ORDER
Mohan Shantanagoudar, J.
1. The petitioners in all these writ petitions i.e., Karnataka State Road Transport Corporation ('Corporation' for short) and two private operators are seeking writ of certiorari to quash the orders passed by the Secretaries of Regional Transport Authorities ('RTA' for short) as well as the Secretary of the Karnataka State Transport Authority ('KSTA' for short), granting Contract Carriage Permits ('CCP' for short) and Stage Carriage Permits ('SCP' for short) in favour of the various private operators. Since the common questions of facts and law are involved in all these writ petitions, they have been clubbed and disposed of by this common order.
2. The petitioner in W.P. Nos. 40338 of 2004 to 40342 of 2004, 35189 of 2004, 35190 of 2004, 35374 of 2004, 18663 to 18668 and 18670 to 18672 of 2004 is the 'Corporation' and is represented by the learned Advocates Sri Ashok Harnahalli and Sri S. Prakash Shetty. The petitioners in Writ Petition Nos. 37259 and 37260 of 2004 and W.P. No. 21297 of 2004 are the private operators represented by the learned Advocates Sri S.V. Krishnaswamy and Sri A.S. Prasara Kumar.
3. I have heard learned Counsels Sri Ashok Harnahalli, Sri Prakash Shetty, Sri S.V. Krishnaswamy and Sri A.S. Prasara Kumar for petitioners and Sri Jayakumar S. Patil, learned Senior Counsel, Sri B.R.S. Gupta, Sri M.R.V. Achar, Sri C.V. Kumar and Sri B. Palakshaiah, learned High Court Government Pleader, learned Counsels appearing on behalf of the respondents and perused the material on record.
4. Based on the arguments of the learned Counsels for rival parties, the following points emerge for consideration by this Court:
(i) Whether the Rules 55 and 56 of the Karnataka Motor Vehicles Rules, 1989 are valid in law?
(ii) Whether the State Transport Authority has jurisdiction to issue the Contract Carriage Permits/Stage Carriage Permits?
(iii) Can the Secretary of RTA/STA be delegated with the power to issue the Contract Carriage Permits/Stage Carriage Permits and to perform the duties of RTA/STA under Rules 55 and 56 of the Karnataka Motor Vehicles Rules? and whether the resolution passed by the STA on 20/12/95 and 21/12/95 in Subject No. 25 of 1995-96 is valid?
(iv) Whether the Secretary of the State Transport Authority has applied his mind while passing the impugned orders?
(v) Whether the schemes framed by State Government under Section 100(3) of the Motor Vehicles Act, 1988 prohibit the operation of contract carriages by private operators?
(vi) Whether the Contract Carriage Permit holders can operate their contract carriages as if they are the Stage Carriages?
5. Re: Point Nos. (i), (ii) and (iii).--Sri Ashok Haranahalli, learned Counsel submitted that consideration of the applications for grant of either 'SCP' or 'CCP' under Sections 72 and 74 respectively of the Motor Vehicles Act, 1988 (hereinafter referred to as 'Act' for short) has to be by RTA only and not by STA or its Secretary; that the application for grant of permits shall be made under Section 69(1) of the Act to the 'RTA'; that the 'STA' can perform the duties of 'RTA' under Section 68(3)(b) of the 'Act' only if the circumstances mentioned therein exist; that the exercise of jurisdiction by 'STA' under Section 88(2) of the Act is subject to Section 68(3) of the Act; that if the 'STA' is allowed to perform the functions of 'RTA', it will be nullifying the effect of Sections 68, 69 and 74 of the Act. On these grounds, Sri Ashok Harnahalli submitted that the 'STA' has got no jurisdiction to consider the application for grant of permits. He further submits that the 'RTA' and 'STA' shall consist of Chairman who has judicial experience or experience as Revisional or Appellate Authority or adjudicating authority competent to pass any order or take any decision; that the 'RTA' and 'STA', looking to the scheme of the Act, will perform the Quasi-judicial functions while discharging their duties; that as the 'STA' performs its duties as quasi-judicial authority, it cannot delegate its jurisdiction to its Secretary; that looking to the scheme of the Act, the Transport Authority shall have to exercise its discretion judiciously before granting the permits. He relies upon the judgment of this Court in W.P. No. 31958 of 2004, DD: 30-8-2004 and W.P. No. 25478 of 2003, DD: 13-4-2004, wherein it is held that the Secretary of 'STA' has got no jurisdiction to consider the applications for grant of permits.
