# SHRINIV ASA REDDY AND OTHERS v. THE STATE 0]' MYSORE AND OTHERS

- **Citation:** [1960] 2 S.C.R. 130
- **Court:** Supreme Court of India
- **Decided:** 1959-03-31
- **Case number:** Writ Petition No. 75 of 1959
- **Bench:** B. P. Sinha, Jafer Imam, J. L. Kapur, K. N. Wanchoo, K. C. Das Gupta
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/shriniv-asa-reddy-and-others-v-the-state-0-mysore-and-others-1851
- **Pages:** 17

## Headnote

Motor V ehicles-l>l ationalisation of transport services-Scheme
-If must be capable of hfing implemented all at once-Application
for permit by State Transport Undertaking-Procedure- Motor
Vehicles Act, I939 (4 of r939), as amended by the Motor Vehicles
(Amendment) Act, r956 (roo of r956), ss. 68C, 68F(z), 57(2).
The stage carriage permits of the petitioners, who were also
the petitioners in Writ Petition No. 75 of 1959, previously
reported, were expiring on 31st March, 1958, and were rene\ved
up to March 31, 1959·
A fresh scheme of nationalisation having
,
-
-
-
S.C.R.
SUPREME COURT REPORTS
131
been approved ahd published under s. 68C of the Motor Vehicles
z959
Act, the Regional Transport Authority, in order to avoid inconvenience to the public, granted temporary permits to the Shrinivasa Reddy
petitioners till the State Transport Department obtained, their
v.
permits. The Departme'nt applied for permits under s. 68F(1) of
The.State of
the Act in accordance with the scheme admittedly less than six
Mysore.
weeks before the date when they were to take effect, contrary to
the provision of s. 57(2) of the Act. The petitioners had also
applied for renewal of their permits. The Regional Transport
Authority issued permits to the Department and rejected the
renewal applications of the petitioners. The petitioners moved
the High Court under Art. 226 of the Constitution for quashing,
that order. The High Court held that the issue of permits to the
Department was invalid as the provision of s. 57(2) had not been
complied with, and the refusal of renewal of the petitioners'
permits was incorrect, but it dismissed the Writ Petition on the
ground that the relief that could be granted to the petitioners
could only be short-lived. The petitioners applied for a certificate
to enable them to appeal to this Court and while that application
lay pending, applied to this Court under Art. 32 of the Constitution. It was contended on their behalf that before the renewal
application could be rejected and permits grantea to the Department under s. 68F(r) of the Act, the Department must apply
for permits in respect of all the routes covered by the scheme so
that there could be no possibility of any discrimination between
an operator and an operator in infringement of Art. 14 of the
Constitution as also their rights to carry on their business under
Art. 19(1)(g) of the Constitution. It was further contended that
non-compliance with the provision of s. 57(2) of the Act disentitled the Department to any permits at all. It was contended on
behalf of the Department that it was open to it to implement the
scheme by stage and it was denied that there could be any discrimination in doing so or that. s. 57(2) applied to an application
under s. 68F(1) of the Act.
Held (per Sinha, C.J., Imam, Wanchoo and Das Gupta, JJ.),
that it was clear from the language of s 68F of the Motor
Vehicles Act, 1939,. that an application by a State Transport
Undertaking for a permit thereunder mu'st be made in the manner
prescribed by Ch. IV of the Act and, therefore, there could be no
doubt that such an application must fall within the purview of
s. 57(2) of the Act. Consequently, the orders granting the application for permits made by the State Transport Department in
the instant case, admittedly in breach of s. 57(2) of the Act, were
on that ground alone liable to be quashed.
Section 68C of the Act contemplates that where there is no
intention to operate an entire route but a portion of it, that
portion alone should be specified as the route and not the whole
of it.or any portion thereof as in the instant case. The scheme,
however, clearly intended that alL the routes in their entirety
•
132
SUPREME COURT REPORTS [1960 (2))
x959
were to be taken over and so the qualifying words were mere
surplusage.
Shrinivasa Reddy
v.
The State of
..'ifysore
Wanchoo ].
Per Kapur, J.-On a proper construction of ss. 68C and 68F
of the Act, it would not be correct to say that the Legislature
intende

## Text

'959
130
SUPREME COURT REPORTS [1960(2)]
The house in Dhanraj Lane was valued in the draft
sale deed at Rs. 3,500 and in the sale deed at Rs. 2,ooo:
Bhashar Wainan
Joshi
No explanation has been given for this disparity
v.
between the prices mentioned in the draft and the
Narayan Rambilas sale deed and there is substance in the contention
Agarwal
s£rongly pressed by counsel for the transferors that the
Shah].
