Full Judgment Text
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PETITIONER:
SARASWATI DEVI & ORS.
Vs.
RESPONDENT:
STATE OF U.P. & ORS.
DATE OF JUDGMENT04/11/1980
BENCH:
KOSHAL, A.D.
BENCH:
KOSHAL, A.D.
CHANDRACHUD, Y.V. ((CJ)
BHAGWATI, P.N.
KRISHNAIYER, V.R.
FAZALALI, SYED MURTAZA
CITATION:
1981 AIR 660 1981 SCR (1)1005
1980 SCC (4) 738
ACT:
Motor Vehicles Act, 1959, sections 68C and 68D, scope
of-objections involving comparison of the pre-existing road
transport services with those prepared in a scheme are
relatable to the ingredients of section 68C and are,
therefore admissible under section 68D of the Act.
Uttar Pradesh State Transport Services (Development)
Rules, 1958, rules 5(v) and 7(2)(iv), scope of-Summoning of
witnesses and production of witnesses, explained.
HEADNOTE:
Dismissing the appeal by special leave, the Court
^
HELD: (1) A bare reading of sections 68A to contained
in Chapter IV-A, which was added to the Act by Central Act
100 of 1956, makes it clear that they provide for
nationalisation of road transport services. However, such
nationalisation, in view of the provisions of section 68C,
is not nationalisation for nationalisation’s sake but
nationalisation with a view to the achievement of certain
specified objects. Unless a scheme conforms to the two
conditions referred to in section 68C, namely, (a) the
S.T.U. is competent to prepare and publish a scheme under
section 68C only after it has formed the opinion that it is
necessary in the public interest that road transport
services covered by the scheme should be run and operated by
itself, whether to the exclusion, complete or partial, of
other persons or otherwise; and (b) the necessity for the
road transport services to be run and operated by the S.T.U.
must flow, in its opinion, from the purpose of providing ar.
efficient, adequate, economical and properly coordinated
road transport service, it will fall outside the ambit of
section 68C. [1012A, 1013H, 1014A-C]
Section 68D gives the right to certain persons,
associations and authorities to file objections to a scheme
published under section 68C within the specified period of
thirty days of its publication and also lays down the
procedure for the hearing and disposal of such objections by
the State Government. The procedure provided in section 68D
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is designed to - (a) enable parties affected by the scheme
to point out flaws therein; (b) enable the State Government
to find out which flaws, if any, the scheme suffers from,
and (c) enable the State Government either to remedy the
flaws by a suitable modification of the scheme or to rescind
the scheme altogether. Under section 68(2), every objector
or his representatives and the representatives of the S.T.U.
have to be given an opportunity of being heard in the matter
and it is only thereafter that the State Government has to
exercise its power to approve or modify the scheme, which
power includes the power not to approve the scheme at all
and to drop it in its entirety. [1014D-F]
Malik Ram v. State of Rajasthan, [1962] 1 S.C.R. 978 at
981, followed.
1006
Section 68D does not specify the type of objections
envisaged by it but then their purpose being to point out
flaws in the scheme they must be confined to the matters
covered by section 68C. If the opinion forming the basis of
the scheme does not suffer from errors such as may render it
abnoxious to the dictates of section 68C and on the other
hand, conforms to the conditions laid down in that section,
the scheme would be unobjectionable. Objections may thus be
made to show: (a) that it is not necessary in the public
interest for the concerned road transport services to be
operated by the S.T.U.; (b) that it is not necessary in the
public interest that such services be taken over by the
S.T.U. to the complete exclusion (if such exclusion is
envisaged by the scheme) of other persons and that their
partial exclusion would suffice; (c) that it is not
necessary in the public interest that such services shall be
taken over by the S.T.U. even to the partial exclusion of
others; (d) that the scheme is not calculated to provide an
efficient road transport service; (e) that the scheme would
not provide an adequate road transport service; (f) that the
road transport service envisaged by the scheme would not be
economical; or (g) that the road transport service provided
for by the scheme would suffer from lack of proper
coordination. [1014H, 1015A-E]
Objections falling outside these seven categories would
not be admissible inasmuch as they would not have anything
to do with any of the conditions which a scheme must satisfy
in order to be covered by section 68C. [1015E-F]
2. In order to find out if the scheme fulfils the
requirements of section 68C a comparison of the attributes
of the two services, such as quality, capacity, financial
implications and coordination would certainly fall within
the scope of the inquiry to be conducted by the State
Government, although a comparison would not be permissible
for the sole purpose of finding out whether the private
operators should be given a preference over the State
Transport Undertaking. If such a comparison as held to be
permissible is ruled out, the result would be to shut out
from the enquiry held by the State Government under section
68D most of the material relevant for determination of the
validity of the scheme - a result contemplated neither by
section 68D nor by the decision of this Court in [1967] 3
S.C.R. 329. [1018A-C]
Objections calculated to show that a scheme does not
provide a road transport service which can be considered
efficient, adequate. economical o} properly coordinated
would certainly lie; and the adjectives "efficient",
"adequate", "economical" and "properly coordinated are not
absolute but more or less comparative terms. [1017E-F1].
