# REGIONAL TRANSPORT AUTHORITY & ANR v. SHAJU ETC

- **Citation:** [2022] 9 S.C.R. 785
- **Court:** Supreme Court of India
- **Decided:** 2022-02-17
- **Case number:** Civil Appeal Nos. 1453 -1454 of 2022
- **Bench:** K. M. Joseph, Pamidighantam Sri Narasimha
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/regional-transport-authority-anr-v-shaju-etc-36482
- **Pages:** 34

## Headnote

Motor Vehicles Act, 1988 - s.83 - Kerala Motor Vehicle Rules,
1989 - r.174(2)(c) - Whether r.174(2)(c) is ultravires the provisions
of the Act as the power with respect to prescription of age limit of a
motor vehicle is in the exclusive domain of the Central Government
- Held: No - r.174 (2) (c) made by the State Government to enable
replacement of the vehicle under a Transport permit, does not
impinge upon the powers of the Central Government with respect to
fixation of the age of the vehicle, or fitness of the vehicle conferred
upon it u/ss. 56 and 59 in Chapter IV - The scrutiny under r.174 is
only to enable the Authority to ensure that the subsisting permit is
not interrupted and at the same time public interest is not
compromised by deviating from the permit - The Rule will have no
bearing on the power of the Central Government and as such it
would not be ultra vires the provisions of the Act - Thus, r.174 (2)
(c) is intra vires the provisions of the Act and also s.83 of the Motor
Vehicles Act - It is valid and salutary.
Motor Vehicles Act, 1988 - Kerala Motor Vehicle Rules, 1989
- Whether r.174(2)(c) of the 1989 Rules, travels beyond and contrary
to s.83 of the Motor Vehicles Act, 1988 - Held: No - The rule is
neither beyond nor contrary to s.83.
Kerala Motor Vehicle Rules, 1989 - r.174(2)(c) - Discretion
exercised by Authority - Scope of - Discussed.
Motor Vehicles Act, 1988 - ss.64, 65 - Distinction between
rule making power of Central government and State government -
Discussed.
Motor Vehicles Act, 1988 - s.83 - Kerala Motor Vehicle Rules,
1989 - r.174(2)(c) - Subordinate Legislation - Principles of
construction - Held: Reasoning adopted by the Division Bench in
[2022] 9 S.C.R. 785
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the impugned order that r.174 (2) (c) has overridden the Act is not
correct because a subordinate legislation must be interpreted to
effectuate the statutory purpose and objective - The Rule should
enable the transport Authorities considering applications for
replacement to insist upon the permit holder to abide by the same
rigour and regulation that he was put to when the permit was granted
- High Court did not appreciate the context in which r.174 (2) (c)
r/w s.83 is to be construed - Judgment of High Court set aside -
Interpretation of Statutes.
Motor Vehicles Act, 1988 - ss.70, 71, 83 - Kerala Motor
Vehicle Rules, 1989 - r.174(2)(c) - Held: r.174(2)(c) is intended to
ensure that the conditions under which a transport permit is granted
is not diluted when the vehicle covered by the permit is sought to be
replaced by a new vehicle - Purpose and object of mandating
replacement by a vehicle of the same nature in s.83 is only to ensure
that the scrutiny and the conditions that were undertaken and
imposed at the time of the grant continue even during the subsistence
of the permit - Statutory scheme u/s.70 requiring an application for
a transport permit to provide material particulars include the
requirement of indicating the type of vehicle is also incorporated in
the Rules made by the State Government - The Rules, followed by
the Forms require details of the type of the vehicles to be furnished.
Words and Phrases - "of the same nature", "same", "nature"
- Motor Vehicles Act, 1988 - s.83 - Discussed - Interpretation of
Statutes.
Allowing the appeals, the Court
HELD: 1.1 Section 83 is an enabling provision. It allows a
permit holder to replace the vehicle covered under the transport
permit. The right to replace the vehicle under a permit is subject
to the permission of the Authority. The right, as well as the power
to grant permission, are subject to the condition that the vehicle
to be replaced is 'of the same nature'. The expression, 'of the
same nature' can have multiple meanings. This phrase, in its
natural expression would only mean having similar features. But
then, would 'same' mean similar, identical, equivalent, comparable,
interchangeable or related? Likewise, would the

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REGIONAL TRANSPORT AUTHORITY & ANR.
v.
SHAJU ETC.
(Civil Appeal Nos. 1453 -1454 of 2022)
FEBRUARY 17, 2022
[K. M. JOSEPH AND
PAMIDIGHANTAM SRI NARASIMHA, JJ.]