6. Sri Prakash Shetty, learned Counsel appearing for the petitioner-'Corporation' in another batch of writ petitions, while supporting the contentions raised by Mr. Ashok Harnahalli, vehemently contended that the grant of 'SCP' as well as 'CCP' is under Chapter V of the Act and the State Government may make Rules under Section 96 of the Act for the purpose of carrying into effect of provisions of Chapter V; that Section 96 of the 'Act' nowhere provides for framing of rules for delegating the jurisdiction to Secretary of the 'STA' or 'RTA' with regard to consideration of the applications for grant of permits. He further submitted that Section 68(5) of the empowers the 'STA' or the 'RTA' to delegate such powers and functions to such authority, if authorised in this behalf by rules made under Section 96 of the 'Act'; but Section 96 of the Act does not empower the State Government to make rules pertaining to delegation of powers relating to the grant of permits to the Secretary of 'STA' or 'RTA' and thus neither the 'STA' nor the 'RTA' can delegate its power to the Secretary under Section 68(5) of the Act. Both the learned Counsels submitted that Rules 55 and 56 of the Karnataka Motor Vehicles Rules are beyond rule making power of the State Government inasmuch as Section 96 of the Act does not empower the State Government to frame rules pertaining to delegation of powers by STA/RTA to their Secretaries. On these amongst other grounds, learned Counsel argued that at the first instance the 'STA' has no jurisdiction to grant permission; secondly, that the Secretary of 'STA' or 'RTA' has no jurisdiction to grant permits and thirdly Rules 55 and 56 of KMV Rules are invalid and are liable to be struck down.
7. Sri S.V. Krishnaswamy, learned Counsel appearing in W.P. Nos. 37259 and 37260 of 2004 on behalf of the petitioners-private operators argued inter alia contending that though 'STA' has got jurisdiction to consider the application for grant of permits, it cannot delegate its jurisdiction to its Secretary, as adjudicating powers are involved in either granting, cancelling or transferring of the permits. Even at the time of assignment of timings, the STA has to adjudicate and that therefore, such power cannot be delegated.
8. In W.P. No. 21297 of 2004, the validity of the Rules 55 and 56 of the 'Rules' are challenged by the petitioner (private operator). Sri S.A. Prasara Kumar, learned Counsel appearing on behalf of the petitioner in this writ petition argued that the said 'Rules' are ultra vires of Section 96 read with Section 68(5) of the Act inasmuch as Section 96 does not specifically empower the State Government to make 'Rules' regarding delegation of powers pertaining to grant of permits.
9. Per contra, Sri Jayakumar S. Patil, learned Senior Counsel appearing on behalf of the grantees submitted that Section 68(3)(b) of the Act envisages three situations wherein the 'STA' can perform the duties of 'RTA', (a) where there is no such 'RTA'; (b) if STA thinks fit to perform those duties in respect of any route common to two or more regions; and (c) if so required by RTA. Thus 'STA' can suo motu exercise the jurisdiction of RTA if it so thinks fit under Section 68(3)(b) of the Act and if the 'STA' does not exercise its jurisdiction for grant of permits to ply the vehicles on any route common to two or more routes, it may lead to great hardship inasmuch as the applicants will have to obtain counter-signatures on the permits from various 'RTAs' by running round the entire State; that, generally, the route to which the 'CCP' is granted runs through the jurisdiction of various regional transport authorities and consequently, the permit holders will have approach all the 'RTAs' for getting counter-signatures; that in view of the liberalisation of the policy of the Legislature, the power of STA cannot be curtailed. On these grounds, he argues that the 'STA' can exercise its jurisdiction if the route passes through jurisdiction of more than one 'RTA' and consequently, the 'STA' has got jurisdiction to consider the application for grant of 'CCPs'. He further submits that the Secretary of 'RTA' or 'STA' has jurisdiction to' consider the application for grant of 'CCP' and 'SCP' under Rules 56 and 55 respectively of the Karnataka Motor Vehicles Rules, 1989 (hereinafter referred to as 'Rules' for short), if the general or special resolution is passed under the said Rules delegating the powers to the concerned Secretary of 'RTA' and 'STA' for grant of permits; that by the resolution passed by the 'STA' in its meetings held on 20-12-1995 and 21-12-1995 in Subject No. 25 of 1995-96, it has taken a decision to delegate its jurisdiction to its Secretary to grant permits. He further submitted that Section 68(5) of the Act is not taken into consideration by this Court while disposing of the Writ Petition Nos. 25478 and 25541 of 2003, DD: 13-4-2004.
10. Sri B.R.S. Gupta and C.V. Kumar, learned Counsels appearing for the grantees, while supporting the argument addressed by Sri Jayakumar S. Patil submitted that the Rules relating to Chapter V can be framed under Section 96 of the Act; that the Rules 55 and 56 are framed under Section 96 read with Section 68(5) of the Act and consequently, STA/RTA can delegate its power to its Secretary. Sri B. Palakshaiah, learned High Court Government Pleader, by taking me through the preamble of KMV Rules argued in support of the orders passed by the Secretary of the 'STA'.
