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IN THE HIGH COURT OF ALLAHABAD
A. P. Srivastava, J.
KHALIL-UL-RAHMAN KHAN - Appellant
Versus
STATE TRANSPORT APPELLATE TRIBUNAL - Respondents
Civil Misc. Writ 1061 Of 1962
Decided On : 08/28/1962
MOTOR VEHICLES ACT - PERMIT - TRANSFER - CONDITIONS - VALIDITY - CANCELLATION OF PERMIT - GROUNDS - VALIDITY - TRANSFER OF SHARE IN PERMIT - PERMISSION OF TRANSPORT AUTHORITY - NECESSITY - OWNERSHIP OR POSSESSION OF VEHICLE BY PERMIT HOLDER - REQUIREMENT - RENEWAL OF PERMIT - EFFECT ON TRANSFER AGREEMENT.
Fact of the Case:
The petitioner, a stage carriage permit holder, sold a one-fourth share in the permit and the vehicle covered by it to the third respondent. The Regional Transport Authority (RTA) cancelled the petitioner's permit on the ground that he had contravened a condition of the permit by selling the share without permission. The petitioner challenged the cancellation order, and the third respondent filed an appeal seeking entry of his name in the permit as the owner of the one-fourth share. The State Transport Appellate Tribunal (STAT) dismissed the petitioner's appeal and allowed the third respondent's appeal.
Finding of the Court:
1. The condition of the permit relied upon by the RTA to cancel the petitioner's permit did not refer to the transfer of a share in the permit and was, therefore, not a valid ground for cancellation. 2. The transfer of a share in the permit without prior permission of the RTA was not invalid or ineffective, as the Motor Vehicles Act and rules did not require such prior permission. 3. The STAT had the power to permit the transfer retrospectively and did so by implication by recognizing the transfer and directing the entry of the third respondent's name in the permit. 4. The requirement of ownership or possession of the vehicle covered by the permit was not a condition for the grant of a permit, as the definition of 'permit' in the Act did not refer to ownership or possession. 5. The agreement between the petitioner and the third respondent conferred on the third respondent the right to use and usufruct of the buses covered by the permit, including replaced buses, and was binding in respect of the renewed permit.
Issues: 1. Whether the cancellation of the petitioner's permit was valid. 2. Whether the transfer of a share in the permit without prior permission of the RTA was valid. 3. Whether the STAT could permit the transfer retrospectively. 4. Whether ownership or possession of the vehicle covered by the permit was a requirement for the grant of a permit. 5. Whether the agreement between the petitioner and the third respondent was binding in respect of the renewed permit.
Ratio Decidendi: 1. The condition of the permit relied upon by the RTA to cancel the petitioner's permit did not refer to the transfer of a share in the permit and was, therefore, not a valid ground for cancellation. 2. The transfer of a share in the permit without prior permission of the RTA was not invalid or ineffective, as the Motor Vehicles Act and rules did not require such prior permission. 3. The STAT had the power to permit the transfer retrospectively and did so by implication by recognizing the transfer and directing the entry of the third respondent's name in the permit. 4. The requirement of ownership or possession of the vehicle covered by the permit was not a condition for the grant of a permit, as the definition of 'permit' in the Act did not refer to ownership or possession. 5. The agreement between the petitioner and the third respondent conferred on the third respondent the right to use and usufruct of the buses covered by the permit, including replaced buses, and was binding in respect of the renewed permit.
Final Decision: The petition challenging the cancellation of the petitioner's permit was allowed, and the cancellation order was quashed. The petition seeking entry of the third respondent's name in the permit as the owner of the one-fourth share was dismissed.
( 1 ) THESE are two connected petitions under Article 226 of the Constitution. The parties are identical and the petitions relate to the same order passed by the State Transport Appellate tribunal, Lucknow. It will, therefore, be convenient to deal with them together.
( 2 ) THE petitioner Sri Khalil-ul-Rahman Khan had been granted a stage carriage permit No. 42i-A on Aligarh-Pahasu route on 25-3-1957. The permit was for a period of three years and the vehicle covered by it was No. UPB 1694. On 25-11-1957, the petitioner was allowed to replace vehicle No. UPB 1694 with vehicle No. UPB 1305. On the 7-8-1958 by an agreement of that date between the petitioner and the third respondent Sri Hazari Lal it was provided that for a consideration of Rs. 2,500/- the petitioner had sold the one-fourth share in the permit he held in favour of the third respondent and for a consideration of Rs. 2000/- he had sold to the third respondent one-fourth share in the vehicle No. UPB 1305 which was at that time covered by the permit. The agreement further provided in its 8th clause : -
"that in case any replacement is made against this bus, the parties shall have the same share in the replaced bus as they have in this bus and they shall continue to be so in all subsequent replacements. "
( 3 ) NO permission for the transfer of the one-fourth share of the permit was, however, obtained before the agreement was entered into, from the Transport Authorities concerned as required by section 59 (1) of the Motor Vehicles Act. On 17-11-1958 the petitioner was allowed to replace vehicle No. UPB 1305 with the vehicle No. UPA 4438. On 7-2-1959, Hazari Lal respondent No. 3 filed an objection against the order of replacement passed on the 17-11-1958. The ground he put forward was that the petitioner had sold to him one-fourth share in the permit and also in the stage carriage No. UPA 4438. When this alleged transfer came to the notice of Regional Transport Authority it issued a notice on 25-2-1959, under section 60 of the Motor Vehicles Act to the petitioner requiring him to show cause why his permit should not be cancelled. The petitioner showed cause. In spite of the objection filed by the third respondent to the replacement of the earlier vehicle by vehicle No. UFA 4438 the Regional Transport Authority permitted the replacement in March, 1959- After getting the explanation of the petitioner in respect of the notice issued to him under section 50 of the Motor Vehicles Act the Regional Transport Authority on 14/15-5-59 ordered that as he had contravened condition No. 17 of the permit issued to him by selling one-fourth share of the permit his permit was being cancelled. It was, however provided that if he paid Rs. 1000/-by way of compounding fee the order of cancellation would not be given effect to. This order was communicated to the petitioner on 25-5-1959. Against this order the petitioner preferred an appeal to the Transport Appellate Tribunal, on 26-5-1959 and also made a conditional deposit of the compounding fee of Rs. 1000/ -. The third respondent had also in the meantime filed an application on the 4-5-1959 paying that one-fourth share of the permit be transferred in his favour and his name be entered in the permit as the owner of that share. This application was opposed by the petitioner and wad rejected by the Regional. Transport Authority on 11-8-1959. Against that order the third respondent also preferred an appeal to the State Transport Appellate Tribunal. In this way, two appeals came up before the State Transport Appellate Tribunal, one by the petitioner against the order cancelling his permit and the other by the third respondent against the order refusing to enter his name in respect of the permit as the owner of the one-fourth share. Both these appeals were heard and considered by the State Transport Appellate Tribunal and by a joint order dated 29-12-1961. The appeal of tie petitioner was dismissed. The order cancelling his
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