# KERALA STATE ROAD TRANSPORT CORPORATION v. BABY P. P. & ORS

- **Citation:** [2018] 5 S.C.R. 747
- **Court:** Supreme Court of India
- **Decided:** 2018-05-16
- **Case number:** Civil Appeal No. 5257 of 2018
- **Bench:** Kurian Joseph, Mohan M. Shantanagoudar, Navin Sinha
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/kerala-state-road-transport-corporation-v-baby-p-p-ors-33183
- **Pages:** 28

## Headnote

Motor Vehicles Act, 1988 - Chapter VI - ss.99, 100, 103 and
s.104 and its Proviso - Road Transport Service - Grant of temporary
permit to private stage carriage operators on notified routes - When
not permissible - Scheme notified by State for providing properly
coordinated passenger road transport services - Clause 4 of the
Scheme inter alia provided that the services to be operated by the
State Transport Undertaking (STU) along the notified route were to
the exclusion of private stage carriages operating in the said route
- Respondent no.1, private stage carriage operator sought
temporary permit under proviso to s.104 to run services for the
route Pallissery-Angamaly-Perumbavoor - Rejected by Regional
Transport Authority (RTA) - Held: Scheme formulated by the State
Government is a law by itself and holds the fort in all matters involving
permits - Since it partially excludes private stage carriage operators
on the notified route, the same is to be adhered to - No private
stage carriage operator can operate beyond the stipulations of the
scheme - Route from Angamaly to Perumbavoor is a notified route
- Thus, STU has exclusive right to ply its stage carriages - Proviso
to s.104 gives only a limited breath of life to the private sector, viz.,
only if the vehicles of STU do not operate on the notified route as
per the scheme, temporary permits may be granted to the private
stage carriage operators - Undisputedly, more than 450 buses of
STU ply everyday on the notified route - Further, the Scheme does
not permit private stage carriage operators to overlap more than 5
kms or 5 % (whichever is less) of the route proposed by it - However,
respondent no.1 sought temporary permit for the route which
overlaps by 13 kms on the notified route - Such overlap is clearly
prohibited under the Scheme - Respondent no.1 does not fall within
the proviso to s.104- RTA was justified in rejecting the claim of
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[2018] 5 S.C.R.
respondent no.1 - Road Transport Corporations Act, 1950 - s.3Motor Vehicles Act, 1939 - ss.68-C and 68-D.
Words & Phrases - 'Intersection' & 'Overlapping' -
Distinction between - Discussed - Motor Vehicles Act, 1988.
Interpretation of Statutes - Proviso vis-a-vis main Section -
Interpretation of - Discussed - Motor Vehicles Act, 1988 - s.104
and proviso.
Allowing the appeals, the Court
HELD: 1.1 The law governing the formulation of schemes
is found in Sections 99 and 100 of the Motor Vehicles Act, 1988.
Chapter VI of the Act deals with special provisions relating to
State Transport Undertaking (STUs). Preparation and publication
of proposals regarding road transport services of the STU has
been dealt with under Section 99. If the State Government is of
the opinion that for the purpose of providing efficient, adequate,
economical, and properly guaranteed road transport services in
relation to any area or route or operation thereto, these road
transport services should be run and operated by the STU to the
exclusion (complete or partial) of private stage carriage operators,
a proposal in the Official Gazette shall be published as provided
under Section 99. After considering the objections, if any, and
after giving an opportunity to the objectors or their
representatives and the representatives of the STU, the State
Government may approve or modify such proposals. The
approved or modified scheme will be published in the Official
Gazette of the State Government, apart from newspapers, under
Section 100(3). After publication, the scheme shall be final and
the same is called "the approved scheme". The area or the route,
to which the scheme relates, shall be called "Notified Area" or
"Notified Route". Section 103 deals with the issue of permits by
the STU pursuant to the scheme, if approved. Section 104 relates
to the restrictions on grant of permits in respect of the notified
area or notified route. [Paras 11, 12] [758-G; 759-F-H; 760-A-C]
1.2 Section 104 mak

## Text

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KERALA STATE ROAD TRANSPORT CORPORATION
v.
BABY P. P. & ORS.
(Civil Appeal No. 5257 of 2018)
MAY 16, 2018
[KURIAN JOSEPH, MOHAN M. SHANTANAGOUDAR
AND NAVIN SINHA, JJ.]
