Full Judgment Text
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PETITIONER:
DOSA SATYANARAYANAMURTY ETC.
Vs.
RESPONDENT:
THE ANDHRA PRADESH STATE ROADTRANSPORT CORPORATION
DATE OF JUDGMENT:
08/09/1960
BENCH:
ACT:
Motor Vehicles-Nationalisation of road transport services-
Preparation and enforcement of schemes-Constitutional
validity of enactment-Varying frequency of services, if
variation of ’the scheme-Validity of rule-Motor Vehicles
Act, 1939 (IV of 1939), as amended by Act 100 of 1956, Ch.
IV, ss. 68C, 68E-Andhra Pradesh Motor Vehicles Rules, r. 5-
Constitution of India, Arts. 19 (1)(g), 19(6)(ii), 14.
HEADNOTE:
These petitions by certain stage carriage permit-holders for
appropriate writs quashing seven schemes for nationalisation
of road transport services in West Godavari District,
approved and enforced from different dates by the Government
of Andhra Pradesh, called in question the constitutional
validity of Ch. IVA of the Motor Vehicles Act, 1939, as
amended by Act 100 of 1956, and the validity of r. 5 of the
Andhra Pradesh Motor Vehicles Rules framed by the State
Government under s. 68(1) of the Act and the note in terms
of the said rule appended to the schemes which was said to
be inconsistent with the Act and was as follows:-
"The frequency of services of any of the notified routes or
within any notified area shall, if necessary, be varied
having regard to the traffic needs during any period."
Held, that in view of the decision of this Court in H. C.
643
Narayanappa v. The State of Mysore, it was no longer open to
the petitioners to contend that the provisions of Ch. IVA
of the Motor Vehicles Act (IV of 1939), as amended by the
Central Act 100 of 1956, were ultra vires the powers of the
Parliament.
H. C. Narayanappa v. The State of Mysore, [1960] 3 S.C.R.
742, followed.
Nor was it correct to contend that Ch. IVA of the Act was
invalid on the ground that it infringed Art. 19(i)(g) of the
Constitution and was not saved by Art. 19(6) as the powers
conferred on the State by s. 68C of the Act exceeded the
limits of Art. 19(6)(ii) of the Constitution. Article
19(6)(ii) is couched in very wide terms, the word ’service’
used by it is wide enough to include all species of motor
service and it does not in any way limit the States’ power
to confer on itself a monopoly in respect any area in
exclusion of any person or persons.
The only classification that Ch. IVA of the Act makes is
between the State Transport Undertaking and private
transport undertakings, whether carried on by individuals or
firms or companies, and that classification is reasonably
connected with the object it has in view. It was not,
therefore, correct to say that it contravenes Art. 14 of the
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Constitution. That Chapter does not confer any arbitrary
and discriminatory power upon the State Transport
Undertaking nor does the quasi-judicial procedure prescribed
by it seek to cover such power. Any mala fide or collusive
exercise of the power, therefore, in deprivation of an
individual’s rights can only be a ground for quashing a
particular scheme alone but not for declaring the chapter
void.
Since that chapter provides a complete and satisfactory
machinery for reasonably regulating the exclusion of all or
some of the private operators from a notified area or route
it requires no liberal construction.
Gullapalli Nageswara Rao v. Andhra Pradesh Road Transport
Corporation, [1959] SUPP. 1 S.C.R. 319, referred to.
Saghir Ahmad v. The State of U. P., [1955] 1 S.C.R. 707,
considered.
Official bias inherent in the discharge of a statutory duty,
as has been pointed out by this Court, is distinct from
personal bias for or against any of the parties. Since in
the instant case, the State Road Transport Corporation was
neither legally nor factually a department of the State
Government and the State Government in deciding the dispute
between the said undertaking and the operators of private
buses was only discharging its statutory function, no
question of official bias could arise.
Gullapalli Nageswara Rao v. The State of Andhra Pradesh,
[1960] 1 S.C.R. 580 and H. C. Narayanappa v. The State of
Mysore, [1960] 3 S.C.R. 742, considered.
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The observations made by this Court in Srinivasa Reddy v.
The State of Mysore, in regard to piecemeal implementation
of a scheme were directed against any abuse of power by way
of discrimination as between operators and operators in
respect of a single scheme. Since the seven schemes in
question were intended to avoid the vice inherent in
piecemeal implementation of a single scheme and were meant
to be implementated in their entirety from different dates,
those observations did not apply to them.
Srinivasa Reddy v. The State of Mysore, [1960] 2 S.C.R 130,
explained.
There can be no doubt that r. 5 of the Andhra Pradesh Motor
Vehicles Rules in conferring on the State Transport
Undertaking the power to vary the frequency of services,
gave it the power to effect a substantial modification in
the scheme permissible only under s. 68E of the Act, and as
such the rule must be declared void. But since the note
appended to the schemes in pursuance of the rule is
severable from the schemes, it should be deleted and the
schemes must be declared valid.