'959
November 6.
value of Rs. 2,000 for a house with a ground floor and
two stories is artificial. The evidence discloses that the
house was let out on a monthly rent of Rs. 20 and
capitalising that rent at 5% on the assumption that by
the construction the land was folly developed, the price
thereof was more than double the price set out in the
deed. It is clear that this house was included in the
deed to make up the total value of Rs. 39,500, the
amount required by the transferors to tide over their
immediate difficulties.
Counsel for the transferees sought to· rely upon the
evidence of subsequent conduct of the transferors as
indicative of the character of the transaction as a sale,
but as already observed, that evidence is inadmissible.
In our view, the High Court was right in holding
that the real transaction incorporated in Ex. D-1 was
a mortgage and not a sale. The appeal therefore fails
and is dismissed with costs.
Appeal dismissed.
SHRINIV ASA REDDY AND OTHERS
v.
THE STATE 0]' MYSORE AND OTHERS
(B. P. SINHA, c. J., JAFER IMAM, J. L. KAPUR,
K. N. WANCHOO and K. C. DAS GUPTA, JJ.)
Motor V ehicles-l>l ationalisation of transport services-Scheme
-If must be capable of hfing implemented all at once-Application
for permit by State Transport Undertaking-Procedure- Motor
Vehicles Act, I939 (4 of r939), as amended by the Motor Vehicles
(Amendment) Act, r956 (roo of r956), ss. 68C, 68F(z), 57(2).
The stage carriage permits of the petitioners, who were also
the petitioners in Writ Petition No. 75 of 1959, previously
reported, were expiring on 31st March, 1958, and were rene\ved
up to March 31, 1959·
A fresh scheme of nationalisation having
,
-
-
-
S.C.R.
SUPREME COURT REPORTS
131
been approved ahd published under s. 68C of the Motor Vehicles
z959
Act, the Regional Transport Authority, in order to avoid inconvenience to the public, granted temporary permits to the Shrinivasa Reddy
petitioners till the State Transport Department obtained, their
v.
permits. The Departme'nt applied for permits under s. 68F(1) of
The.State of
the Act in accordance with the scheme admittedly less than six
Mysore.
weeks before the date when they were to take effect, contrary to
the provision of s. 57(2) of the Act. The petitioners had also
applied for renewal of their permits. The Regional Transport
Authority issued permits to the Department and rejected the
renewal applications of the petitioners. The petitioners moved
the High Court under Art. 226 of the Constitution for quashing,
that order. The High Court held that the issue of permits to the
Department was invalid as the provision of s. 57(2) had not been
complied with, and the refusal of renewal of the petitioners'
permits was incorrect, but it dismissed the Writ Petition on the
ground that the relief that could be granted to the petitioners
could only be short-lived. The petitioners applied for a certificate
to enable them to appeal to this Court and while that application
lay pending, applied to this Court under Art. 32 of the Constitution. It was contended on their behalf that before the renewal
application could be rejected and permits grantea to the Department under s. 68F(r) of the Act, the Department must apply
for permits in respect of all the routes covered by the scheme so
that there could be no possibility of any discrimination between
an operator and an operator in infringement of Art. 14 of the
Constitution as also their rights to carry on their business under
Art. 19(1)(g) of the Constitution. It was further contended that
non-compliance with the provision of s. 57(2) of the Act disentitled the Department to any permits at all. It was contended on
behalf of the Department that it was open to it to implement the
scheme by stage and it was denied that there could be any discrimination in doing so or that. s. 57(2) applied to an application
under s. 68F(1) of the Act.
Held (per Sinha, C.J., Imam, Wanchoo and Das Gupta, JJ.),
that it was clear from the language of s 68F of the Motor
Vehicles Act, 1939,. that an application by a State Transport
Undertaking for a permit thereunder mu'st be made in the manner
prescribed by Ch. IV of the Act and, therefore, there could be no
doubt that such an application must fall within the purview of
s. 57(2) of the Act. Consequently, the orders granting the application for permits made by the State Transport Department in
the instant case, admittedly in breach of s. 57(2) of the Act, were
on that ground alone liable to be quashed.
Section 68C of the Act contemplates that where there is no
intention to operate an entire route but a portion of it, that
portion alone should be specified as the route and not the whole
of it.or any portion thereof as in the instant case. The scheme,
however, clearly intended that alL the routes in their entirety
•
132
SUPREME COURT REPORTS [1960 (2))
x959
were to be taken over and so the qualifying words were mere
surplusage.
Shrinivasa Reddy
v.
The State of
..'ifysore
Wanchoo ].
Per Kapur, J.-On a proper construction of ss. 68C and 68F
of the Act, it would not be correct to say that the Legislature
intended that the scheme as approved must be implemented all
at once or not al all. It would be impractical to suggest that the
whole scheme should be implemented in a rigid manner.