 Motor Vehicles Act, 1988 - Chapter VI - ss.99, 100, 103 and
s.104 and its Proviso - Road Transport Service - Grant of temporary
permit to private stage carriage operators on notified routes - When
not permissible - Scheme notified by State for providing properly
coordinated passenger road transport services - Clause 4 of the
Scheme inter alia provided that the services to be operated by the
State Transport Undertaking (STU) along the notified route were to
the exclusion of private stage carriages operating in the said route
- Respondent no.1, private stage carriage operator sought
temporary permit under proviso to s.104 to run services for the
route Pallissery-Angamaly-Perumbavoor - Rejected by Regional
Transport Authority (RTA) - Held: Scheme formulated by the State
Government is a law by itself and holds the fort in all matters involving
permits - Since it partially excludes private stage carriage operators
on the notified route, the same is to be adhered to - No private
stage carriage operator can operate beyond the stipulations of the
scheme - Route from Angamaly to Perumbavoor is a notified route
- Thus, STU has exclusive right to ply its stage carriages - Proviso
to s.104 gives only a limited breath of life to the private sector, viz.,
only if the vehicles of STU do not operate on the notified route as
per the scheme, temporary permits may be granted to the private
stage carriage operators - Undisputedly, more than 450 buses of
STU ply everyday on the notified route - Further, the Scheme does
not permit private stage carriage operators to overlap more than 5
kms or 5 % (whichever is less) of the route proposed by it - However,
respondent no.1 sought temporary permit for the route which
overlaps by 13 kms on the notified route - Such overlap is clearly
prohibited under the Scheme - Respondent no.1 does not fall within
the proviso to s.104- RTA was justified in rejecting the claim of
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respondent no.1 - Road Transport Corporations Act, 1950 - s.3Motor Vehicles Act, 1939 - ss.68-C and 68-D.
Words & Phrases - 'Intersection' & 'Overlapping' -
Distinction between - Discussed - Motor Vehicles Act, 1988.
Interpretation of Statutes - Proviso vis-a-vis main Section -
Interpretation of - Discussed - Motor Vehicles Act, 1988 - s.104
and proviso.
Allowing the appeals, the Court
HELD: 1.1 The law governing the formulation of schemes
is found in Sections 99 and 100 of the Motor Vehicles Act, 1988.
Chapter VI of the Act deals with special provisions relating to
State Transport Undertaking (STUs). Preparation and publication
of proposals regarding road transport services of the STU has
been dealt with under Section 99. If the State Government is of
the opinion that for the purpose of providing efficient, adequate,
economical, and properly guaranteed road transport services in
relation to any area or route or operation thereto, these road
transport services should be run and operated by the STU to the
exclusion (complete or partial) of private stage carriage operators,
a proposal in the Official Gazette shall be published as provided
under Section 99. After considering the objections, if any, and
after giving an opportunity to the objectors or their
representatives and the representatives of the STU, the State
Government may approve or modify such proposals. The
approved or modified scheme will be published in the Official
Gazette of the State Government, apart from newspapers, under
Section 100(3). After publication, the scheme shall be final and
the same is called "the approved scheme". The area or the route,
to which the scheme relates, shall be called "Notified Area" or
"Notified Route". Section 103 deals with the issue of permits by
the STU pursuant to the scheme, if approved. Section 104 relates
to the restrictions on grant of permits in respect of the notified
area or notified route. [Paras 11, 12] [758-G; 759-F-H; 760-A-C]
1.2 Section 104 makes it amply clear that where a scheme
has been published under Section 100(3) of the Act in respect of
any notified area or notified route, grant of any permit on the
notified route or area is impermissible, except in accordance with
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the provisions of the scheme. However, the proviso clarifies that
wherever the STU has not sought any permit in respect of any
notified route or notified area in pursuance to the scheme, the
RTA (or STA, as the case may be) may grant a temporary permit
to any private stage carriage operator in respect of such notified
area or notified route, on the condition that such permit shall
cease to be effective on the issue of a permit to the STU in respect
of that area or route. The scheme formulated and published by
the State Government under Section 100 (3) of the Act holds the
fort in all matters involving permits. [Paras 15, 16] [761-A-C, D]
1.3 The proviso to Section 104 of the Act cannot be read
aloof from the main section. A plain reading of the proviso to
Section 104 makes it clear that temporary permits can be granted
to the private sector, wherever the STU does not operate its
service. However, the proviso is also subject to the stipulations
of the scheme, akin to the main section. Since the Scheme on
hand partially excludes private stage carriage operators on the
notified route, the same is to be adhered to. It is necessary in the
public interest that road transport services on notified routes
should be run and operated by the STU to the complete or partial
exclusions of private stage carriage operators. In a State where
the scheme has been published, subject to such scheme
formulated by the State, no private stage carriage operator can
operate beyond the stipulations of the scheme. This also applies
to applications for temporary permits under the proviso to Section
104 of the Act. [Paras 17, 18] [762-F; 763-C-D]
1.4 The route from Angamaly to Perumbavoor is
undisputedly a notified route. The STU thus has the exclusive
right or monopoly to ply its stage carriages and obtain the required
permit as per the Scheme to the exclusion of private stage
carriage operators. The proviso gives only a limited breath of
life to the private sector, viz., only if the vehicles of the STU do
not operate on the notified route as per the scheme, in which
event temporary permits may be granted to the private stage
carriage operators. In the matter on hand, undisputedly, more
than 450 buses of the STU ply everyday on the notified route
which pass from Angamaly to Perumbavoor. It is not open for the
respondent no.1 to claim that the STU is not running sufficient
KERALA STATE ROAD TRANSPORT CORPORATION v.