The word ’route’ in s. 68C of the Act does not refer to a
preexisting route. It is permissible under that section to
frame a scheme in respect of any area or route or any
portions thereof, or a new route, since there is no inherent
inconsistency between an ’area’ and a ’route’.
JUDGMENT:
ORIGINAL JURISDICTION: Writ Petitions Nos. 76, 217 to 228 of
1960.
Petitions under Article 32 of the Constitution of India for
enforcement of Fundamental Rights.
A. V. Viswanatha Sastri and T. V. R. Tatachari, for the
petitioners (In petitions Nos. 76, 87, 93-104 and 217-228 of
1960).
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T. V. R. Tatachari, for the petitioners (In petitions Nos. 72
and 229-233 of 1960).
D. Narasaraju, Advocate General for the State of Andhra
Pradesh, P. R. Ramchandra Rao and T. M. Sen, for the
respondents (In all the petitions).
1960. September 8. The Judgment of the Court was delivered
by
SUBBA RAO J.-These petitions are filed under Art. 32 of the
Constitution for the enforcement of the petitioners’
fundamental right to carry on the business of motor
transport in West Godavari District in
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the State of Andhra Pradesh by the issuance of writs of
certiorari or any other appropriate writs, orders or
directions to quash the schemes of road transport services
as finally approved by the Government of Andhra Pradesh on
March 21, 1960, and for other incidental reliefs.
In exercise of the powers conferred by s. 68C of the Motor
Vehicles Act (IV of 1939), as amended by the Central Act 100
of 1956, (hereinafter called the Act), Shri Guru Pershad,
the Chief Executive Officer, Andhra Pradesh State Road
Transport Corporation, (hereinafter called the Transport
Corporation) published seven proposals dated December 7,
1959, in the Andhra Pradesh Gazette dated December 17, 1959,
propounding seven schemes for the nationalization of the
road transport in respect of different parts of West
Godavari District in that State. Under that notification
objections from the public and affected parties were invited
to be filed within 30 days of the publication thereof More
than 3000 objections were received by the Government against
the said schemes. After considering the objections, the
Government issued notices to the objectors or their
representatives and the representatives of the Transport
Corporation informing them of the time, place and the dates
of hearing. On the notified dates, namely, March 10, 11 and
12, 1960, 200 objectors were present and most of them were
represented by Advocates. The Transport Corporation was
also represented by its Chief Executive Officer and its
legal advisers. The Minister in charge of the portfolio of
transport held an enquiry, considered the conflicting
arguments advanced, gave definite findings on the points
urged, rejected all the objections but one and approved the
schemes with a slight modification. The seven schemes were
directed to be put in force from different dates which were
given in the order made by the Minister. The aggrieved
operators who were not satisfied with the order of the
Minister filed the present petitions for the said reliefs.
Shri A. V. Viswanatha Sastri, learned counsel for the
petitioners, raised before us the following points.
646
(1)The provisions of Ch. IVA of the Act are ultra vires the
powers of Parliament because they are within the exclusive
legislative field of the States. (2) The provisions of Ch.
IVA of the Act infringe the fundamental rights of the
petitioners under Art. 19(1)(g) of the Constitution and are
not saved by el. (6) of the said Article. (3) The
provisions of Ch. IVA are also violative of Art. 14 of the
Constitution. (4) The order of the Government confirming the
schemes is vitiated by the doctrine of bias and, therefore,
void. (5) Though in fact seven schemes are framed, in effect
they are component parts of one scheme and that device has
been adopted to circumvent the judgment of this Court in
Srinivasa Reddy v. The State of Mysore (1). (6) The schemes-
are void inasmuch as they area prepared and published by the
Chief Executive Officer who was not one of the persons who
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could act on behalf of the Transport Corporation under s. 13
of the Road Transport Corporations Act. (7) The schemes as
propounded by the Transport Corporation did not give the
number of vehicles proposed to be operated in each route as
it should have given under r. 4 of the Andhra Pradesh Motor
Vehicles Rules (hereinafter called the rules) and the
modification made by the Minister directing the Transport
Corporation to do so does not also comply with the
requirements of the said rule. (8) In exercise of the power
conferred under r. 5 of the-Rules, the State Transport
Under, taking conferred upon itself power to vary the fre-
quency of the services and that rule and the note made
pursuant thereto are inconsistent with the provisions of the
Act and, therefore, void. (9) The proposed schemes include
three new routes and that is illegal as the said Transport
Undertaking has no power to include any new routes in a
scheme proposed by it. Though many other questions are
raised in the petitions, they are not pressed before us.
Learned Advocate General for the State of Andhra Pradesh
sought to sustain the schemes as approved by the Minister in
their entirety.
(1) (1960] 2 S.C.R. 130.
647
We shall now proceed to deal with the contentions in the
order they were raised.
