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Case Number

D.B Civil Writ Petition No. 138 of 1957

Advocates

K.K Rastogi with D.B Gupta and S.L Mardia, for Petitioners;
L.N Chhangani, Government Advocate;
Jai Gopal, for Respondents Nos. 3 & 5;
Ram Chandra Vyas, for Respondent No. 4;
Mahendra Singh, for Respondent No. 6

Judges

Mr. K.L. Bapna
Mr. Jagat Narain

Acts

MOTOR VEHICLES ACT

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Smart Summary

Judgment Summary — Jagat Narayan, J.

Factual and Procedural Background

The application was filed under Article 226 challenging an appellate order under the Motor Vehicles Act which granted five further permits along the Ajmer–Beawar route to respondents Nos. 2 to 6. The petitioners were existing operators on that route: Automobile Transport Ltd. (petitioner No. 1) held six permits and petitioners Nos. 2 and 3 each held one permit.

The events giving rise to the petition are as follows. On 25.2.56 the Ajmer State Transport Authority (Regional/State Transport Authority) resolved to increase buses on the route from 14 to 17 and invited applications for three permits in accordance with the Rules and section 57 of the Act. Some 102 applicants applied, including applications connected to petitioner No. 1 and petitioner No. 3. No objections were filed asserting that existing permits were already sufficient. After hearings, three permits were granted and 99 applications were rejected. Five applicants (respondents Nos. 2–6) appealed under section 64 against refusal of permits. Before those appeals were decided, the State Reorganization Act merged Ajmer into Rajasthan and the appellate jurisdiction passed to Rajasthan authorities. The Transport Minister heard the appeals on 15.7.57 and on 24.7.57 advised that five more permits should be granted for public interest reasons; the Governor formalized that advice in an order dated 6.11.57 under Article 163(1). The petition challenging the Minister's order (later embodied in the Governor's order) was filed on 22.8.57 and subsequently amended to challenge the Governor's order dated 6.11.57 as well.

Legal Issues Presented

Whether the resolution of the Ajmer State Transport Authority dated 25.2.56 fixing the number of permits (from 14 to 17) amounted to a final, binding order under section 48(a) such that the Appellate Authority could not increase the number of permits while deciding an appeal under section 64 without giving notice to existing operators.
Whether the Governor's order dated 6.11.57 (which embodied the Transport Minister's decision of 24.7.57) was invalid because, being quasi-judicial, the Governor should have given personal hearings to the parties before deciding the appeal.

Arguments of the Parties

Petitioners' Arguments

The resolution of the Ajmer State Transport Authority dated 25.2.56 amounted to an order under section 48(a) (as it stood before amendment) and was final and binding on the Appellate Authority; therefore the Appellate Authority could not increase the number of permits without giving notice to existing operators. This argument relied on observations in Bajranglal v. R.T.A., Jodhpur.
The Governor's order dated 6.11.57 was invalid because where a quasi-judicial decision is involved the Governor was incumbent to give personal hearings to the parties before deciding the appeal; reliance was placed on Purshotam Singh v. Narain Singh.

Respondents' Arguments

The opinion does not contain a detailed account of the respondents' legal arguments beyond the matters reflected in the orders challenged and the legal issues considered by the Court.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Bajranglal v. The R.T.A., Jodhpur	Observations that Regional Transport Authority decisions under sub‑sec. (3) of sec. 47 (amended Act) must consider representations of existing operators and that without notice a decision may be invalid.	The Court held those observations apply to decisions by the Regional Transport Authority under sec. 48(a) but are not applicable to the Appellate Authority deciding appeals under sec. 64. The Court treated the interference in Bajranglal as premature where no permit had yet been granted and therefore limited the scope of that decision.
Saghir Ahmad v. State of U.P.	Principles concerning public streets/roads held by State as trustee, the right of citizens to use roads and carry on transport business protected by Art. 19(1)(g), and limits on State action that curtail that right beyond constitutional permitted limits.	The Court relied on these principles to emphasize that RTA and the Appellate Authority must ask whether refusal to grant a permit is required in public interest and that an Appellate Authority can grant a permit on appeal if public interest does not require refusal.
Purshotam Singh v. Narain Singh	Authority (in that case Rajpramukh) exercising an exclusive discretionary function should give personal hearing when making such decisions; applied where decision is to be taken in the Rajpramukh's discretion.	The Court distinguished Purshotam Singh as applicable to cases of exclusive personal discretion (Rajpramukh) and held it did not apply where a quasi‑judicial decision of the Government is the result of ministerial advice under Article 163. Thus personal hearing by the Governor was not required in the present context.
Messrs. Pioneer Motors Ltd. v. O.M.A. Majeed	Accepted view that executive/quasi‑judicial orders emerging from Government decisions are made on the advice of Ministers and that such decisions become orders of Government when so embodied.	The Court expressed respectful agreement and used the reasoning to support the conclusion that the Transport Minister's decision dated 24.7.57, tendered as advice, validly became a Government order when embodied by the Governor on 6.11.57.

