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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 5257 OF 2018 (@ SLP (C) NO.26954 OF 2017)

KERALA STATE ROAD TRANSPORT  CORPORATION                                          ...APPELLANT

VERSUS

BABY P.P. & ORS. ...RESPONDENTS

WITH

CIVIL APPEAL NO.5258 OF 2018 (@SLP (C) NO.32804 OF 2017)

KERALA STATE ROAD TRANSPORT  CORPORATION                                  ...APPELLANT

VERSUS

JOY C.A. & ORS. ...RESPONDENTS

CIVIL APPEAL NO.5259 OF 2018 (@SLP (C) NO.101 OF 2018)

THE DISTRICT TRANSPORT OFFICER, KERALA STATE ROAD TRANSPORT  CORPORATION                            ...APPELLANT

VERSUS

JIJO & ORS. ...RESPONDENTS

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JUDGMENT

MOHAN M. SHANTANAGOUDAR, J.

Leave granted.

2. These appeals arise out of the judgment dated 02.08.2017

passed by the High Court of Kerala at Ernakulam in O.P.(C) No.

1827 of 2017, O.P.(C) No. 1784 of 2017 and O.P.(C) No. 581 of

2017 dismissing the writ petitions and consequently confirming

the order dated 11.01.2017 passed by respondent no.5 herein,

the State Transport Appellate Tribunal (hereinafter referred to as

‘STAT’) in M.V.A.R.P No. 53 of 2016. Therein, the STAT had held

that the Regional Transport Authority under the facts of the case,

may exercise power conferred on it by the proviso to Section 104

of the Motor Vehicles Act, 1988 (hereinafter referred to as ‘the

Act’) to grant temporary permits.

3. The State of Kerala vide G.O. (P) No.42/2009/Tran. dated

14.07.2009  notified  a  new  scheme  in  exercise  of  its  powers

conferred by Section 100 of the Act for the purpose of providing

convenient,  adequate,  economical,  and  properly  coordinated

passenger road transport services. As per the said Scheme, the

route of Kottayam-Kozhikode was made a notified route. Clause 4

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of  the  said  Scheme  interalia provides  that  the  services  to  be

operated by the State Transport Undertaking (hereinafter referred

to  as  ‘STU’)  along  the  notified  route  were  to  the  exclusion  of

private stage carriages operating in the said route. Clause 4 of

the said Scheme reads thus:

“4. Whether the services are to be operated by the State Transport  Undertaking to the  exclusion of other  persons or  otherwise.

Yes, the permits issued in the private sector on or  before  9.5.2006 will be allowed to  continue till  the  dates  of  expiry of  the  respective permits.  Thereafter regular  permits  will  be granted to them.  When the  State  Transport Undertaking applies for introducing  new services  in  the  above routes,  corresponding number  of  existing private  stage  carriage permits  in  the  said routes  whose  permits expire  first  after  filing application by the State Transport  Undertaking shall  not  be  renewed. As  regards  permits issued after 09.05.2006 temporary  permits alone  shall  be  issued afresh  on  expiry  in these  routes  or  any portion thereof till such time  the  State Transport  Undertaking

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replaces  with  new services.   The  decision of  the  State  Transport Undertaking  to  apply for  permits  to  replace the  existing  Stage Carriages  as  above shall  be  taken  by  the Chief  Executive  of  the State  Transport Undertaking.”

4. From the aforementioned clause, it is clear that the permits

which  were  already  issued  to  the  private  sector  prior  to

09.05.2006 will be allowed to continue until the date of expiry of

the respective permits. Thereafter, regular permits will be granted

to them. However, as and when the STU applies for introducing a

new service on the route, the corresponding number of existing

private stage carriage permits in the said route, whose permits

expire first after the filing of the application by the STU, shall not

be renewed. Meaning thereby, the services to be operated by the

STU along the notified route were to the exclusion of private stage

carriages if the STU operates on the same route. If the STU has

not applied for a permit, then the permits issued in the private

sector prior to 09.05.2006 will continue until the date of expiry,

following which regular permits will be granted. The temporary

permits issued after 09.05.2006, on the notified route would be

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in operation, only until the STU operates on the same route with

new services. Clauses 5(c) and 6 of the Scheme read thus:

“5  (c)

Whether  it  is  proposed to  allow  other  services to pick up or set down passengers between any two places on the route covered by the scheme.

Yes, on the portion of the route permitted to operate as in clause 4 above.  Permits  will also  be  granted  to private stage carriages of  other  routes permitting  them  to overlap 5 kilometre or 5 percent of the length of  their  own  routes, whichever  is  less  on the notified routes, for purposes  of intersection.

6. The  maximum  and minimum  number  or trips  to  be  provided  in relation to each area or route  by  the  State Transport  Undertaking in  the  case  of  stage carriage.

As per traffic demand”

5. Clauses 5(c) and 6 of the aforementioned Scheme provide

that  private  services  would  be  allowed  to  pick  up  and  drop

passengers between any two places on the route covered by the

Scheme,  if  and  only  if  the  route  of  the  private  stage  carriage

overlaps the notified route maximum to an extent of 5 kms or 5%

of the length of its own route (whichever is less) for purposes of

intersection.