Re. (1) : The first contention does not now merit a detailed
consideration as it has been considered and rejected by this
Court in H. C. Narayanappa v. The State of Mysore (1). In
that case, after considering the question, Shah, J.,
speaking for this Court, observed:
"We are therefore of the view that Chapter IVA could
competently be enacted by the Parliament under entry No. 21
read with entry No. 35 of the Concurrent List."
Nothing further Deed be said on this point. With respect we
accept and follow the said decision.
Re. (2): The next contention is based upon Art. 19 of the
Constitution. The question is whether Ch. IVA of the Act
is saved by Art. 19(6) of the Constitution. If Chiva, which
provides for the nationalization of road transport services
in the manner prescribed, thereunder is not a permissible
legislation covered by Art. 19(6), it would certainly offend
against the fundamental right of the petitioners to do
business in motor transport. The constitutional validity of
Ch. IVA of the Act was raised in Gullapalli Nageswara Rao
v. Andhra Pradesh Road Transport Corporation (2). There it
was argued that Ch. IVA of the Act was a piece of
colourable legislation whose real object was to take over
the business of the petitioners therein under the cover of
cancellation of permits in contravention of Art. 31 of the
Constitution and that plea was rejected by this Court. But
no attack was made on the validity of Ch. IVA of the Act on
the ground that it infringed the provisions of Art. 19(1)(g)
of the Constitution and was not saved by cl. (6) of the
Article. That point is now raised before us. Under Art.
19(1)(g), all citizens shall have the right to carry on
trade or business. The material part of (6) of Art. 19, as
amended by the Constitution (First Amendment) Act,
1951,reads:
" Nothing in sub-clause (g) of the said clause.. shall
affect the operation of any existing law in so far
(1) [1960] 3 S.C.R. 742.
(2) [1959] Supp. 1 S.C.R. 319.
83
648
as it relates to, or prevent the State from making any law
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relating to............ the carrying on by the State, or by
a corporation owned or controlled by the State, of any
trade, business, industry or service, whether to the
exclusion, complete or partial, of citizens or otherwise."
The only question is, how far and to what extent Art. 19(6)
secures the validity of Ch. IVA of the Act from attack that
it offends against Art. 19(1)(g) ? Learned counsel for the
Petitioners contends that Art. 19(6)(ii) provides only for
partial exclusion of citizens, that is, the exclusion of a
certain class of persons as a whole and not for partial
exclusion of some among the same class. As s. 68C, the
argument proceeds, enables the State Transport Undertaking
to frame a scheme for excluding some among the same class,
the said provision is not saved by Art. 19(6) of the
Constitution. Relevant portions of s. 68C of the Act read:
" Where any State transport undertaking is of opinion
that.............. 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 route 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...."
Under this section a scheme may be framed in respect of road
transport service in general or in respect of a particular
class of such service empowering the State Transport
Undertaking to run the said service ; it may be in relation
to any area or route or a portion thereof; it may also be to
the exclusion of all or some of the persons running the said
service in general or a particular class of it. The section
enables the State to take over particular class of a
service, say, the bus service, and exclude all or some of
the persons doing business in that class of service.
Learned counsel says that this section confers a wide power
beyond the permissible limits of Art. 19(6)(ii) of the
Constitution. To state it differently, the argument is that
while Art. 19(6)(ii) does not enable a partial exclusion
649
of some among the same class of service, s. 68C permits the
said exclusion.
The answer to this argument depends upon the true meaning of
the provisions of the said Article. Under sub-cl. (ii) of
Art. 19(6), the State can make a law relating to the
carrying on by the State or by a corporation owned or
controlled by the State, of any particular business,
industry or service, whether to the exclusion, complete or
partial, of citizens or otherwise. Article 19(6) is only a
saving provision and the law made empowering the State to
carry on a business is secured from attack on the ground of
infringement of the fundamental rights of a citizen to the
extent it does not exceed the limits of the scope of the
said provision. Sub-clause (ii) is couched in very wide
terms. Under it the State can make law for carrying on a
business or service to the exclusion, complete or partial,
of citizens or otherwise. The law, therefore, can provide
for carrying on a service to the exclusion of all the
citizens; it may, exclude some of the citizens only; it may
do business in the entire State or a portion of the State,
in a specified route or a part thereof The word " service "
is wide enough to take in not only the general motor service
but all the species of motor service. There are, therefore,
no limitations on the State’s power to make laws conferring
monopoly on it in respect of an area, and person or persons
to be excluded. In this view, it must be held that s. 68C
does not exceed the limits prescribed by Art. 19(6)(ii) of
the Constitution.
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Re. (3): The next contention is that the provisions of Ch.