Some
flexibility in implementing it must necessarily be implied for
other\vise nationalisation of transport services, the accepted State
policy in India, was likely to be indefinitely held up, if not
thwarted. The language used by s. 68F lends no support to such
a contention nor do the words "in Pursuance of" occurring
therein mean that the whole of the scheme has to be put into
operation and not a portion of it.
Bradford Corporation v. Myers, (1916) l A.C. 242, referred to·
If the State cannot take over routes for which application
can be immediately made, the taking over must become not only
difficult but extremely expensive as other interests may supervene
in the meantime.
Where, therefore, it intends to run a scheme
\vithin a reasonable time, there can be no reason \vhy it should
not apply· for different routes \vi thin a reasonable time so long as
it acts honestly, fairly and without any oblique motives.
Since the State Undertaking in the present case had implemented a part of the scheme and made fresh applications for
permits in the manner providec! by s. 57(2) and their relevant
provisions of Act, it is not necessary to pass a formal order
quashing the permits granted in its favour.
J{. N. Guruswamy v. The State of Mysore, [1955] 1 S C.R. 305
referred to.
ORIGINAL JURISDICTION: Petition No. 95 of 1959.
Petition under Article 32 of the Constitution for
enforcement of Fundamental Rights.
C. K. Daphtary, Solicitor.General of India and
B. R. L. Iyengar, for the petitioners .•
H. N. Sanyal, Additional Solicitor-General of India,
R. Gopalakrishnan and T. M. Sen, for respondents
Nos. I and 2.
1959.
November 6.
The Judgment of Sinha, C.J.,
Imam, iVanchoo and Das Gupta, JJ. was delivered by
Wanchoo, J. Kapur, J. delivered a separate judgment.
W ANCHOO J.-This petition under Art. 32 of the
Constitution is a sequel to Writ Petition No. 75 of 1959,
which is also being disposed of. today. It is not necessary therefore to set out the early history leading to
•
'
S.C.R.
SUPREME COURT REPORTS
133
this petition as that has already been given in the
z959
judgment in Petition No. 75.
Suffice it to say that 5 , . . -R dd
h
. .
h
h
th
. .
.
,irinivasa
e y
t e pet1t10ners w o are t e same as
e pet1t10ners m
v.
Petition No. 75 were transport operators in the Anekal
lheStateof
pocket in the State of Mysore. They held stage carriMysore
age permits for various routes which were expiring on
March 31, 1958.
They were granted renewal of these
Wanchoo f.
permits up to March 31, 1959. . In the meantime,
steps were taken to .formulate an approved scheme
under Chapter IV-A of the Motor Vehicles Act, No. IV
of 1939, (hereinafter called the Act). The scheme was
. finally approved and published on ·April 23, 1959. In
order, however, to avoid inconvenience to the public
temporary permits were granted to the petitio!,lers
after March 31, 1959, for a period of four months or
up to the time the Mysore Government Road Transport Department (hereinafter called the Department)
was granted .permits under s. 68]', whichever was
earlier.
Sometime before June 23, 1959, the Department applied for permits in accordance with the
scheme while the petitioners had a,pplied for renewal
of their permits. The Regional Transport Authority,
Bangalor.e (hereinafter calle<l the Authority) issued
permits to the Department and -rejected the renewal
applications of the petitioners on June 23, 1959. The
petitioners then applied to the High Court of Mysore
by a writ petition challenging the issue of permits to
the Department and the refusal of renewal to them.
This petition was disposed of by the High Court op.
July 14, 1959, and.it was held that the grant of per-
'mits to the Department was invalid and the rejection
of the renewal applications of the petitioners was
incorrect ; but the High Court dismissed this petition
on the ground ~hat the relief.to which the petitioners
were entitled, in view of these findings, would be short- ·
lived. The petitioners then applied for a certificate to
enable them to appeal to this Court and that application is still pending. The present petition was filed on
August 3, 1959.
The first contention of the petitioners in this peti.
tion is that after.the scheme had been approved and
published under Chapter IV-A of the Act, it was the
134
SUPREME COURT REPORTS [1960 (2)]
r959
duty of the Department to apply under s. 68F for all
Sh . . -R dd the routes covered by the scheme and it was only,
rinivasa
e y
h
h D
l' d c
II
v.
w en t e
epartment app 1e
<Or a
the routes, that
The State of
it would be open to the Authority to reject the applicMysore
ations for renewal made by the petitioners.
The
Department in this case applied only for some of the
Wanehoo f.
routes and in particular it was pointed out that there
was no application at any rate for one out of the fourteen routes included in the scheme. Therefore, it is
submitted that the Department by picking and choosing which route to apply for and which to leave out
was discriminating against those operators for whose
routes it applied for permits and in favour of those
operators for whose routes it did not apply for permits.