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buses from Palliserry to Perumbavoor via Angamaly. Admittedly,
Palliserry to Angamaly is not a notified route. The dispute between
the parties, thus, virtually relates to the route between Angamaly
to Perumbavoor and not the route between Palliserry to
Angamaly. Even otherwise it is not disputed that the STU is plying
8 trips from Palliserry to Perumbavoor via Angamaly. Apart from
the same, the private sector is operating sufficient number of
services from Palliserry to Angamaly. It is brought to the notice
of this Court by the STU that the STU may provide more buses if
required between Palliserry to Angamaly. Moreover, it is open
for the respondent no.1 to seek permission as per law before the
concerned authority and ply its buses on the non-notified route.
However, when it comes to operating on the notified route, that
is, in between Angamaly and Perumbavoor, the respondent no.1
cannot operate its services for more than 5 kms or 5% of its
route (whichever is less). Admittedly, part of the respondent no.1's
route measuring 13 kms is between Angamaly and Perumbavoor,
and that entire patch of 13 kms overlaps the notified route. The
total route length applied for by the respondent no.1 is only 28
kms. The overlap thus, permitted on the notified route (in the
case on hand) as per the Scheme could only be 1.4 kms whereas
the respondent no.1 wants to overlap by 13 kms, i.e.
approximately 50% of his route, which is totally impermissible
and the same is rightly objected to by the STU, particularly when
the STU is operating 452 buses (amounting to 770 trips) in a day
on the said route. [Paras 19, 20] [763-E-H; 764-B-D]
1.5 The Scheme is a law by itself and until it is varied
according to law, no private stage carriage operator has any right
to camouflage any device to obtain the permits. The new route
introduced by the respondent no.1 fuses a non-notified route (to
an extent of 15 kms) and a notified route (to an extent of 13
kms), totally measuring 28 kms. This is contrary to the approved
Scheme, since such newly introduced route by the respondent
No.1 overlaps with 13 kms of the notified route, which is prohibited
as per the Scheme. The RTA was justified in rejecting the claim
of the respondent no.1 seeking temporary permit on the notified
route, since the respondent no.1 has sought a temporary permit
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for the route which overlaps by 13 kms on the notified route;
such overlap is clearly prohibited under the Scheme.
[Paras 25-27] 768-B-C, E-F]
1.6 Moreover, overlapping to the extent of 5 kms or 5%
of the route of respondent no.1 (whichever is less), is only for
purposes of intersection under the Scheme. The intersection of
the notified route may not be the same as traversing and
overlapping with the route, because the prohibition under the
Scheme must apply to the whole or a part of the notified route,
and private stage carriage operators cannot be allowed to traverse
the same line in the guise of intersection. In this case, as the
stage carriage services of the respondent no.1 are to operate on
a notified route to an extent of 13 kms, it cannot be considered
an intersection. Intersection means "to cut across". It is
permissible for any private stage carriage operator, under the
Scheme in question, to traverse on a notified route up to the
permissible limit as contemplated under the Scheme only for the
purpose of cutting across the notified route, and to proceed further
on a non-notified route. Only in such a case can the temporary
permit be granted. [Para 28] [768-G-H; 769-A-C]
1.7 There is a clear distinction between overlapping and
intersection. The expression "intersection" is not defined in the
Act. The meaning of the word "intersection" as provided generally
in various dictionaries is "cutting across". The word has to be
construed in the context of the provision of the Act and scheme
of the Act. The "Scheme" intends total exclusion of private stage
carriage operators for a notified route except for "intersecting"
it is not open for the authorities to grant permits to private stage
carriage operators to operate on the notified route but may be
permitted merely to intersect within permissible limits. The
"intersection" thus, is not traversing the same line of travel
beyond permitted limits, but to cut across a notified route for its
onward journey. This exception is carved out only to avoid
hardships to travellers. Any other view contrary to the above
view would amount to violating integrity of an approved Scheme.
An intersection is permissible, while an overlap is not.
[Para 29] [769-D; 770-B-D]
KERALA STATE ROAD TRANSPORT CORPORATION v.