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6. The  appellant  is  a  STU  under  Section  3  of  the  Road

Transport Corporations Act, 1950. The respondent no.1 in SLP(C)

No.26954 of 2017 (namely Baby P.P contesting respondent in all

these appeals),  a private stage carriage operator, submitted an

application  seeking  a  temporary  permit  under  the  proviso  to

Section  104  of  the  Act  before  respondent  no.  2  herein,  the

Regional Transport Authority (hereinafter referred to as ‘RTA’) to

run services for the route Pallissery-Angamaly-Perumbavoor. The

total length of this route applied for by respondent no. 1 is 28

kms. The RTA rejected the application filed by the respondent

no.1  on  22.12.2015  stating,  interalia,  that  part  of  the  route

applied  for  by  the  respondent  no.1  from  Angamaly  to

Perumbavoor is 13 kms in length and it objectionably overlaps

with  the  notified  route  of  Kottayam-Kozhikode  beyond  the

permissible  limit  as  contemplated  by  the  Scheme  dated

14.07.2009. As against the order of the RTA, the respondent no.1

approached the STAT by filing M.V.A.R.P. No.53 of 2016 which

came to be allowed in part on 11.01.2017, remanding the matter

to the RTA to consider the matter afresh and to exercise its power

conferred under the proviso to Section 104 of the Act.

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7. Questioning the order  passed by the STAT, the appellant

herein approached the High Court by filing O.P.(C) No. 1827 of

2017. Respondent no. 1 in SLP(C) No. 32804 of 2017, a private

stage  carriage  operator,  filed  O.P.(C)  No.  1784  of  2017.

Respondent no. 1 in SLP (C) No. 101 of 2018, another private

stage carriage operator,  also filed O.P.(C)  No.  581 of  2017. All

these O.Ps. were heard together and came to be dismissed on

02.08.2017 with the following observations:

“35.   Reckoning  the  legal  principles mentioned  above  and  the  factual  situation revealed  in  this  case,  especially  Ext.  P8 scheme,  I  find  that  the  petitioners  failed  to establish a case that the 1st respondent or any other private operator is not entitled to get a temporary  permit,  overlapping  on  a  notified route, by invoking proviso to Section 104 of the Act.   State  Transport  Authority  or  Regional Transport Authority, as the case may be, as a temporary  measure  and  until  STU  puts vehicles  on  the  route,  can  grant  temporary permits to cater the need of travelling public. It is the bounden duty of the STU to cater the needs of the commuting public and if it fails to fulfil  obligations,  the  Government  should intervene  and  pass  appropriate modifications/changes in the scheme so as to provide amenities to the passengers.  It is for the  Government  and  the  authorities  to  take stock  of  the  situation  periodically  and reconsider  the  notification,  if  STU  could  not discharge  their  obligations  in  the  expected lines.   Till  then,  the  authorities  may  invoke

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power conferred on them by proviso to Section 104 of the Act.   

In the result,  original  petitions are dismissed confirming Ext.P5 order.”

8. Aggrieved by the judgment passed by the STAT, as well as

the judgment of the High Court, these appeals are presented. The

issue before this court in these appeals is as under:

 Can  a  temporary  permit  be  granted  to  a  private  stage

carriage operator on a notified route (which is already being

served  by  the  STU)  for  a  distance  that  exceeds  the

permissible limit provided under the scheme, that too not

for intersecting but for merely traversing and consequently

overlapping its service on the notified route?

In other words,

 Under the facts of this case, is it open for a private stage

carriage operator (Respondent No.1) to operate the services

overlapping  more  than 5 kms or  5% of  the  route  of  the

private  stage  carriage  operator  (as  specified  under  the

Scheme) for the purpose of traversing by overlapping on the

notified route which is being served by the STU, but not for

purposes of intersection?

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9. Mr. V. Giri, learned Senior Advocate appearing on behalf of

the appellant contended that no person other than the STU can

operate on the notified route except as provided in the Scheme;

the  proviso  to  Section  104  of  the  Act  is  also  subject  to  the

Scheme;  Clause  5(c)  of  the  Scheme  makes  it  clear  that

respondent no.1’s route objectionably overlaps with the notified

route far beyond the permissible limit; the appellant is plying a

sufficient number of buses on the notified route in question as on

this day.

10. Mr. R. Basant, learned Senior Advocate appearing on behalf

of  the  respondent  no.1  submitted  that  the  Scheme  does  not

render the proviso of  Section 104 of  the Act  otiose;  temporary

permits  can  be  granted  when  the  route  is  unserved  or

underserved by STU; the appellant has failed to prove that it was

plying  sufficient  number  of  buses  on  the  route

Palliserry-Angamaly-Perumbavoor for which the respondent no.1

has a claim for temporary permit; three temporary permits were

issued even after the scheme came into force in 2009. He further

drew the attention of this Court to the fact that pursuant to the

remand order of the STAT, the RTA on 23.02.2017 has granted a

temporary  permit  on  the  route  in  question  in  favour  of  the

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respondent no. 1. But, the appellant without questioning such

order  passed by  the  RTA,  has  merely  questioned the  order  of

remand passed by the STAT before the High Court. Even before

this  Court,  the  order  granting  temporary  permit  is  not

questioned.

11. The law governing the formulation of schemes is found in

Sections 99 and 100 of the Motor Vehicles Act. In this context, it

is relevant to note the observations of a Constitution Bench of

this  Court  in  the  case  of  Adarsh  Travels  Bus  Service  and   

Anr.  vs. State  of  U.P.  and Ors.  reported in  (1985)  4 SCC 557,

where it highlighted the power of the State to make laws on the

passage of motor vehicles:

“3. The right of the members of the public to pass and repass over a highway including the right to use motor vehicles on the public road existed  prior  to  the  enactment  of  the  Motor Vehicles  Act  and  was  not  its  creation.  The State could control and regulate the right for the purpose of ensuring the safety, peace and good health of the public. As an incident of his right of passage over a highway, a member of the public was entitled to ply motor vehicles for pleasure or pastime or for the purpose of trade and business, subject, of course, to permissible control  and  regulation  by  the  State.  Under Article  19(6)(ii)  of  the  Constitution,  the  State can make a law relating to the carrying on by

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the  State  or  by  a  corporation,  owned  or controlled  by  the  State  of  any  particular business,  industry  or  service  whether  to  the exclusion,  complete  or  partial,  of  citizens  or otherwise.  The law could provide for carrying on of a service to the total exclusion of all the citizens;  it  may  exclude  some of  the  citizens only; it may do business in the entire State or a portion of the State, in a specified route or part thereof. The word “service” has been construed to  be  wide  enough  to  take  in  not  only  the general motor service, but also the species of motor service.  There are no limitations on the State's  power  to  make  laws,  conferring monopoly  on  it  in  respect  of  an  area,  and person or persons to be excluded. All  this is now well established by the various decisions of this Court.”

