# Octihu1 81. 800 SUPREME COURT REPORTS [1963] SUP11. GANDHARA TRANSPORT CC>. LTD v. THE STATE OF PUNJAB. AND OTHE],lS

- **Citation:** [1963] Supp. 1 S.C.R. 800
- **Court:** Supreme Court of India
- **Decided:** 1960-03-15
- **Case number:** Civil Appeal No. 200 of 1962
- **Bench:** B. P. SINir.A, P. B. Gajendragadkar, K. N. Wanchoo, K. C. Das Gupta, J. C. Shah
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/octihu1-81-800-supreme-court-reports-1963-sup11-gandhara-transport-cc-ltd-v-the-2747
- **Pages:** 9

## Headnote

Stage
Garria{je-Temporary
permit-Application
for
renewal-Grant of regular permit-Validity-Motor VeMclu
Act, 1939 (4of1939), 1947, 57, 58, 62.
By an order of the Minister in charge of the Transport
Department, Punjab State, a temporary permit was granted
to M for plying vehicles on the route indicated in the permit.
When the period of the temporary permit expired M applied
to the Regional Transport Authority for renewal of the permit.
The Regional Transport Authority issued a
notic~ inviting
objections "regarding the further renewal of the permits for a
period of three years on regular basis in favour of M." The
appellants and oihers filed objections but M was granted a
regular permit for a period of three years. On 'appeal, the
Provincial Transport Controller quashed the
ord~. on the
ground that M had merely applied for renewal of the temporary
permit, that the procedure adopted for granting a P,ermit to
M did not conform to the provisions of the law and that,
therefore, the order renewing a temporary perihit and making
it a permit to ply a stage carriage for. three years was invalid.
But the 6rder of the Transport Controller was set aside by the
Secretary, Transport Department. The appellants then moved
the High Conrt of Punjab by a petition under Art. 226 of
the Constitution of India for quashing tht order of the secretary, but the High Court rejected the application on the view
that for adjudicating on the merits of the claims for and
again8t the grant of the permit the authorities under the
Motor Vehicles Act were the proper authorities.
Held, that the order of the Regional Transport Authority
granting a regular permit to M was unla,vfu] as it was vitiated
by grave errors of procedure. The Transport
Author~ty ( 1) had
entertained an application for a rene\val of a terilporary permit
which was not contemplated by any provision of the Motor
Vehicli;s Act, 1939, (2) had invited objections t6 the application
as one for renewal for three years on regular basis, the:rcby
misleading parties desiring to enter into competition, and
_J
1 S.C.R. SUPREME COURT REPORTS
801
(3) had failed to apply its mind to matte1s which had to
be considered under s. 47 of the Act.
HeW,, further, that the order passed by the High Court
should be set aside and the order of the Transport Authority
declared unlawful, though the period of the regular permit had
expired in the meantime, because otherwise when making fresh
applications for permit, M would be getting the benefit of the
proviso to s. 58 (2). which was available only to those having
lawful permits.

## Text

1962
Octihu1 81.
800 SUPREME COURT REPORTS [1963] SUP11.
GANDHARA TRANSPORT CC>. LTD.,
v.
THE STATE OF PUNJAB. AND OTHE],lS
(B. P. SINir.A., c. J., P. B. GAJENDRAGADKAR,
K. N. WANCHOO, K. C. DAS GUPTA and
J. C. SHAH, JJ.)
Stage
Garria{je-Temporary
permit-Application
for
renewal-Grant of regular permit-Validity-Motor VeMclu
Act, 1939 (4of1939), 1947, 57, 58, 62.
By an order of the Minister in charge of the Transport
Department, Punjab State, a temporary permit was granted
to M for plying vehicles on the route indicated in the permit.
When the period of the temporary permit expired M applied
to the Regional Transport Authority for renewal of the permit.
The Regional Transport Authority issued a
notic~ inviting
objections "regarding the further renewal of the permits for a
period of three years on regular basis in favour of M." The
appellants and oihers filed objections but M was granted a
regular permit for a period of three years. On 'appeal, the
Provincial Transport Controller quashed the
ord~. on the
ground that M had merely applied for renewal of the temporary
permit, that the procedure adopted for granting a P,ermit to
M did not conform to the provisions of the law and that,
therefore, the order renewing a temporary perihit and making
it a permit to ply a stage carriage for. three years was invalid.
But the 6rder of the Transport Controller was set aside by the
Secretary, Transport Department. The appellants then moved
the High Conrt of Punjab by a petition under Art. 226 of
the Constitution of India for quashing tht order of the secretary, but the High Court rejected the application on the view
that for adjudicating on the merits of the claims for and
again8t the grant of the permit the authorities under the
Motor Vehicles Act were the proper authorities.