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 1.8 Except for exceptional circumstance of cutting across
the notified route, the scheme totally excludes private stage
carriage operators on the notified route. In case of overlapping,
such carrier would ply on the same line to travel on a portion of
the notified route, whereas in case of intersection, the private
stage carriage operator's route only cuts across the notified route
for its onward journey. Since the scheme is a law, the same has to
be preserved and protected in public interest. Since it is not a
case of intersection as contemplated under Clause 5(c) of the
Scheme, and as the overlapping sought by the respondent no.1
is more than both 5 kms or 5% of his total route, the prayer of
respondent no.1 must be rejected. However, Clauses 5(c) and 6
of the Scheme provide that the private stage carriages would be
allowed to pick up and drop passengers in between any two places
on the route covered by the Scheme, provided that the route of
the private stage carriage overlaps the notified route maximum
to an extent of 5 kms or 5% of the length of its own route
(whichever is less). [Paras 30, 31] [771-D-F]
1.9 The respondent no. 1 does not fall within the proviso
to Section 104 of the Act. Both parties admit that the appellant is
running sufficient number of buses on the notified route. Since it
is found that the Respondent no.1 is not entitled to ply stage
carriage buses on the notified routes, the temporary permit
granted by the RTA on 23.02.2017, consequent to the order of
the STAT remanding the matter to the RTA, in favour of
respondent no.1 is set aside. [Paras 32, 36] [771-G-H; 774-C]
1.10 In view of this discussion, the following answer
emerges:
(i) A temporary permit cannot be issued to a private stage
carriage operator to traverse on the notified route which is being
served by the STU, in excess of the permissible distance provided
under the scheme.
(ii)Under the facts of this case, it is not open for a private
stage carriage operator (the respondent no.1) to operate its
services by overlapping on a notified route for more than 5 kms
or 5% (whichever is less) of the route of the private stage carriage
operator (as specified under the Scheme) which is being served
by the STU. [Para 37] [774-C-E]
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Punjab Roadways v. Punjab Sahib Bus & Transport
Co. (2010) 5 SCC 235 : [2010] 5 SCR 256 -
distinguished.
Adarsh Travels Bus Service & Anr. v. State of U.P. &
Ors. (1985) 4 SCC 557- followed.
Gajraj Singh & Ors. v. State Transport Appellate
Tribunal and Ors. (1997) 1 SCC 650 : [1996] 6 Suppl.
SCR 172 ; Dwarka Prasad v. Dwarka Das Saraf
(1976) 1 SCC 128 : [1976] 1 SCR 277 ; U.P. State
Roadways Transport Corporation v. Anwar Ahmed &
Ors. (1997) 3 SCC 191 : [1996] 7 Suppl. SCR 98 ;
Mysore State Road Transport Corporation v. Mysore
State Transport Appellate Tribunal (1974) 2 SCC 750 :
[1975] 1 SCR 615 ; Karnataka SRTC v. Ashrafulla
Khan (2002) 2 SCC 560 : [2002] 1 SCR 194 ; U.P.
SRTC and Another v. Sanjida Bano and Others
(2005) 10 SCC 280 - relied on.
Black's Dictionary of Law, 5th Edn. ; Law Lexicon,
Reprint Edn., 1987; Chambers English Dictionary;
Webster's Dictionary, Vol. I ; Shorter Oxford English
Dictionary, Vol. I ; Concise Oxford Dictionary
- referred to.
Case Law Reference
(1985) 4 SCC 557
 followed
Para 11
[1996] 6 Suppl. SCR 172 relied on
Para 16
[1976] 1 SCR 277
 relied on
Para 17
[1996] 7 Suppl. SCR 98 relied on
Para 23
[1975] 1 SCR 615
 relied on
Para 29
[2002] 1 SCR 194
 relied on
Para 30
(2005) 10 SCC 280
 relied on
Para 32
[2010] 5 SCR 256
 distinguished
Para 34
KERALA STATE ROAD TRANSPORT CORPORATION v.
BABY P. P. & ORS.
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CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5257
of 2018.
From the Judgment and Order dated 02.08.2017 of the High Court
of Kerala at Ernakulam in OPC No. 1827 of 2017
WITH
Civil Appeal Nos.5258 and 5259 of 2018.
V. Giri, Sr. Adv., Deepak Prakash, Yanmi Phazang, Sree Devi,
Subhash Chandran K.R, Raneev Dahiya, Kunal Singh, Sriram P.,
Nachiketa Vajpayee, Amith Krishnan, Advs. for the Appellant.
R. Basant, Sr. Adv., Santosh Krishnan, K. V. G. Nair, Nishe Rajen
Shonker, Ms. Anu K. Joy, Alim Anvar, Reegan S. Bel, Advs. for the
Respondents.
The Judgment of the Court was delivered by
MOHAN M. SHANTANAGOUDAR, J. Leave granted.
2. These appeals arise out of the judgment dated 02.08.2017 passed
by the High Court of Kerala at Ernakulam in O.P.(C) No. 1827 of 2017,
O.P.(C) No. 1784 of 2017 and O.P.(C) No. 581 of 2017 dismissing the
writ petitions and consequently confirming the order dated 11.01.2017
passed by respondent no.5 herein, the State Transport Appellate Tribunal
(hereinafter referred to as 'STAT') in M.V.A.R.P No. 53 of 2016.