Motor Vehicles Act, 1988 - s.83 - Kerala Motor Vehicle Rules,
1989 - r.174(2)(c) - Whether r.174(2)(c) is ultravires the provisions
of the Act as the power with respect to prescription of age limit of a
motor vehicle is in the exclusive domain of the Central Government
- Held: No - r.174 (2) (c) made by the State Government to enable
replacement of the vehicle under a Transport permit, does not
impinge upon the powers of the Central Government with respect to
fixation of the age of the vehicle, or fitness of the vehicle conferred
upon it u/ss. 56 and 59 in Chapter IV - The scrutiny under r.174 is
only to enable the Authority to ensure that the subsisting permit is
not interrupted and at the same time public interest is not
compromised by deviating from the permit - The Rule will have no
bearing on the power of the Central Government and as such it
would not be ultra vires the provisions of the Act - Thus, r.174 (2)
(c) is intra vires the provisions of the Act and also s.83 of the Motor
Vehicles Act - It is valid and salutary.
Motor Vehicles Act, 1988 - Kerala Motor Vehicle Rules, 1989
- Whether r.174(2)(c) of the 1989 Rules, travels beyond and contrary
to s.83 of the Motor Vehicles Act, 1988 - Held: No - The rule is
neither beyond nor contrary to s.83.
Kerala Motor Vehicle Rules, 1989 - r.174(2)(c) - Discretion
exercised by Authority - Scope of - Discussed.
Motor Vehicles Act, 1988 - ss.64, 65 - Distinction between
rule making power of Central government and State government -
Discussed.
Motor Vehicles Act, 1988 - s.83 - Kerala Motor Vehicle Rules,
1989 - r.174(2)(c) - Subordinate Legislation - Principles of
construction - Held: Reasoning adopted by the Division Bench in
[2022] 9 S.C.R. 785
785
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the impugned order that r.174 (2) (c) has overridden the Act is not
correct because a subordinate legislation must be interpreted to
effectuate the statutory purpose and objective - The Rule should
enable the transport Authorities considering applications for
replacement to insist upon the permit holder to abide by the same
rigour and regulation that he was put to when the permit was granted
- High Court did not appreciate the context in which r.174 (2) (c)
r/w s.83 is to be construed - Judgment of High Court set aside -
Interpretation of Statutes.
Motor Vehicles Act, 1988 - ss.70, 71, 83 - Kerala Motor
Vehicle Rules, 1989 - r.174(2)(c) - Held: r.174(2)(c) is intended to
ensure that the conditions under which a transport permit is granted
is not diluted when the vehicle covered by the permit is sought to be
replaced by a new vehicle - Purpose and object of mandating
replacement by a vehicle of the same nature in s.83 is only to ensure
that the scrutiny and the conditions that were undertaken and
imposed at the time of the grant continue even during the subsistence
of the permit - Statutory scheme u/s.70 requiring an application for
a transport permit to provide material particulars include the
requirement of indicating the type of vehicle is also incorporated in
the Rules made by the State Government - The Rules, followed by
the Forms require details of the type of the vehicles to be furnished.
Words and Phrases - "of the same nature", "same", "nature"
- Motor Vehicles Act, 1988 - s.83 - Discussed - Interpretation of
Statutes.
Allowing the appeals, the Court
HELD: 1.1 Section 83 is an enabling provision. It allows a
permit holder to replace the vehicle covered under the transport
permit. The right to replace the vehicle under a permit is subject
to the permission of the Authority. The right, as well as the power
to grant permission, are subject to the condition that the vehicle
to be replaced is 'of the same nature'. The expression, 'of the
same nature' can have multiple meanings. This phrase, in its
natural expression would only mean having similar features. But
then, would 'same' mean similar, identical, equivalent, comparable,
interchangeable or related? Likewise, would the expression
"nature" mean type, feature, texture, make, model, design, or
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generation? These are open textual expressions, used in the
normal course to convey a meaning which the legislature would
not have intended to be read in a pedantic manner. When the
words in the Section allow multiple interpretations, Courts of Law
have developed the art and technique of finding the correct
meaning by looking at the words in their context. As the text by
itself has not conferred certainty to the meaning of the expression
- of the same nature, the phrase has to be examined in context of
the words in the Section, the neighboring provisions, the
Chapters, Parts and its location in the Statute as a whole. For the
purpose of this case, it is sufficient to examine the phrase in the
context of Chapter IV relating to Registration of Motor Vehicles
and Control of Transport Vehicles in Chapter V. [Paras 8.1-8.3, 9
and 10][798-E-G; 799-A-B, G; 800-A, C]
Reserve Bank of India v. Peerless General Finance
Investment Co. Ltd and Ors. (1987) 1 SCC 424 : [1987]
2 SCR 1 - relied on.
1.2 Following the power vested in it, the Central
Government enacted the Central Motor Vehicles Rules, 1989.
There is a distinction between the rule-making power given to
the Central Government on one hand and to the State Government
on the other. Section 64 is the rule-making power of the Central
Government, enabling it to lay down the norms and procedures
to be followed for implementation of provisions in the Act. Subsections (m) and (n) of Section 64 are relevant for present
purposes. In contrast, the rule-making power of the State
Government is as the executing agency for implementing of the
provisions of the Act. For this purpose, Section 65 enables the
State Government to make such Rules as are necessary for
execution. [Paras 11.2, 11.4, 11.5][800-H; 801-E, G-H; 802-A]
1.3 Chapter V relates to the regulatory regime of the State
Governments with respect to Transport vehicles. It prohibits
transportation without a valid permit under Section 66. Under
this Chapter State Government alone has power to make rules.