Held, that the order of the Regional Transport Authority
granting a regular permit to M was unla,vfu] as it was vitiated
by grave errors of procedure. The Transport
Author~ty ( 1) had
entertained an application for a rene\val of a terilporary permit
which was not contemplated by any provision of the Motor
Vehicli;s Act, 1939, (2) had invited objections t6 the application
as one for renewal for three years on regular basis, the:rcby
misleading parties desiring to enter into competition, and
_J
1 S.C.R. SUPREME COURT REPORTS
801
(3) had failed to apply its mind to matte1s which had to
be considered under s. 47 of the Act.
HeW,, further, that the order passed by the High Court
should be set aside and the order of the Transport Authority
declared unlawful, though the period of the regular permit had
expired in the meantime, because otherwise when making fresh
applications for permit, M would be getting the benefit of the
proviso to s. 58 (2). which was available only to those having
lawful permits.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 200 of 1962.
Appeal from the judgment and order dated
March 15, 1960, of the Punjab High Court, Chandigarh, in Civil Writ No. 315of1960.
Bishan Narain, Daya
Swarup Nehra
and
Naunit Lal, for the appellant.
K. L. Gosain, S. K. Mehta and K. L. Mehta,
for respondent No. 3.
1962. October 31. The Judgment of the
Court was delivered by
SHAH, J.-By order dated October 23, 1956,
the Regional Transport Authority, Patiala, granted
a permit to one Manohar Singh for plying a staie
carriage on the Bhatinda Khera (Via Bajekhanna)-
Jaitu-Kot-Kapura route which was about 55 miles
long. This route covered 35 miles of the BliatindaKot-Kapura-Faridkot route for which the appellants,
M/s. Gandhara Transport Co. Ltd., held permits for
plying their vehicles. In appeal against the order
passed by the Regional Transport Authority, the
appellate authority cancelled the permit in favour of
Manohar Singh, but the order of the Appellate
Authority was set aside by the Minister in-charge of
the Transport Department, Punjab State, in revision,
and it was directed that a fresh temporary permit be
granted to Manohar Singh for plying vehicles on
the route for which he had been given a permit. The
appellants then preferred a petition under Art. 226
1962
Grmdlmr• r,..,,.,,_
Co., Ltd.
v.
Stall •f PllJ!iah
Shah, J,
1902
•Gandhora Tronspo1 t
Co., Ltd.
v.
Sl4te of Punjab
Shah, J,
802 SUPREME COURT REPORTS [l96g] SUPP.
of the Constitution before the High Court of Punjab,
challenging the validity of the order passed by the
Minister. Before this writ petition could be heard
the period of the temporary permit expired and
Manohar Singh applied to the Regional Transport
Authority for renewal of the permit. The Regional
Transport Authority issued on April 16, 1958, a
notice inviting objections "regarding the furthe1
renewal of the permits for a period of three years on
regular bru.,3" in favour of Manohar Singh on the
Bhatinda-Khera (via Bajekhanna)--J aitu-Kot-Kapura.
The appellants and others filed objections to the
"renewal of the permits for three years on regular
basis". The regional Transport Authority posted
the objections for hearing on July 30, 1958. In the
mean time the appellants applied to the High Court
of Punjab for an interim order directing the Regional Transport Authority t.J stay pronouncement of
the order on the application submitted by Manohar
Singh till the disposal of their petition in the High
Court. By order dated July 29, 1958, the High Court
rejected the application observing that it was open
to the appellants to move the Regional Transport
Authority to
postpone
announcement
of
its
order on
the application of Manohar Singh.
The
Regional
Transport
Authority
declined
to
postpone
announcement
of its orders
and
on August 1, 1958, directed that a regular permit for
three years be granted to Manohar Singh for the
route notified. On August 7, 1958, the writ petition
of the appellants was heard by the High Court
and it was dismissed.
The High Court observed that
by the petition before it the issue of a Temporary
permit in favour of Manohar Singh alone was
challenged and the period for which the permit was
issued having expired, it was not possible for the
Court to grant any relief to the appellants, and the
remedy of the appellants against the order of the
Regional Transport Authority granting fresh pennitlay before the Transport Authorities under the Motor
l S.C.R.
SUPREME COURT REPORTS
803
Vehicles Act. The high Court observed "it is possible
that the fact, that Manohar Singh was the holder of
a temporary permit may have influenced the Regional
Transport Authority in granting him a permanent
permit, but it is open to the petitioner-Companies to
agitate that matter before the Appellate and the
Revisional Authorities in proper proceedings and if no
relief is given by the aforesaid authorities then this
Court can be approached under article 226 of the
Constitution, if proper grounds exist for invoking its
extraordinary powers under the aforesaid Article.
x
x
x
·x
The mere fact that respondent
No. 4 (Manohar Singh) held a temporary permit is
not the only ground on which the permanent permit
has to be granted to him. While granting the permanent permit the authorities have to follow the
provisions of the statute and take into consideration
the various matters that are provided for by the
Motor Vehicles Act".