Capital Multi-Purpose Co-operative Society, Bhopal and
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others v. The State of Madhya Pradesh and others, [1967] 3
S.C.R. 329, explained.
3. Objections of a "personal" nature may be of two
types. (i) those challenging the scheme on the ground that
it harms an existing operator and, (ii) those which indicate
the details of the services afforded by an existing operator
for the purpose of showing that service envisaged by the
scheme would in comparison not be efficient, adequate, etc.
Objections of the second type would be admissible, while
those of the first type, would be wholly irrelevant to the
determination of the validity of the scheme in view of the
postulates of section 68C and would, therefore, be
inadmissible. [1018E-G]
Gullapalli Nageswara Rao and others v. Andhra Pradesh
State Road Transport Corporation and Another, [1959] Suppl.
1 S.C.R. 319, distinguished.
1007
4. It is true that the State Government was acting in the
discharge of its quasi-judicial functions and it could
devise its own procedure (in the absence of express
provisions to the contrary) so that its functions could be
effectively discharged. Further, when the statute gives the
power to the State Government to afford to the objectors a
reasonable opportunity of being heard and to take evidence,
oral as well as documentary, in support of their objections,
the power to send letters of request to witnesses to appear
and give evidence or to produce documents is inherent in the
situation and needs no statutory sanction, although the
power to enforce their attendance or compel them to produce
documents is lacking on account of absence of conferment
thereof by a statute. [1021D-F]
Nehru Motor Transport Co-operative Society Limited v.
The State of Rajasthan, [1964] 1 S.C.R. 220, followed.
5. Sub-rule (5) of rule 5 of Uttar Pradesh State
Transport Services (Development) Rules, 1958 serves a
salutary purpose and, that is, that the inquiring authority
may shut out all evidence which is sought to be brought on
the record but which is either irrelevant or otherwise
inadmissible. [1022G-H, 1023A]
6. In the instant case, no right of the appellants can
be said to be infringed when their applications for
summoning witnesses and production of documents were
rejected by the State Government and the rejection is not
illegal. [1022E-F]
Capital Multi-Purpose Co-operative Society, Bhopal and
Others v. The State of Madhya Pradesh and Others, [1967] 3
S.C.R. 329; applied.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1755 of
1980.
Appeal by Special Leave from the Judgment and order
dated 8-8-1980 of the Allahabad High Court in Civil Misc.
Writ Petition No. 4376/69.
S.N. Kackar, R.B. Mehrotra and Pramod Swarup for the
Appellants.
O. P. Rana and Mrs. Shobha Dikshit for Respondent No.
1.
Yogeshwar Prasad, Mrs. Rani Chhabra, P.K. Pillai and
R.N. Trivedi for Respondent No. 2.
The Judgment of the Court was delivered by
KOSHAL, J.-This appeal by special leave is directed
against a judgement dated the 8th August 1980 of a Division
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Bench of the Allahabad High Court dismissing a petition
instituted by the 18 appellants under article 226 of the
Constitution of India in which the reliefs prayed for were-
(a) that the order dated the 19th July, 1969
(hereinafter referred to as the impugned order)
passed by the Deputy Secretary (Judicial),
Government of Uttar Pradesh,
1008
rejecting all the objections filed by the
appellants to a scheme (hereinafter called the
impugned scheme) published on the 21st January
1961 in the Government Gazette of Uttar Pradesh
under section 68C of the Motor Vehicles Act 1939
(for brevity, the Act) be set aside as illegal.
and
(b) that the notification published in the said
Gazette dated the 7th November, 1970 and approving
the impugned scheme (for short, the 1970
notification) be quashed.
2. The notification dated the 21st January 1961
declared that the State Government was of the opinion that
"for the purpose of providing an efficient, adequate,
economical and properly coordinated road transport service,
it is necessary in the public interest that road transport
services on the routes mentioned at item No. 2 of the
annexed schemes should be run and operated by the State
transport undertaking to the complete exclusion of other
persons" and the impugned scheme was being published on that
account under section 68C of the Act read with rule 4(1) of
the Uttar Pradesh State Transport Services (Development)
Rules, 1958 (for short, the rules). The impugned scheme
envisaged the plying of buses on the route Gorakhpur-Khajni-
Gola via Dhuriapur and Malhanpur exclusively by the State
transport undertaking (hereinafter described as the S.T.U.)
and invited all persons whose interest was affected by it to
file objections thereto within 30 days of its publication in
the Official Gazette.