Therein, the STAT had held that the Regional Transport Authority under
the facts of the case, may exercise power conferred on it by the proviso
to Section 104 of the Motor Vehicles Act, 1988 (hereinafter referred to
as 'the Act') to grant temporary permits.
3. The State of Kerala vide G.O. (P) No.42/2009/Tran. dated
14.07.2009 notified a new scheme in exercise of its powers conferred
by Section 100 of the Act for the purpose of providing convenient,
adequate, economical, and properly coordinated passenger road transport
services. As per the said Scheme, the route of Kottayam-Kozhikode
was made a notified route. Clause 4 of the said Scheme interalia provides
that the services to be operated by the State Transport Undertaking
(hereinafter referred to as 'STU') along the notified route were to the
exclusion of private stage carriages operating in the said route. Clause 4
of the said Scheme reads thus:
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4. From the aforementioned clause, it is clear that the permits
which were already issued to the private sector prior to 09.05.2006 will
be allowed to continue until the date of expiry of the respective permits.
Thereafter, regular permits will be granted to them. However, as and
when the STU applies for introducing a new service on the route, the
corresponding number of existing private stage carriage permits in the
said route, whose permits expire first after the filing of the application by
the STU, shall not be renewed. Meaning thereby, the services to be
operated by the STU along the notified route were to the exclusion of
private stage carriages if the STU operates on the same route. If the
STU has not applied for a permit, then the permits issued in the private
sector prior to 09.05.2006 will continue until the date of expiry, following
which regular permits will be granted. The temporary permits issued
after 09.05.2006, on the notified route would be in operation, only until
the STU operates on the same route with new services. Clauses 5(c)
and 6 of the Scheme read thus:
"4.
Whether the services are to
be operated by the State
Transport Undertaking to
the
exclusion
of
other
persons or otherwise.
Yes, the permits
issued in the
private
sector
on
or
before
9.5.2006 will
be allowed to
continue till the dates of expiry of
the respective permits. Thereafter
regular permits will be granted to
them. When the State Transport
Undertaking
applies
for
introducing new services in the
above
routes,
corresponding
number of existing private stage
carriage permits in the said routes
whose permits expire first after
filing application by the State
Transport Undertaking shall not
be renewed. As regards permits
issued after 09.05.2006 temporary
permits alone shall be issued
afresh on expiry in these routes or
any portion thereof till such time
the State Transport Undertaking
replaces with new services. The
decision of the State Transport
Undertaking to apply for permits
to replace the existing Stage
C arriages as above shall be taken
by the Chief Executive of the
State Transport Undertaking."
KERALA STATE ROAD TRANSPORT CORPORATION v.
BABY P. P. & ORS. [MOHAN M. SHANTANAGOUDAR, J.]
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5. Clauses 5(c) and 6 of the aforementioned Scheme provide that
private services would be allowed to pick up and drop passengers between
any two places on the route covered by the Scheme, if and only if the
route of the private stage carriage overlaps the notified route maximum
to an extent of 5 kms or 5% of the length of its own route (whichever is
less) for purposes of intersection.
6. The appellant is a STU under Section 3 of the Road Transport
Corporations Act, 1950. The respondent no.1 in SLP(C) No.26954 of
2017 (namely Baby P.P contesting respondent in all these appeals), a
private stage carriage operator, submitted an application seeking a
temporary permit under the proviso to Section 104 of the Act before
respondent no. 2 herein, the Regional Transport Authority (hereinafter
referred to as 'RTA') to run services for the route Pallissery-AngamalyPerumbavoor. The total length of this route applied for by respondent
no. 1 is 28 kms. The RTA rejected the application filed by the respondent
no.1 on 22.12.2015 stating, interalia, that part of the route applied for
by the respondent no.1 from Angamaly to Perumbavoor is 13 kms in
length and it objectionably overlaps with the notified route of KottayamKozhikode beyond the permissible limit as contemplated by the Scheme
dated 14.07.2009. As against the order of the RTA, the respondent no.1
approached the STAT by filing M.V.A.R.P. No.53 of 2016 which came
to be allowed in part on 11.01.2017, remanding the matter to the RTA to
"5 (c)
Whether it is proposed
to allow other services to
pick up or set down
passengers between any
two places on the route
covered by the scheme.
Yes, on the portion of the
route permitted to operate as
in clause 4 above. Permits
will also be granted to
private stage carriages of
other routes permitting them
to overlap 5 kilometre or 5
percent of the length of their
own routes, whichever is
less on the notified routes,
for purposes of intersection.
6.
The
maximum
and
minimum
number
or
trips to be provided in
relation to each area or
route
by
the
State
Transport
Undertaking
in the case of stage
carriage.