Court's Reasoning and Analysis

The Court addressed the petitioners' two principal contentions in turn and explained the statutory and constitutional framework that informed its conclusions.

On the first contention (finality of the RTA resolution):

The Act does not provide that a decision of the Regional/State Transport Authority fixing the number of stage carriages on a route (under sec. 48(a)) is final and binding on the Appellate Authority. Section 64, which provides for appeals against refusal to grant permits, contains no prohibition on the Appellate Authority increasing the number of permits fixed by the Regional Transport Authority.
Relying on constitutional principles (as explained in Saghir Ahmad), the Court emphasised that the right to carry on transport business on public roads engages Article 19(1)(g). Thus when considering applications under sec. 46 the RTA must consider whether grant would be against public interest; if not, the constitutional guarantee compels grant.
The statutory scheme requires publication of each application under sec. 57; publication gives notice to the public and existing operators so they may make representations in the manner prescribed (sec. 57(3) and (4)). The Court held that those representations must be made before the Regional Transport Authority within the published time and that representation will be considered under sec. 57(5).
If a representation opposes grant and is allowed, the applicant may appeal under sec. 64(4) against rejection; if representation is rejected, the person making it may appeal under sec. 64(f) against grant. The Legislature provided that the Regional Transport Authority's interest (representing public interest when it opposes grant) will be represented before the Appellate Authority; the person who made a representation before the RTA has no automatic right to be heard afresh before the Appellate Authority.
The Court characterised a decision under sec. 48(a) as necessarily tentative: even the RTA must reconsider the number fixed whenever fresh applications are made. Therefore a prior resolution increasing permits is not a final decision binding even on the Authority itself, much less on the Appellate Authority.
The practical consequence is that when many applications are published (as here, 102), existing operators had notice and the statutory mechanism (sec. 57) was the appropriate avenue to make objections. The Appellate Authority was free to grant permits in the public interest, even if that increased the number beyond what the RTA had previously contemplated.
The Court thus rejected the petitioners' contention that the Appellate Authority could not increase permits without giving notice to existing operators and held that the Appellate Authority could lawfully increase the number of permits when deciding appeals under sec. 64.

On the second contention (requirement of personal hearing by the Governor):

The petitioners relied on Purshotam Singh for the proposition that in quasi‑judicial matters the Governor must give personal hearings. The Court analysed Purshotam Singh and found it concerned decisions where the Rajpramukh exercised exclusive personal discretion (not acting on ministerial advice).
The Court explained that executive action (Article 166) includes orders that result from quasi‑judicial decisions by Government, and such decisions are made on the advice of Ministers under Article 163(1). There is no constitutional provision requiring the Governor to exercise quasi‑judicial powers in his personal discretion; rather, decisions of this nature are properly made on ministerial advice and embodied in Government orders.
The Transport Minister's decision (24.7.57) amounted to the advice tendered to the Governor by the Council of Ministers and it was properly embodied in the Governor's order dated 6.11.57. The Court referred with agreement to the approach in Messrs. Pioneer Motors Ltd. v. O.M.A. Majeed.
Accordingly, the Court held that the Governor's order was a valid quasi‑judicial decision under section 64 and that no personal hearing by the Governor himself was required in the circumstances presented.