IVA of the Act, and particularly those of s. 68C thereof,
offend against Art. 14 of the Constitution. The argument is
that Ch. IVA enables the State to make a discrimination
between the State Road Transport Corporation on the one hand
and private operators and private transport undertakings on
the other, and also to make a similar discrimination between
the private operators or the private transport undertakings,
and that this discrimination is left to the arbitrary
discretion of the Transport Corporation. It is true that
the provisions of this Chapter
650
enable a scheme to be framed conferring a monopoly on the
State in respect of transport services to the partial or
complete exclusion of other persons. However, the
provisions of the scheme do not make any distinction between
individuals operating a transport service and private
transport undertakings; they are all treated as one class
and the classification is only made between the State
Transport Undertaking and private transport undertakings,
whether the business is carried on by individuals or firms
or companies. The only question, therefore, is whether such
a classification offends against the equality clause of the
Constitution. Article 14 says:
" The State shall not deny to any person equality before the
law or the equal protection of the laws within the territory
of India."
This doctrine of equality has been so frequently considered
by this Court that it does not require any further
consideration. It has been held that this Article does not
prohibit reasonable classification for the purpose of
legislation, but such a classification cannot be arbitrary
but must be based upon differences which have rational
relation to the object sought to be achieved. Doubtless in
the present case, the Legislature placed the State Transport
Undertaking in a class different from other undertakings.
The question is whether the classification made in Ch. IVA
of the Act is just and has reasonable relation to the object
of the legislation. The object of Ch. IVA, as disclosed by
the provisions of s. 68C, is to provide in the interest of
the public an efficient, adequate, economical and properly
coordinated road transport service. To achieve that object
s. 68C confers a power on the State Transport Undertaking to
prepare a scheme to run the service, whether to the
exclusion, complete or partial, of other persons or
otherwise. The classification has certainly reasonable
nexus to the object sought to be achieved. Ordinarily a
State Transport Undertaking, compared with per. sons or
private undertakings, should be in a better Position than
others to carry on the said services for the benefit of the
public administratively, financially
651
and technically it can be expected to be in a far better
position than others. It can provide more well equipped
buses, give better amenities to the travelling public, keep
regular timings, repair or replace the buses in emergencies.
It may also employ efficient supervisory staff to keep
things going at an appreciably high standard. We are not
suggesting that there are no individuals or private
companies who can efficiently run the service. But the
State, compared with individuals, should certainly be in a
better position to achieve the object, namely, to improve
the road transport service in all its diverse aspects. In
such a situation, when the legislature, which must be
presumed to understand and correctly appreciate the needs of
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its own people, makes a classification between a State
Transport Undertaking and others carrying On the business of
transport services, we cannot say that there is no
reasonable basis for such a classification.
But it is said that s. 68C of the Act and other provisions
of Ch. IVA thereof confer an arbitrary power upon the State
Transport Undertaking to discriminate between individuals
and the said Undertaking between individuals and private
undertakings, and between individuals and individuals. But
the scheme of Ch. IVA, which has been considered by this
Court in Gullapalli Nageswara Rao v. Andhra Pradesh State
Road Transport Corporation (1), evolves a machinery for
keeping the State Transport Undertaking within bounds and
from acting in an arbitrary manner, for s. 68C lays down the
legislative policy in clear and understandable terms and the
State Transport Undertaking can initiate a scheme only for
providing an efficient, adequate, economical and properly
coordinated road transport service. Another condition which
it lays down is that the scheme is necessary in the public
interest. The scheme so framed is published, with all-
necessary particulars, in the official Gazette and also in
such manner as the State Government may direct; persons
affected by the scheme may file objections within the
prescribed time ; the State Government, after considering
the objections and
(1) [1959] Supp. 1 S.C.R. 319.
652
giving an opportunity to the objectors or their
representatives and the representatives of the State
Transport Undertaking to be beard in the matter, may approve
or modify the scheme; the scheme so approved or modified is
published. The rules framed under the Act provide for
personal hearing. If the State Transport Undertaking seeks
to modify a scheme, it will have to follow the same
procedure before doing so: see as. 68C, 68D and 68E of the
Act. It will be seen from the provisions of Ch. IVA of the
Act that the State Transport Undertaking, before propounding
a scheme, arrives at the decision on objective criteria.
The parties affected and the public are given every
opportunity to place their objections before the Government,
and the Government, after following the prescribed quasi-
judicial procedure, confirms or modifies the scheme. The
scheme, before it is finalised, is subjected to public gaze
and scrutiny and the validity and appropriateness of the
provisions are tested by a quasi-judicial process. The
Government cannot be equated to a Court; but the procedure
prescribed accords with the principles of natural justice.
It is said that the State Transport Undertaking is either
the State Government or a corporation, owned or controlled
by the State, and as such the entire quasi-judicial
procedure prescribed is only a cloak to screen the exercise
of an absolute and arbitrary power on the part of the
Government. We cannot say that Ch. IVA is such a device.