As per traffic demand"
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consider the matter afresh and to exercise its power conferred under
the proviso to Section 104 of the Act.
7. Questioning the order passed by the STAT, the appellant herein
approached the High Court by filing O.P.(C) No. 1827 of 2017.
Respondent no. 1 in SLP(C) No. 32804 of 2017, a private stage carriage
operator, filed O.P.(C) No. 1784 of 2017. Respondent no. 1 in SLP (C)
No. 101 of 2018, another private stage carriage operator, also filed
O.P.(C) No. 581 of 2017. All these O.Ps. were heard together and came
to be dismissed on 02.08.2017 with the following observations:
"35. Reckoning the legal principles mentioned above and the
factual situation revealed in this case, especially Ext. P8 scheme,
I find that the petitioners failed to establish a case that the 1st
respondent or any other private operator is not entitled to get a
temporary permit, overlapping on a notified route, by invoking
proviso to Section 104 of the Act. State Transport Authority or
Regional Transport Authority, as the case may be, as a temporary
measure and until STU puts vehicles on the route, can grant
temporary permits to cater the need of travelling public. It is the
bounden duty of the STU to cater the needs of the commuting
public and if it fails to fulfil obligations, the Government should
intervene and pass appropriate modifications/changes in the
scheme so as to provide amenities to the passengers. It is for the
Government and the authorities to take stock of the situation
periodically and reconsider the notification, if STU could not
discharge their obligations in the expected lines. Till then, the
authorities may invoke power conferred on them by proviso to
Section 104 of the Act.
In the result, original petitions are dismissed confirming Ext.P5
order."
8. Aggrieved by the judgment passed by the STAT, as well as the
judgment of the High Court, these appeals are presented. The issue
before this court in these appeals is as under:
• Can a temporary permit be granted to a private stage carriage
operator on a notified route (which is already being served by the
STU) for a distance that exceeds the permissible limit provided
under the scheme, that too not for intersecting but for merely
traversing and consequently overlapping its service on the notified
route?
KERALA STATE ROAD TRANSPORT CORPORATION v.
BABY P. P. & ORS. [MOHAN M. SHANTANAGOUDAR, J.]
f the
ate as
rmits
d to
s of
them
or 5
 their
er is
outes,
tion.
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In other words,
• Under the facts of this case, is it open for a private stage carriage
operator (Respondent No.1) to operate the services overlapping
more than 5 kms or 5% of the route of the private stage carriage
operator (as specified under the Scheme) for the purpose of
traversing by overlapping on the notified route which is being served
by the STU, but not for purposes of intersection?
9. Mr. V. Giri, learned Senior Advocate appearing on behalf of
the appellant contended that no person other than the STU can operate
on the notified route except as provided in the Scheme; the proviso to
Section 104 of the Act is also subject to the Scheme; Clause 5(c) of the
Scheme makes it clear that respondent no.1's route objectionably overlaps
with the notified route far beyond the permissible limit; the appellant is
plying a sufficient number of buses on the notified route in question as
on this day.
10. Mr. R. Basant, learned Senior Advocate appearing on behalf
of the respondent no.1 submitted that the Scheme does not render the
proviso of Section 104 of the Act otiose; temporary permits can be
granted when the route is unserved or underserved by STU; the appellant
has failed to prove that it was plying sufficient number of buses on the
route Palliserry-Angamaly-Perumbavoor for which the respondent no.1
has a claim for temporary permit; three temporary permits were issued
even after the scheme came into force in 2009. He further drew the
attention of this Court to the fact that pursuant to the remand order of
the STAT, the RTA on 23.02.2017 has granted a temporary permit on
the route in question in favour of the respondent no. 1. But, the appellant
without questioning such order passed by the RTA, has merely questioned
the order of remand passed by the STAT before the High Court. Even
before this Court, the order granting temporary permit is not questioned.
11. The law governing the formulation of schemes is found in
Sections 99 and 100 of the Motor Vehicles Act. In this context, it is
relevant to note the observations of a Constitution Bench of this Court
in
the
case
of
Adarsh
Travels
Bus
Service
and
Anr. vs. State of U.P. and Ors. reported in (1985) 4 SCC 557, where it
highlighted the power of the State to make laws on the passage of motor
vehicles:
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"3. The right of the members of the public to pass and repass
over a highway including the right to use motor vehicles on the
public road existed prior to the enactment of the Motor Vehicles
Act and was not its creation. The State could control and regulate
the right for the purpose of ensuring the safety, peace and good
health of the public. As an incident of his right of passage over a
highway, a member of the public was entitled to ply motor vehicles
for pleasure or pastime or for the purpose of trade and business,
subject, of course, to permissible control and regulation by the
State. Under Article 19(6)(ii) of the Constitution, 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. The law could provide for
carrying on of a service to the total 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 part
thereof. The word "service" has been construed to be wide enough
to take in not only the general motor service, but also the species
of motor service. There are 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. All this is now well established
by the various decisions of this Court."