(emphasis supplied)

12. Chapter  V  of  the  Act  deals  with  the  control  of  transport

vehicles  whereas  Chapter  VI  of  the  Act  deals  with  special

provisions relating to STUs. As per  Section 98 of  the Act,  the

provisions  of  Chapter  VI  and  the  rules  and  orders  made

thereunder  shall  have  overriding  effect,  notwithstanding  any

inconsistency contained in Chapter V or any other law for the

time  being  in  force.  Preparation  and  publication  of  proposals

regarding road transport services of the STU has been dealt with

under Section 99 of the Act. If the State Government is of the

opinion  that  for  the  purpose  of  providing  efficient,  adequate,

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economical, and properly guaranteed road transport services in

relation to  any  area  or  route  or  operation thereto,  these  road

transport services should be run and operated by the STU to the

exclusion (complete or partial) of private stage carriage operators,

a proposal in the Official Gazette shall be published as provided

under Section 99 of the Act.  Objections to the proposal will be

invited before the State Government under Section 100(1) of the

Act. After considering the objections, if any, and after giving an

opportunity  to  the  objectors  or  their  representatives  and  the

representatives of the STU, the State Government may approve or

modify such proposals. The approved or modified scheme will be

published in the Official Gazette of the State Government, apart

from  newspapers,  under  Section  100(3)  of  the  Act.  After

publication, the scheme shall be final and the same is called “the

approved scheme”. The area or the route, to which the scheme

relates, shall be called “Notified Area” or “Notified Route”. Section

103  of  the  Act  deals  with  the  issue  of  permits  by  the  STU

pursuant  to  the  scheme,  if  approved.  Section  104  of  the  Act

relates to the restrictions on grant of permits in respect of the

notified area or notified route.

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13. It is relevant to note that Chapter IV of the Motor Vehicles

Act, 1939 is analogous to Chapter V of the Motor Vehicles Act,

1988. Chapter IV-A of the 1939 Act corresponds to Chapter VI of

the 1988 Act. The sections contained in Chapter IV-A of the1939

Act are in pari materia with the sections contained in Chapter VI

of the 1988 Act. To be more precise, Sections 99 and 100 of the

1988  Act  are  in  pari  materia with  Sections  68-C  and  68-D

respectively of the 1939 Act.

14. Before  proceeding  further,  it  would  be  relevant  to  note

Section 104 of the Act along with its proviso, which reads thus:

“104.  Restriction  on  grant  of  permits  in respect of a notified area or notified route – Where  a  scheme  has  been  published  under sub-section (3) of section 100 in respect of any notified  area  or  notified  route,  the  State Transport Authority or the Regional Transport Authority, as the case may be, shall not grant any  permit  except  in  accordance  with  the provisions of the scheme:

Provided that where no application for a permit has  been  made  by  the  State  Transport Undertaking in respect of any notified area or notified  route  in  pursuance  of  an  approved scheme, the State Transport Authority or the Regional Transport Authority, as the case may be, may grant temporary permits to any person in  respect  of  such  notified  area  or  notified route subject to the condition that such permit shall  cease  to  be  effective  on  the  issue  of  a

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permit  to  the  State  transport  undertaking  in respect of that area or route.”

15. A plain reading of  Section 104 makes it  amply clear that

where a scheme has been published under Section 100(3) of the

Act in respect of any notified area or notified route, grant of any

permit on the notified route or area is impermissible, except in

accordance  with  the  provisions  of  the  scheme.  However,  the

proviso clarifies that wherever the STU has not sought any permit

in respect of any notified route or notified area in pursuance to

the scheme, the RTA (or STA, as the case may be) may grant a

temporary permit to any private stage carriage operator in respect

of such notified area or notified route, on the condition that such

permit shall cease to be effective on the issue of a permit to the

STU in respect of that area or route. It is needless to observe that

respondent no.1 claims such a temporary permit based on the

proviso to Section 104 of the Act, contending that the STU is not

operating its services on the notified route.

16. It  is by now well  settled that the scheme formulated and

published by the State Government under Section 100 (3) of the

Act holds the fort in all matters involving permits.The scheme is a

law by  itself,  as  observed by  this  Court  in  various  judgments

including the case of Gajraj Singh and Others vs. State Transport

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Appellate  Tribunal  and  others reported  in  (1997)  1  SCC  650,

wherein it is observed as hereunder:

