport  Authority  to  modify the terms  of  an  existing permit  so  as to curtail the area or route covered  by  the permit in so far as such permit relates to the notified area or   notified  route.   Section  68  authorises  the   State Government  to make rules for the purpose of  carrying  into effect  the provisions of Chapter IV A and in particular  to provide the form in which any scheme or approved scheme  may be  published  under secs. 68C and 68D. In exercise  of  its powers  under  sec.  68 I the State  Government  framed  the Kerala  Motor Vehicles (State Transport Undertaking)  Rules, 1960. Rule 3 provides that every proposed scheme shall be in form  I  when it is in complete exclusion of  existing  road transport  service,  in form when the scheme is  in  partial

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exclusion  of existing road transport service, in  form  III when  the  scheme is in supplementation   of  existing  road transport  service  and  in form IV when the  scheme  is  to modify an existing scheme.     On   December  15,  1965  the  Kerala  State   Transport Corporation  published  a  draft  scheme  in  form  II   for nationalization  of 9 specified routes in the  districts  of Ernakulam and Kottayam in partial exclusion of the  existing passenger  transport  services 466 concerned,  giving  the particulars of  the  stage  carriage permits  to be excluded.  On October 17, 1966 after  hearing the objectors the State Government approved the scheme.   On October  24,  1966 the government published   the   approved scheme.   On  December 7, 1966 the appellant  filed  a  writ petition   in   the Kerala High Court to quash  the  scheme. V.P.  Gopalan  Nambiyar  J.  dismissed   the   petition.   A Divisional  Bench of the High Court affirmed his order.  The present  appeal   has  been filed  after  obtaining  special leave.     The  appellant’s contention is that the impugned  scheme is a complete exclusion scheme and should have been in  form I  and as it is in form Ii it is in contravention of Rule  3 read with sec. 68C and is therefore invalid.  Let us examine this  contention.  The scheme is in respect of  9  specified routes.  The scheme excludes all private  operators  holding stage  carriage. permits for those routes.  Take  the  route Kottayam-Ernakulam.   All   the  private  operators  holding stage  carriage permits for that route are excluded.  It  is therefore  argued  that  the  scheme  is  one  of   complete exclusion.  But it appears that there are 33 existing routes partially overlapping the notified routes.  The 33  existing routes  and  the  notified  routes  have  many  common  road sectors.   The scheme does no.t interfere with the  services on  the  33  routes. In spite of the scheme the  public  can get  services on the common road sectors from the  operators running  on  the  33 routes.  Take  the  notified  Kottayam- Ernakulam route.  There is  an  existing Kottayam-Muttupetty route.    A  portion  of  the   Kottayam-Muttupetty    route overlaps   the:   Kottayam-Ernakulam  route.   The  impugned scheme does not exclude the services of the operators of the Kottayam-Muttupetty route on the road sector common to the   Kottayam-Ernakulam  and  Kottayam-Muttupetty   routes. On  these facts, it is impossible to. say that the  impugned scheme  is one of complete exclusion.     Section 68C envisages schemes of road transport services in relation to any area or route or portion thereof  whether to the exclusion, complete, or partial of other persons   or otherwise.  Rule  3  of the  Kerala  Motor  Vehicles  (State Transport   Undertaking)  Rules, 1960 speaks of  schemes  of road  transport service in complete or partial exclusion  of existing road transport services. From the language of  sec. 68C and Rule 3 it appears that  a complete exclusion  scheme in  relation to. any area or route would be a  scheme  which completely  excludes the existing road services  of  private operators  on  the, area or route in  question.   The  route includes the highway over which it runs.  If other  existing services are allowed to continue over a part of the  highway relating to the  notified  route  the scheme.  is  not   one of  complete exclusion. 467     A stage carriage permit is granted under secs. 46 to  48 for  a  specified area.  The words "roads  included  in  the proposed  route or area" in sec. 47( 1 )(f) implies  that  a route  includes  the road or the  physical  track.   Section

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68F(2)(iii)  implies  that  a portion of  the  route  of  an existing  permit  may  relate to  a  notified  route.   This happens  when  the  two routes have  a  common  road  sector Section 68F (2)(iii) authorises the exclusion  of the common portion  of the road from the  existing  permit  for  giving effect  to.  the  scheme for the notified  route.   For  the purposes  of  Chapters.  IV and IVA there  is  no  practical distinction between the route or the notional line from  one terminus  to another for which the permit is granted and the road over which the transport services are run and operated. As  pointed  out  in  Nilkanth Prasad &  Ors.  v.  State  of Bihar(1)  "the distinction between "route" as  the  notional line  and  "road" as the physical track  disappears  in  the working  of Chap. IVA."  The  route is also an  area.   (see Kondala Rao v. Andhra Pradesh S.T.C. Corporation(2) & C.P.C. Motor  Service v. State of Mysore(3).  The  impugned  scheme does  not  exclude  the road transport services  of  the  33 existing  routes  over  many  sections  of   the    highways relating to the notified routes.  It follows that the scheme is  not  in complete exclusion of  existing  road  transport services  in  respect  of the notified  routes  and  is  not required  to  be in  form I. There is no  infirmity  in  the scheme because it was in form II.     The   impugned  scheme  is  in  partial  exclusion    of operators  from Kottayam-Ernakulam and  Kottayam-Eratupettah routes  and  7 other routes.  It is common case  that  there were earlier schemes relating to the Kottayam-Ernakulam  and Kottayam-Eratupettah  routes.   In so far  as  the  impugned schemes   excludes  private operators from those routes,  it has  the  effect  of modifying  the  earlier  schemes.   The appellant’s  contention  is  that  the  impugned  scheme  is invalid as the modification of the earlier schemes were made without  complying with the provisions of sec. 68E.  In  our opinion,  this contention is baseless.  The new  scheme  has been  proposed  and approved after following  the  procedure laid down in secs. 68C and 68D.  In so far as the new scheme modities  the  earlier schemes, the modifications  could  be made  under sec. 68E.  As the procedure laid down  in  sees. 68C  and  68D were followed the conditions of sec. 68E  were satisfied.  68E does not require that the new scheme  should expressly  say  that  it cancels  or  modifies  the  earlier schemes.  On the promulgation of the new scheme the  earlier schemes stand modified by implication pro tanto.     A  scheme  to modify an existing scheme  simpliciter  is required  by  Rule  3 of the Kerala  Motor  Vehicles  (State Transport Under- (1)  [1962] Suppl. 1 S.C.R. 728 at 737. (2) A.I.R. 1961 S.C. 82 at 93. (3) [1962] Supp. I.S.C.R. 717; A.I.R. 1966 S.C. 1661. 468 taking)  Rules, 1960 to be in Form IV.  The impugned  scheme was in Form H as it was in partial exclusion of the existing road  transport  service.  Such a scheme could  not  be   in form  IV. The partial exclusion scheme was rightly  proposed in form Ii and when approved it had the effect of  modifying the earlier schemes.     Counsel  suggested that the approval of the  scheme   by the  State Government on October 17, 1966 was defective   as the  Government was merely of the opinion that the  proposed scheme was necessary to provide efficient, adequate and  co- ordinated  road transport services and it did not  form  the opinion that the scheme was necessary to provide  economical road  transport  service.  The point was not  taken  in  the courts  below and we therefore indicated in the  course.  of the arguments that the appellant will  not  be permitted  to

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raise.  this  point  at this late   stage.   Several   other objections  were taken in the courts below but they are  not pressed in this Court. The appeal is dismissed with costs. Y.P.                                     Appeal dismissed. 469