11. In reply, Sri Prakash Shetty, learned Counsel appearing on behalf of the 'Corporation' submits that the Karnataka Contract Carriages (Acquisition) Act, 1976 came into force with effect from 30-1-1976 and the same was repealed on 1-4-2003; thus, there was no question of granting 'CCPs' during the aforesaid period and consequently, there was no occasion for passing the resolution on 20-12-1995/21-12-1995 by the 'STA' delegating its power to its Secretary for grant, countersign etc., of 'CCPs'; that looking to the subject placed for discussion before the 'STA' on 20-12-1995, it is clear that the 'STA' was only considering the applications of the Karnataka State Tourism Development Corporation (hereinafter referred to as 'KSTDC' for short) which is a wing of the State Government, for grant of 'CCP'. In that connection, the resolution in question i.e., on Subject No. 25 of 1995-96 was passed by the KSTA and the same will not be of any help to the private operators-respondents in these writ petitions.
12. Section 68 of the 'Act' deals with the constitutions of 'STA' and 'RTA' and Section 69 of the 'Act' deals with general provision as to the application for grant of permits. Application for grant of permits shall be made to the concerned 'RTA' for the region in which the permit is proposed to be used. Section 69 of the 'Act' reads thus:
'69. General provision as to application for permits.--(1)Every application for a permit shall be made to Regional Transport Authority of the region in which it is proposed to use the vehicle or vehicles:
Provided that if it is proposed to use the vehicle or vehicles in two or more regions lying within the same State, the application shall be made to the Regional Transport Authority of the region in which the major portion of the proposed route or area lies, and in case the portion of the proposed route or area in each of the regions is approximately equal, to the Regional Transport Authority of the region in which it is proposed to keep the vehicle or vehicles:
Provided further that if it is proposed to use the vehicle or vehicles in two or more regions lying in different States, the application shall be made to the Regional Transport Authority of the region, in which the applicant resides or has his principal place of business.
(2) Notwithstanding anything contained in Sub-section (1), the State Government may, by notification in the Official Gazette, direct that in the case of any vehicle or vehicles proposed to be used in two or more regions lying in different States, the application under that Sub-section shall be made to the State Transport Authority of the region in which the applicant resides or has his principal place of business'.
Sections 72 and 74 of the 'Act' empowers the 'RTA' to grant 'SCP' and 'CCP', relevant portion of which reads thus:
'72. Grant of Stage Carriage Permit.--(1) Subject to the provisions of Section 71, a Regional Transport Authority may, on an application made to it under Section 70, grant a Stage Carriage Permit in accordance with the application or with such modifications as it deems fit or refuse to grant such permit:
Provided that no such permit shall be granted in respect of any route or area not specified in the application.(2) The Regional Transport Authority, if it decides to grant a Stage Carriage Permit, may grant the permit for a stage carriage of a specified description and may subject to any rules that may be made under this Act, attach to the permit any one or more of the following conditions, namely--
(i) that the vehicles shall be used only in a specified area, or on a specified route or routes;
(ii) to (xxiv) xxx xxx xxx.
74. Grant of Contract Carriage Permit.--(1) Subject to the provisions of Sub-section (3), a Regional Transport Authority may, on an application made to it under Section 73, grant a Contract Carriage Permit in accordance with the application or with such modification as it deems fit or refuse to grant such permit:
Provided that no such permit shall be granted in respect of any area not specified in the application.(2) The Regional Transport Authority, if it decides to grant a contract carriage permit, may subject to any rules that may be made under this Act, attach to the permit any one or more of the following conditions, namely--
(i) that the vehicle shall be used only in a specified area or on a specified route or routes;
(ii) to (xxiv) xxx xxx xxx'.
The procedure for applying and granting of permits is prescribed under Section 80 of the 'Act' relevant portion of which reads thus:
'80. Procedure in applying for and granting permits.--(1)
An application for a permit of any kind may be made at any time.
(2) A Regional Transport Authority, State Transport Authority or any prescribed authority referred to in Sub-section (1) of Section 66 shall not ordinarily refuse to grant an application for permit of any kind made at any time under this Act:
Provided that that the Regional Transport Authority, State Transport Authority or any prescribed authority referred to in Sub-section (1) of Section 66 may summarily refuse the application if the grant of any permit in accordance with the application would have the effect of increasing the number of stage carriages as fixed and specified in a notification in the Official Gazette under Clause (a) of Sub-section (3) of Section 71 or of contract carriages as fixed and specified in a notification in the Official Gazette under Clause (a) of Sub-section (3) of Section 74:
Provided further that where a Regional Transport Authority, State Transport Authority or any prescribed authority referred to in Sub-section (1) of Section 66 refuses an application for the grant of a permit of any kind under this Act, it shall give to the applicant in writing its reasons for the refusal of the same and an opportunity of being heard in the matter'.
Further Section 88 of the 'Act' which deals with the validation of permits for using outside region in which the same are granted.