 (emphasis supplied)
12. Chapter V of the Act deals with the control of transport vehicles
whereas Chapter VI of the Act deals with special provisions relating to
STUs. As per Section 98 of the Act, the provisions of Chapter VI and
the rules and orders made thereunder shall have overriding effect,
notwithstanding any inconsistency contained in Chapter V or any other
law for the time being in force. Preparation and publication of proposals
regarding road transport services of the STU has been dealt with under
Section 99 of the Act. If the State Government is of the opinion that for
the purpose of providing efficient, adequate, economical, and properly
guaranteed road transport services in relation to any area or route or
operation thereto, these road transport services should be run and operated
by the STU to the exclusion (complete or partial) of private stage carriage
operators, a proposal in the Official Gazette shall be published as provided
under Section 99 of the Act. Objections to the proposal will be invited
KERALA STATE ROAD TRANSPORT CORPORATION v.
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before the State Government under Section 100(1) of the Act. After
considering the objections, if any, and after giving an opportunity to the
objectors or their representatives and the representatives of the STU,
the State Government may approve or modify such proposals. The
approved or modified scheme will be published in the Official Gazette of
the State Government, apart from newspapers, under Section 100(3) of
the Act. After publication, the scheme shall be final and the same is
called "the approved scheme". The area or the route, to which the scheme
relates, shall be called "Notified Area" or "Notified Route". Section 103
of the Act deals with the issue of permits by the STU pursuant to the
scheme, if approved. Section 104 of the Act relates to the restrictions on
grant of permits in respect of the notified area or notified route.
13. It is relevant to note that Chapter IV of the Motor Vehicles
Act, 1939 is analogous to Chapter V of the Motor Vehicles Act, 1988.
Chapter IV-A of the 1939 Act corresponds to Chapter VI of the 1988
Act. The sections contained in Chapter IV-A of the1939 Act are in pari
materia with the sections contained in Chapter VI of the 1988 Act. To
be more precise, Sections 99 and 100 of the 1988 Act are in pari materia
with Sections 68-C and 68-D respectively of the 1939 Act.
14. Before proceeding further, it would be relevant to note Section
104 of the Act along with its proviso, which reads thus:
"104. Restriction on grant of permits in respect of a notified
area or notified route - Where a scheme has been published
under sub-section (3) of section 100 in respect of any notified
area or notified route, the State Transport Authority or the Regional
Transport Authority, as the case may be, shall not grant any permit
except in accordance with the provisions of the scheme:
Provided that where no application for a permit has been made
by the State Transport Undertaking in respect of any notified area
or notified route in pursuance of an approved scheme, the State
Transport Authority or the Regional Transport Authority, as the
case may be, may grant temporary permits to any person in respect
of such notified area or notified route subject to the condition that
such permit shall cease to be effective on the issue of a
permit to the State transport undertaking in respect of that
area or route."
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15. A plain reading of Section 104 makes it amply clear that where
a scheme has been published under Section 100(3) of the Act in respect
of any notified area or notified route, grant of any permit on the notified
route or area is impermissible, except in accordance with the provisions
of the scheme. However, the proviso clarifies that wherever the STU
has not sought any permit in respect of any notified route or notified
area in pursuance to the scheme, the RTA (or STA, as the case may be)
may grant a temporary permit to any private stage carriage operator in
respect of such notified area or notified route, on the condition that such
permit shall cease to be effective on the issue of a permit to the STU in
respect of that area or route. It is needless to observe that respondent
no.1 claims such a temporary permit based on the proviso to Section 104
of the Act, contending that the STU is not operating its services on the
notified route.
16. It is by now well settled that the scheme formulated and
published by the State Government under Section 100 (3) of the Act
holds the fort in all matters involving permits.The scheme is a law by
itself, as observed by this Court in various judgments including the case
of Gajraj Singh and Others vs. State Transport Appellate Tribunal
and others reported in (1997) 1 SCC 650, wherein it is observed as
hereunder:
"51. After giving careful and anxious consideration to the respective
contentions, we find that there is some force in the contention of
the respective counsel for the appellants. It bears repetition to
state that the approved scheme under the Repealed Act or in the
Act is a self-contained and self-operative scheme. It is a law by
itself. The schemes published under the Repealed Act, as held
earlier, are saved by Section 217(2)(a) of the Act. Therefore,
until they are modified or cancelled under Section 102, the scheme
should continue to be in operation in the notified area, route or
part thereof. The right to apply for and obtain permit in the notified
scheme was totally frozen to the private operators giving exclusive
right to the STU to apply for and obtain permits to run the stage
carriages or additional service under Section 101 of the Act on
the notified area, route or a part thereof and none else. With a non
obstante clause in Section 101, the right to apply for and obtain
temporary permits under Section 87 by private operators was taken
KERALA STATE ROAD TRANSPORT CORPORATION v.