Holding and Implications

Holding: The petition was dismissed. The Court held that the Appellate Authority was entitled to increase the number of permits beyond the number fixed by the Regional Transport Authority under section 48(a) without giving separate notice of that intention to existing operators, and that the Governor's order dated 6.11.57 (embodying the Transport Minister's advice dated 24.7.57) was a valid decision under section 64.

Implications:

Direct effect on the parties: The order granting five further permits to respondents Nos. 2 to 6 was upheld; the petition was dismissed with costs and the stay order was discharged.
Legal clarification provided by the Court: the power of an Appellate Authority under section 64 to grant permits is not constrained by a prior tentative determination of the number of permits by the Regional Transport Authority; representations against grant must be made in the manner and at the time provided by section 57 to the Regional Transport Authority, which is the body to represent public interest before the Appellate Authority if it objects. The Court distinguished earlier authority (Bajranglal) where intervention had been premature.
The Court also clarified that when a quasi‑judicial decision is taken by Government on ministerial advice and embodied as an order by the Governor under Article 163(1), personal hearing by the Governor is not required in such circumstances.

This summary is based exclusively on the contents of the provided opinion and does not add information beyond what that opinion states.

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The Automobile Transport (Rajputana) Ltd. v. Nathuram Mirdha

Jagat Narayan, J.:— This is an application under Art. 226 of the Constitution against an appellate order under the Motor Vehicles Act (hereinafter called the Act) granting 5 further permits along the Ajmer-Beawar route to respondent Nos. 2 to 6. The petitioners are the existing operators on the route. Members of the Automobile Transport Ltd., petitioner No. 1, hold 6 permits on this route. Petitioners Nos. 2 and 3 hold one permit each.

2. The facts which have given rise to this application are these. In its meeting held on 25.2.56 the Ajmer State Transport Authority decided to increase the number of buses operating on this route from 14 to 17. Application for the grant of three permits were consequently invited by means of a notice published in accordance with the Rules prescribed by the Ajmer Government for publishing the applications for grant of permits under sec. 57 of the Act. No less than 102 bus owners filed applications for the grant of further permits for the route. These applications included two applications by Narain Das Lohia, Chairman of the Automobile Transport (Rajputana) Ltd. petitioner No. 1 (one in his own name and one in the name of Messrs Lohia Transport Co.) and one by petitioner No. 3 Smt. Gulab Devi. No one filed any objection that the existing number of permits issued for this route were sufficient to meet the needs of the traffic. These applications were considered by the Ajmer State Transport Authority at its meetings dated 2-7-56, 12-7-56, 18-7-56, 1.8.56 & 16.8.56 and three permits were granted to Kedar Nath Heda, Baba Transport Co. and Brij Raj respectively. The remaining 99 applications for permits were rejected. These included the three applications on behalf of the petitioners referred to above and the 5 applications of respondents Nos. 2 to, 6. Only respondents Nos. 2 to 6 filed appeals under sec. 64 of the Act to the Chief Commissioner Ajmer against the order of the Ajmer State Transport Authority refusing to grant them permits. Before these appeals could be decided the State Reorganization Act came into force as a result of which the State of Ajmer was merged with the State of Rajasthan. The rules framed under the Act by the Ajmer State were adapted and the State of Rajasthan became the Appellate Authority in place of the Chief Commissioner. The appeals were heard by the Minister of Transport on 15.7.57 A decision was given by him on 24.7.57 holding that it was necessary to allow at least 5 more buses along the route in the interest of public to provide for weekly holiday and emergencies like breakdowns, sickness etc. and granting 5 further permits to respondents Nos. 2 to 6. The present application was filed against that order on 22.8.67 challenging it inter alia on the ground that the Minister was not competent to decide the appeals. This defect was subsequently remedied by the issuing of an order on 6.11.57 in the name of the Governor. The decision of the Transport Minister dated 24.7.57 was treated as advice to the Governor under Art. 163(1) of the Constitution, which was accepted and was embodied in the order. The writ application was then amended and this order was also challenged.

