Judgment

RAY, J.:- These three appeals are by certificate from the judgments dated 9 June, 1966; 10 December, 1964 and 19 July, 1966 of the High Court of Mysore.

2. The only question which falls for consideration in these appeals is the interpretation of Section 63A (2) (c) of the Motor Vehicles Act, 1939 (hereinafter referred to as the Act).

3. Civil Appeal No. 1084 of 1967 concerns applications for grant of permits on specified routes in the State of Maharashtra. On 8 April, 1963, the Regional Transport Authority, South Kanara issued a notification under Section 57 (2) of the Act inviting applications from public carriers permit holders of South Kanara District intending to operate their vehicles in the State of Maharashtra. The permits were under reciprocal agreement between the State Government of Mysore and Maharashtra. There were 28 vacancies for permits, 39 applications were made for the same. The respondent Kamath in Civil Appeals No. 1084 of 1967 submitted an application for permit. His application was rejected by the Regional Transport Authority, Mangalore. He preferred an appeal to the State Transport Appellate Tribunal. The State Transport Appellate Tribunal rejected the appeal.

4. The inter-State Transport Commission issued certain directions to the Regional Transport Authorities. These directions were issued under Section 63A (2) (c) of the Act. These directions laid down the order of preference in the grant of permits. The Transport Authorities kept in view those directions. The principal point for consideration in these appeals is whether the Inter-State Transport Commission was competent to do so.

5. Section 63A (2) of the Act deals with functions of the Inter-State Transport Commission. One of the principal functions is regulation of the operation of transport vehicles in an inter-State region. Section 45 of the Act deals with application where it is proposed to use the vehicle in two or more different States. Section 63 of the Act requires a permit granted in any one State to be counter-signed by the State Transport Authority or the Regional Transport Authority of the other State. Section 63 further provides that it shall not be necessary to follow the procedure laid down in Section 57 for the grant of counter-signatures of permits, where the permits granted in any one State are required to be counter-signed by the State Transport authority of another State or by the Regional Transport Authority concerned as a result of any agreement arrived at between the States after complying with the requirements of sub-section (3A), or for the grant of counter-signatures of permits in pursuance of any direction issued by the Commission under clause (c) of sub-section (2) of section 63A. Section 63 further provides that the agreement between the States shall be published by each of the States concerned in the Official Gazette together with a notice of the date before which representation in connection therewith may be submitted, and the date, not being less than thirty days from the date of such publication, on which the representations will be considered.

6. Section 63A (2) (c) of the Act is as follows:

"63A. (2) The Commission shall perform throughout an Inter-State region all or such of the following functions as it may be authorised to do by the Central Government by notification in the Official Gazette, namely;

(c) to issue directions to the State Transport Authorities or Regional Transport Authorities interested regarding the grant, revocation and suspension of permits and of counter-signatures of permits for the operation of transport vehicles in respect of any route or area common to two or more States".

7. The directions issued by the Inter-State Transport Commission under Section 63A (2) (c) were inter alia these;

(i) Preference will be given in the following order in the grant of the permits.

(a) A Co-operative Society (i) at least 50 per cent of the members of which are not related to each other;

(ii) 75 per cent of the