13. No doubt that the bare reading of Sections 69 and 74 of the Act discloses that the applications for grant of permit shall be made to 'RTA' and the same shall be considered by the said authority. But the said provisions will have to be read together with Section 68(3), Section 80 and Section 88(2) of the Act. It is relevant to note the provision of Section 68(3) of the 'Act' which reads thus:
'68(3) The State Transport Authority and every Regional Transport Authority shall give effect to any directions issued under Section 67 and the State Transport Authority shall, subject to such directions and save as otherwise provided by or under this Act exercise and discharge throughout the State, the following powers and functions, namely--
(a) to co-ordinate and regulate the activities and policies of the Regional Transport Authorities, if any, of the State;
(b) to perform the duties of a Regional Transport Authority where there is no such Authority and, if it thinks fit or if so required by a Regional Transport Authority, to perform those duties in respect of any route common to two or more regions;
(c) to settle all disputes and decide all matters on which difference of opinion arise between Regional Transport Authorities'.
Further, it is relevant to note here itself the provisions of Section 88(2) of the Act which reads thus:
88(2) Notwithstanding anything contained in Sub-section (1) a permit granted or countersigned by a State Transport Authority shall be valid in the whole State or in such regions within the State as may be specified in the permit.
14. On careful reading of Section 68(3) makes abundantly clear that the 'STA' shall exercise its jurisdiction and discharge its functions and perform the duties of RTA: (a) where there is no RTA; (b) if so required by RTA; and (c) if it thinks fit to perform those duties in respect of any route common to two or more regions. Thus, the 'STA' can consider the applications for grant of permit, if it thinks fit, in respect of any routes common to two or more regions. Section 80(1) and (2) and Section 88(2) of the Act make it further clear that the 'STA' has jurisdiction to entertain applications for grant of permits of any kind made at any time under the provisions of the 'Act' and such permits granted or countersigned by the 'STA' shall be valid in the whole State or within such regions of the State as may be specified in the permit.
15. Section 80(2) is amended with effect from 14-11-1994 by Act No. 54 of 1994 and by the said amendment, the word 'RTA' which existed earlier are substituted by the words 'RTA, STA or any prescribed authority referred to in Sub-section (1) of Section 66 of the 'Act'. Though 'RTA' has jurisdiction to grant the 'CCPs', the same will be confined to his region only unless the permit holder obtains the counter-signature from other 'RTAs' within whose jurisdiction the rest of the route lies. To avoid the cumbersome procedure, the Legislature might have thought it fit to amend Section 80(2) of the 'Act' so as to empower the 'STA' also to consider the application for grant of permit. The provisions of Sections 69, 74, 68(3)(c), 80(1) and (2) and 88(2) of the Act have to be read and appreciated jointly and not in isolation. The harmonious reading of all the aforesaid provisions makes it abundantly clear that both 'STA' and 'RTA' have jurisdiction to consider and dispose of the applications for grant of any type of permit including the 'CCP' and 'SCP'. In view of the above, I hold that the 'STA' also has jurisdiction to consider the applications for grant of permits including the 'SCP' and 'CCP' under the Motor Vehicles Act.
16. The 'STA' and 'RTA', as could be seen from Section 68(2) of the 'Act', shall consist of a Chairman who has had judicial experience or experience as an appellate or a Revisional Authority or as an adjudicating authority competent to pass any order or take any decision under any law. The 'STA' shall also consist of the members not being more than four (whether official or not). The 'RTA' shall consist of a Chairman as aforesaid and members not being more than two as the State Government may think to appoint. Further, Sub-section (2)(ii) of Section 68 makes it clear that the State Government may, where it considers necessary or expedient so to do, constitute the 'STA' or 'RTA' for any region so as to consist of only one member who shall be an official with judicial experience or experience as an appellate or a Revisional Authority or as an adjudicating authority competent to pass any order or take any decision under any law. Thus, as could be seen from the above provisions, the intention of the Parliament is very much clear that the Chairman of the 'STA' or 'RTA' shall have the judicial experience.
17. When the jurisdiction with regard to grant of permits is conferred exclusively on 'STA/RTA' as the case may be, looking to the scheme of the Act, it cannot be delegated to the Secretary of 'STA/RTA'. As aforesaid, from the provisions of Section 68(2) of the 'Act', the intention of the Legislature is very much clear that the 'RTA' and 'STA' should be headed by the person who has had judicial experience. Looking to the scheme of the Act, the 'STA' and 'RTA' will exercise 'Quasi-judicial' functions and not pure administrative functions. It is needless to mention that the 'quasi-judicial' function cannot be delegated to the inferior ministerial officer. The authority in which discretion is vested has to exercise its own judgment because the Legislature has placed trust in its judgment.
18. It is well-settled that the 'Quasi-judicial' decision is an administrative decision which is subject to some measure of judicial procedure. It is an administrative function, which the law requires it to be exercised in some respects, as if it were judicial. The adjudicatory jurisdiction should be exercised by the authority upon whom it is conferred and by no one else, even if the same may cause, sometimes, administrative inconvenience.