The impugned scheme was later on modified by different
notifications and three allied routes were brought within
its purview. Supplementary objections to the scheme as
amended were put forward by persons interested.
Shri S.K. Bhargava, Deputy Secretary (Judicial) to the
U.P. Government rejected all the objections and approved the
scheme through the impugned order, in pursuance of which The
1970 notification was published in the Government Gazette.
3. On behalf of the 18 appellants (out of whom
appellants Nos. 1 to 17 are transport operators who were
plying their buses on the routes covered by the impugned
scheme while appellant No. 18 is the Motor operators
Association, Gorakhpur) the following grounds were put
forward before the High Court in support of the prayers
made:
(i) The impugned scheme was vitiated by mala fides
inasmuch as it was the outcome of action taken by
Shri Hanumant Singh Negi, Deputy Transport
Commissioner, U.P., who had
1009
threatened Shri Bajrangi Lal, Pairokar for one of
the petitioners, namely, Shri Kashi Prasad Gupta,
that the disputed route would be nationalised in
case the latter pursued in the Supreme Court the
matter which had earlier been decided against him
by the High Court.
(ii) The impugned order did not deal at all with
objections of a personal nature which had been
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filed by the appellants and which, inter alia,
indicated that the scheme would operate to the
great disadvantage of the appellants all of whom
were plying buses on the disputed route and had
invested huge sums of money for that purpose.
(iii) The impugned order did not record specific
findings on any of the objections of a "personal
nature" and was liable to be quashed for that
reason alone.
(iv) It was incumbent on the author of the impugned
order to compare the services rendered by the
appellants with those to be rendered by the S.T.U.
That not having been done, the impugned order and
the 1970 notification were both vitiated.
4. The High Court went at length into the question of
mala fides and rejected the contention of the appellants in
that behalf mainly on the ground that it was not Shri
Hanumant Singh Negi who had initiated the nationalisation of
the disputed route but that it was the State Government
under whose decision the impugned scheme was formulated.
In support of ground (ii) reliance on behalf of the
appellants was placed before the High Court mainly on
Gullapalli Nageswara Rao and Others v. Andhra Pradesh State
Road Transport Corporation and Another, which was decided by
a Bench of five Judges of this Court. The crucial question
before the Court in that case was whether the authority
deciding the objections under section 680 of the Act was
bound to act judicially. Subba Rao, J. (as he then was), who
answered the question in the affirmative on behalf of the
majority consisting of himself, Das, C.J., and Bhagwati, .,
dealt at length with the provisions of sections 68C and 68D
of the act and while concluding that the matter partook the
character of a dispute between two parties, observed:
"The citizen may object to the scheme on public grounds
or on personal grounds. He may oppose the scheme on the
ground that it is not in the interest of the public or
on the ground that the route which he is exploiting
should be excluded from
1010
the scheme for various reasons. There is, therefore, a
proposal and an opposition and the third party, the
State Government is to decide that lis and prima facie
it must do so judicially. The position is put beyond
any doubt by the provisions in the Act and the Rules
which expressly require that the State Government must
decide the dispute according to the procedure
prescribed by the Act and the Rules framed thereunder,
viz., after considering the objections and after
hearing both the parties. It therefore appears to us
that this is an obvious case where the Act imposes a
duty on the Stale Government to decide the act
judicially in approving or modifying the scheme
proposed by the transport undertaking.. The scheme
propounded may exclude persons from a route or routes
and the affected party is given a remedy to apply to
the Government and the Government is enjoined to decide
the dispute between the contesting parties. The statute
clearly, therefore, imposes a duty upon the Government
to act judicially. Even if the grounds of attack
against the scheme are confined only to the purposes
mentioned in s. 68C-we cannot agree with this
contention-the position will not be different, for,
even in that case there is a dispute between the State
transport undertaking and the person excluded in
respect of the scheme, though the objections are
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limited to the purposes of the scheme. In either view
the said two provisions, sections 68C and 68D, comply
with the three criteria of a judicial act laid down by
this Court."
(emphasis supplied)
Emphasis before The High Court was laid on the under-
lined portions of the above observations. On the other hand,
attention of the Court was invited to Capital Multi-Purpose
Co-operative Society Bhopal and Others v. The State of M.P.
& Others. on behalf of the State for the proposition that
the objections to the impugned scheme had to be related to
the four purposes indicated in section 68C of the Act. After
giving consideration to the matter the High Court held:
"There can be no quarrel with the proposition that an
objection of a personal nature can be filed but it
should be for the purposes of showing that the four
purposes indicated in section 68C cannot be achieved.
