Judgment

B. K. MUKHERJEA, J.: The appellants in these two analogous appeals, along with many others, have been carrying on the business of plying motor vehicles as stage carriages on hire on the Bulandshahr-Delhi route from a number of years past. The running of these vehicles has been regulated so long by the Motor Vehicles Act of 1939 which provides, inter alia, for granting of driving licences, the registration of vehicles and exercising control over transport vehicles through permits granted by Regional Transport Authorities. Section 42(3) of the Act exempts transport vehicles, owned by or on behalf of the Central Government or the Provincial Government from the necessity of obtaining permits unless the vehicles were used in connection with the business of an Indian State Railway.

It appears, that some time after 1947 the Government of U.P. conceived the idea of running their own buses on the public thoroughfares. They first started running buses only as competitors with the private operators but later on they decided to exclude all private bus owners from the field and establish a complete State monopoly in respect to the road transport business. They sought to achieve this object by calling in aid the provisions of the Motor Vehicles Act itself. Under section 42(3) of the Act as mentioned above, the Government had not to obtain permits for their own vehicles and they could run any number of buses as they liked without the necessity of taking out permits for them.

The Transport Authorities, in furtherance of this State policy, began cancelling the permits already issued to private operators and refusing permits to people who would otherwise have been entitled to them. Upon this, a number of private bus owners filed petitions in the Allahabad High Court under Article 226 of the Constitution praying for appropriate relief, by way of writs, against what was described as the illegal use of the provisions of the Motor Vehicles Act by the Government of U.P.

These petitions were heard by a Full bench of five Judges and four judgements were delivered dealing with various questions that were raised by the parties. A majority of the judges expressed the opinion that the State purporting to act under section 42(3) of the Motor Vehicles Act, could not discriminate against other persons in their own favour and that the sub-section, in so far as it purports to exempt State Transport buses from the obligation to obtain permits for their use, conflicts with Article 14 of the Constitution. All the judges concurred in holding the nationalisation of an industry was not possible by a mere executive order without appropriate legislation and such legislation would probably have to justified under Article 19(6) of the Constitution. As a result of this decision the Transport Authorities were directed to deal with the applications for permits, made by the various private bus owners, in accordance with the provisions of the Motor Vehicle Act, without in any way being influenced by the consideration that the State Government wanted to run buses of their own on certain routes.

2. In view of this pronouncement of law, the State Government, which wanted to have the exclusive right to operate Road Transport Services within its territory, sought the assistance of the legislature and the U.P. Road Transport Act (Act II of 1951) was passed and become law on and from the 10th of February, 1951. It is the constitutional validity of this enactment which is the sub-matter of contest in these present proceedings.

3. The preamble to the Road Transport Act(hereinafter called "The Act") says :

"Whereas it is expedient in the interest of the general public and for the promotion of the suitable and efficient road transport to provide for a State Road Transport Services in Uttar Pradesh, it is enacted as follows."

Section 2 gives definition of certain terms, while section 3, which is the most material section in the Act, embodies virtually its whole purpose. It provides th