While Section 95 relates to the rule making power of the State
Government with respect to stage and contract carriages, Section
96 relates to the general power of the State Government to make
REGIONAL TRANSPORT AUTHORITY & ANR. v. SHAJU ETC.
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rules for the purpose of Chapter V. There is no power for the
Central Government to make rules under Chapter V.
Replacement of a vehicle under a permit with any other vehicle,
the provision with which the Court is concerned in this case, is
provided in Section 83. [Paras 12.1, 12.3][802-B, E-F; 803-B]
1.4 The statutory scheme under Chapter V generally
provides for the powers of the State Government to deal with
transport vehicles except under Section 88 of the Act where the
powers are subject to the rules made by the Central Government.
It provides not only the procedure for grants of permits, but also
the mechanism by which vehicles used for transportation are
regulated. It is in this context that Section 83 relating to
replacement of a vehicle occurs. The placement of Section 83 in
Chapter V is a recognition of the need to provide a seamless
mechanism for replacement of a vehicle during subsistence of a
transport permit. Seen in the context of Chapter V relating to
transport vehicles, it becomes clear that the provision is intended
only to enable the owner to work his permit without any
interruption even if there is a need to replace the vehicle covered
by the permit. There is no other purpose. It is intended to be a
simple transaction and this is reason why the scope of scrutiny is
limited only to examining if the vehicle is of same nature as in
the permit. This is all that is required. It is but natural that the
replacement would require the Authority to grant the necessary
permission as they are the regulators. When an application made
under Section 83 is taken up, the Authority is cognizant of the
fact that there is a valid and a subsisting permit and the permit
holder seeks to continue operating the permit and it is only for
this reason that he is seeking replacement of the vehicle. The
context in which his scrutiny is called upon, is only to ensure that
the conditions of the permit are not deviated from. Therefore,
when the statute says same nature, it is only relatable to the
permit. The scrutiny is not of the vehicle in itself but the vehicle
in relation to the permit. It is for this reason that a scrutiny of the
vehicle, stand alone, irrespective of its relation with the permit
becomes an irrelevant consideration for the purpose of Section
83. The phrase, of the same nature seen in the context of
provisions proximate to Sections 83, relating to duration and
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renewals of permits (Section 81), transfer of permits (Section 82)
lend clarity to the meaning of the expression. Same nature must
necessarily relate to the same nature of the vehicle in the permit.
The question to be asked is the nature of the vehicle under the
permit. What kind of a vehicle was that? How was that connected
to the permit granted? Does the new vehicle serve the same
purpose as the old vehicle was serving under the permit? [Paras
13.2-13.4][803-C-H; 804-A-C]
1.5 Questions relating to the vehicle or about the vehicle
are matters of concern in Chapter IV, under which the Central
Government is empowered to set the norms for the fitness or
the age limit of the vehicle. Chapter V, on the other hand contains
the legal regime with respect to operations of transport vehicles.
It is under this Chapter that the Parliament intended that there
must be a provision for replacement of a vehicle covered under a
permit so that the permit granted could continue and subsist till
the end of its tenure. Chapters IV and V operate in their own
field subserving the purpose and objects mentioned therein. Rule
174 (2) (c) made by the State Government to enable replacement
of the vehicle under a Transport permit, does not impinge upon
the powers of the Central Government with respect to fixation of
the age of the vehicle, or fitness of the vehicle conferred upon it
under Sections 56 and 59 in Chapter IV. The scrutiny under Rule
174 is only to enable the Authority to ensure that the subsisting
permit is not interrupted and at the same time public interest is
not compromised by deviating from the permit. The Rule will
have no bearing on the power of the Central Government and as
such it would not be ultra vires the provisions of the Act. There
is yet another aspect which can lend a certain amount of clarity to
this position. The vehicle which the Authority may not approve
for replacement under section 83 on the ground that it is older
than the vehicle covered under the permit, can be used as a
transport vehicle within the State. There is no prohibition for
such a usage as the said vehicle may continue to be fit and within
the age limit prescribed by the Central Government. The rigour
of Rule 174 (2) (c) is only in the context of a subsisting transport
permit and not as a condition for transport vehicles as such. For
the reasons stated above, the submission that Rule 174(2)(c) is
ultra vires the provisions of the statute is not accepted. Rule
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174(2)(c) of the Kerala Motor Vehicle Rules,1989 is valid and
salutary and does not go beyond the scope of Section 83. [Paras
13.5-13.8][804-C-H; 805-A-B]
2.1 By the order impugned, the Division Bench of the High
Court held that Rule 174 (2) (c) being inconsistent with the Act
should be held to be inoperative. Rule 174 (2) (c) is intended to
ensure that the conditions under which a transport permit is
granted is not diluted when the vehicle covered by the permit is
sought to be replaced by a new vehicle. The purpose and object
of mandating replacement by a vehicle of the same nature in
Section 83 is only to ensure that the scrutiny and the conditions
that were undertaken and imposed at the time of the grant
continue even during the subsistence of the permit. The legal
regime involved in the grant of the permit as evidenced by the
statutory provisions, rules, forms and certification establish this
principle. Section 83 is to be understood only in the context of a
subsisting permit. The present is a case of a stage carriage permit,
the application for which is to be made under Section 70. As per
the P.St.S.A form provided for in Rule 144 for grant of a stage
carriage permit is formulated and appended, which comprises of
various particulars that an applicant must fill and submit. The
statutory scheme under Section 70 requiring an application for a
transport permit to provide material particulars include the
requirement of indicating the type of vehicle is also incorporated
in the Rules made by the State Government. The Rules, followed
by the Forms require details of the type of the vehicles to be
furnished. The need to call for information about the vehicle
becomes relevant when the requirement of Section 71 is noticed,
relating to the procedure and consideration of the applications.