:Further, the Authority by granting .permits to the
Department in such· circumstances
was denying
equality before the law to the petitioners. This was
an infringement of Art. 14 of the Constitntion and also
contravened the petitioner's right to carry on business
guaranteed under Art. 19 (l)(g).
Secondly, the petitioners contended that the Authority could not issue
permits in this case as s. 57(2) and (3) was not complied
with. The petitioners therefore prayed for a direction
quashing the order of the Authority issuing permits to
the Department under s. 68F and refusing their
renewal applications.
The petition has been opposed by the Department
and its contention is tha,t even though an approved
scheme might cover a number of routes, it was open
to the Department to implement it. in stages and that
it was the best judge as to which route should be taken
over first and there could be no discrimination so long
as the holders of the stage carriage permits operating
on a particular route were treated eqμally inter se in
pursuance of the approved scheme. It is also urged
that sub-sections (2) and (3) of s. 57 do not apply to
applications for issue of permits made under s. 68F(l).
We shall begin by examining the second contention.
Section 68F lays down that where in pursuance of
an ,,,pprnved scheme any State Transport Undertaking
applies in the manner specified in Chapter IV for a
stage carriage permit, etc., in respect of a notified area
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;
S.C.R.
SUPREME COURT REPORTS
135
or a notified route, the Regional Transport Authority
z959
shall issue such permit to the Undertaking notwith- Sh . . -R ~a
.
.
,
•
rinitiasa
eu. y
standmg anythmg to the contrary contamed m
.
v.
Chapter IV. Clearly therefore the undertaking has
The State of.
to apply for permits in the manner provided in
Mysore
Chapter lV,
even though the Regional Transport
Authority may be bound on such application to issue
Wanchoo J.
the permits. This takes us to s. 45, which lays down
to which authority the application shall be made and
then to s. 46 which lays down the particuJars which
the application must contain. Thus the Undertaking
must comply with the terms of ss. 45 and 46 when it.
applies for permits. Then comes s. 57(2) which lays
down that an application for a stage carriage permit
(with which we are concerned in this case) shall be made
not less than six weeks before the date on which it is
desired that the permit shall take effect or if the
Regional Transport Authority appoints dates for the
receipt of such applications, on f!uch dates. In this
case the Regiona1 Transport Authority had appointed
no date and clearly therefore the Undertaking should
have applied not less than six weeks before the date
on which it desired to start the service. This is necessary to give time to the Regional Transport Authority
to deal with the matter and if necessary to inform
those who might be affected under s. 68F (2) to be prepared for the change. That is whys. 68F (1) provided
that the applications shall be made in the manner
provided in Chapter IV. This provision has nothing
to do with the publicatiqn required under s. 57(3) which
is meant for a different purpose. It was urged by the
learned Solicitor-General that the procedure provided
in s. 57(3) also applies as it is not inconsistent with
the provisions of Chapter IV-A (see s. 68B).
We
consider it unnecessary to go into this matter for it is
not disputed that the applications for permits in this
case were not made at least six weeks before the date
from which the permits were to take effect. In the
circumstances the applications being not in the manner
provided in Chapter lV and being actually in breach
of s. 57 (2), no permits could be issued ..on such applications.
Therefore, the orders in favour of the
I959
Shrini11asa Reddy
v.
The State of
Mysore
Wanchoo ].
136
SUPREME COURT REPORTS [1960 (2)]
Department issuing permits to it are liable to be
quashed on this ground alone.
In view of the above decision, it is really not necessary for us to decide the first contention.
We would,
however, like to point ont the dangers inherent in the
claim put forward by the Departme\lt. A scheme is
prepared under s. 68C. It is initiated by the Undertaking when it is of opinion that for the purpose of
providing an efficient, adequate, economical and properly co-ordinated road transport services, it is nPcessary inothe public interest that road transport serviees
in general or any particular class of such scn·ice in
relation to any area or route or portion thereof should
be run and operated by the Undertaking, whether to
the exclusion, complete or partial, of other persons or
otherwise. This section thus gives power to the
Undertaking to prepare a scheme in relation to an
area or route or portion thereof. The U ndcrtaking is
thus not bound to prepare a scheme for the whole
State at one time ; it has been given the power to
choose particular types of services or a particular area
or particular routes or even portions thereof, for the
reason -that it may not be possible for the Undertaking
to run services all over the State at the same time.
Thns when the Undertaking decides to frame a
scheme, it must take into account its resources in men, .
material and money and frame a scheme only to the
extent to which it can carry it out in full. For example,
if it can carry out the scheme for the whole State at
once it may frame a scheme for the whole State. But
if it cannot do so, it can frame a scheme for one
district. Even if that is not within its resources it
can frame a scheme for a part of a district. Even in
a part of the district its scheme may deal with certain
routes and not all. So long as it can show that the
scheme is an efficient, adequate, economical and properly co-ordinated scheme for road transport service,
it will have a right to frame a scheme for only a part
of the transport services running in a State. Therefore, the scheme to be framed must be such as is
capable of being carried out all at once and that is why
the Undertaking has been given the power to frame a
•
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..