“51. After  giving  careful  and  anxious consideration to the respective contentions, we find that there is some force in the contention of the respective counsel for the appellants.  It bears  repetition  to  state  that  the  approved scheme under the Repealed Act or in the Act is a self-contained and self-operative scheme. It is a law by itself. The schemes published under the Repealed Act, as held earlier, are saved by Section  217(2)(a)  of  the  Act.  Therefore,  until they are modified or  cancelled under  Section 102,  the  scheme  should  continue  to  be  in operation  in  the  notified  area,  route  or  part thereof.  The  right  to  apply  for  and  obtain permit in the notified scheme was totally frozen to the private operators giving exclusive right to the STU to apply for and obtain permits to run the stage carriages or additional service under Section  101  of  the  Act  on  the  notified  area, route or a part thereof and none else. With a non obstante clause in Section 101, the right to  apply  for  and  obtain  temporary  permits under  Section  87  by  private  operators  was taken away. There is no need for STU to obtain such  permits  as  an  intimation  to  RTA concerned  of  its  providing  such  additional service  on  special  occasions  like  fair  or religious  gatherings  for  conveyance  of passengers, is sufficient. Yet the scheme itself saved and preserved the rights of  the named existing  operators  in  respect  of  overlapping routes in the specified permits, subject to the corridor restrictions of picking up and setting down  the  passengers en  route the  prescribed prohibited route. They became entitled to run their  stage  carriages  subject  to  the  law. Though,  their  permits  are  saved,  the  named

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operators  being  private  operators,  Parliament appears  to  have  thought  that  there  was  no necessity  to  expressly  retain  in  Chapter  VI itself  their  right  of  renewal  as the same was already  provided  in  Section  81  of  the  Act corresponding to Section 68-F(1-D) of Chapter IV-A of the Repealed Act. The reason appears to  be  obvious.  Every  private  operator  falls within the  field  covered by  Chapter  V of  the Act.  It  would  seem that  Parliament  is  of  the view  that  the  named  operators,  being  saved under  the  schemes,  are  entitled  to  apply  for and obtain necessary permit or renewal thereof to ply their stage carriages only on overlapped routes  subject  to  the  corridor  restrictions mentioned  in  the  scheme  itself.  It  may  be stated  that  we  do  not  find  any  express indication  of  their  rights  being  taken  away under the Act; nor do we find it by necessary implication  in  that  behalf  and  to  that  effect. This view does justice also to all concerned.”

                                    (emphasis supplied)

17. In light of this, it is to be noted that the proviso to Section

104 of  the Act cannot be read aloof  from the main section.  A

plain reading of the proviso to Section 104 makes it clear that

temporary permits can be granted to the private sector, wherever

the STU does not operate its service. However, the proviso is also

subject  to  the  stipulations  of  the  scheme,  akin  to  the  main

section. A Four-Judge Bench of this Court in Dwarka Prasad vs.

Dwarka Das Saraf, reported in (1976) 1 SCC 128, observed that

the proviso cannot be read separately from the main section, in

the following manner:

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“18.…A proviso must be limited to the subject-matter of  the  enacting  clause.  It  is  a  settled  rule  of construction that a proviso must prima facie be read and considered in relation to the principal matter to which  it  is  a  proviso.  It  is  not  a  separate  or independent enactment. “Words are dependent on the principal enacting words, to which they are tacked as a proviso.  They cannot be read as divorced from their context” (1912 AC 544). If the rule of construction is that  prima  facie  a  proviso  should  be  limited  in  its operation to the subject-matter of the enacting clause, the  stand  we  have  taken  is  sound.  To  expand  the enacting clause, inflated by the proviso, sins against the  fundamental  rule  of  construction  that  a  proviso must be considered in relation to the principal matter to which it stands as a proviso. A proviso ordinarily is but a proviso, although the golden rule is to read the whole section, inclusive of the proviso, in such manner that  they  mutually  throw  light  on  each  other  and result in a harmonious construction.  ”

                               (emphasis supplied)

18. Since the Scheme on hand partially excludes private stage

carriage  operators  on  the  notified  route,  the  same  is  to  be

adhered  to.  It  is  necessary  in  the  public  interest  that  road

transport services on notified routes should be run and operated

by the STU to the complete or partial exclusions of private stage

carriage  operators.  In  a  State  where  the  scheme  has  been

published, subject to such scheme formulated by the State, no

private  stage  carriage  operator  can  operate  beyond  the

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stipulations of the scheme. This also applies to applications for

temporary permits under the proviso to Section 104 of the Act.

19. In the matter on hand, it is the case of the STU that it has

been running 452 buses (covering 770 trips) every day on part of

the notified route, i.e. from Angamaly to Perumbavoor, wherein

overlapping  of  13  kms  is  claimed.  So  far  as  the  route  from

Angamaly  to  Perumbavoor  is  concerned,  the  same  is

undisputedly a notified route. The STU thus has the exclusive

right  or  monopoly  to  ply  its  stage  carriages  and  obtain  the

required permit as per the Scheme to the exclusion of  private

stage carriage operators. The proviso gives only a limited breath

of life to the private sector, viz., only if the vehicles of the STU do

not operate on the notified route as per the scheme, in which

event  temporary  permits  may  be  granted  to  the  private  stage

carriage operators. In the matter on hand, undisputedly,  more

than 450 buses of  the STU ply everyday on the notified route

which pass from Angamaly to Perumbavoor. It is not open for the

respondent no.1 to claim that the STU is not running sufficient

buses from Palliserry to Perumbavoor via Angamaly. Admittedly,

Palliserry  to  Angamaly  is  not  a  notified  route.  The  dispute

between the parties, thus, virtually relates to the route between

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Angamaly to Perumbavoor and not the route between Palliserry to

Angamaly.

20. Even otherwise it is not disputed that the STU is plying 8

trips from Palliserry to Perumbavoor via Angamaly. Apart from

the  same,  the  private  sector  is  operating  sufficient  number  of

services from Palliserry to Angamaly. It is brought to the notice of

this Court by the STU that the STU may provide more buses if

required between Palliserry to Angamaly. Moreover, it is open for

the  respondent  no.1 to seek permission as per  law before  the

concerned authority and ply its buses on the non-notified route.