Under Section 71, if the Central Government, in exercise of its
powers restricts the number of vehicles depending on the road
conditions and other relevant factors, the State Government shall
direct the Authorities to limit the number of stage carriages etc.
The consequence of limiting the stage carriages, coupled with
the provision for reservation in favour of Schedule Castes and
Schedule Tribes will necessarily compel the Authorities to
prioritize competing applicants on the basis of certain
prescriptions. These are statutorily prescribed under Section 71
(3)(d) read with proviso. Having considered the applications under
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Section 70, following the procedure laid down under Section 71,
the stage carriage permission is granted by the authority under
Section 72. Even at the stage of grant, the Authority is empowered
to prescribe certain conditions for the operation of the grant. In
compliance of Section 72, when a stage carriage permit is granted,
Rule 159 of Kerala Motor Vehicle Rules, 1989 mandatorily
prescribes that a permit shall bear the registration mark of the
vehicle. Grant of a transport permit is an important function that
the statutory authority under the Act would perform. [Paras 14,
15, 16.1, 16.3, 17.1-18.1][805-C, G-H; 806-A-B; 807-E; 808-AB; 809-F-H; 810-A, F; 811-D]
S. Rajaseekaran v. Union of India and Ors. (2018) 13
SCC 532 : [2017] 13 SCR 508; Subhash Chandra v.
State of U.P and Ors. (1980) 2 SCC 324 : [1980] 2
SCR 1024; Maharashtra State Road Transport
Corporation v. Babu Goverdhan Regular Motor Service
and Ors. (1969) 2 SCC 746 : [1970] 2 SCR 319 - relied
on.
Shaheed Khan v. State of MP (2011) SCC Online MP
2228 - approved.
Sheelchand and Co. v. State Transport Appellate
Authority, Gwalior and Anr. (1963) SCC Online MP
44 - referred to.
2.2 The reasoning adopted by the Division Bench in the
impugned order that Rule 174 (2) (c) has overridden the Act is
not correct because a subordinate legislation must be interpreted
to effectuate the statutory purpose and objective. The Rule should
enable the transport Authorities considering applications for
replacement to insist upon the permit holder to abide by the same
rigour and regulation that he was put to when the permit was
granted.The High Court has not appreciated the context in which
Rule 174 (2) (c) read with Section 83 is to be construed. The
Section as well as the Rule are to be seen in the context of
Chapter V relating to control of transport vehicles with respect
to which the State Government has the jurisdiction and power
grant and regulate transport permits. Rule 174 (2) (c), gives effect
to that regulatory regime of the State. Replacement of a vehicle
during the subsistence and continuation of a transport permit is
REGIONAL TRANSPORT AUTHORITY & ANR. v. SHAJU ETC.
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only an incident in the working of a transport permit. While
addressing such an incident, the Authority cannot be oblivious of
the history and background in which the permit is granted. [Paras
21.1, 21.2][816-E-H]
2.3 Further, the assumption in the impugned judgment that
the expression "same nature" is confined only to, mean "a bus
by bus, a mini-bus by mini-bus and not bus by a minibus...." is
not a correct way to read the provision. There is no need to
restrict the meaning of an expression same nature. In fact,
expressions such as this are better kept open ended to enable
courts to subserve the needs of changing circumstances. Having
examined Rule 174 (2) (c), intended to implement the purpose of
section 83 and also having examined Section 83 in the context of
Chapter V, in contrast to Chapter IV, the Court is of the view that
the rule is neither beyond nor contrary to Section 83. [Paras 21.3,
21.4][817-A-C]
3. Scope of the discretion exercised by the authority in
exercise of its power under Rule 174(2)(c) of the Kerala Motor
Vehicles Rules, 1989- Discretion is to be exercised wherever
necessary in order to render the exercise of power reasonable,
fair and non-arbitrary. Discretion could be express or implied.