..
s:c.R.
SUPREME COURT REPORTS'
137
scheme for an area or route or even a portion thereof.
Further after the scheme is framed it is approved and
published by the State Government.
Thereafter it is
the duty of the Undertaking to carry out the scheme
and in pursuance of that it applies for permits under
s. 68F(l}. If the Undertaking at that stage has the
power to carry it out piecemeal, it would be possible
for it to abuse the power of implementation and to
discriminate against some operators and in favour . of
others included in the scheme and also to break up
the int!,lgrity of the scheme and in a sense modify it
against the terms of s. 68E. Tqere is no difficulty for
the Undertaking to apply for permits relating to the
entire scheme at the s~me time, for the manner in
which the scheme is prepared under s. 680 takes into
account all the difficulties which might arise in· the
implementation of the scheme and with that very object
provides for taking over particular types of transport
services in relation to areas or routes or even portions
thereof. W c need not however pursue the matter
further on this occasion.
Before we go to the other point raised in this petition, we should like briefly to refer to a feature of the
scheme, which has been brought to our notice.
This
feature is that though the scheme mentions fourteen
routes with their terminii and intermediate points
and the length of the routes, there is a parrot-like
repetition of the words " or any portion thereof" in
all the fourteen routes.
We should like to point out
that it is the duty of the Undertaking when it
prepares a scheme under s. 680 to decide whether. it
will take up a whole route or a portion thereof. If it
decides to take a portion of the route (provided, however, conditions of efficiency, adequacy, economy and
proper co-ordination are fulfilled}, it should specify
that portion only in the scheme.
S. 680 does not
contemplate that· the routes should be specified in
the manner in which they have been specified· in this
case, as, for example, ·" Bangalore to Anekal or any
portion thereof." If·the intention was not to operate
on the whole Bangalore-Anekal route, but only a
portion of it, that portion should have been specified
JS
I959
Shrinivasa Reddy
v.
The State of
Mysore
Wanchoo ].
I959
Shrinivasa Reddy
v.
The State of
Mysore
Wanchoo ].
138
SUPREME COURT REPORTS [1960(2)]
as the route.
However, in this particular cas~, we are
of opinion that the intention clearly was to take over
the whole route in the case of all the fourteen routes,
which will be clear from the length of the route to be
taken over mentioned in the schedule to the so.heme.
Therefore, the words "or any portion thereof" which
have been repeated, as if they were some kind of charm,
throughout the schedule are surplusage in view of the
length specified and may be ignored and the scheme
taken to apply to the entire length 6f the fourteen
routes.
The next question is about the order to be passed in
this case.
The contention on behalf of the Department is ·that as the petitioners had applied to the
High Court and their petition was dismissed and the
application for a certificate to appeal to this Court is
pending before the High Court, this Court should
dismiss the present petition and direct the petitioners
to come either on a certificate granted by the High
Court or by a special leave application in case the
High Court refuses the certificate.
We do not think it
necessary in this case to decide this general question
in view of certain special features of the present case.
It is true·that the writ petition by the petitioners was
dismissed by the High Court ; but the judgment of thii
High Court shows that it was of opinion that the
applications under s. 681<' should have complied with
s. 57 (2) of the Act and should thus have been made at
least six weeks before the date from which the scheme
was to be implemented. On that view the High Court
held that the issue of permits to the Department
was not according to law. It.also held in consequence
that refusal of the renewal to the petitioners was illegal;
but it refused to pass an order in favour of the petitioners on the ground tliat the relief granted to them
would be short-lived. In effect, therefore, the judgment of the High Court was in favour of the petitioners and not against them, though in form the
writ petition was dismissed.
In these circumstances
we are of opinion that as the petitioners' fundamental right to carry on business is certainly involved
in this case we sholJld 11ot refuse relief tq the
,
-
.,
•
,
.
.
s.c.n.
SDPREMB COURT R:li:POR1'S
139
petitioners on the ground that their writ petition was
z959
dismissed by the High Court and they have not yet Sh . . -R di
been able to obtain a certificate permitting them. to
""'·~· ' Y
appeal to this Court.
.