In other words objections of the nature that the
petitioners will suffer hardship and there will be
financial loss to the petitioner or that the
petitioners have
1011
invested large amount cannot per se be sufficient to
nullify a scheme of the nature referred to above unless
they have a material bearing on the purposes indicated
in section 68C of the Act. When a scheme is framed for
nationalisation of a route, whether wholly or partly,
the necessary consequence will be that the persons who
have invested their money in purchasing vehicles will
be displaced and that there will be loss in their
earnings. If this could have been the ground for
rejecting or modifying a scheme, no scheme could be
taken up. A bare perusal of section 68C indicates that
the purpose of the scheme is to provide an efficient,
adequate, economical and properly coordinated road
transport service which is necessary in public
interest, and such a scheme will be liable to be
approved under the provisions of the Act. The
objections of personal nature in the instant case in
our opinion fail to establish that the four purposes
which are sought to be achieved by the scheme will not
be achieved and for that reason the scheme should
either be rejected or modified."
Ground (iii) was repelled by the High Court with a
remark that even if objections of a personal nature were
covered by section 68C the impugned order was not liable to
be quashed merely on the ground that its author did not
record specific findings thereon. Support for this view was
sought from a Full Bench decision of the same Court reported
as Khuda Dad Khan v. State of U.P. and others
The last ground of attack against the impugned order
and the 1970 notification also did not find favour with the
High Court as, according to it, in Capital Multi-Purpose Co-
operative Society Bhopal and others v. The State of M.P. &
others (supra), the Supreme Court had taken the view that it
was not necessary for the concerned authority to compare the
services rendered by the private operators with those to be
expected from the S.T.U.
It was in these premises that the High Court passed the
judgment under appeal.
5. Out of the grounds put forward before the High Court
on behalf of the appellants, two, namely, those listed at
serial Nos. (i) and (ii) above were not pressed before us by
their learned counsel, Shri S. N. Kacker, who, however,
argued the point covered by ground (iv) with great force and
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also challenged the finding recorded by the High Court in
relation to ground (iii). In order to determine
1012
the questions raised before us and canvassed by learned
counsel for the parties it is necessary to undertake an
analytical study of sections 68A to 68E contained in Chapter
IVA which was added to the Act by Central Act 100 of 1956.
Section 68A contains two definitions According to it-
"(a) ’road transport service’ means a service of
motor vehicles carrying passengers or goods or both by
road for hire or reward;
"(b) ’State transport undertaking’ means any
undertaking providing road transport service, where
such undertaking is carried on by,-
(i) the Central Government or a State Government;
(ii) any Road Transport Corporation established
under section 3 of the Road Transport
Corporations Act, 1950;
(iii) any municipality or any corporation or
company owned or controlled by the Central
Government or one or more State Governments,
or by the Central Government and one or more
State Governments."
Section 68B gives over-riding effect to the provisions
of Chapter IVA. Contents of sections 68C and 68D are
reproduced below:
"68C. Where any State transport undertaking is of
opinion that for the purpose of providing an efficient,
adequate, economical and properly coordinated road
transport service, it is necessary in the public
interest that road transport services in general or any
particular class of such service in relation to any
area or portion thereof should be run and operated by
the State transport undertaking, whether to the
exclusion, complete or partial, of other persons or
otherwise, the State transport under taking may prepare
a scheme giving particulars of the nature of the
services proposed to be rendered, the area or route
proposed to be covered and such other particulars
respecting thereto as may be prescribed, and shall
cause every such scheme to be published in the Official
Gazette and also in such other manner as the State
Government may direct."
"68D. (1) on the publication of any scheme in the
Official Gazette and in not less than one newspaper in
regional language circulating in the area or route
which is proposed to be covered by such scheme-
1013
(i) any person already providing transport
facilities by any means along or near the
area or route proposed to be covered by the
scheme;
(ii) any association representing persons
interested in the provision of road transport
facilities recognised in this behalf by the
State Government; and
(iii) any local authority or police authority
within whose jurisdiction any part of the
area or route proposed to be covered by the
scheme lies,
may, within thirty days from the date of its
publication in the official Gazette, file objections to
it before the State Government.
"(2) The State Government may, after considering
the objections and after giving an opportunity to the
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objector or his representatives and the representatives
of the State transport undertaking to be heard in the
matter, if they so desire, approve or modify the
scheme.
"(3) The scheme as approved or modified under sub-
section (2) shall then be published in the official
Gazette by the State Government and the same shall
thereupon become final and shall be called the approved
scheme and the area or route to which it relates shall
be called the notified area or notified route:
"Provided that no such scheme which relates to any
inter-State route shall be deemed to be an approved
scheme unless it has been published in the official
Gazette with the previous approval of the Central
Government."