Rule 174(2) is a provision where the Government has expressly
enabled the Authority to apply discretion, wherever necessary,
while exercising the power to grant replacement of a vehicle
under a permit. This discretion will have to be exercised
reasonably, fairly as the facts and circumstance would clearly
demonstrate. For instance, where the vehicle sought to be
substituted is marginally and inconsequentially older than the
vehicle covered under the permit, the Authority may perhaps be
justified in permitting such an application. The Authority will also
bear in mind the circumstances in which the permit holder was
chosen in cases of comparative merit under which the rival
applicants would have offered their own vehicles. If the exercise
of the discretion is not based on just reasonable and non-arbitrary
principles, such a decision would be vulnerable and subject to
correction in appeal and a further review. [Para 22.2][817-E-G;
818-A-B]
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4. Whether the fact that the impugned judgment which has
held the field over last few years and has been followed in
subsequent orders is in itself a sufficient ground to reject the
appeals? The Special Leave Petition against the order impugned
was filed immediately after the decision of the Division Bench of
the High Court and the matter has been pending adjudication
before this Court. As the judgment of the High Court is contrary
to law, it is compelling and inevitable that the judgment is set
aside. The judgment of the High Court is set aside, by holding
that Rule 174 (2) (c) is intra vires the provisions of the Act and
also Section 83 of the Motor Vehicles Act. [Para 24][818-D-E, FG]
Geeta B. Rao v. Secretary, Karnataka State Transport
Authority, 1994 2 Karn LJ 703; Yeshodhara Kadamba
v. KSRAT, ILR1988 KAR 2447;
Municipal
Corporation of City of Hubli v. Subha Rao
Hanumatharao Prayag and Others (1976) 4 SCC 830
: [1976] 3 SCR 883; Vijayawada Municipal
Corporation v. Andhra Pradesh State Electricity Board
and Another (1976) 4 SCC 548 : [1977] 1 SCR 846;
Bheem Singh Bhati v. State of MP and Ors. (2013) SCC
Online MP 8381; Ushakumari v. Abdul Azeez & Amp;
Ors. (2000) SCC Online Ker 269; Madan Singh
Shekhawat v. Union of India (1999) 6 SCC 459;
Kailash Chand and Anr. v. Dharam Dass (2005) 5 SCC
375 : [2005] 3 SCR 1182; Bangalore Turf Club Limited
v. Regional Director, Employees' State Insurance
Corporation (2014) 9 SCC 657 : [2014] 8 SCR 1021 -
referred to.
Case Law Reference
[1987] 2 SCR 1
relied on
Para 8.3
[1976] 3 SCR 883
referred to
Para 8.3
[1977] 1 SCR 846
referred to
Para 8.3
[2017] 13 SCR 508
relied on
Para 18.1
[1980] 2 SCR 1024
relied on
Para 20.1
[1970] 2 SCR 319
relied on
Para 20.2
REGIONAL TRANSPORT AUTHORITY & ANR. v. SHAJU ETC.
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(1999) 6 SCC 459
referred to
Para 21.3
[2005] 3 SCR 1182
referred to
Para 21.3
[2014] 8 SCR 1021
referred to
Para 21.3
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 14531454 of 2022.
From the Judgment and Order dated 18.07.2017 of the High Court
of Kerala at Ernakulam in W.A. Nos. 1466 and 1470 of 2017.
Santosh Krishnan, Adv. (Amicus Curiae).
G. Prakash, Ms. Priyanka Prakash, Ms. Beena Prakash, Mohit
Kumar Gupta, Advs. for the Appellants.
The Judgment of the Court was delivered by
PAMIDIGHANTAM SRI NARASIMHA, J.
1. Leave granted.
2. Section 83 of the Motor Vehicles Act, 1988 enables replacement
of the vehicle covered under an existing transport permit by another
vehicle of the same nature. Can a State Government make Rules,
enabling the road transport authority to reject an application for
replacement if the proposed vehicle is older than the one covered under
the existing permit? This is the question we are tasked to answer. For
the analysis and the reasoning that will follow, we have held that Rule
174(2)(c) of the Kerala Motor Vehicle Rules,1989 is valid and salutary
and does not go beyond the scope of Section 83. We will first refer to
the basic facts and the statutory provisions before analyses and
determination.