Th• s;.,, of
There are two prayers in the present petition: (1)
Mysore
that the proceedings of the Authority issuing tiermits
to the Department be · quashed, and (2) that the proWanchoo J.
ceedings rejecting the renewal applications. of the
petitioners be also quashed. . \Ve see no reason why
we should not grant the first prayer and quash the
issue of permits to the Department by the Authority
on June 23, 1959. Our attention in this. connection
was drawn to K.N.Guruswamy v. The State of ~lllysore ·
and Others('). In that casethis Court after declaring
the law in favour of the petitioner did· not· issue a
writ as there was liardly a fortnight left for the excise
contract which was involved in that case to expire and
the issue of a writ would have been meaningless and
ineffective. ·That case however is distinguishable
because the contract there would have come to an end
within a few days. . In the present case there is no
reason to assume that the six weeks period which is
the minimum period prescribed· under s. 57 (2) is the
only period that will be ·required· for implementation ·
of the scheme under s. ·68F(l}. In these circumstances
we are of opinion that the prayer for quashing . the
permits granted to the Department on June 23,1959,
should be allowed.
As for the other prayer for quashing the order rejecting the renewal applications of the
petitioners, it is now unnecessary in view of our decision in Petitions Nos. 54 and 75 of 1959.
\Ve, therefore, allow the petition and quash the order
issuing permits to the Department. \Ve order parties
to bear their own costs of this petition taking into
account that Petition Ne. 117 of 1959 filed by the
petitioners with respect to the validity of the scheme
has been withdrawn by them at a late stage. and we
have directed parties to bear their own costs of that
petition also.
·
_
KAPUR J.-I have read the judgment prepared· by
my learned brother \Vanchoo, J., but I respectfully
Kapu• J.
I959
Shrinivasa Reddy
v.
The State of
Mysore
Kapur].
140 •
SUPREME COURT REPORTS [1960(2)]
dissent from the opinion therein given. I shall proceed to give my reasons for the dissent.
It is not necessary to restate the facts which are
set out in detail in the proposed judgment but reference may be made to certain dates. On August 28,
1958, the proposed scheme under Chapter IV-A of the
Motor Vehicles Act, 1939, as amended by Act 100 of
1956 (which for the sake of convenience will hereinafter be termed the Act) was published as a draft
scheme. It was approved on October 24, 1958, but
on its being challenged in the High Court of Mysore,
it was quashed on December 3, 1958. A fresh draft
scheme was published on January 22, 1959, and after
the Chief Minister had heard objections against it, it
was approved on April 15, 1959, and was published
on April 23, 1959. The fresh scheme was also challenged in the High Court of Mysore in Civil Writ
Petition No. 315 of 1959 but this petition was dismissed on June 1, 1959. The Regional Transport
Authority on the application of the Mysore Government Road Transport Department (hereinafter termed
the Department) issued in favour of the Department
permits on June 23, 1959, and rejected the application
of the other operators, the petitioners. This order was
challenged in the High Court by Civil Writ Petition
No. 463of1959 on June 24, 1959. On July 14, 1959,
the High Court although it found in favour of the
petitioners practically on all points, did not grant any
relief and dismissed the petition on the ground that
the effectiveness of the relief will be for a short period
of six weeks at the most; but in. the order it was
stated that the permits granted to the Department
were invalid as they had not applied for in the
manner provided in s. 57 of the Act and also that
the Regional Transport Authority had been careless in
the exercise of its powers. Against this decision the petitioners applied to the High Court for a certificate for
appeal to this Court but the matter is still pending in
the High Court. In the meanwhile the petitioners
filed this petition in this Court under Art. 32.
The core of the question is what is the consequence
of the framing of the scheme under Chapter IV-A
-
S.C.R.
SUPREME COURT R~PORTS
141
·and how it is to be implemented. The petitioners
contended that on a proper construction of ss. 68C
and 68F the scheme as approved must be implemented
as a whole simultaneously
or not at all. The
submission of the Department on the other hand is
two-fold: (1) that in the very nature of things it
must be left open to the Department to implement the
scheme in reasonably convenient stages and (2) if th,e
Department has applied for and obtained permits for
certain routes in the scheme and has substantially
implemented that scheme the implemented portion of
the scheme cannot be set aside. The decision of these
rival contentions would turn on the interpretation of
the various sections in Chapter IV-A. This Chapter
contains special provisions relating to State Transport Undertaking and was inserted in the Act bys. 62
of Act 100 of 1956. Section 68A contains definitions,
68B gives overriding effect to this Chapter qua
Chapter IV. Section 68C deals with preparation and.
publication of the scheme of road transport services
of the State Transport Undertaking. Section 68D
provides for objections to be filed against a proposed
scheme; 68E to the consequences of cancellation or
modification of the scheme. Then comes s. 68F which
provides for the issue of permits to State Transport
Undertakings. Section 68G provides for the method
of determining of compensation in case of State
Transport taking over ; 68H for paymen~ of compensation and 68I gives power to make rules. We were
informed by Mr. Sanyal that rules have been framed
under this section. The relevant portion of s. 68C
is as follows :-.