The Legislature made a sincere attempt to protect as far as
possible individual rights from the arbitrary acts of the
executive. Once it is conceded that Ch. IVA of the Act is
constitutionally good and that the Legislature can validly
make law for nationalization of the road transport service,
the procedure laid down for implementing the said policy
cannot, in our view, be said to be unreasonable. If in any
particular case the mala fides of the authorities concerned
and collusion between the State Transport Undertaking and
the State Government to deprive particular persons of their
right to do road transport business or to drive out
particular persons from the trade on extraneous
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653
considerations, are established, that may be a ground for
striking down that particular scheme. But the provisions of
Ch. IVA cannot be struck down on the ground that they
confer an arbitrary power on the State Transport Undertaking
and on the State Government to discriminate between
individuals and the State Transport Undertaking, between
individuals and private undertakings, and between
individuals and individuals.
This question was raised in Saghir Ahmad v. The State of U.
P. (1). That case dealt with the provisions of the U. P.
Road Transport Act, 1951 (U. P. Act II of 1951). Under s.
42(3) of that Act the Government was exempt from taking
permits for its own vehicles and it could run any number of
buses as it liked without the necessity of taking out
permits’ for them. In furtherance of the State policy to
establish a complete State monopoly in respect of road
transport business, the transport authorities began not only
to cancel the permits already issued to private operators
but also refused to issue permits to others, who would
other. wise be entitled to them. The constitutional
validity of that section was questioned. It may also be
mentioned that though that decision was given after the
Constitution (First Amendment) Act, 1951, it was not based
upon that amendment, as the Constitution before the
amendment governed the rights of the parties therein. In
that situation, adverting to the argument based upon Art. 14
of the Constitution, Mukherjea, J., as he then was, made the
following observations at p. 731:
" There is no doubt that classification is inherent in the
concept of a monopoly; and if the object of legislation is
to create monopoly in favour of the State with regard to a
particular business, obviously, the State cannot but be
differentiated from ordinary citizens and placed in a
separate category so far as the running of the business is
concerned and this classification would have a perfectly
rational relation to the object of the statute.",
Section 3 of that Act provided that " where the State
(1) [1955] 1 S.C.R. 707.
654
Government is satisfied that it is necessary, in the
interest of general public and for subserving the common
good, so to direct, it may declare that the Road Transport
Services in general, or any particular class of such service
on any route or portion thereof, shall be run and operated
by the State Government exclusively or by the State
Government in conjunction with railway or partly by the
State Government and partly by others in accordance with the
provisions of this Act It was contended therein that, as the
State could choose any and every person it liked for the
purpose of being associated with the transport service and
as there were no rules to guide its discretion, that
provision would offend against Art. 14 of the Constitution.
It was pointed out on behalf of the State that the
discretion under s. 3 of that Act was not uncontrolled as
that could Only be done by granting of permits in accordance
with the provisions of the Motor Vehicles Act. Accepting
the construction suggested, this Court held that the
discretion to be exercised by the State would be a,
regulated discretion guided by statutory rules. But in the
instant case, no liberal construction of the provisions need
be resorted to, for Ch. IVA of the Act in specific terms
provides a complete and, in the circumstances, satisfactory
machinery for reasonably regulating the exclusion of all or
some of the private operators from the notified area or
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route. We, therefore, hold that the provisions of Ch. IVA
of the Act do not infringe the equality clause enshrined in
Art 14 of the Constitution.
Re. (4): By the next contention the learned counsel attacks
the validity of the scheme on the ground that the Government
is actuated by bias against the private operators of buses
in West Godavari District, and indeed had predetermined the
issue. In the petitions it was alleged that the Government
had complete control over the Road Transport Corporation
that the entire administration and control over such road
transport undertaking vested in the Government, that the
Chief Secretary to the Government of Andhra Pradesh was its
chairman and that, therefore, the
655
entire scheme, from its inception to its final approval, was
really the act of the Government. On this hypothesis it was
contended that the Government itself was made a judge in its
own cause and that, therefore, its decision was vitiated by
legal bias. That apart, it was also pleaded that a sub-
committee, consisting of Ministers, Secretaries and officers
of connected departments and presided over by the Minister
in charge of transport, decided in its meeting of January
28, 1960, that under the scheme of nationalization of bus
service, the State Government would take over the bus
services in West Godavari District and Guntur District
before the end of that year and, therefore, the Minister in
charge of the portfolio of transport, he having
predetermined-the issue, disqualified himself to decide the
dispute between the State Transport Undertaking and the
petitioners. The self same questions were raised in
Gullapalli Nagestvara Rao v. The State of Andhra Pradesh(1).
There, as in this case, it was contended that the Chief
Minister, who was in charge of the portfolio of transport,
could not be a judge in his own cause, as he was biased
against the private operators. This Court pointed out the
distinction between official bias of an authority which is
inherent in a statutory duty imposed on it and personal bias
of the said authority in favour of, or against, one of the
parties. In dealing with official bias this Court, after
considering the relevant English decisions, observed at p.
587 thus:
"These decisions show that in England a statutory invasion
of the common law objection on the ground of bias is
tolerated by decisions, but the invasion is confined
strictly to the limits of the statutory exception. It is
not out of place here to notice that in England the
Parliament is supreme and therefore a statutory law, however
repugnant to the principles of natural justice, is valid ;
whereas in India the law made by Parliament or a State
Legislature should stand the test of fundamental rights
declared in Part III of the Constitution."