Sub-section (1) of section 68E gives to the S.T.U.
power to cancel or modify at any time any scheme published
under sub-section (3) of section 68D and provides that "the
procedure laid down in section 68C and section 68D shall, so
far as it can be made applicable, be followed in every case
where the scheme is proposed to be cancelled or modified as
if the proposal were a separate scheme." Sub-section (2) of
section 68E confers on the Stale Government the power to
modify a scheme published under sub-section (3) of section
68D after giving the S.T.U. and any other person likely to
be affected by the proposed modification an opportunity of
being heard in respect thereof.
6. A bare reading of the sections noted above makes it
clear that they provide for nationalisation of road
transport services. However, such nationalisation, in view
of the provisions of section 68C,
1014
is not nationalisation or nationalisation’s sake but
nationalisation with a view to the achievement of certain
specified objects. A break up of the section brings out the
following essential features.
(a) The S.T.U. is competent to prepare and publish a
scheme under section 68C only after it has formed
the opinion that it is necessary in the public
interest that road transport services covered by
the scheme should be run and operated by itself,
whether to the exclusion, complete or partial, of
other persons or otherwise.
(b) The necessity for the road transport services to
be run and operated by the S.T.U. must flow, in
its opinion, from the purpose of providing an
efficient, adequate, economical and properly
coordinated road transport service.
Unless a scheme conforms to these two conditions it
will fall outside the ambit of section 68C.
Section 68D gives the right to certain persons,
associations and authorities to file objections to a scheme
published under section 68C within the specified period of
30 days of its publication and also lays down the procedure
for the hearing and disposal of such objections by the State
Government. An important feature of sub section (2) of the
section is that (every objector or his representatives and
the representatives of the S.T.U. have to be given an
opportunity of being heard in the matter and it is only
thereafter that the State Government has to exercise its
power to approve or modify the scheme, which power includes
the power not to approve the scheme at all and to drop it in
its entirety), as held in Malik Ram v State Of Rajasthan
[1952] 1 S.C.R. 978 (981).
The procedure provided in section 68D is thus designed
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to-
(a) enable parties affected by the scheme, to point
out flaws therein,
(b) enable the State Government to find out which
flaws, if any, the scheme suffers from, and
(c) enable the State Government either to remedy the
flaws by a suitable modification of the scheme or
to rescind the scheme altogether.
7. This brings us to the main point of controversy in
the case, that is, the nature of objections which parties
affected by a scheme may prefer to it. Section 68D does not
specify the type of objections
1015
envisaged by it but Then their purpose being to point out
flaws in the scheme they must be confined to the matters
covered by section 68C. In the opinion forming the basis of
the scheme does not suffer from errors such as may render it
obnoxious to the dictates of section 68C and on the other
hand, conforms to the conditions laid down in that section,
the scheme would be unobjectionable. Objections may thus be
made to show :-
(a) that it is not necessary in the public interest
for the concerned road transport services to be
operated by the S.T.U.;
(b) that it is not necessary in the public interest
that such services be taken over by the S.T.U. to
the complete exclusion (if such exclusion is
envisaged by the scheme) of other persons and that
their partial exclusion would suffice;
(c) that it is not necessary in the public interest
that such ser vices shall be taken over by the
S.T.U. even to the partial exclusion of others;
(d) that the scheme is not calculated to provide an
efficient road transport service;
(e) that the scheme would not provide an adequate road
transport service;
(f) that the road transport service envisaged by the
scheme would not be economical, or
(g) that the road transport service provided for by
the scheme would suffer from lack of proper
coordination.
Objections falling outside the seven categories above
set out would not be admissible inasmuch as they would not
have anything to do with any of the conditions which a
scheme must satisfy in order to be covered by section 68C.
To this conclusion there is no challenge from either side,
but then it has been vehemently contended on behalf of the
appellants that a comparison of the road transport services
operating on the route covered by a scheme with those
envisaged by the scheme itself may be necessary in order to
find out if the scheme conforms to the provisions of section
68C and this contention is controverted by learned counsel
for the respondents on the strength of Capital Multi-Purpose
Co-operative Society Bhopal and Others v. The State of M.P.
& Others, wherein Wanchoo, J., speaking for a Bench of this
Court which consisted of himself, Bachawat and Ramaswami,
JJ., observed:
1016
"We are further of opinion that there is no
question of consideration of comparative merits of the
State Transport Undertaking and the private operators
in the context of Chapter IV-A. As we have said already
Chapter IV-A was enacted for nationalisation of road
transport services in accordance with the amendment
made in article 19(6) of the Constitution. The
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nationalised road transport under that Chapter can only
be run by the State Transport Undertaking as defined in
section 68-A(b) of the Act. In view of that fact, if
nationalisation has to come as envisaged by the
amendment of the Constitution, the only body which can
run the nationalised service is the State Transport
Undertaking, and in those circumstances we fail to see
any necessity for comparison between a State Transport
Undertaking on the one hand and individual operators on
the other.