" Where any· State transport undertaking is of
opinion that for the purpose of providing. an efficient, adequate, economical and properly co-ordinated
road transport service it is necessary in the public
interest that road transport services in general or
any particular class of such service in relation to
any area or route or portion thereof should be run
and operated by the State transport undertaking,
whether to the exclusion, complete or partial of other
persons or otherwise, the State transport undertaking
I959
Sh>inivasa Reddy
v.
The State of
Mysore
Kapur].
z959
Shrinivasa Reddy
v.
The State of
Mysore
Kapur}.
142
SUPREME COUR'r REPORTS [1960.(2)]
may prepare a scheme giving particulars of the·
nature of the services proposed to be rendered the
area or route proposed to be covered ..... "
Secti9n 68F(l) provides:
"Where, in pursuance of an approved scheme
any State transport undertaking applies in the
manner specified in Chapter IV for a stage carriage
. permit or a public carrier's permit or a contract
carriage in respect of a notified area or notified
route, the Regional Transport Authority shall issue
such permit to the State Transport undertaking, notwithstanding anything to the contrary contained
in Chapter IV."
It was contended that the State Transport Undertaking (to be termed the Undertaking) can propose a
scheme only when the conditions in s. 68C are fulfilled,
that is, for the purpose of providing efficient, adequate, economical and properly co-ordinated road
transport services. The argument is that all these
conditions are a sine qua non of the scheme being
proposed and if for any reason the Undertaking is
unable to put the whole scheme into effect all at once
then it should modify the scheme under s. 68E and
implement this modified scheme. No doubt the words
adequate, economical and co-ordinated are used in the
SC'ction but they must be read in the context. The
words of the section require that when the Undertaking is of the opinion that for the objects therein
mentioned the services on any route or in any area
should be operated by it, it may prepare a scheme.
All that the section requires is that the Undertaking
must be of that opinion when it prepares the scheme.
The scheme has to contain particulars of the services
proposed to be rendered, the areas or routes to be
covered.
It was next submitted that the language of s. 68F
further supports the contention that if the approved scheme is to be implemented it must be implemented all at ·once or not at all and emphasis was
laid on the words "in pursuance of" and "pcrm:it
in respect of a notified area or notified route".
These words, in my opinion, do not necessarily lead
'
,
•
"
•
S.C.R. ·
SUPREME COURT REPORTS
143
to that conclusion. Before the scheme is proposed
r959
the Undertaking. is to be of a certain opinion and Shrinivasa Reddy
when it is to be in operation the Undertaking has to
v.
proceed in a manner
prescribed
in the section.
The state of
But it cannot be said that when the scheme is imple. ..
Mysore ·
mented, the whole thing is to be done in a rigid
manner. Some • flexibility
and
practicability
in
Kapur l
effectuating the scheme must necessarily be implied
because of the implications, financial and others of
the scheme itself. It may happen that at the time of
the implementation it is discovered that the scheme
cannot be put into effect all at once, because of a
natural calamity or of some unforeseen circumstance
beyond the control of the State Transport Undertaking. If the contention of the petitioners is correct
then it would mean that the whole scheme must be
>
scrapped and a new scheme prepared and approved
with its consequential delays. In this manner the
policy of nationalisation which is the State policy in
India would be indefinitely put off because in the
meanwhile all kinds of interests may come into
existence and circumstances may supervene which
may defay, if not obstruct., the State in its policy of
nationalisation.
The use of the words " in pursuance of" in s. 68F
only means that applications are made to give effect
to the scheme or in execution of the scheme. These
words import a notion of obligation and are more
restrictive than the phrase "by reason of" which
is permissive.
Bradford
Corporation v.
Myers (1)
where Lord Buckmaster in construing these words
said:-
"It is because the act is one which is either an
act in the direct execution of a statute, or in the
discharge of a public duty, or the exercise of a
public authority."
T~erefore, the mere use of the words " in pursuance
of" eannot mean that the whole scheme has to be
put into operation and not. a portion of it.
(1) (1916) I A.C. 242 at p. 247.
r959
Shrinivasa Reddy
v.
The State of
Mysore
Kapur].
144
SUPREME COURT REPORTS [1960(2)]
The second argument raised in support of the contention that the scheme has to be implemented as a
whole and all at once is the use of the words "applies
in the manner specified in Chapter IV for a stage
carriage permit ....... in respect of a notified a,rea
or notified route." Chapter IV deals with the control
of transport vehicles.
Section 46 deals with applications for such stage carriage permits and requires the
following particulars to be set out in the applications:
the route or routes or the area or areas for which the
application is made, the number of vehicles proposed
to operate in relation to each route or area, the
minimum and maximum_number of daily services proposed to be provided in relation to each route, the
number of vehicles to be kept in reserve, the arrangements to be made for housing and repair of vehicles
and for the comfort and convenience of passengers
and such other matters as may be prescribed. This
section also applies to applications made under 68F.
