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1962 Supreme(SC) 296
SUPREME COURT OF INDIA
17th September, 1962
B.P. SINHA, C.J.I., S.J. IMAM, K. SUBBA RAO, J.C. SHAH, N. RAJAGOPALA AYYANGAR AND J.R. MUDHOLKAR, JJ.
Sobhraj Odharmal and others, Appellants
Versus
The State of Rajasthan and others, Respondents.
Civil Appeal No. 471 of 1962 and Writ Petn. No. 66 of 1962.
Advocates appeared
Mr. M. C. Setalavad, Attorney General for India, (M/s. R. K. Garg., D. P. Singh,, S. C. Agarwala and M. K Ramamurthi, Advocates of M/s. Ramamurthi and Co., with him), for Appellants and Petitioner; Mr. C. K. Daphtary, Solicitor General of India, (M/s. S. K. Kapur, K. K. Jain and P. D. Menon, Advocates, with him), for Respondents (In the Appeal and the Petition).
Civil Misc. Writ No. 214 of 1962, D/-9-5-1962 Raj.
C.K.DAFTARY, D.P.Singh, K.K.JAIN, M.C.SETALVAD, M.K.RAMAMURTHI, P.D.MENON, R.K.GARG, RAMAMURTHI, S.C.AGRAWAL, S.K.KAPOOR
An approved nationalisation scheme lawfully extinguishes the rights of permit holders. The power to cancel permits under Section 68F(2) of the Motor Vehicles Act is independent of the State Transport Undertaking's acquisition of permits, precluding claims of infringement of the fundamental right to business.
Headnote:(A) Motor Vehicles Act, 1939 - Sections 68C, 68D, 68F and 68I - State Transport Service (Development) Rules - Rule 7(4) - Nationalisation of transport route - Reasonable opportunity of being heard - Notice of hearing - Presumption of service - Whether publication of notice in the Official Gazette along with registered post constitutes reasonable opportunity - If objectors are professional operators and were aware of previous court proceedings, and the authority is satisfied regarding service, the scheme cannot be challenged on grounds of lack of notice. (Para 9)
(B) Motor Vehicles Act, 1939 - Section 68F - Cancellation of permits - Fundamental right to carry on business - Whether the operation of vehicles by a State Transport Undertaking without permits infringes the rights of operators whose permits have been cancelled under an approved scheme - Power to cancel permits under Section 68F(2) is independent of the grant of permits under Section 68F(1) - Once permits are lawfully cancelled pursuant to a final scheme, the right to ply vehicles is extinguished, and no fundamental right is infringed by the State's operation. (Paras 10-14)
Facts of the case:
A scheme for nationalizing a motor transport route was published. Objections were filed and subsequently heard after a remand from the High Court. Notices were sent via registered post and published in the Official Gazette. Despite some notices being returned unserved, the authorized officer approved the scheme. Consequently, permits of several operators were cancelled, and the State Transport Undertaking commenced operations. The operators challenged the scheme on the grounds of inadequate notice and infringement of their fundamental right to carry on business.
Findings of Court:
The court found that the authority was satisfied with the service of notice, considering the operators' professional status and their knowledge of the prior litigation. Regarding the permits, the court held that the cancellation of permits under the approved scheme lawfully extinguished the operators' rights.
Issues: Whether the notice provided constituted a reasonable opportunity to be heard and whether the State's operation of vehicles without permits infringed the fundamental right to business of the operators whose permits were cancelled.
Ratio Decidendi: The court reasoned that professional transport operators are expected to monitor the Official Gazette. Furthermore, the power to cancel permits under Section 68F(2) to implement an approved scheme is distinct from the requirement to grant permits under Section 68F(1). Once a valid scheme is published and permits are cancelled, the operator's right is extinguished, leaving no basis for a fundamental rights claim.
Result: Appeal and writ petition dismissed.
SHAH, J. : Questions relating to the validity of a scheme approved by the State of Rajasthan under S. 68D of the Motor Vehicles Act 4 of 1939 and its effect are raised by the appeal and the writ petition. In the appeal the validity of the scheme is challenged on the plea that the appellants were denied reasonable opportunity of being heard in support of their objections before the scheme was approved. In the writ petition it is submitted that the fundamental right of the petitioner to carry on business of a motor transport operator is infringed by the State of Rajasthan plying its buses along the route covered by the scheme without obtaining permits under S. 42 (1) of the Motor Vehicles Act.
2. A scheme for operating a motor transport service on the Jaipur-Tonk-Deoli Kotah route was published on September 10, 1960 in the Rajasthan Government Gazette, by the Rajasthan State Roadways which is a State Transport Undertaking within the meaning of S. 68A (b) of the Motor Vehicles Act, 1939. Sixtyone persons, including certain holders of state carriage permits authorising them to ply state carriages on the route, lodged objections to the scheme with the Secretary, Government of Rajasthan, Transport Department Jaipur within the period prescribed. The objections were heard by the Legal Remembrancer of the State and were rejected by order dated February 2, 1961. The scheme was then approved by the State Government and was published under S. 68D of the Motor Vehicles Act and Rule 8 of the Rajasthan State Road Transport Service (Development) Rules, 1960. Some holders of state carriage permits applied under Arts. 226 and 227 of the Constitution of the High Court of Rajasthan for the issue of writs cancelling the scheme. The High Court by order dated May 3, 1961 allowed the petition and set aside the scheme. The operative part of the order, in so far as it is material, was as follows :
"The approval of Scheme B Jaipur-kotah by the Legal Remembrancer is quashed and he is directed to decide the objections of the permit holders of Jaipur-Chaksu-Niwai-Banasthali-Tonk-Deoli route in accordance with the observations made above. The Notification of the State Government publishing the scheme is also set aside".
3. Thereafter the Legal Remembrancer sent individual notices by registered post pre-paid and addressed to all the sixty-one objectors fixing June 26, 1961 for hearing objections, and also published in the State Government Gazette a general notice to that effect. Out of sixty-one notices dispatched, thirteen were duly received by the addressees and thirty-nine were returned unserved : about the remaining nine notices no intimation was received from the Postal Department till June 19, 1961. The legal Remembrancer commenced hearing the objections. The proceeding lasted from June, 1961 to March, 1962. There were fifteen hearings, at which evidence was recorded and oral arguments were heard. The Legal Remembrancer by his order dated March 23, 1962 approved the scheme subject to certain modification. The scheme as approved was then published on April 2, 1962 in the Government Gazette. On May 3/4, 1962 the Secretary, Regional Transport Authority, Jaipur, issued an order declaring that the State Road Transport Service shall commence to operate from May 15, 1962 on the route specified in the scheme as mentioned in Rule 2 and directed that fifty-five permits described in the order to stand cancelled. Pursuant to the scheme the State Transport Undertaking commenced operating its vehicles upon the route without obtaining permits under S. 42(1) of the Motor Vehicles Act. Subsequently, applications were submitted to the Regional Transport Authority for permits and the same were granted to the State Transport Undertaking on July 28, 1962.
4. In the meantime, sixteen persons-who will be hereinafter referred to collectively as appellants- claiming that they had not received notice of the proceedings before, the Legal Remembrancer after the scheme was q