However, when it comes to operating on the notified route, that

is, in between Angamaly and Perumbavoor, the respondent no.1

cannot operate its services for more than 5 kms or 5% of its route

(whichever  is  less).  Admittedly,  part  of  the  respondent  no.1’s

route measuring 13 kms is between Angamaly and Perumbavoor,

and that entire patch of 13 kms overlaps the notified route. The

total route length applied for by the respondent no.1 is only 28

kms. The overlap thus, permitted on the notified route (in the

case on hand) as per the Scheme could only be 1.4 kms whereas

the  respondent  no.1  wants  to  overlap  by  13  kms,  i.e.

approximately 50% of his route, which is totally impermissible

20

and the same is rightly objected to by the STU, particularly when

the STU is operating 452 buses (amounting to 770 trips) in a day

on the said route.

21. The contention of the respondent no.1 is that the travelling

public could be inconvenienced if the passengers travelling in the

buses of the respondent no.1 from Palliserry to Perumbavoor are

asked  to  get  down  at  Angamaly.  Such  factors  relating  to

inconvenience  etc.  necessarily  have  to  be  taken  into

consideration by the concerned authorities before publication of

the proposal regarding road transport services of the STU under

Section 99 of the Act, by the State Government under Section

100(1) of the Act when considering the objections to the scheme,

and thereafter  either  by the STU or  by the Government when

inconvenience is experienced by the travelling public and brought

to its notice. As held by the Constitution Bench of this Court in

case  of  Adarsh  (supra),  the  question  is  one  of  weighing  the

balance between the advantages conferred on the public by the

nationalisation  of  the  route  Kottayam-Kozhikode  against  the

inconvenience suffered by the public by wanting to travel straight

from Palliserry to Perumbavoor via Angamaly.

21

22. It is quite well known that under the guise of permits over

longer  routes  covering  shorter  notified  routes,  or  overlapping

parts of  notified routes, such permits are more often than not

mis-utilized,  since  it  is  well  nigh impossible  to  keep  a  proper

check at every point of the route. If indeed there is any need for

protecting  the  travelling  public  from  inconvenience,  as  was

submitted by Mr. Giri, the STU and the Government will make

sufficient provisions in the Scheme itself to avoid inconvenience

being caused to the travelling public.  In  Adarsh  (supra)  under

similar circumstances, it was observed thus,

“7.…The question is one of weighing in the balance the advantages  conferred  on  the  public  by  the nationalisation  of  the  route  C-D  against  the inconveniences suffered by the public wanting to travel straight from A to B. On the other hand it is quite well known that under the guise of the so-called “corridor restrictions”  permits  over  longer  routes  which  cover shorter notified routes or “overlapping” parts of notified routes are more often than not misutilised since it is well nigh impossible to keep a proper check at every point  of  the  route.  It  is  also  well  known that  often times permits for plying stage carriages from a point a short distance beyond one terminus to a point a short distance beyond another terminus of a notified route have  been  applied  for  and  granted  subject  to  the so-called  “corridor  restrictions”  which  are  but  mere ruses or traps to obtain permits and to frustrate the scheme.  If indeed there is any need for protecting the travelling public from inconvenience as suggested by the learned counsel we have no doubt that the State Transport Undertaking and the Government will make

22

a  sufficient  provision  in  the  scheme  itself  to  avoid inconvenience being caused to the travelling public.  ”

“14.…We however wish to introduce a note of caution. When  preparing  and  publishing  the  scheme  under Section 68-C and approving or modifying the scheme under Section 68-D care must be taken to protect, as far as possible, the interest of the travelling public who could  in  the  past  travel  from  one  point  to  another without having to change from one service to another en  route. This  can  always  be  done  by  appropriate clauses  exempting  operators  already  having  permits over  common  sector  from  the  scheme  and  by incorporating  appropriate  conditional  clauses  in  the scheme  to  enable  them  to  ply  their  vehicles  over common sectors without picking up or  setting down passengers on the common sectors. If such a course is not  feasible the State  Legislature may intervene and provide  some  other  alternative  as  was  done  by  the Uttar  Pradesh  Legislature  by  the  enactment  of  the Uttar Pradesh Act 27 of 1976 by Section 5 of which the competent  authority  could  authorise  the  holder  of  a permit of a stage carriage to ply his stage carriage on a portion  of  a  notified  route  subject  to  terms  and conditions including payment of licence fee. There may be  other  methods  of  not  inconveniencing  through passengers but that is entirely a matter for the State Legislature,  the  State  Government  and  the  State Transport Undertaking. But we do wish to emphasise that good and sufficient care must be taken to see that the  travelling  public  is  not  to  be  needlessly inconvenienced.”

(emphasis supplied)

23. In the case of U.P. State Roadways Transport Corporation vs.

Anwar  Ahmed and Others  reported in  (1997)  3  SCC 191,  this

Court observed thus:

“6. In  view  of  the  settled  legal  position  that once  the  scheme  has  been  approved  and notified, right to ply stage carriages by private

23

operators  on  the  notified  area,  routes  or portions  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…”

“7. It would, therefore, be seen that where the scheme has been published under sub-section (3)  of  Section  100  in  respect  of  any  notified area  or  notified  route,  the  State  Transport Authority or the Regional Transport Authority, as the case may be, shall not grant any permit except in accordance with the provisions of the scheme.  Thus,  the  appellant-Corporation has the  exclusive  right  or  monopoly  to  ply  their stage carriages and obtain the required permit as  per  the  scheme.  The  proviso  gives  only  a limited  breath  of  life,  namely,  until  the Corporation puts the vehicles  on the notified routes as per the scheme, temporary permits may be granted to private operators. Thereby, it would be clear that temporary inconvenience to travelling public is sought to be averted till the permits are taken and vehicles are put on the  route  by  the  appellant.  Therefore,  the temporary permits will have only limited breath of life. Private operators are attempting to wear the mask of inconvenience to travelling public to infiltrate into forbidden notified area, route or portion thereof to sabotage the scheme. The permits were taken by the appellant and the vehicles are put on the route in terms of the scheme. Therefore,  the direction given by the High Court at the pain of contempt is obviously illegal.  It  is  stated  by  Shri  V.R.  Reddy, Additional  Solicitor  General,  on  instruction that the appellant is prepared to take all the permits required on the routes.