"Apart from this general consideration, we are
further of opinion that ordinarily no question of
comparative merits based on past record between a State
Transport Undertaking and individual operators can
arise. Section 68-C provides the State Transport
Undertaking has to run an efficient, adequate,
economical and properly coordinated road transport
service, and for doing that it does not take up just
one route and put one transport vehicle on it. It takes
up a large number of routes and puts a large number of
transport vehicles on them in order to run an
integrated service whether for passengers or for goods,
or for both. In these circumstances it is difficult to
see how one can compare such an undertaking with
individual private operators who are running one
transport vehicle or so on individual routes. Secondly,
it would be unusual for the State Transport Undertaking
to be running transport vehicles on individual routes
before it produces a scheme for nationalisation of the
type provided for in Chapter IV-A, though it may be
conceded that this may not be quite impossible, for
some State transport undertaking might have entered
into competition with private operators and might have
obtained permits under Chapter V; (see for instance
Parbani Transport Co-operative Society Ltd. v. The
Regional Transport Authority, [1960] 3 S.C.R. 177).
Even so, when the State transport undertaking takes
action under Chapter IV-A of the Act there can in our
opinion be no question of comparison between a State
transport undertaking running an integrated service and
individual operators running one transport vehicle or
more on individual routes. We are therefore of opinion
that
1017
the authority cannot be said to have gone wrong in not
asking for past records of the Corporation in the
present case for purposes of such comparison. It is
true that section’ 68-C requires that the scheme should
be in public interest. But unless the scheme is shown
not to be efficient, adequate, economical and properly
coordinated, it will in our opinion generally follow
that it is in the public interest. We do not think
therefore that the comparative merits of the
Corporation as against individual operators require to
be judged under Chapter IV-A in the public interest."
A careful study of these observations would show that they
were meant to exclude from consideration a comparison
between the S.T.U. and private operators for the purpose of
finding out which of them should be preferred on the basis
of their past performance and not to declare irrelevant a
comparison between the service envisaged by the scheme and
pre-existing services for the purpose of determining whether
the scheme as framed provides for the operation of a service
which would be efficient, adequate, economical and properly
coordinated. Normally, as pointed out by Wanchoo, J., a
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S.T.U. takes up a large number of routes and puts a large
number of vehicles on them in order to run an integrated
service while private operators cater to individual routes
and may not, therefore, be in a position to provide what is
described in section 68C as "a properly coordinated
service". That does not mean, however, that. all schemes,
howsoever framed, would in the very nature of things provide
for services which conform to the quality insisted upon by
section 68C. As stated above, objections calculated to show
that a scheme does not provide a road transport service
which can be considered efficient, adequate, economical or
properly coordinated would certainly lie; and the adjectives
"efficient", "adequate", "economical" and "properly
coordinated" are not absolute but more or less comparative
terms. A service consisting of only one round trip per day
may be adequate if the traffic on the concerned route is
lean. On the other hand, a hundred round trips may not be
adequate for a route burdened with heavy traffic. If a
private operator is running 10 buses either way and is
sought to be replaced by the S.T.U. under a scheme which
makes provision only for five round trips per day the
proposed road transport service cannot be considered
adequate if the number of round trips required to fully cope
with the traffic is more than five. Efficiency of the
service covered by a scheme may similarly have to be
determined in comparison to that which pertains to the pre-
existing services. Economics and proper coordination of the
service proposed in a scheme may again be
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matters for which a comparison with the pre-existing
services is called for. In order to find out, therefore, if
the scheme fulfils the requirements of section 68C a
comparison of the attributes of the two services, such as
quality, capacity, financial implications and coordination
would certainly fall within the scope of the inquiry to be
conducted by the State Government, although a comparison,
would not be permissible for the sole purpose of finding out
whether the private operators should be given a preference
over the S.T.U. If such a comparison as we have held to be
permissible is ruled out, the result would be to shut out
from the enquiry held by the State Government under section
68D most of the material relevant for determination of the
validity of the scheme-a result contemplated neither by
section 68D nor by Wanchoo, J., in the observations above
quoted, which, on the other hand, make it clear that the
proposed scheme may certainly be shown (in whatever way it
is possible) not to fulfil the criteria of efficiency,
adequacy, economy and proper coordination. The comparison
ruled out by him was not between the merits of the rival
services but between the expectations from their operators
in view of their respective past records including these
relating to other areas and routes. The High Court thus
erred in arriving at the conclusion that The Capital Multi-
Purpose case eschewed all comparison and its finding in that
behalf, in so far as it runs counter to the opinion
expressed by us above, is set aside.