The appellants then appealed against the order
of the Regional Transport Authority. The Provincial
Transport Controller, Punjab, by his order dated
May 29, 1959, quashed the order of the Regional
Transport Authority, because in his view Manohar
Singh had merely applied for renewal of his temporary
permit, and that before the Regional Transport
Authority there was no application for a regular
permit and that the procedure adopted for granting a
permit to Manohar Singh, did not conform to the
provisions of the law and therefore the order renewing
a temporary permit and making it a permit to ply a
stage carriage for three years was invalid.
The
Provincial Transport Controller directed "that the
question of allotment of permits may, if necessary, be
taken up afresh after the requisite formalities are
observed." But the order of the Transport Controller
was set aside by the Secretary. Transport Department,
State or Punjab, in exercise of revisional authority
1962
Gant/hara TranttMI
Co., Lli.
v.
Stat• of Pwja6
Shah, J.
1962
•Gandlrara Transpolt
Co., Lid.
v.
Stal• of Punjab
Shah, J.
804 SUPREME COURT REPORTS [1963) SUPP.
under s. 64(h) of the Motor Vehicles Act as amended
by Punjab Act 28 of 1948.
The appellants then moved the High Court of
Punjab by a petition under Art. 226 of the Constitution for quashing the order of the Secretary, Transport Department, on the pleas, inter alia, that the
order passed by the Secretary was illegal because it
ignored the 'effect of the temporary permit which
was the basis on which the permanent permit was
granted' to Manohar Singh, that the Secretary had
failed to note that the Regional Transport Authority
had not invited apphcations from the public for
granting permit' for the route and had merely notified the application for renewal of the permit of the
third respondent and that the Act contained no
provision for renewal of a temporary permit into a
regular permit. The High Court rejected this application.
In the view of the High Court "every
possible argument" was advanced before the Regional
Transport Authority and was considered by that
authority, and that for adjudicating on the merits
of the claims for and against the grant of the permit
the authorities under the Motor Vehicles Act were
'the proper authorities.'
Section 62 of the Motor Vehicles Act, 1939,
empowers the Regional Transport Authority to grant
without following the procedure laid down in s. 57 of
the Act and subject to such conditions as it thinks
fit to impose, permits to be effective for a limited
period (not in any case exceeding four months) authorising the use of a transport vehicle-( a) for the
conveyance of passengers on special occasions such
as to and from fairs and religious gatherings, or (b)
for the purpose of a seasonal business, or (c) to meet
a particular need, or (d) pending decision of an
application for the renewal of a permit. By the
amendment made by Act 100 of 1956 two restrictions
were placed on this power (i) that the temporary
I S.C.R.
SUPREME COURT REPORTS
805
permit shall in no case be granted in respect of any
route or area specified in an application for the
grant of a new permit under s. 46 or s. 54 during the
pendency of the application and (ii) that the tempo·
rary permit shall, in no case, be granted more than
once in respect of any route or area specified in an
application for the renewal of a permit during the
pendency of such application for renewal. Permits
under s. 62 are undoubtedly intended to meet tempo·
rary needs of the nature specified in the section, and
the formalities which are prescribed by s. 57 of the
Act are not requited to be followed before such
permits are granted. It appears that it was the
practice followed in the State of Punjab to issue all
permits for plying stage carriages as temporary
permits, and not to issue regular permits at all under
s. 57 of the Act. This is pointed out in its order by
the Regional Transport Authority in this case, and on
that point there is no dispute.
The permit granted to Manohar Singh pur·
suant to the order of the Minister,
Transport
Department, was a temporary permit. After the
expiry of the period of the temporary permit in his
favour, Manohar Singh applied not for a regular
permit under s. 57, but for renewal of a temporary
permit. The Act, however, does not contemplate
renewal of temporary permits : only regular permits
may be renewed under s. 58 of the Act. The
Regional Transport Authority invited objectious to
the application of Manohar Singh 'for renewal of the
permit for a period of three years on regular basis',
without indicating that Manohar Singh was the
holder of a temporary permit. As we have already
observed there were on the route specified in the
application no regular permits issued under s. 57 and
all the permits which were issued by the Authoritv
were temporary permits under s.62. The Regional
Transport Authority had, therefore, for the first time
to issue regular permits under s.57 of the Act and
1962
Gatul!JJJTa T "'""''I
Cu., Ltd.