3. The first contention on behalf of the petitioners is that the resolution of the Ajmer State Transport Authority dated 25.2.56 deciding to increase the number of permits from 14 to 17 amounted to an order under sec. 48(a) as it stood before its amendment by Act No. 100 of 1956 and that this order was final and binding on the Appellate Authority who could not have increased the number of permits while deciding an appeal against an order of the State Transport Authority refusing to grant a permit. It may be mentioned here that the present proceedings are governed by the unamended Act. Reliance was placed on the decision of this Court in Bajranglal v. The R.T.A, Jodhpur (1) in which it was held that when the Regional Transport Authority takes a decision under sub-sec. (3) of sec. 47 of the amended Act it has to consider the matters provided in sub-sec. (1), one of which is that it shall take into-consideration any representation made by the existing operators and that unless some kind of notice is given to the existing operators enabling them to make a representation its decision is invalid, it was argued that these observations are equally applicable to the Appellate Authority while it is deciding an appeal under sec. 64 of the Act and that it is consequently not open to the Appellate Authority to increase the number of permits along the route without giving notice of its intention of doing so to the existing operators.

4. Having heard the learned counsel for the parties we are satisfied that the above contention raised on behalf of the petitioners has no force. The Act nowhere provides that a decision of the Regional Transport Authority limiting the number of stage carriages on any specific route is final and binding on the Appellate Authority. Sec. 64 which provides for an appeal by a person aggrieved by the refusal of a permit nowhere lays down that in deciding the appeal the Appellate Authority cannot increase the number of permits fixed by the Regional Transport Authority without giving notice to the existing operators.

5. As was pointed out by their lordships of Supreme Court in Saghir Ahmad v. State of U.P (2) “all public streets and roads vest in the State, but that the State holds them as trustees on behalf of the public. The members of public are entitled as beneficiaries to use them as a matter of right and this right is limited only by the similar rights possessed by every other citizen to use the pathways. The State as trustees on behalf of the public is entitled to impose all such limitations on the character and extent of the user as may be requisite for protecting the rights of the public generally ………. but subject to such limitations the right of a citizen to carry on business in transport vehicles on public pathways cannot be denied to him on the ground that the State owns the highways. Within the limits imposed by State regulations, any member of the public can ply motor vehicle on a public road. To that extent he can also carry on the business of transporting passengers with the aid of the vehicles. It is to this carrying on of the trade or business that the guarantee in Art. 19(i)(g) is attracted.” It follows from this that a citizen can legitimately complain if any order passed under the Motor Vehicles Act by the Regional Transport Authority takes away or curtails that right any more than is permissible under clause (6) of that Article. Therefore when an application for the grant of a permit is made under sec. 46 of the Act what the Regional Transport Authority is bound to consider is whether it would be against public interest to grant it. If it finds that it will not be against public interest to grant it then the Authority is bound, in view of the constitutional guarantee, to allow the application. The Regional Transport Authority has to put this question to itself every time when a fresh application for grant of a permit is made. Under the Act as it stood before its amendment by Act No. 100 of 1956 the Regional Transport Authority was bound to publish every application for grant of a permit and to hear it at a public hearing in the manner provided under sec. 57. It is open to the applicant to prefer an appeal under sec. 64 against an order refusing to grant a permit. The Appellate Authority has to apply its mind to the same question again namely whether public interest demands that the application should be rejected. There would be no sense in providing for an appeal if it were not open to the Appellate Authority to grant a permit to the appellant. The result of the grant of such a permit would be to increase the total number of permits along the route by one.