The 'Regional Transport Authorities' or 'State Transport Authority' are in no way subject to administrative interference while deciding a particular case. They make their own decisions independently. The power to grant or refuse 'Contract Carriage Permits'V' Stage Carriage Permits', to renew the permits, or replacement of vehicle by another, suspending the permits, to recover from the holders of such permit, the sum of money agreed upon in accordance with Section 86(5) of the 'Act', to grant or to refuse temporary permits or special permits, to countersign the permits and to attach or vary the conditions thereof, assignment of timings etc., involve adjudicatory process to be exercised by the authority which has had judicial experience. Sometimes, the aforesaid acts may involve long drawn process of hearing the parties resulting in passing of the elaborate and reasoned order. Granting of permits is not mere ministerial function. Therefore, the Parliament, in its wisdom has made a provision to have the Chairman of RTA/STA who has had judicial experience or the experience as an adjudicating authority. Whereas the Secretary of the RTA/STA need not have the said qualification prescribed for the Chairman of the authority. Under such circumstances, the 'Quasi-judicial Function' entrusted to the 'STA', 'RTAs' cannot be equated with the functions assigned to their Secretaries, and hence such functions cannot be delegated to them.
19. As already noted, Sri Jayakumar S. Patil, learned Senior Counsel and Sri B.R.S. Gupta appearing on behalf of the grantees submitted that Rules 55 and 56 of the 'Rules' empower the concerned authority to delegate its power to the Secretary and that those 'Rules' are framed under Section 96 read with Section 68(5) of the 'Act'. Sections 68(5) and 96 of the Act read thus:
'68(5) The State Transport Authority and any Regional Transport Authority, if authorised in this behalf by rules made under Section 96, may delegate such of its powers and functions to such authority or person subject to such restrictions, limitations and conditions as may be prescribed by the said rules.
96. Powers of State Government to make Rules for the purposes of this Chapter.--(1) A State Government may make rules for the purpose of carrying into effect the provisions of this Chapter.
(2) Without prejudice to the generality of the foregoing power, rules under this section may be made with respect to all or any of the following matters, namely--
xxx xxx xxx'.
20. A combined reading of Sections 96 and 68(5) of the Act makes it amply clear that the State Government may make 'Rules' for the purpose of carrying into the effect the provisions of Chapter V of the Act. The permits are granted under the provisions of Sections 72 and 74 of the Act which come in Chapter V of the Act. Section 68(5) of the Act empowers the 'STA' or 'RTA', if authorised in this behalf by 'Rules' made under Section 96 of the 'Act' to delegate such of its powers or functions to such authority or person subject to such restrictions, limitations and conditions as may be prescribed by the said rules. Thus, the 'STA' or the 'RTA', as the case may be, may delegate such of its powers and functions to such an authority only if the 'Rules' are made under Section 96 of the 'Act', authorising them to do so. Thus, to exercise power under Section 68(5) by the 'STA' or the 'RTA' as the case may be, framing of Rules under Section 96 of the 'Act' is a must. On careful examination of the Karnataka Motor Vehicles Rules, 1989, I am of the considered view that no 'Rules' are framed as contemplated under Section 96 of the 'Act'. In this connection, it is just and necessary to note the preamble to the Karnataka Motor Vehicles Rules, 1989, which reads as under:
'Whereas, the draft of the rules further to amend the Karnataka Motor Vehicles Rules, 1989 was published as required by Sub-section (1) of Section 212 of the Motor Vehicles Act, 1988 (Central Act 59 of 1988), in Notification No. FTD 26 TMR 89, dated 14th March, 1990 in Part IV, Section 2-C(i) of the Karnataka Gazette, Extraordinary, dated 20th March, 1990 inviting objections and suggestions from all persons likely to be affected thereby on or before 5th April, 1990.
And whereas, the said Gazette was made available to the public on 20th March, 1990.
And whereas, the objections and suggestions received in this regard have been considered by the State Government.
Now, therefore, in exercise of the powers conferred under Sections 28, 38, 65, 95, 109, 111, 138 and 178 of the Motor Vehicles Act, 1988 (Central Act 59 of 1988), the Government of Karnataka hereby makes the following rules, namely'.
21. Looking to the aforesaid preamble, it is very much clear that the Government of Karnataka has framed the Karnataka Motor Vehicles Rules, 1989 in exercise of power conferred on it by Sections 28, 38, 65, 95, 109, 111, 138 and 178 of the Motor Vehicles Act, 1988 (Central Act 59 of 1988). Thus, it is clear that the State Government has not exercised power conferred on it under Section 96 of the Act and consequently, no rules are framed under Section 96 of the Act. If no Rules are framed under Section 96 of the Act, the 'STA' or the 'RTA' cannot delegate its power including power of grant of permits to any authority including its Secretary. Where the empowering 'Act' as enacted by the Parliament lays down the limits expressly, the State Government shall not act or exceed outside its power by framing 'Rules' like Rules 55 and 56 of the Karnataka Motor Vehicles Rules, 1989. Thus, Rules 55 and 56 of the 'Rules' become inoperative. Consequently, the Secretary of the 'RTA' and 'STA' cannot exercise jurisdiction in pursuance to the notification issued under Rules 55 and 56 of the 'Rules'.