It means therefore that if the area is extensive or the
number of routes which a State Undertaking wishes
to take over is large a number of applications will
have to be made if all these particulars ha ;e to be
properly given. If the contention of the petitioners is
correct then all applications under s. 46 will have to
be made at one and the same time and there is no
reason to make allowances for mistakes or accidental
om1ss10ns.
If accidental omissions are to be excused
there is no reason to exclude omission due to unforeseen circumstances, e.g., some vehicle being found
unusable, some, repair shops not being completed in
time or some natural calamity m'aking it impossible to
start operations on a particular route. If the State
cannot take over those routes for which applications
can immediately be made then it would mean that
taking over would become not only difficult but
extremely expensive because, as I have said before,
other interests may come in which it may not be possible for the State to take over. Therefore, if the State
Undertaking intends to run a scheme within a reasonable time then there is no reason why the State should
not apply for different routes within a reasonitble time
•
•
S.C.R.
SUPREME COURT REPORTS
145
so long as it acts honestly, fairly and without oblique
motives.
The third argument on behalf of the respondents
was that if the State Undertaking has implemented
the scheme in regard to c~rtain routes and has
actually started work on those routes after having
obtained permits that portion of the implemented
scheme should not be quashed because it would mean
that the stage carriages of the State Undertaking will
be taken off and somebody else will have to be given
the permits at once or the people will have to go without road transport which cannot be the intention of
the Act. If the policy of the State is nationalisation
then such an order will not only delay but obstruct
and thwart that policy. In my opinion therefore it is
not the intention of the legislature in ss. 680 and 68]'
that the whole scheme must be put into operation all
at once or not at all.
The question then arises as to what should be the
order in the instant case. The High Court has indicated
in its order that the applications made on behalf
of the State Undertaking were not in accordance with
s. 57 of the Act and the learned Additional SolicitorGeneral informed us that the State Undertaking had
accepted that view of the law and proceeded to make
applications in accordance withs. 57 and other relev ..
ant provisions of Chapter IV. In that view of the
matter, in my opinion, it is not necessary to pass a
formal order quashing the permits granted in favour
of the State Undertaking. The case is very much
like K. N. Guruswamy v. The State of Mysore & Ors.(i).
In this view of the matter and in view of the
opinion I have given in Petitions Nos. 54, 75 & 76,
I am of the view that this petition should be dismissed
but the parties should bear their own costs.
ORDER OF COURT
In accordance with the opinion of the majority, we
allow the petition and quash the order issuing permits
(1) [1955] l
S.C.R. 305.
19
I959
Shrinivasa Reddy
v.
The State of
Mysor•
J(apur J.
,
'959
Shrinivasrt Reddy
'
v.
The State of
Mysore
Kapur].
x959
Nov~mber 6
146
SUPREME COURT REPORTS [1960 (2)1
to the Department. We order parties to bear their
own costs of this petition taking into account that
Petition No. 117 of 1959 filed by the petitioners with
respect to the validity of the scheme has been withdrawn by them at a late stage and we have directed
parties to bear their own costs of that petition also.
Y. MAHABOOB SHERIFF AND OTHERS
v.
MYSORE STATE TRANSPORT AUTHORITY
AND OTHERS
(B. P. SINHA, C.J., JAFER IMAM, J. L. KAPUR,
K. N. WANCHOO and K. C. DAS GUPTA, JJ.)
Motor vehicles-Stage carriage per1nit-Period of renrwalDuty of Transport Authority-Motor Vehicles Act, I939 (IV of
I939), as amended by Act IOO of I956, s. 58.
Suh-section (r)(a) of s. 58 of the Motor Vehicles Act, 1939,
provides,-
" A stage carriage permit or a contract carriage permit other
than a temporary permit issued under s. 62 shall be effective
without rene\\1al for such period not less than three years and
not more than five years, as the Regional Transport Authority
may specify in the permit. "
Sub-section (2) provides,-
" A permit may be renewed on an application made and dis·
posed of as if it were an application for a permit."
Provided that ......................... "
~
The stage carriage permits of the petitioners were ending on
March 31, 1958. and they applied to the Regional Transport
Authority, Bangalore. for a renewal of them.
The Tran,port
Department of the Mysore State Government opposed such
renewal and applied that fresh permits for the routes in question
might be granted to it as the State Government int:ended to
nationalise the transport services.
The Authority, however, dismissed the applications of both the contending parties, but, on
appeal, its orders were set aside and the ma1ter was remanded
for a fresh decision.
A scheme under s. 68C of Ch. IVA of the
Act was in the meantime published and approved by the State
Government, which was later on quashed qy the High Court. at
the instance of the petitiJners.
The Authority passed orders
renewil)g the permits of the petitioners for a period of one year
from April I, 1958, to March 31, 1959· Appeals against the said
orders having proved abortive the petitioners appiicd to the
'