6. When an application for a permit is made and is published in the manner provided in sec. 57(3) the public at large including the existing operators get notice of the fact that an application for the grant of a further permit has been made to the prescribed authority and that the application is bound to be granted unless the authority is satisfied that it would be against the public interest to do so. If any one wishes to make a representation against the grant of permit to the applicant on any ground whatsoever he must proceed in the manner provided under sec. 57. He must file a representation before the Regional Transport Authority before the date published under sec. 57(3) and must simultaneously furnish a copy of the same to the applicant as provided under sec. 57(4). If he does so his representation will be duly considered by the Regional Transport Authority under sec. 57(5). If the representation is rejected the person making the representation can file an appeal under sec. 64(f) against the grant of the permit. If however the representation is allowed and the application for grant of a permit is rejected the applicant can prefer an appeal under sec. 64(4). In this appeal the person making the representation has no right of being heard. This is as should be. For it is the refusal of the permit which is likely to affect the constitutional guarantee contained in Art. 19(1)(g). The grant of a permit may in certain circumstances be against public interest. Such cases are however likely to be rare. Both fares and timings of buses are fixed by the order of the Regional Transport Authority and there can be no uneconomic competition which might be against public interest. If too many buses are allowed on a particular route so as to make their running uneconomical some of the operators will in due course withdraw their buses and only such number of them will be run as is profitable. But the Legislature has not thought it proper to enact that persons who have opposed the grant of the permit before the Regional Transport Authority successfully should be heard by the Appellate Authority. All that the Legislature has thought fit to enact is that the Regional Transport Authority shall be heard by the Appellate Authority. No existing operator has any vested right to prevent others from plying their buses on the same route. It is only when the plying of more buses is opposed to public interest that a permit can be refused. If the Regional Transport Authority is satisfied that the grant of a permit is against public interest then naturally the Regional Transport Authority would oppose the grant of the permit before the Appellate Authority also and the Legislature has thought it fit that the interest of the general public shall in such circumstances be represented before the Appellate Authority by the Regional Transport Authority alone. In case however a person authorised to make a representation against the grant of permit is unable to convince the Regional Transport Authority that no more permits should be granted, that a right of appeal to him has been provided so that he may get a hearing before the Appellate Authority. This right has been given for the public benefit and not for safeguarding the financial interest of the existing operators.

7. A decision under sec. 48(a) is not even binding on the Regional Transport Authority itself. For even after the number of buses is limited the Authority has to consider afresh whenever another application for a permit is made as to whether or not it should be increased. That involves reconsideration of the number of buses fixed under sec. 48(a) whenever a fresh application is made. It will thus be seen that a decision under sec. 48(a) by the Regional Transport Authority can never be regarded as a final decision binding even on itself.

8. The number of buses has no doubt to be fixed under sec. 48(a), having regard to the matters mentioned in sec. 47(1). But no procedure for doing so has been provided either under the Act or under the Rules. The reason obviously is that a decision under sec. 48(a) can, from the very nature of it, as has been shown above, be only tentative. It is no use arriving at a tentative decision after hearing interested parties. It is only when a permit is granted in pursuance of the decision that any party can really have a grievance against the decision. The procedure prescribed for the grant of a permit involves publication of the application and as has been pointed out above when the application is published all those interested in opposing the application get notice that an application has been made and is bound to be allowed unless the Regional Transport Authority is satisfied that it would be against public interest; to do so. That is the proper time when persons who are interested in the matter should make a representation against the grant of the permit. That is the only opportunity which has been provided to them under the law for making representations. They are not entitled to a hearing before the Appellate Authority which has full power to grant as many permits as it considers necessary to do in public interest after hearing the Regional Transport Authority.

9. The decision of the Ajmer State Transport Authority, dated 25-2-56 increasing the number of permits to 3 can only be regarded as a tentative one. When 102 persons applied for permits and these applications were published the petitioners and other existing operators had notice of these applications. They will be deemed to have notice of the provisions of the Act. That Act allows the Regional Transport Authority or the Appellate Authority to grant each one of the applications made for the grant of permits provided it is not against public interest to do so. The petitioners or the other existing operators were not entitled to assume either that the Regional Transport Authority would not grant more than three permits or that the Appellate Authority would not grant more than five permits on considering the applications. If they had any representation to make they could have only done so as provided under sec. 57 of the Act. They were entitled to a hearing only before the Regional Transport Authority and not before the Appellate Authority. In the present case the petitioners filed no objection before the Regional Transport Authority. On the other hand some of them applied for the grant of further permits to themselves. Their argument is that they were not aggrieved by the grant of three more permits but they are aggrieved by the grant of further 5 more permits which had been issued by the Appellate Authority. In view of the provisions of the Act they should have known that the Appellate Authority had power to grant more permits than the number fixed by the Regional Transport Authority. If they had any objection to the grant of more permits than three that objection should also have been made as provided under sec. 57. If they had made such representations and if there had been any substance in them the Regional Transport Authority would have placed that substance before the Appellate Authority, for its consideration.