22. Sri Jayakumar S. Patil submitted that as long as Rules 55 and 56 are in the statute book, the 'STA' or the 'RTA' can delegate its powers to the Secretary and those two rules cannot be rendered nugatory. The said argument cannot be accepted in view of the fact that there 'Rules' are framed by the State Government without any competence. As aforesaid, 'Rules' relating to delegation of powers can be framed only under Section 96 of the Act, as could be seen from Section 68(5) of the Act. As no 'Rules' are framed under Section 96 of the Act, Rules 55 and 56 cannot operate. Rules 55 and 56 are beyond the rule making power of the State Government. If the 'Rules' are to be valid, they need statutory authorisation and if they are not within the ambit or powers given by the statute or Act, they have no legal legs to stand on. In such an event, the Court will necessarily have to quash those 'Rules' or declare the same to be ultra vires and unlawful or prohibit any action to enforce them. In view of the above, said 'Rules' are liable to be struck down as they are ultra vires of the Act. Consequently, the resolution passed by the 'KSTA' in the meeting held on 20-12-1995/21-12-1995 is without authority of law and the same is also liable to be quashed.
23. In view of the above, this Court is of the considered view that the orders passed by the Secretaries of 'RTAs' granting Contract Carriage Permits in favour of the respondents-private operators are also without authority of law and the same are liable to be quashed.
24. Added to it, as rightly pointed out by Sri Prakash Shetty, the Karnataka Contract Carriages (Acquisition) Act was in force from 30-1-1976 to 1-4-2003. During that period, there was total prohibition on the private operators to run contract carriages. When such being the case, there was no occasion for the 'KSTA' to pass the resolution on 20/21-12-1995 (at Serial No. 19) of Sub. No. 25 of 1995-96 delegating its power to the Secretary to consider the application for grant of 'Contract Carriage Permits' in favour of private operators. Even otherwise, looking to the agenda of the meeting of 'KSTA', the subject was only to consider the applications filed by the 'KSTDC' for grant of contract carriage permits. As the 'KSTDC' is the wing of the State Government, the same did not come within the purview of the Karnataka Contract Carriages (Acquisition) Act and consequently, the 'KSTDC' could ply its buses even during the subsistence of said Karnataka Contract Carriages (Acquisition) Act, 1976. Thus, the resolution passed on 20/21-12-1995 vide (SI. No. 19) at Sub. No. 25 of 1995-96 of the 'KSTA' could be said to have been passed only relating to the applications filed by the 'KSTDC' with regard to grant of 'CCP'. In this view of the matter also, the private contract carriage permit holders cannot take advantage of the said resolution in Sub. No. 25 of 1995-96 passed in a meeting that was held on 20/21-12-1995. Point Nos. (i) to (iii) are answered accordingly.
25. Re: Point No. (iv).--In view of my aforesaid findings on Point Nos. (i) to (iii) no useful purpose will be served in considering Point No. (iv) as to whether the Secretary of 'STA' has applied his mind while passing the impugned orders or not.
26. Re: Point No. (v).--Learned Counsel appearing for the petitioners argued that the 'CCP' holders respondents herein are not entitled to operate their services on the notified routes; that various schemes are framed under Section 100(3) of the 'Act' by the State Government wherein certain areas and routes are notified and consequently, the 'CCP' holders cannot ply their buses in those notified area or notified routes and as such, the 'CCPs' granted by the Secretary of the STA to the respondents-operators are illegal in view of Section 104 of the 'Act' and consequently, the same are liable to be quashed.
On the other hand, it is contended on behalf of the respondents-permit holders that in none of the schemes framed by the State Government, the operation of contract carriages are barred but are saved. In other words, they contended that the contract carriages are exempted from the schemes framed by the State Government.
27. The learned Counsels appearing for rival parties have made available, the copies of the various schemes framed by the State Government under Section 100(3) of the 'Act'. On perusal of those schemes it is clear that in none of the schemes (except in Hubli scheme), the contract carriages are barred from being operated. In all the schemes (except in Hubli scheme), the State Transport undertaking i.e., the 'Corporation' alone is permitted to run and operate its Stage Carriage services on the notified routes or portion thereof as mentioned in the said schemes i.e., to the complete exclusion of other private operators. Thus, it is clear that the schemes framed by the State Government have not excluded the private operators from operating their contract carriages on the notified routes but have excluded the stage carriages. If really the State Government had intended to exclude other private operators from operating the 'Contract Carriages' also, it should have mentioned so in the schemes. In the absence of any prohibition, in the schemes, to run the 'Contract Carriages', it is open for the private operators to run the 'Contract Carriages' after obtaining the necessary permits under Section 74 of the Act.