8. We may in passing refer to what are called
objections of a "personal" nature. These may be of two
types: (1) those challenging the scheme on the ground that
it harms an existing operator and, (2) those which indicate
the details of the services afforded by an existing operator
for the purpose of showing that the service envisaged by the
scheme would in comparison not be efficient, adequate, etc.
Objections of the second type, as we have just above
concluded, would be admissible for the reasons stated. Those
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of the first type, however, would be wholly irrelevant to
the determination of the validity of the scheme in view of
the postulates of section 68C and would, therefore, be
inadmissible. This proposition may appear at first sight to
run counter to those observations of Subba Rao, J., in
Gullappalli’s case (supra) which we have extracted above but
this is not really so. Those observations were made in the
course of consideration by this Court of the sole question
whether the State Government, in deciding objections under
section 68D, acted judicially or purely in an administrative
capacity. The answer to that question, according to Subba
Rao, J., depended on whether the matter before the State
Government amounted to a lis; and it
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was in that connection that he said that the citizen may
object to the scheme on public grounds or on personal
grounds and also that the Court did not agree with the
contention that the grounds of objection against the scheme
were confined only to those mentioned in section 68C. The
Court was not called upon to decide as to whether the scheme
of sections 68C and 68D embraced objections of a "personal"
nature or not and it was only incidentally that reference
thereto was made. We conclude that Gullapalli’s case (supra)
is no authority for the proposition that "personal"
objection not confined to the scope of the requirements of
section 68C are admissible under section 68D.
9. Referring to ground (iii) pressed in the High Court
on behalf of the appellants, Shri Kacker made a serious
grouse of the fact that the impugned order did not so much
as mentioned those objections made by the appellants which
called for a comparing of the type held by us to be
permissible and he contended that the impugned order was bad
on that account. In reply learned counsel for the
respondents argued that at the hearing before the State
Government no such objections were pressed. Our attention
has been drawn by Mr. Kacker to paragraphs 14, 20(a), 21,
26, 43, 49? 51, 61, 63, 64, 73 and 75 of the statement of
objections forming annexure to the petition under Article
226 of the Constitution before the High Court. A perusal of
those paragraphs makes it abundantly clear that quite a few
of the objections were such as were related to the purposes
mentioned in section 68C and called for a comparison of the
proposed service with the existing one. That some of these
objections were pressed before the State Government is
apparent from the written arguments which were submitted to
Shri S. K. Bhargava who is the author of the impugned order
and which were appended to the petition under Article 226 or
the Constitution of India before the High Court in the form
of Annexure J. The stand of the respondents to the contrary
is thus not well founded. But then we further find that in
the impugned order its author has devoted five paragraphs to
the objections which called for comparison of both the types
above discussed. In paragraphs 24 to 27 the impugned order
rightly rejects the objections which were based on a
comparison of the S.T.U. with the private operators in
relation to their respective past performances, and in doing
so relies correctly on The Capital Multi-purpose case. It
proceeds then (in paragraph 28) to take note of the further
opinion expressed in the same case from which it follows
that a scheme may nevertheless be shown not to be in public
interest by demonstrating
1020
that it does not provide for a service which would be
efficient, adequate, economical and properly coordinated;
but then dismisses the matter with the remark that the
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appellants had not been able "to show anything substantial
which may justify this inference that the proposed scheme in
respect of the routes in question would not be efficient,
adequate, economical and properly coordinated", a remark
which is obviously meant to dispose of those objections to
the scheme which called for a comparison of the service
envisaged by it with that already available. The cryptic
remark no doubt neither lists the objections disposed of by
it nor discusses the relevant evidence but the reason for
the absence of a discussion in this behalf appears to be
that no such evidence had been produced before the State
Government. And if that be so, much fault cannot he found
with the brevity of the contents of paragraph 28.
However, Mr. Kacker made another grouse in this
connection, namely, that the State Government refused to
summon witnesses and to enforce the production of documents
at the request of the appellants and that in doing so it had
acted illegally and by thus shutting out evidence had really
denied to the appellants any real opportunity of being
heard. We find that when the case was at the evidence stage
before the State Government, the appellants submitted two
applications requesting that witnesses, one of whom, namely,
the Secretary, Legislative Assembly, U.P. was to bring the
proceedings of that Assembly, relating to the speech of the
Chief Minister delivered on the 13th July 1967 in relation
to the budget of the Transport Department, be summoned
through letters of request and examined. The applications
were rejected by Shri S.K. Bhargava through an order dated
the 20th March 1969, the relevant part of which runs thus: -
.