Facts:
3.1 The Respondent was granted a stage carriage operator permit,
P.St. 7/362/2012 dated 7.5.2017 in respect of vehicle number KL-41L1017, a 38-Seater, 2016 model by the Regional Transport Authority
(hereinafter referred to as 'Authority') to conduct transport service on
the route Pattimattam-Kakkanad in Kerala. On 19.5.2017, the Respondent
applied to the Authority under Section 83 of the Motor Vehicles Act,
1988 (hereinafter referred to as 'Act') read with Rule 174 of the Kerala
Motor Vehicle Rules, 1989 (hereinafter referred to as 'Rules') for grant
of permission to replace the vehicle covered under his permit with another
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vehicle KL-17E-997, a 33-Seater, 2006 model. Alleging inaction on the
part of the Authority, the Respondent filed a Writ Petition before the
High Court of Kerala on 12.6.2017. The Learned Single Judge disposed
of the writ petition on 13.06.2017 by merely directing the State and the
Authority to consider the application on the ground of road-worthiness
alone and without reference to the model of the vehicle.
3.2 Aggrieved by the Single Judge's decision, the Authority
preferred Writ Appeals No.1466/2017 before the Division Bench of the
High Court of Kerala. Another Writ Appeal No.1470/2017 dealing with
similar facts and issues was also taken up along with this case. The
Division Bench by the impugned judgment dated 18.07.2017 dismissed
the Writ Appeals holding that Rule 174(2)(c) of the Kerala Motor Vehicle
Rules, 1989 goes beyond the provision of the Act. The Court concluded:-
"When in exercise of delegated authority, the subordinate
authority i.e., the State, makes the rules, the rules have to be
consistent with the Act. The Rules cannot override the Act or
restrict the ambit of the Act. When the expression is vehicle of
same nature, then if Rule l74(2)(c) restricts that an older
vehicle cannot be brought in, it would be restricting the right
conferred to a person by the provisions of the Act. Surely
such an exercise by a delegate cannot be permitted. Rules
have to be consistent with the Act and not restricting or in
derogation thereto. Rules to that extent cannot thus be held
to be consistent with the Act and would have to be held to be
inoperative."
3.3 With these findings the Division Bench dismissed the Appeals.
It is this order that is challenged before this Court. We heard Sh. G
Prakash, Advocate for the appellant State and the Authorities and
Sh. Santosh Krishnan, Amicus Curiae.
Contentions:
4.1 Shri G. Prakash, learned counsel on behalf of the State and
Authority submitted that the purpose of Rule 174(2)(c) is to ensure the
safety of the travelling public and therefore the prohibition for replacement
of a vehicle covered under a permit with an older model would be legal
and justified as it will also ensure that the vehicle of the 'same nature' as
prescribed under Section 83. Alternatively, it is also submitted that the
requirement under Rule 174(2)(c) must be seen in the context of
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discretion to be exercised by the Authority while considering the
application for replacement. It is his case that rejection is not automatic
as it is within the power of the Authority to either accept or reject the
request the application for a good and a valid reason. He further submits
that as there was no specific challenge to Rule 174(2)(c), the High Court
was not justified in declaring the Rule as inoperative. In light of these
submissions, he urged for the impugned judgment to be set-aside and the
Rule be upheld.
4.2 Since there was no appearance on behalf of the Respondents,
we requested Shri Santosh Krishnan to assist us as Amicus Curiae and
he readily accepted the assignment and ably assisted us by filing written
submissions supporting the judgment of the High Court. The primary
submission of the Amicus Curiae is that the State Government does not
have the legislative competence to make the impugned Rule. He argued
that matters relating to prescription of conditions, methodology for
verification and even certification of fitness of vehicle (Section 56 read
with the Rule 62) as well as the power to fix the age limit of a motor
vehicle (Section 59) fall within the province of the Central Government
and therefore, the State Government does not have the competence to
make Rules 174(2)(c). He would urge that a collateral challenge to the
impugned order on the ground of competence is legally permissible. He
drew our attention to Rules made in other States to demonstrate that
none of them have made a Rule akin to Rule 174(2)(c) that touches
upon the fitness of a vehicle. He concluded by submitting that the
impugned decision of the High Court has held the field for over four
years and has also been followed in subsequent cases and therefore this
Court may not interfere while exercising jurisdiction under Article 136.
5. The following issues arise for our consideration:
i.
Whether Rule 174(2)(c) of Kerala Motor Vehicles Rules,
1989 is ultra-vires the provisions of the Act as the power
with respect to prescription of age limit of a motor vehicle
is in the exclusive domain of the Central Government?
ii.
Whether Rule 174(2)(c) of the Kerala Motor Vehicles
Rules, 1989 travels beyond and contrary to Section 83 of
the Motor Vehicles Act, 1988?
iii.
 What is the scope of the discretion exercised by the
Authority in exercise of its power under Rule 174(2)(c) of
the Kerala Motor Vehicles Rules, 1989?
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iv.
Whether the Respondents can challenge the legality of Rule
174(2)(c) without specifically praying for the same in the
Writ Petition and whether the High Court is justified in
permitting such a submission?
v.
Whether the fact that the impugned judgment has held the
field over last few years and has been followed in subsequent
orders is in itself a sufficient ground to reject the appeals?