The Mysore scheme was published in the Official Gazette on 10th November, 1960. The said notification discloses that the draft Mysore scheme proposed and published by the State Government included the prohibition to run contract carriages also; but while approving the scheme, the words 'Contract Carriage' appearing against Clause (c) (wherein the class/types of services are mentioned) of the draft scheme is omitted. Thus, it makes amply clear that the State Government did not intend to prohibit other operators from operating the 'Contract Carriages'.
Whenever the State Government intended to exclude the private operators from operating the 'Contract Carriages', the State Government has specifically disclosed its intention. This policy of the Government is clear from the Hubli scheme. Hubli scheme is notified on 7-11-1960 wherein it is specified that 'Stage Carriages', 'Contract Carriages' and city services are exclusively permitted to be run by the State Transport undertaking i.e., the 'Corporation' to the total exclusion of other operators. Except Hubli scheme, the other schemes do not prohibit the other private operators from running their 'Contract Carriages'. However, the Hubli scheme is also subsequently amended to major extent.
There cannot be any dispute that scheme framed under Section 100(3) of the Act is law and the same has to be followed strictly, while granting permits to the private operators. In these matters, looking to the various schemes framed by the State Government under Section 100(3) of the 'Act' it is clear that under the schemes, the State transport undertaking is exclusively given permission to run its 'Stage Carriage' vehicles on the notified routes to the total exclusion of other permit holders, which means, that the private operators are not excluded to run 'Contract Carriages' on the notified routes, the Apex Court in the case of Uttar Pradesh State Road Transport Corporation v. Anwar Ahmed and Ors., : (1997)3SCC191 while observing that the scheme is law and the same prevails till it is varied according to law, held as under:
'Once the scheme has been approved and notified, right to ply 'Stage Carriages' by private operators on the notified area, routes or portion thereof is totally frozen. Therefore, they have no right to claim any grant of stage carriage, temporary or contract carriage permits thereunder on the said notified area, routes or portions thereof except to the extent saved by the scheme with restrictions imposed thereunder. By virtue of Section 104 the appellant-Corporation has the exclusive right or monopoly to ply their stage carriage and obtain the required permit as per the scheme'.
(emphasis supplied)
Further, the learned Counsels appearing on behalf of the 'Corporation' relied upon the judgment of the Apex Court in the case of Karnataka State Road Transport Corporation v. Ashrafulla Khan and Ors., : [2002]1SCR194 wherein the Apex Court, while dealing with 'Kolar Pocket Scheme' observed thus:
'No permit can be granted to operate on a notified route or portion thereof if a scheme prohibits such operation by a private operator and the only exception is where a private operator holding permit on non-notified route has to intersect a notified route'.
The facts, as stated by the Apex Court in paragraph 3 of its judgment, if carefully read, make it clear that Kolar Pocket Scheme empowers 'Corporation' to run its 'Stage Carriages' to the complete exclusion of the private operators. It is made clear in the said decision that no permit can be granted to operate on the notified area or routes or portions thereof if a scheme prohibits such operation by a private operator.
Looking to the aforesaid judgments and the provisions of Sections 100 and 104 of the 'Act', it is clear that the permits can be granted to the private operators, if the scheme does not prohibit to do so. As aforesaid, the schemes framed by the Government of Karnataka (except Hubli scheme, which is also now modified to major extent) do not prohibit the operation of contract carriages by the private operators and consequently, there is no prohibition for the private operators to run their contract carriages by obtaining necessary permits. Point No. (v) is answered accordingly.
28. Re: Point No. (vi).--The learned Counsel Sri Ashok Harnahalli, appearing on behalf of the petitioner vehemently submitted that though the respondents-private operators have obtained permits to run the 'Contract Carriages', they are virtually plying their busses as if they have obtained the 'Stage Carriage Permits'. He submitted that every 'Contract Carriage Permit' holder is collecting individual fare en-route by picking up or setting down the passengers and if such practice is allowed to continue, there would be no distinction between 'Stage Carriage Permit' or 'Contract Carriage Permit'. He relied upon the judgment of the Apex Court in the case of State of Andhra Pradesh and Ors. v. B. Noorulla Khan and Anr., : AIR2004SC2413 , wherein the Apex Court observed thus:
'The distinction between a stage carriage permit or a contract carriage permit as envisaged by the Legislature has to be maintained as the two types of permits are intended to meet different requirements. The contract carriages are for those want to hire the vehicle collectively or individually for a group or a party for their transport to a destination/destinations. The vehicle has to be hired as a whole for the carriage of passengers mentioned in the contract. There has to be only one contract for carrying the passengers mentioned in the contract from one destination to another. An agent or a group of persons/individuals cannot hire a public service vehicle for going from one place to another with passengers having different purposes. If such a construction is put then there would be no distinction between stage carriage or contract carriage permits. If contract carriage permit holder is permitted to pick up individual or a few of them from the starting point of journey and drop them at the last terminus of the route it would virtually be a Stage Carriage with corridor restriction. Stage carriage is intended to meet the requirements of the general public travelling from one destination to another having different purposes whereas a contract carriage is meant for those who want to hire a public service vehicle as a whole collectively for their transport from one destination to another having the same purpose. High Court was not right in holding that the travelling party as a whole need not have a common purpose for their travel and it was sufficient if they had a common destination. The view taken runs counter to the law laid down by this Court in Brijendra Kumar Chaudhari v. State of Uttar Pradesh, : (1992)4SCC703 and Nirmala Jagdishchandra Kabra v. Transport Commissioner, : [1997]2SCR78 , case, and therefore, bad in law. High Court was not right in declaring ultra vires the Rules framed by the State Government providing that the party hiring the contract carriage vehicle should, not only, have the intention of travelling to the same destination but should also have the common purpose of travelling as well. In Rule 297-A(1)(c) 'common purpose' has been defined to mean the intention shared alike by all the persons travelling by the public service vehicles to attend a meeting, gathering or function, social, religious, political and the like or to go to a pilgrimage or visit to place of tourist's interest or both. That it would not include the intention or the act of such persons merely travelling from one common point to another. This rule framed by the State Government does not run counter to the provisions of Section 2(7) of the Act either in its intent or in its expression. The rule is in consonance with the intent of Section 2(7) of the Act. The same has been framed to fulfill the object with which Section 2(7) has been enacted. Any other interpretation would obliterate the distinction between a stage carriage permit and a contract carriage permit'.