"It is nat necessary to issue letters of request as
prayed for. The objectors can only examine those
witnesses whom they themselves brought. It is also not
necessary to send for any record as prayed.
No further reasons appear in the order for a rejection of
the prayer made for issuing letters of request but it seems
that while making the order Shri Bhargava had in mind the
provisions of sub-rules (2) and (4) of rule 7 of the Rules
and of the absence from the Act and the Rules of any express
provision conferring on the State Government the right to
issue process for enforcing the attendance of witnesses and
the production of documents. The said two sub-rules may be
reproduced:
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"(2) The said officer shall fix the date, time and
place for the hearing of the objections and issue
notices thereof to the objector, and the
representatives of the State transport undertaking,
calling upon them to appear before him in person, or
through a duly authorised agent or counsel and to
produce their oral and documentary evidence on the date
fixed for hearing."
"(4) Subject to the provisions of sub-rule (7) the
objector and the State transport undertaking shall
produce their evidence and witnesses, necessary and
relevant to the inquiry, on the first date fixed for
the hearing."
The contention raised on behalf of the respondents is that
the power the exercise of which the appellants sought by
their applications had not been conferred by the Act or the
Rules on the State Government and that, therefore, the order
passed by Shri Bhargava was correct. We find substance in
this contention. It is true that the State Government was
acting in the discharge of its quasi-judicial functions and
it could devise its own procedure (in the absence of express
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provisions to the contrary) so that its functions could be
effectively discharged. Further, when the statute gives the
power to the State Government to afford to the objectors a
reasonable opportunity of being heard and to take evidence,
oral as well as documentary, in support of their objections
the power to send letters of request to witnesses to appear
and give evidence or to produce documents is inherent in the
situation and needs no statutory sanction, although the
power to enforce their attendance or compel them to produce
documents is lacking on account of absence of conferment
thereof by a statute. This view finds support from Nehru Mot
Transport Co-operative Society Limited v. The State of
Rajasthan, in which also the argument raised was that there
could be no effective hearing without a provision or
coercive process compelling attendance of witnesses and
production of documents. It was pointed out in that case
that the Rajasthan Rules did not provide for compelling the
attendance of witnesses and that it was enough if the
authority took evidence of witnesses whom the objector
produced before it. It was also remarked that the authority
might
1022
help the objector to secure their attendance by issue of
summonses, though in the absence of any provision in the
law, the witnesses might or might not appear in answer
thereto.
But then the question arises whether an order of the
State Government rejecting a prayer for issuance of summons
or letters of request would be illegal. This question was
answered in the negative by Wanchoo, J., in the Capital
Multi-purpose case (supra) with the following observations:
"Further, reliance in this connection is placed on the
observation of this Court in Nehru Motor Transport Co-
operative Society’s case (supra) that the authority
might help the objectors by issuing summonses. This
observation in our opinion does not mean, in the
absence of any provision in the Act or the Rules, that
the authority was bound to summon witnesses even though
the persons summoned were not bound to obey the
summonses as there was no provision in law for issue of
such summonses. The use of the words ’by issue of
summonses’ in the circumstances of that case was by
oversight, for issue of summonses presumes that there
is authority to issue them and the person to whom they
are issued is bound to obey. But in the absence of such
power all that the authority can do is to issue letters
merely requesting persons to appear and it is open to
those persons to appear or not. In this situation if an
authority decides not to issue such letters it cannot
be said that there was no effective hearing."
These observations have our concurrence and we do not find
that any right of the appellants was infringed when their
applications for summoning witnesses and production of
documents were rejected.
Here we may briefly advert to another aspect of the
matter to which our attention was drawn on behalf of the
respondents. Sub-rule (5) of rule 5 of the Rules states
"A person filing an objection and desiring to be heard
shall also submit along with the memorandum of
objections, a list of documents and witnesses with
their names and addresses and a brief summary of the
nature and type of evidence which each such witness is
likely to give."
No compliance with this rule was made by the appellants when
the two applications just above considered were filed. The
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sub-rule serves a salutary purpose and, that is, that the
inquiring authority may shut out all evidence which is
sought to be brought on the record
1023
but which is either irrelevant or otherwise inadmissible.
The two applications, therefore, suffered from a serious
flaw by reason of which alone they merited dismissal unless
the summary insisted upon by sub-rule (5) was supplied
before they were disposed of.
10. In the result the appeal must fail in spite of the
fact that we have accepted one main contention raised by Mr.
Kacker, namely, that objections involving comparison of the
pre-existing services with those proposed in a scheme are
relatable to the ingredients of section 68C and are,
therefore, admissible under section 68D of the Act.
Accordingly it is dismissed but with no order as to costs.
S.R. Appeal dismissed.
1024