24

8. But the crucial  question is whether a new route can be introduced by fusing two notified routes  and  temporary  permits  sought  to  be obtained  on carved-out  route?  This  device  is obviously  impermissible  to  enter  into  frozen area  or  route  or  portion  thereof  through backdoor. The scheme is law by itself and until it  is  varied  according  to  law,  no  private operator  has  any  right  to  camouflage  any device  to  obtain  temporary  permits.  Under these  circumstances,  action  taken  by  the respondents  to  obtain  temporary  permits  is obviously ultra vires and authorities have no jurisdiction to grant such permits. The altered or modified routes are contrary to the approved scheme, since they have been occupied by two notified routes and to be operated as per the scheme.”

                                    (emphasis supplied)

24. From  the  aforementioned,  it  is  clear  that  the  temporary

inconvenience, if any, to the travelling public was to be avoided

till  the permits were taken by the appellant and vehicles were

made to ply on the route by it. Since the appellant is running

sufficient  number  of  buses/trips  on  the  notified  route,  no

inconvenience to the public is made out. Private stage carriage

operators  generally  would  be  attempting  to  wear  a  mask  to

infiltrate into forbidden routes or areas or portions thereof, under

the pretext of inconvenience to the travelling public, to sabotage

the scheme.

25

25. The STAT impliedly interpreted the proviso to Section 104 of

the Act  to mean that  the competent  authority would have the

power to grant a temporary permit  de hors the scheme.  Such

interpretation deserves to be rejected, i.e., the interpretation that

until the STU puts vehicles on the newly carved out route fusing

non-notified  and  notified  route,  temporary  permits  may  be

granted to private stage carriage operators. A new route cannot

be introduced by  fusing  a  non-notified route  with the  notified

route to seek a temporary permit  on a carved out route.  This

device is obviously impermissible to enter into a frozen area or

route or portion thereof, in excess of the limited permit under the

scheme, through a back door. The Scheme is a law by itself and

until  it  is  varied  according  to  law,  no  private  stage  carriage

operator has any right to camouflage any device to obtain the

permits. The new route introduced by the respondent no.1 fuses

a non-notified route (to an extent of 15 kms) and a notified route

(to  an  extent  of  13  kms),  totally  measuring  28  kms.  This  is

contrary to the approved Scheme, since such newly introduced

route by the respondent No.1 overlaps with 13 kms of the notified

route, which is prohibited as per the Scheme. There cannot be

any dispute that  there will  not  be any scope for  grant of  any

26

permit in that area or route covered by the Scheme, except what

is specifically permitted or provided under the Scheme itself.  

26. In the matter on hand, the Scheme does not permit private

stage  carriage  operators  to  overlap  more  than  5  kms  or  5  %

(whichever  is  less)  of  the  route  proposed  by  the  private  stage

carriage  operator,  and  as  the  respondent  no.  1  wants  to  run

services overlapping by 13 kms, the prayer is liable to be rejected.

27. Thus,  the RTA was justified in rejecting the claim of  the

respondent no.1 seeking temporary permit on the notified route,

since the respondent no.1 has sought a temporary permit for the

route  which  overlaps  by  13  kms  on  the  notified  route;  such

overlap is clearly prohibited under the Scheme. Since the STU is

running hundreds of bus trips on the part of the notified route

i.e.  from  Angamaly  to  Perumbavoor,  it  is  not  open  for  the

respondent  no.1  to  seek  a  temporary  permit  covering  that

distance.

28. Moreover, overlapping to the extent of 5 kms or 5% of the

route of respondent no.1 (whichever is less), is only for purposes

of intersection under the Scheme. As the proviso to Section 104

of the Act is also subject to the Scheme, it is not open for any

27

private stage carriage operator including the respondent no.1 to

claim a temporary permit for traversing and overlapping with the

notified route to the extent of  13 kms. The intersection of the

notified route may not, in our view, be the same as traversing

and overlapping with the route, because the prohibition under

the Scheme must apply to the whole or  a part of  the notified

route, and private stage carriage operators cannot be allowed to

traverse the same line in the guise of intersection. In this case, as

the stage carriage services of the respondent no.1 are to operate

on  a  notified  route  to  an  extent  of  13  kms,  it  cannot  be

considered an intersection. Intersection means “to cut across”. It

is permissible for any private stage carriage operator, under the

Scheme in question,  to  traverse on a  notified route up to  the

permissible limit as contemplated under the Scheme only for the

purpose  of  cutting  across  the  notified  route,  and  to  proceed

further  on a  non-notified  route.  Only  in  such a  case  can the

temporary permit be granted.

29. There  is  a  clear  distinction  between  overlapping  and

intersection. The expression “intersection” is not defined in the

Act. Hence, in order to understand this distinction, the dictionary

meaning of the expression “intersection” deserves close scrutiny.

28

In Black's  Dictionary  of  Law,  5th  edn.,  the  word

“intersection” means: as applied to a street or highway means the

space occupied by two streets at the point where they cross each

other.  Space  common to  both  streets  or  highways,  formed by

continuing the curb lines.