He further submitted that neither the police nor the officials of the transport department are initiating any action against such erring 'contract carriage permit' holders. Based on these grounds, he sought for quashing the 'Contract Carriage Permits' granted in favour of various private operators.
On the other hand, learned Counsels appearing on behalf of the respondents-private operators, while denying the allegations made by Sri Ashok Harnahalli submitted that it is always open for the authorities of the State Government to initiate action against the erring 'Contract Carriage Permits' holders.
29. It is needless to observe that the concerned authorities have to initiate action against the erring contract carriage permit holders in accordance with law, if they violate the conditions mentioned therein. The observations and the dictum laid down by the Apex Court in the judgment cited supra have to be strictly followed with all seriousness by all the 'Contract Carriage Permit' holders. The concerned officials of the State machinery should strictly deal with such operators, if any violation in observing the aforesaid dictum laid down by the Apex Court as well as the conditions laid down in the 'Contract Carriage Permits' is found. The contract carriage permits cannot be treated as stage carriage permits. However, as no specific instance is brought-to the notice of this Court in these matters with regard to violation of the conditions of the 'contract carriage permits' by the permit holders, no specific direction or order can be issued against any of such permit holders in these, matters.
For the foregoing reasons, and the discussion made above, the following order is made:
(i) Rules 55 and 56 of the Karnataka Motor Vehicles Rules, 1989 are declared as nullity in law and ultra vires of the Motor Vehicles Act, 1988 and consequently, they are struck down.
(ii) The State Transport Authority has jurisdiction to consider and dispose of the applications for grant of 'Contract Carriage Permits' and 'Stage Carriage Permits'.
(iii) Secretary of STA/RTA cannot be delegated with power of issuing contract carriage/stage carriage permits and to perform the duties of RTA/STA under Rules 55 and 56 of the Karnataka Motor Vehicles Rules.
And consequently
The resolution passed by the Karnataka State Transport Authority, Bangalore in its meeting held on 20-12-1995/21-12-1995 vide SI. No. 19 of Sub. No. 25/1995-96 delegating the power to its Secretary to consider the applications for grant 'Contract Carriage Permits' is declared as without authority of law and consequently, the same is quashed.
(iv) The impugned orders passed by the Secretaries of Regional Transport Authority/Karnataka State Transport Authority, granting/renewing the 'Stage Carriage Permits'/ 'Contract Carriage Permits' in favour of the respondents-private operators in all these writ petitions are quashed.
(v) The private operators can operate their contract carriages after obtaining permits in accordance with law, as the existing schemes framed by the State Government do not prohibit them to do so.
(vi) The Contract Carriage Operators cannot ply their buses as stage carriages. The concerned authorities of the State Government are directed to initiate action against erring contract carriage permit holders in accordance with law, in the light of the observations made above.
(vii) However, keeping in mind, the inconvenience that would be caused to public at large and as the respondents-private operators are operating their 'Contract Carriages' since long time pursuant to the impugned orders/permits, they are permitted to operate their services for a period of three months from today subject to payment of taxes, despite the aforesaid order. The private operators-respondents are at liberty to approach the concerned Regional Transport Authority/State Transport Authority as the case may be for getting the permits afresh, in accordance with law, .within four weeks from today.
(viii) In case if the applications are filed by the respondents-private operators for grant of fresh permits, the Regional Transport Authorities or State Transport Authority as the case may be directed to dispose of those applications on merits after hearing KSRTC, within three months from today.
These writ petitions are disposed of accordingly.