(1) [1960] 1 S.C.R. 580.
84
656
Then this Court proceeded to state that the provisions of
the Act did not sanction any dereliction of the principles
of natural justice, for the Act visualized in case of
conflict between the undertaking and the operators of
private buses that the State Government should sit in
judgment and resolve the conflict. Much to the same effect
has been stated by Shah, J., in H. C. Narayanappa v. The
State of Mysore (1) though in slightly different
phraseology. The learned Judge stated :
" It is also true that the Government on whom the duty to
decide the dispute rests, is substantially a party to the
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dispute but if the Government or the ,authority to whom the
power is delegated acts judicially in approving or modifying
the scheme, the approval or modification is not open to
challenge on a presumption of bias. The Minister or the
officer of the Government who is invested with the power to
hear objections to the scheme is acting in his official
capacity and unless there is reliable evidence to show that
he is biased, his decision will not be liable to be called
in question, merely because he is a limb of the Government."
In the above cases the transport department of the
Government was the transport undertaking, but here the State
Road Transport Corporation, which is a body corporate having
a perpetual succession and common seal, is the transport
authority. Though under the provisions of the Act, the
State Government has some control, it, cannot be said either
legally or factually that the said Corporation is a
department of the State Government. The State Government,
therefore, in deciding the dispute between the said
undertaking and the operators of private buses is only
discharging its statutory functions. This objection,
therefore, has no merits. Nor can we say that it has been
established that the Minister in charge of the portfolio of
transport has been actuated by personal bias. The fact that
he presided over the sub-committee constituted to implement
the scheme of nationalization of bus services in the West
Godavari District does not in
(1) [1960] 3 S.C.R. 742.
657
itself establish any such bias. Indeed, in the counter
affidavit filed on behalf of the first respondent the con-
tents and authenticity of the reports of the proceedings of
the sub-committee published in the Telu daily "Andhra
Pradesh " were not admitted. Even if the sub-committee came
to such a decision, it is not possible to hold that it was a
final and’ irrevocable decision in derogation of the
provisions of the Act. it was only a policy decision and in
the circumstances could only mean that the sub-committee
advised the State Government to implement the policy of
nationalization of bus services in that particular district.
The said decision could not either expressly or by necessary
implication involve a predetermination of the issue: it can
only mean that the policy would be implemented subject to
the provisions of the Act. It is not suggested that the
Minister in charge of the concerned portfolio has any
personal bias against the operators of private buses or any
of them. We, therefore, hold that it has not been
established that the Minister in charge of the portfolio of
transport bad personal bias against the operators of private
buses and, therefore, disqualified himself from hearing the
objections under Ch. IVA of the Act.
Re. (5): The next contention is based upon the observations
of this Court in Shrinivasa Reddy v. The State of Mysore
(1). After elaborating on the scope of s. 68C of the Act,
Wanchoo, J., observed at p. 136 thus:
"Therefore, the scheme to be framed must be ,such as is
capable of being carried out all at once and that is why the
Undertaking has been given the power to frame a scheme for
an area or route or even a portion thereof............ If
the Undertaking at that stage has the power to carry it out
piecemeal, it would be possible for it to abuse the power of
implementation and to discriminate against some operators
and in favour of others included in the scheme and also to
break up the integrity of the scheme and in a sense modify
it against the terms of s. 68E."
Based on these observations it is contended that the State
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Government intended to frame only one scheme
(1) [1960] 2 S C.R. 130.
658
for the entire district though it was not in a position to
implement the scheme in the entire district at one and the
same time, but to circumvent the observations of this Court
it had split up one scheme into seven schemes. The first
respondent in its counter affidavit met this allegation in
the following way:
"Having regard to the resources of the Undertaking in men,
material and money, each scheme has been so framed that it
is capable of being carried out all at once, and in full,
without breaking its integrity’ The State Transport
Undertaking will carry out each of the published schemes on
a date fixed by the State Government for the implementation
of each scheme". The Minister in his order also adverted to
this aspect and observed: " In this case, seven different
schemes have been framed. Each scheme is a separate and
independent scheme by itself In terms of the notification,
each scheme after approval will come into force only from a
date to be, fixed by the Government. Though different dates
may be fixed for each scheme, each scheme will be
implemented in its entirety. No piecemeal implementation of
any one scheme will be done ". Indeed the order of the
Minister fixed specific dates from which each of the schemes
shall come into force. This Court did not lay down that
there cannot be any phased programme in the nationalization
of transport services in a State or in a district; nor did
it hold that there cannot be more than one scheme for a
district or a part of a district. The observations of this
Court in regard to the implementation of a scheme piecemeal
were aimed at to prevent an abuse of power by discriminating
against some operators and in favour of others in respect of
a single scheme. In the present case, seven schemes were
framed not to circumvent the observations of this Court, but
only to avoid the vice inherent in piecemeal implementation.