In the Law Lexicon, Reprint edn., 1987 “intersect” means as

“to cross; literally, to cut into or between; a word which imports

the intersection of one line with another”.

In Chambers English Dictionary, “intersection” means to cut

across: to cut or cross mutually; to divide into parts, v.i. to cross

each  other; intersect appoint  of  intersection;  intersection

intersecting: the point or line in which lines or surfaces cut each

other (geom.): the set of elements which two or more sets have in

common (math.): a crossroad.

In Webster’s Dictionary, Vol. I, the word “intersection” is: as

the act of intersecting the point at which lines cut across each

other (or the line at which planes do so), a place where two roads

cross each other intersectional.

The Shorter  Oxford  English  Dictionary,  Vol.  I  defines

“intersection” as the action or fact of intersection; the place where

29

two things intersect; chiefly geom.; the point (or line) common to

two lines or surfaces which intersect.

The  Concise  Oxford  dictionary defines:  Intersect  means,   

Divide by passing or lying across it; cross or cut each other.

A reading of the dictionary meanings thus, shows more than

one meaning for the word “intersection”.  But, it can be said that,

meaning  of  the  word  “intersection”  as  provided  generally  in

various  dictionaries  mentioned  supra,  is  “cutting  across”.

However, in such a situation it would be appropriate to keep in

mind that the word has to be construed in the context of  the

provision of the Act and scheme of the Act.  As we find that the

“Scheme”  intends  total  exclusion  of  private  stage  carriage

operators for a notified route except for “intersecting” it  is not

open for the authorities to grant permits to private stage carriage

operators to operate on the notified route but may be permitted

merely to intersect within permissible limits.  The “intersection”

thus, is not traversing the same line of travel beyond permitted

limits, but to cut across a notified route for its onward journey.

This exception is carved out only to avoid hardships to travellers.

Any  other  view  contrary  to  the  above  view  would  amount  to

violating integrity of an approved Scheme.

30

An  intersection  is  permissible,  while  an  overlap  is  not.

In Mysore  State  Road  Transport  Corporation vs. Mysore  State

Transport Appellate Tribunal, reported in (1974) 2 SCC 750, this

Court held as follows:

“10. ...  It is, therefore, apparent that where a private transport owner makes an application to operate on a route  which  overlaps  even  a  portion  of  the  notified route i.e. where the part of the highway to be used by the private transport owner traverses on a line on the same  highway  on  the  notified  route,  then  that application has to be considered only in the light of the scheme as notified. If any conditions are placed then those conditions have to be fulfilled and if there is a total  prohibition  then  the  application  must  be rejected.”

***

“12. This Court has consistently taken the view that if there is a prohibition to operate on a notified route or routes  no  licences  can  be  granted  to  any  private operator whole route traversed or overlapped any part or whole of that notified route. The intersection of the notified  route  may  not,  in  our  view,  amount  to traversing  or  overlapping  the  route  because  the prohibition imposed applies to a whole or a part of the route on the highway on the same line of the route. An intersection cannot be said to be traversing the same line, as it cuts across it.”

                                                          (emphasis supplied)

30. The expression “intersection”as observed by this Court in

the case Karnataka SRTC vs. Ashrafulla Khan reported in (2002)

2 SCC 560, has been employed only to provide a facility to private

31

stage  carriage  operators  operating  on  a  non-notified  route  to

continue their onward journey on a non-notified route by cutting

across  the  notified  route  to  the  extent  permitted  under  the

scheme. This exception is carried out only with the avowed object

of  avoiding  hardship  to  the  travelling  public.  Except  for  such

exceptional circumstance of cutting across the notified route, the

scheme totally excludes private stage carriage operators on the

notified route. In case of overlapping, such carrier would ply on

the same line to travel on a portion of the notified route, whereas

in case of intersection,the private stage carriage operator’s route

only cuts across the notified route for its onward journey. Since

the scheme is a law, the same has to be preserved and protected

in public interest.  

31. Since it is not a case of intersection as contemplated under

Clause 5(c) of the Scheme, and as the overlapping sought by the

respondent  no.1  is  more  than both 5  kms or  5% of  his  total

route, the prayer of respondent no.1 must be rejected. However,

we hasten to add that (as mentioned supra) Clauses 5(c) and 6 of

the  Scheme provide  that  the  private  stage  carriages  would be

allowed  to  pick  up  and  drop  passengers  in  between  any  two

places on the route covered by the Scheme, provided that  the

32

route  of  the  private  stage  carriage  overlaps  the  notified  route

maximum to an extent of 5 kms or 5% of the length of its own

route (whichever is less).

32. At  the  cost  of  repetition,  we  must  observe  that  the

respondent no. 1 does not fall within the proviso to Section 104

of the Act. The appellant has been plying sufficient number of

buses/trips on the notified route as a STU. Both parties admit

that the appellant is running sufficient number of buses on the

notified route. It was held by this Court in U.P. SRTC and another

vs. Sanjida Bano and others, reported in (2005) 10 SCC 280, that

irrespective of the number of buses and trips undertaken by the

STU, the fact that it is plying its vehicles on the notified route

precludes others from taking the benefit of the proviso to Section

104 of the Act. The Court held thus:

“5.…Whether or not the number of buses and the trips operated  by  the  State  transport  undertaking  were enough  to  cater  to  the  volume  of  need  of  the commuting public, is not germane to the applicability of  the  proviso. The  scheme  provides  for  as  many permits as needed being lifted by the State transport undertaking.  The  State  transport  undertaking  was operating 36 trips on the date of the order of the High Court and is now operating 40 trips, as stated by the learned counsel for the appellants at the Bar. However, the  learned Senior  Counsel  for  the  respondents  has disputed  the  correctness  of  this  statement  and submitted  that  the  Secretary,  Regional  Transport

33

Authority had found only 25 trips being in operation. Be that as it may, we are not inclined to hold that in spite  of  the  appellant  Corporation  operating  on  the route resort can be had to the proviso to Section 104 of the Act for granting temporary permits.”