Act and the Rules:
6.1 Rule 174(2)(c) of the Kerala Motor Vehicles Rules, 1989
provides as under: -
"Rule 174. Permit Replacement of vehicles:
(1) If the holder of a permit desires at any time to replace a
vehicle covered by the permit with another vehicle, he shall
forward the permit and apply in Form "P.V.A." with the fee
prescribed in Rule 180 to the Transport Authority which
granted the permit stating the reasons for the proposed
replacement and shall,
(a) if the new vehicle is not in his possession, state the
material particulars in respect of which the new vehicle
differs from the old: and
(b) if the new vehicle is in his possession, forward the
certificate of registration hereof
(2) Upon receipt of the application, the Transport Authority
may in his discretion, reject the application -
(a) if it has previous to the date of receipt of the application
given reasonable notice of its intention to reduce the number
of Transport Vehicles of that class generally or in respect
of the route or area to which the permit applies; or
(b) if the new vehicle proposed differs in the material
respects from the old; or
(c) if the new vehicle proposed is older than the one sought
to be replaced; or
(d) if the holder of the permit has contravened the
provisions thereof or has been deprived of possession of
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the old vehicle under the provisions of any agreement of
higher purchase, hypothecation or lease.
(3) if the new vehicle proposed does not differ in material
respects from the old, the application for replacement of the
vehicle may be allowed. If there is material difference between
the two vehicles, the application shall be treated as if it were
for a fresh permit."
6.2 The power relatable to replacement of the vehicle is provided
in Section 83 of the Act: -
"83. Replacement of vehicles: The holder of a permit may,
with the permission of the authority by which the permit
was granted, replace any vehicle covered by the permit by
any other vehicle of the same nature."
7. Having noticed the Rule in question and the relatable statutory
provision, we will now consider the issues in seriatim.
Issue (i): Whether Rule 174(2)(c) of Kerala Motor Vehicles
Rules 1989 is ultra-vires the provisions of the Act as the
power with respect to prescription of age limit of a motor
vehicle is in the exclusive domain of the Central
Government?
8.1 Section 83 is an enabling provision. It allows a permit holder
to replace the vehicle covered under the transport permit. The right to
replace the vehicle under a permit is subject to the permission of the
Authority. The right, as well as the power to grant permission, are subject
to the condition that the vehicle to be replaced is 'of the same nature'.
8.2 The expression, 'of the same nature' can have multiple
meanings.1 This phrase, in its natural expression would only mean having
similar features. But then, would 'same' mean similar, identical,
1 In Geeta B.Rao v. Secretary, Karnataka State Transport Authority, 1994 2 Karn LJ
703, the Karnataka High Court, while following an earlier judgment Yeshodhara Kadamba
v. KSRAT, ILR1988 KAR 2447 held that the expression "nature" is distinct from the
expression "capacity" that existed prior to its amendment and observed, "firstly, on a
plain understanding of the meaning of the Section can mean, vehicle of a similar type,
i.e., a passenger vehicle. It only means that a tourist vehicle cannot be replaced by a
stage carriage or a goods-vehicle. In other words, the 'character' of the vehicle cannot
be changed. The meaning intended to be conveyed is that the characteristic of the vehicle
should not be lost."
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equivalent, comparable, interchangeable or related? Likewise, would the
expression "nature" mean type, feature, texture, make, model, design,
or generation?
8.3 These are open textual expressions, used in the normal course
to convey a meaning which the legislature would not have intended to be
read in a pedantic manner. When the words in the Section allow multiple
interpretations, Courts of Law have developed the art and technique of
finding the correct meaning by looking at the words in their context. This
approach is beautifully expressed by Justice O. Chinnappa Reddy in the
case of Reserve Bank of India v. Peerless General Finance
Investment Co. Ltd And Ors.2:
"33. Interpretation must depend on the text and the context.
They are the bases of interpretation. One may well say if the
text is the texture, context is what gives the colour. Neither
can be ignored. Both are important. That interpretation is best
which makes the textual interpretation match the contextual.
A statute is best interpreted when we know why it was enacted.
With this knowledge, the statute must be read, first as a whole
and then section by section, clause by clause, phrase by phrase
and word by word. If a statute is looked at, in the context of
its enactment, with the glasses of the statute-maker, provided
by such context, its scheme, the sections, clauses, phrases
and words may take colour and appear different than when
the statute is looked at without the glasses provided by the
context. With these glasses we must look at the Act as a whole
and discover what each section, each clause, each phrase
and each word is meant and designed to say as to fit into the
scheme of the entire Act. No part of a statute and no word of
a statute can be construed in isolation. Statutes have to be
construed so that every word has a place and everything is in
its place......"
9. As the text by itself has not conferred certainty to the meaning
of the expression - of the same nature, we have to examine the phrase
2 Reserve Bank of India v. Peerless General Finance Investment Co. Ltd (1987) 1 SCC
424. We would notice similar approach adopted by this Court in Municipal Corporation
of City of Hubli v. Subha Rao Hanumatharao Prayag and others (1976) 4 SCC 830
Vijayawada Municipal Corporation v. Andhra Pradesh State Electricity Board and
Another (1976) 4 SCC 548.
