KANCHAN AND ORS. A
'"' V.
STATE TRANSPORT APPELLATE TRIBUNAL AND ORS.
JANUARY 17, 2006
[ARIJIT PASAYAT AND TARUN CHATTER.IEE, JJ.] B
Motor Vehicles Act, 1988; Section 68(3)(b):
'r
Grant of permits lo Transporters-Power of Stale Transport Authority/
STA-Mala fides-Held: Authorities granted permits lo Transporters even c
without filing an application for grant of such permits-Relevant records not
produced by the authorities on the pretext of vigilance inquiries in the mailer-
..... In deciding the question of mala fides if the authorities acted without
application ofmind, which act ofthe authority is sufficient lo atlach vulnerability
to the action against it on the question of mala tides-Thus, High Court D
/ rightly found the mala fides of the authorities in granting the permits.
.
' The question which arose in these appeals was as to whether the
permit granted to the appellants/Transporters by the State Transport
Authority could be legally sustained. The permits so granted were set aside
by the State Transport Appellate Tribunal on the ground that the action E
of the authorities was ma/a fide. On appeal, order of the Tribunal was
affirmed by the High Court. Hence the present appeals.
,." It was contended by the appellant that the High Court did not take
note of the fact that the revision petition filed before the Appellate
Tribunal was not maintainable as the Revision petitioner, the existing F
operators had no locus-standi to file the petition. The authorities, in exercise
of power under Section 68(3)(b) of the Motor Vehicles Act, 1988 had taken
over the power to grant permits and in bona fide exercise of the power
issued permits; and that there was no specific challenge in the Revision
Petition before the Tribunal about the infirmities which the High Court
G
has highlighted .
.. The respondents submitted that the whole exercise clearly smacked
~ of non-transparency and mala-fides; that 48 permits were granted and in
some cases, the files which were produced before the Tribunal indicated
451 H
452 SUPREME COllRT REPORTS [2006] I S.C.R.
A that even applications for grant of permits were not there; that the permits
were granted on the very same day on which the State Transport
Authority (ST A) purportedly took over the power to grant permits in
exercise of powers under Section 68(3) (b) of the Act and that too without
issuing a notification in connection thereto leaves no manner of doubt that
B the STA was acting contrary to law; and that as to how the applications
could be made to the ST A much before it assumed power in exercise of
powers under Section 68(3)(b) of the Act.
Dismissing the appeals, the Court
HELD. I.I. This is not a fit case for interference. The findings of
C the High Court about the mala-fides of the State Transport Authority
(STA) are clearly borne out from the records seen by the Tribunal. Both
the Tribunal and the High Court have recorded categorical findings that
....-
there were not even applications for grant of permits in such case. It baffles
one as to how the permits could be granted even without application. The
D State Transport Authority did not produce all the 48 files relating to the
grant of permits. A plea was taken that some of the files were taken by '
the vigilance authorities inquiring into the allegations of corruption. Be
that as it may, the fact remains that in some cases elaborated by the
Tribunal and the High Court, the applications were not there. 1454-D-EI
E 1.2. While deciding the question of mulu:fides, the very fact that in
certain cases, the authorities have acted without application of mind, is
itself sufficient to attach vulnerability to the action. (454-FI
U.P. State Road Transport Corporation through its Chairman v. I '
Omaditya Verma und Ors .. (20051 4 SCC 424, referred to.
F
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7305 of2003.
From the Judgment and Order dated 4.4.2003 of the Allahabad High
Court in Civil Misc. Writ Petition No. 4862412002.
G WITH
C.A. No. 7306/2003 and Cont. Pet. (C) No. 159 2005 in C.A. No.
7306/2003.
-
Vijay Hansaria, P.D. Sharma and Minakshi Sharma for the Appellants.