(emphasis supplied)

33. Strangely, the Respondent No.1 sought to produce certain

documents before  the  Court,  just  about  two days prior  to the

final  arguments.  Such  documents  contained  so  called  three

temporary  permits  granted  in  favour  of  three  private  stage

carriage  operators  on  the  notified  route  subsequent  to  the

scheme.  Relying upon such documents, Mr. Basant argued that

same concession as has been given to three private stage carriage

operators should be given in favour of the respondent no.1 also.

These  submissions  are  rightly  objected  by  Mr.  Giri  taking  an

exception to the manner in which these documents were sought

to  be  produced  two  days  prior  to  the  final  arguments;  these

documents  were  not  available  on  the  record  before  the  High

Court or before the STAT. Since opportunity was not available to

the appellant to have its  say on the documents,  he submitted

that the said documents need to be ignored.   

It is not clear from any of the record that such temporary

permits  were  granted  and  even  if  granted  whether  they  have

34

expired or not.  Even otherwise there was no opportunity for the

appellant to have its say on alleged permits. Hence, we do not

propose  to  consider  and  comment  upon  such  documents

produced by the contesting respondent.

34. Mr. R. Basant relied heavily on Punjab Roadways vs. Punjab

Sahib Bus & Transport  Co.,  reported in  (2010)  5  SCC 235,  to

make a claim that temporary permits may be granted even when

the STU has applied for a permit. In that case, this Court held as

under:

“34. The  abovementioned  provision  states  where  a scheme has been published under sub-section (3) of Section 100 in respect of any notified area or notified route, the STA or the RTA as the case may be, shall not  grant  any permit  except  in  accordance with  the provisions  of  the  scheme.  An  exception  has  been carved out in the proviso to Section 104 stating, where no application for permit has been made by the STU in respect  of  any  notified  area  or  notified  route  in pursuance  of  an  approved  scheme,  the  STA  or  the RTA, as the case may be, may grant temporary permits to any person in respect of any such notified area or notified route subject to the condition that such permit shall cease to be effective on the issue of permit to the STU in respect of that area or route. In our view same is the situation in respect of a case where an STU in spite of grant of permit does not operate the service or surrenders the permit granted or is not utilising the permit. In such a situation it should be deemed that no application for permit has been made by the STU and it is open to the RTA to grant temporary permit if there is a temporary need. By granting regular permits to the private operators the RTA will be upsetting the

35

ratio  fixed  under  the  scheme  which  is  legally impermissible.”

        (emphasis supplied)

35. Despite  the  strong  submissions  made  on  behalf  of  the

respondent no. 1,  it  remains that  Punjab Roadways (supra) is

distinguishable from the present case on facts. In that case, the

scheme  of  the  Punjab  Government  shared  all  routes  on  the

national and State highways in a specified ratio between STUs

and private stage carriage operators. The relevant authorities as

well as the High Court held that regular permits may be granted

to private stage carriage operators where the STU is not using its

permit.  However,  this  Court  took  exception  to  the  grant  of

“regular”  permits  as  relief,  as  doing  so  would  upset  the  ratio

contained in the scheme. Temporary permits would not upset the

balance  and  were  hence  preferable  in  a  situation  where  the

scheme mandated that the routes be divided and utilized in a

specific ratio.  In the case on hand, there is no requirement of

division  into  specific  ratios.  We  see  no  reason  to  apply  the

findings in that case to the present scenario.

36. The contention that the subsequent order of the RTA has

remained unquestioned,  and the respondent no.  1 is  therefore

36

entitled to operate his services on the notified route, cannot be

accepted. Since the order of the STAT remanding the matter to

the RTA with a direction to the RTA to exercise its power under

the proviso to Section 104 of the Act, which was confirmed by the

High  Court,  is  held  to  be  bad  by  us  in  this  appeal,  the

consequent order of the RTA dated 23.02.2017 also needs to be

held illegal. Moreover, we have heard the matter in its entirety

and the said contention of respondent no.1, in our view, is too

technical.  Be that as it may, since we find that the Respondent

no.1 is not entitled to ply stage carriage buses on the notified

routes, the temporary permit granted by the RTA on 23.02.2017

in favour of respondent no.1 is set aside.

37. In view of this discussion, the following answer emerges:

 A  temporary  permit  cannot  be  issued  to  a  private  stage

carriage  operator  to  traverse  on the  notified  route  which is

being served by the STU, in excess of the permissible distance

provided under the scheme.  

 To rephrase, under the facts of this case, it is not open for a

private  stage  carriage  operator  (the  respondent  no.  1)  to

operate its services by overlapping on a notified route for more

than 5 kms or 5% (whichever is less) of the route of the private

37

stage carriage operator (as specified under the Scheme) which

is being served by the STU.

38. Accordingly, the judgment of STAT, the consequent order of

the RTA granting temporary permit to the respondent no. 1, as

well  as  the  judgment  of  the  High  Court,  are  set  aside.  The

appeals before us are hereby allowed. Consequently, O.P.(C) No.

1827  of  2017,  as  preferred  by  the  appellant  KSRTC,  stands

allowed. As regards the O.P.(C) No. 1784 of 2017 and O.P.(C) No.

581 of 2017, the same order shall govern their outcome.

..................................J Kurian Joseph

.................................J Mohan M. Shantanagoudar

.................................J Navin Sinha

New Delhi May 16, 2018