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in context of the words in the Section, the neighboring provisions, the
Chapters, Parts and its location in the Statute as a whole.
10. The Motor Vehicles Act, 1988 regulates matters such as,
licensing of the drivers of motor vehicles in Chapter II, licensing of
conductors of stage carriages in Chapter III, registration of motor vehicles
in Chapter IV, control of transport vehicles in Chapter V, state transport
undertakings in Chapter VI, control of traffic in Chapter VIII, no fault
liabilities in Chapter X, insurances in Chapter XI, establishments of
Tribunals in Chapter XII, penalties in Chapter XIII, apart from the
miscellaneous provisions in Chapter XIV. For the purpose of this case, it
is sufficient to examine the phrase in the context of Chapter IV relating
to Registration of Motor Vehicles and Control of Transport Vehicles in
Chapter V.
11.1 Chapter IV lays out the general regulatory regime for
registration of motor vehicles, transfer of ownership, certification of
fitness, age limit of vehicles and also provides for the rulemaking powers
of the Central as well as the State Governments. The purpose and object
of this Chapter is to regulate driving of a motor vehicle in any public
place and with this endeavor. Section 39 prohibits any person from driving
a motor vehicle without its registration. The Central Government is
empowered to lay down norms and prescribe procedures for registration,
fees, maintenance of registers, registration numbers (RC), time limits
for renewal etc. Fixing the terms and conditions for grant of Certificate
of fitness and fixation of age limits of the vehicle is the exclusive domain
of the Central Government under Sections 56 and 59.
"Section 56. Certificate of fitness of transport vehicles:
(1) Subject to the provisions of sections 59 and 60, a transport
vehicle shall not be deemed to be validly registered for the
purposes of section 39, unless it carries a certificate of fitness
in such form containing such particulars and information as
may be prescribed by the Central Government, issued by the
prescribed authority, or by an authorized testing station
mentioned in sub-section (2), to the effect that the vehicle
complies for the time being with all the requirements of this
Act and the rules made thereunder;...."
11.2 Following the power vested in it, the Central Government
enacted the Central Motor Vehicles Rules, 1989. Rule 62 laying down
the procedure for grant of a certificate.
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"Rule 62. Validity of certificate of fitness:
(1) A certificate of fitness in respect of a transport vehicle
granted under Section 56 shall be in Form 38 and such
certificate when granted or renewed shall be valid for the
period as indicated below........."
11.3 Similarly, we notice the power of the Central Government to
prescribe age limit of a vehicle is in Section 59. The provision to the
extent it is relevant for the purpose of the case is as under: -
"Section 59: Power to fix the age limit of motor vehicle-
(1) The Central Government may, having regard to the public
safety, convenience and objects of this Act, by notification in
the Official Gazette, specify the life of a motor vehicle reckoned
from the date of its manufacture, after the expiry of which the
motor vehicle shall not be deemed to comply with the
requirements of this Act and the rules made thereunder:
Provided that the Central Government may specify different
ages for different classes or different types of motor vehicles."
11.4 There is a distinction between the rule-making power given
to the Central Government on one hand and to the State Government on
the other. Section 64 is the rule-making power of the Central Government,
enabling it to lay down the norms and procedures to be followed for
implementation of provisions in the Act. Sub-sections (m) and (n) of
Section 64 are relevant for our purposes, wherein it is provided that: -
"Section 64: Power of Central Government to make rules:
The Central Government may make rules to provide for all or
any of the following matters namely: -
(m) the form in which the certificate of fitness shall be issued
under sub-section (1) of Section 56 and the particulars and
information it shall contain;
(n) the period for which the certificate of fitness granted or
renewed under Section 56 shall be effective."
11.5 In contrast, the rule-making power of the State Government
is as the executing agency for implementing of the provisions of the Act.
For this purpose, Section 65 enables the State Government to make
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such Rules as are necessary for execution. Crucial words in the Rule
making power of the State are noted below with added emphasis: -
"Section 65: Power of State Government to make rules: (1) A
State Government may make rules for the purpose of carrying
into effect the provisions of this Chapter other than the matters
specified in Section 64."
12.1 Chapter V relates to the regulatory regime of the State
Governments with respect to Transport vehicles. It prohibits
transportation without a valid permit under Section 66. Control of road
transport vested in the State Government under Section 67, is to ensure,
(a) advantages to the public, trade and industry by the development of
motor of transport, (b) coordination of road and rail transport, (c) prevent
deterioration of the road system and also to (d) prevent uneconomic
competition among holders of permits. For this purpose, the State
Government can issue directions to the State and Regional Transport
Authorities established under Section 68. Right to Appeal against the
decisions of State or Regional Transport Authority is provided under
Section 89 and Revisional powers are under Section 90, followed by a
bar on Civil Courts Jurisdiction under Section 94. Under this Chapter
State Government alone has power to make rules.