Not only seven separate schemes were framed in respect of
separate areas of the district, but also the Government made
it clear that each scheme should be implemented in its
entirety commencing from different dates. We do not,
therefore, see any legitimate objection to the framing of
seven separate, schemes.
659
Re. (6): This contention questions the validity of the
schemes on the ground that the Chief Executive Officer of
the Andhra Pradesh Road Transport Corporation is not
empowered to publish the schemes and, therefore, the schemes
were not validly published. In exercise of the powers
conferred by S. 68C of the Act, the Andhra Pradesh State
Road Transport Corporation proposed the schemes and
published them in the Andhra Pradesh Gazette, Part 11, p.
1310. The proposed schemes were signed by Guru Pershad,
Chief Executive Officer, State Transport Undertaking, Andhra
Pradesh Road Transport Corporation, The relevant provisions
of the Road Transport Corporations Act, 1950 (Act LXIV of
1950) may be noticed at this stage. Under s. 4 of the said
Act, " Every Corporation shall be a body corporate by the
name notified under section 3 having perpetual succession
and a common seal, and shall by the said name sue and be
sued ". Relevant portions of s. 12 read: " A Corporation may
from time to time by resolution passed at a meeting.........
authorize the Chief Executive Officer or General Manager, or
any other officer of the Corporation subject to such
conditions and limitations if any as may be specified in the
resolution to exercise such powers and perform such duties
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as it may deem necessary for the efficient day to day
administration of its business". Section 13 says: " All
orders and decisions of a Corporation shall be authenticated
by the signature of the Chairman or any other member
authorized by the Corporation in this behalf and all other
instruments issued by a Corporation shall be authenticated
by the signature of the Chief Executive Officer or General
Manager or any other officer of the Corporation authorized
in like manner in this behalf". Relying upon the said
provisions, learned counsel for the petitioners contends
that the preparation and publication of the schemes in
question under s. 68C of the Act are orders or decisions of
the Corporation and, therefore, should be authenticated by
the signature of the Chairman or any other member duly
authorized under s. 13 of the Road Transport Corporations
Act and not by the Chief Executive Officer. The first
660
respondent in its counter-affidavit attempted to meet this
contention by stating that the Corporation by resolution
authorized the Chief Executive Officer to exercise such
powers and perform such duties as it may deem necessary for
the efficient day to day administration of its business and
the Chief Executive Officer in exercise of such
authorization published the schemes in the Gazette. The
first respondent relied upon s. 12 of the Road Transport
Corporations Act and not on s. 13 thereof to sustain the
power of the Chief Executive Officer to publish the schemes.
We have no reason not to accept the statement of the first
respondent that there was a resolution passed by the
Corporation in terms of s. 12 (c) of the Road Transport
Corporations Act. If so, the only question is whether the
act of publishing the proposed schemes framed by the
Corporation in the Gazette pertains to the day to day
administration of the Corporation’s business. The Chief
Executive Officer has no power under the Act to frame a
scheme. Section 68C empowers only the State Transport
Undertaking to prepare a scheme and cause every such scheme
to be published in the official Gazette and also in such
other manner as the State Government may direct. The
scheme, therefore, need not be directly published by the
Corporation, but it may cause it to be published in the
official Gazette. The act of publishing in the official
Gazette is a ministerial act. It does not involve any
exercise of discretion. It is only a mechanical one to be
carried out in the course of day to day administration. So
understood, there cannot be any difficulty in holding that
it was purely a ministerial act which the Chief Executive
Officer by reason of the aforesaid resolution can discharge
under s. 12(c) of the Road Transport Corporations Act. It
must be presumed for the purpose of this case that the
Corporation decided the terms of the proposed schemes and
the said decision must have been duly authenticated by the
Chairman or any other member authorized by the Corporation
in this behalf and the Chief Executive Officer did nothing
more than publish the said scheme in exercise of its
administrative functions. We,
661
therefore,, hold that the Chief Executive Officer was well
within his rights in publishing the said proposed schemes in
the Andhra Pradesh Gazette.
Re. (7): The next argument turns upon the provisions of r.