10. We have already pointed out above that the observations made in Bajranglal's case(1) are only applicable to a decision made by the Regional Transport Authority under sec. 48(a) and that they cannot be applied to the Appellate Authority in deciding an appeal against the decision of the Regional Transport Authority under sec. 64. As has been shown above the notice implicit in sec. 48(a) to the existing operators and local authorities is given when applications for permits are published as required under sec. 57. In that view of the case the interference by this Court in Bajranglal's case was premature. The petitioner in that case came to the Court before any permit was granted as soon as he came to know that the Regional Transport Authority had passed a resolution increasing the number of permits. The petitioner could only be said to have a real grievance if an order granting further permits had been passed. Before such an order could be passed the applications would have been published as provided under sec. 57 and the applicant would have got notice of the proposal of the Regional Transport Authority to increase the number of permits. He could have preferred his objection in the manner provided in sec. 57 and would have got a hearing. One of us was a party to the decision in Bajranglal's case (1). This aspect of the matter was not brought to the notice of the Court when that decision was given.

11. We accordingly hold that it was open to the Appellate Authority to have increased the number of permit by 5 beyond the limit fixed by the Regional Transport Authority under sec. 48(a) without giving notice of its intention to do so to the existing operators.

12. The second contention put forward on behalf of the petitioners is that the decision of the Governor conveyed in order dated 6.11.57 is invalid as a decision on an appeal filed under sec. 64, for in a quasi-judicial matter it was incumbent on the Governor to have given a personal hearing to the parties to the appeal before deciding it. Reliance was placed on the decision of this Court in Purshotam Singh v. Narain Singh (3). We have carefully read the judgment of that case and we are firmly of the opinion that the observations made in it are only applicable where the Governor is required to exercise his function in his discretion within the meaning of Art. 163(1) of the Constitution. Purshotam Singh's case related to a decision with regard to the succession to a jagir made by the Rajpramukh under Art. VII(3) of the Covenant which runs as follows:—

“Unless other provision is made by an Act of the Legislature of the United State, the right to resume Jagirs or to recognise succssion, according to law and customs to the right and titles of the Jagirdar shall vest exclusively in the Raj Pramukh.”

13. In arriving at his decision the Raj Pramukh was not prevented from consulting his Ministers, he was not bound to do so or to act on their advice. The decision was to be exclusively that of Raj Pramukh. It was in such circumstances that it was held in that case that the Raj Pramukh should have given a personal hearing to the applicant before deciding the case.

14. The expression ‘executive action’ in Article 166 of the Constitution is comprehensive enough to include orders which emerge as a result of a quasi-judicial decision by the Government. Such decisions can only be made on the advice of the ministers, as there is no provision in the Constitution requiring the Governor to exercise quasi-judicial functions in his discretion. There is an allocation of business among the Ministers and each Minister is assigned some department in regard to which he takes the primary responsibility for the advice. The decision taken by the Minister on 24.7.57 was the advice which he tendered to the Governor on behalf of the Council of Ministers and it became an order of Government when it was embodied in a formal order issued on the authority of the Governor. A similar view was taken in Messrs. Pioneer Motors Ltd. v. O.M.A. Majeed (4) with which we are in respectful agreement.

15. We accordingly hold that the order, dated 6.11.57 issued in the name of the Governor was perfectly a valid quasi-judicial decision under sec. 64 of the Act.

16. In the result we dismiss the petition with costs and discharge the stay order.

The Automobile Transport (Rajputana) Ltd. v. Nathuram Mirdha

Judgment Summary — Jagat Narayan, J.

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Petitioners' Arguments

Respondents' Arguments

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

The Automobile Transport (Rajputana) Ltd. v. Nathuram Mirdha

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