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away. There is no need for STU to obtain such permits as an
intimation to RTA concerned of its providing such additional service
on special occasions like fair or religious gatherings for conveyance
of passengers, is sufficient. Yet the scheme itself saved and
preserved the rights of the named existing operators in respect of
overlapping routes in the specified permits, subject to the corridor
restrictions of picking up and setting down the passengers en route
the prescribed prohibited route. They became entitled to run their
stage carriages subject to the law. Though, their permits are saved,
the named operators being private operators, Parliament appears
to have thought that there was no necessity to expressly retain in
Chapter VI itself their right of renewal as the same was already
provided in Section 81 of the Act corresponding to Section 68F(1-D) of Chapter IV-A of the Repealed Act. The reason appears
to be obvious. Every private operator falls within the field covered
by Chapter V of the Act. It would seem that Parliament is of the
view that the named operators, being saved under the schemes,
are entitled to apply for and obtain necessary permit or renewal
thereof to ply their stage carriages only on overlapped routes
subject to the corridor restrictions mentioned in the scheme itself.
It may be stated that we do not find any express indication of
their rights being taken away under the Act; nor do we find it by
necessary implication in that behalf and to that effect. This view
does justice also to all concerned."
 (emphasis supplied)
17. In light of this, it is to be noted that the proviso to Section 104
of the Act cannot be read aloof from the main section. A plain reading of
the proviso to Section 104 makes it clear that temporary permits can be
granted to the private sector, wherever the STU does not operate its
service. However, the proviso is also subject to the stipulations of the
scheme, akin to the main section. A Four-Judge Bench of this Court in
Dwarka Prasad vs. Dwarka Das Saraf, reported in (1976) 1 SCC
128, observed that the proviso cannot be read separately from the main
section, in the following manner:
"18....A proviso must be limited to the subject-matter of the
enacting clause. It is a settled rule of construction that a proviso
must prima facie be read and considered in relation to the principal
matter to which it is a proviso. It is not a separate or independent
enactment. "Words are dependent on the principal enacting words,
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to which they are tacked as a proviso. They cannot be read as
divorced from their context" (1912 AC 544). If the rule of
construction is that prima facie a proviso should be limited in its
operation to the subject-matter of the enacting clause, the stand
we have taken is sound. To expand the enacting clause, inflated
by the proviso, sins against the fundamental rule of construction
that a proviso must be considered in relation to the principal matter
to which it stands as a proviso. A proviso ordinarily is but a proviso,
although the golden rule is to read the whole section, inclusive of
the proviso, in such manner that they mutually throw light on each
other and result in a harmonious construction."
 (emphasis supplied)
18. Since the Scheme on hand partially excludes private stage
carriage operators on the notified route, the same is to be adhered to. It
is necessary in the public interest that road transport services on notified
routes should be run and operated by the STU to the complete or partial
exclusions of private stage carriage operators. In a State where the
scheme has been published, subject to such scheme formulated by the
State, no private stage carriage operator can operate beyond the
stipulations of the scheme. This also applies to applications for temporary
permits under the proviso to Section 104 of the Act.
19. In the matter on hand, it is the case of the STU that it has
been running 452 buses (covering 770 trips) every day on part of the
notified route, i.e. from Angamaly to Perumbavoor, wherein overlapping
of 13 kms is claimed. So far as the route from Angamaly to Perumbavoor
is concerned, the same is undisputedly a notified route. The STU thus
has the exclusive right or monopoly to ply its stage carriages and obtain
the required permit as per the Scheme to the exclusion of private stage
carriage operators. The proviso gives only a limited breath of life to the
private sector, viz., only if the vehicles of the STU do not operate on the
notified route as per the scheme, in which event temporary permits may
be granted to the private stage carriage operators. In the matter on
hand, undisputedly, more than 450 buses of the STU ply everyday on the
notified route which pass from Angamaly to Perumbavoor. It is not open
for the respondent no.1 to claim that the STU is not running sufficient
buses from Palliserry to Perumbavoor via Angamaly. Admittedly,
Palliserry to Angamaly is not a notified route. The dispute between the
parties, thus, virtually relates to the route between Angamaly to
Perumbavoor and not the route between Palliserry to Angamaly.
KERALA STATE ROAD TRANSPORT CORPORATION v.
BABY P. P. & ORS. [MOHAN M. SHANTANAGOUDAR, J.]
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20. Even otherwise it is not disputed that the STU is plying 8 trips
from Palliserry to Perumbavoor via Angamaly. Apart from the same,
the private sector is operating sufficient number of services from
Palliserry to Angamaly. It is brought to the notice of this Court by the
STU that the STU may provide more buses if required between Palliserry
to Angamaly.