••
814" of Punjab
Sllah, J.
1962
Garulhara Transport
Co., ltd.
v.
Stat1 of Punjab
Shnh, l•
806 SUPREME COURT REPORTS [1963] SUPP.
that authority might well have, before· censidering
applications submitted by holders of temporary permits, invited applications
from persons who were
interested in applying for permits for the route in
question.
In considering an application for a permit
for a stage carriage normally the Regional Transport
Authority has to consider matters set out in clauses
(a) to (f) of s. 47 such as the interest of the public
generally, the advantages to the public of the service
to be provided, including the saving of time likely
to be effected thereby, adequacy of other passenger
transport services operating or likely to operate in
the near future, benefit to any particular locality or
localities likely to be afforded by the service, opera.
tion by the applicant of other
transport services
including those in respect of. which applications from
him for permits are pending and the condition of the
roads included in the proposed roulc or areas. The
Regional Transport Authority ha5 also to consider
whether the number of stage carriages generally or
of any specified type for which permits may be granted should be limited in any specified area 01 on any
specified route within the region. When there is
already a transport service maintained on the route
in question by operators holding rugular permits, the
Regional Transport Authority may, having regard to
the previous investigations made, proceed on results
of enquiries or surveys made in respect of some of the
matters detailed in s. 47 but it has still to consider all
those matters. Further by virtue of the proviso to
sub-s. (2) of s. 58 if other conditions are equal an
application for renewal has to be given preference
over new applications for permits.
Manifestly in
dealing with applications for issue of temporary
permits, regular permits aud renewal of regular permits, different considerations come into play.
A
temporary permit may be issued to meet purely temporary needs.
In considering the issue of regular permits
an elaborate procedure has to be followed, including
a
hearing demanding
a
judicial consideration
1 S.C.R.
SUPREME COURT REPORTS
807
1962
of the claims of the individual applicant5 inter se
in the context of the wider interest .of the general
public ; in considering ah application for renewal of
a permit, the authority has to afford to an existing
operator a preemptive opportunity, if other conditions
were equal.
As there were no existing operators with
regular permits, a detailed enquiry under s. 57 with
special attention to the requirements had to be made.
But the Regional Transport Authority committed an
error at the threshold of his proceeding: it entertained
an application which is not contemplated by any
provision of the Act, invited objections thereto in
terms which were somewhat misleading, thereby preventing other applicants from coming forward to
apply, and failed to apply its mind to matters which
had to be considered under s. 47 of the Motor Vehicles Act. Therefore by entertaining an application
for renewal of a temporary permit and inviting objections against such renewal the Regional Transport
Authority entertained an application which was not
in law maintainable, and by inviting objections to
the application as one for renewal for three years on
regular basis in substance misled the parties desiring
to enter into competition into desisting from submitting their applications.
Its proceedings were,
therefore, in our judgment, vitiated on account of
grave errors of procedure.
Gandhara Transp~r f
Co., lld.
But Mr. Gosain appearing on behalf of the respondc;nts submits that even the _period of the regular
permit granted to Manohar Smgh by the Regional
Transport Autho:ity has expired and the Regional
~ransport Aut_honty has now to consider fresh applica·
tlons for permits and whatever irregularities may have
occurred in the issue of permit in favour of Manohar
~ingh t~ey ca~not now be rectified, and any declara- ·
~10n wh1~~ this Court may r:iake in regard to the
~rregul~nt1es would be academic. But it is necessary
m our J_udgment to declare the true position in law,
so that in the consideration of the fresh applications
v.
Stal< •f Punj•b
Shah, J.
;1111dJ&ara Tr111UjJtrt
Co., Lid.
v.
Stai. of Prmjab
Shah, J.
808 SUPREME COURT REPORTS [1963) SUPP.
the mistakes originally committed may not be repeated. Again by making an order affirming the
decision passed by the High Court we would be giving
to Manohar Singh a benefit to which he is not lawfully entitled. If the permit which was granted by
the Regional Transport Authority on August l, 1958,
was not lawfully granted, Manohar Singh would not
be entitled to the benefit of the proviso to sub-s. (2)
of s. 58 and his application for permit would have to
be one under s. 57 and would have to be considered
in competition with other claimants for permits on
the route. We do not think, therefore, that the
consideration of the objections to the validity of the
procedure followed by the Regional Transport
Authority has become academic as submitted by
Mr. Gosain.
We accordingly set aside th1~ orderfassed by the
High Court and declare that the order o the Regional Transport Authority granting a permit in favour of
·Manohar Singh was, for reasons already set out, unlawful. The appellant will be entitled to the costs
of this appeal.
Appeal allowed.