4 of the Andhra Pradesh Motor Vehicles Rules. The relevant
part of the rule reads: " The scheme or approved scheme to
be published in the official Gazette as required under
section 68C or 68D as the case may be, shall contain the
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following particulars: (i)......... (ii) the number of
vehicles proposed to be operated on each route ". In certain
schemes the number of vehicles to be operated on each route
was not specified, and one number was mentioned against two
or more routes bracketing them. When an objection was taken
before the Government in regard to this matter, the Minister
accepted it and directed that the scheme might be modified
so as to indicate the number of vehicles to be operated on
each route separately. The schemes were accordingly’
modified by indicating the number of vehicles to be operated
on each route separately and the approved schemes with the
said modification were duly published in the Gazette dated
March 21, 1960. The approved schemes, therefore, satisfy
rule 4(2),of the Rules, for the approved schemes, as duly
modified, contain the number of vehicles proposed to be
operated on each route. But the point sought to be made is
that the Minister himself should have fixed the number of
vehicles proposed to be operated on each route and should
not have merely directed the appropriate modification to be
made in the approved schemes. It does not appear from the
record that there was any dispute before the Minister as
regards the apportionment of the number of vehicles shown
against two or more routes to each of the routes; but the
only contention raised was that the bracketing of the number
of vehicles between two or more routes contravened the
provisions of r. 4. Though the order of the Minister only
contains a direction, the apportionment of the vehicles,
between the routes was not made by the State Transport
Authority, but only by the Government, for the approved
schemes were published not by the Chief Executive Officer
but
662
by the State Government. It must be presumed that the
allocation also must have been made with the approval of the
Minister. There are no merits in this objection either.
Re. (8): The next contention is that r. 5 framed by the
State Government in exercise of the power conferred on it
under s. 68(1) is inconsistent with the provisions of s. 68B
of the Act and, therefore, is void. The schemes prepared by
the State Transport Authority contain the following note: "
The frequency of services on any of the notified routes or
within any notified area shall, if necessary, be varied
having regard to the traffic needs during any period ". In-
deed the said note was practically a reproduction of a note
appended to r. 5. The only question is whether r. 5 and the
note made pursuant thereto come into conflict with s. 68E of
the Act. Section 68E reads:
" Any scheme published under sub-section (3) of section 68D
may at any time be cancelled or modified by the State
transport undertaking and 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 modified as if the modification proposed were
a separate scheme". The short question that arises is
whether the variation of frequency of service by the State
Transport Undertaking amounts to a modification of a scheme
within the meaning of s. 68E of the Act. The rule is not so
innocuous as the learned Advocate-General of the Andhra
Pradesh contends. Under that rule the State Transport
Undertaking, having regard to the needs of traffic during
any period, may increase or decrease the number of trips of
the existing buses or vary the frequency by increasing or
decreasing the number of buses. This can be done without
any reference to the public or without hearing any repre-
sentations from them. This increase or decrease, as the
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case may be, ’Can only be for the purpose of providing an
efficient, adequate, economical transport service in
relation to a particular route within the meaning of s. 68C.
At the time the original schemes are proposed, the persons
affected by them may file
663
objections to the effect that the number of buses should be
increased or decreased on a particular route from that
proposed in the schemes. The Government may accept such
suggestions and modify the schemes; but under this rule
the authority may, without reference to the public or the
Government, modify the schemes. Learned counsel contends
that the note only provides for an emergency. But the rule
and the note are comprehensive enough to take in not only an
emergency but also a modification of the scheme for any
period which may extend, to any length of time. We are,
therefore, definitely of opinion that the rule confers power
on the State Transport Undertaking to modify substantially
the scheme in one respect, though that power can only be
exercised under s. 68E of the Act in the manner prescribed
thereunder. This rule is void and, therefore, the said note
was illegally inserted in the schemes. But on that ground,
as the learned counsel contends, we cannot hold that the
schemes are void. The note is easily severable from the
scheme,% without in any way affecting their structure.
Without the note the schemes are self-contained ones and it
is impossible to hold that the schemes would not have been
framed in the manner they were made if this note was not
allowed to be included therein. We, therefore, hold that
the note should be deleted from the schemes and the schemes
are otherwise good.
Re. (9): The last of the arguments attacks the schemes in so
far as they include new routes. The new routes included in
the schemes are Eluru to Kovvur, and Nidadavol to
Jeelugumilli. It is argued that the provisions of s. 68C
are concerned with the existing routes only. Support is
sought to be drawn for this contention from the provisions
of s. 68C of the Act. The relevant part of that section
says: " Where any State transport undertaking is of opinion
that......... 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 route or portion
thereof should be run and operated by the State
85
664
transport undertaking............ the State transport
undertaking may propose a scheme............ ". Now the
contention is that the word " route " in that section refers
to a preexisting route, for it is said that the words "
route or portion thereof " in the section clearly indicate
that the route is an existing route, for a scheme cannot be
framed in respect of a portion of a proposed route. We do
not see any force in this contention. Under s. 68C of the
Act the scheme may be framed in respect of any area or a
route or a portion of any area or a portion of a route.
There is no inherent inconsistency between an " area " and a
" route ". The proposed route is also an area limited to the
route proposed. The scheme may as well propose to operate a
transport service in respect of a new route from point A to
point B and that route would certainly be an area within the
meaning of s. 68C. We, therefore, hold that s. 68C
certainly empowers the State Transport Undertaking to
propose a scheme to include new routes.
Though some other points were raised in the affidavits filed
before us, they were not pressed.
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In the result we hold that the note relating to the
frequency of the services appended to the schemes must be
deleted and that in other respects the petitions fail; and
accordingly they are dismissed with costs. One set of
hearing fees.
Petitions dismissed.
665