H
KANCHAN 1·. STA TE TRANSPORT APPELLATETRIBUNAL[ PASAYAT,l) 453
\ Rakesh Dwivedi, Ranjeet Kumar, Ms. Gauri Chhabra, Ms. Sudha Pal, A
Mrs. Rani Chhabra, Pramod Swarup, Pramod Dayal and Pradeep Mishra for
the Respondents.
Dinesh Dwivedi and Prashant Chowdhary for the Intervenor.
The Judgment of the Court was delivered by B
ARIJIT PASAYAT, J. Challenge in these appeals is to a composite
order of a learned single Judge of the Allahabad High Court dismissing the
writ petitions filed by the present appellants. The basic question before the
High Court was whether the pennits granted to the appellants by the State
Transport Authority, U.P. Lucknow (in short 'the S.T.A.') could be legally C
sustained. It is to be noted that on a revision filed by the non-official
respondents, the State Transport Appellate Tribunal, U.P., Lucknow (in short
'the Tribunal') set aside the grant of pennits and held that the the action of
ST A was ma/a-fide; it had acted in clear contravention of the statutory
requirements and, therefore, the grant of permit was an exercise which had D
no legal sanction. This order of the Tribunal was the subject mater of challenge
in the writ petitions. The High Court essentially came to record three findings;
(a) in respect of notified routes, the permits could not have been granted; (b)
action of the STA in taking over the ~oute was impermissible, ma/a-fide and
(c) the exercise of power by the STA in granting the permits was equally
unsustainable, being ma/a-fide. E
In support of the appeals, learned counsel for the appellants submitted
that the High Court did not take note of the fact that the revision petition filed
, ~ before the Tribunal was not maintainable as the existing operators who had
tiled the revision petition, has no locus-standi to file the same. It was further
submitted that the High Court proceeded on an erroneous impression as if the F
routes were notified routes. The STA, in exercise of power under Section
68(3)(b) of the Motor Vehicles Act, 1988 (in short 'the Act') had taken over
the power of grant of permits and in fact in bona fide exercise of that.
directed issue of permits. It was pointed out that there was no specific challenge
in the revision petition before the Tribunal about the so called infinnities G
which the High Court has highlighted. It was in essence, submitted that the
exercise of jurisdiction by the Tribunal was hone-fide and there was no
reasonable ground for interference by the Tribunal, as affirmed by the High
Court.
In response. Mr. Rakesh Dwivedi, learned senior counsel for the H
454 Slil'REME COURT REPORTS [2006) I S.C.R.
A respondents submitted that the whole exercise clearly smacked of non-
transparency and mala-fides. It was pointed out that 48 permits were granted
and in some cases, the files which were produced before the Tribunal indicated
that even application for grant of permits were not there. Further, the fact that
the permits were granted on the very same say on which the STA purportedly
B took over the power to grant permits in exercise of powers under Section
68(3 )(b) leaves no manner of doubt that the ST A as acting contrary to law.
It is pointed out that the even assuming that there was any Resolution, which
·according to the learned counsel for the respondents is also not a fact, there
was no notification about the taking over of the jurisdiction by the STA. It
is also not clear as to how the applications cou Id be made to the STA much
C before it assumed power in exercise of powers under Section 68(3 )(b) of the
Act. Finally, the applications are to be made to RTA and one does not know
under what circumstances the applications were made to the STA.
..
We do not consider this to be a fit case for interference. The findings
of the High Court about the ma/a-fides of the STA are clearly borne out from
D the records seen by the Tribunal. It is to be noted that the Tribunal and the
·High Court have recorded categorical findings that there were not even
applications for grant of pennits in such cases. It baffles one as to how the
permits could be granted even without application. The STA for reasons best
known to it, did not produce all the 48 files relating to the grant of permits.
E A plea was taken that some of the files were taken by the vigilance authorities
inquiring into the allegations of corruption. Be that as it may, the fact remains
that in some cases elaborated by the Tribunal and the High Court, .he
applications were not there. The stand of learned counsel for the appellants
that relief may be denied to only those persons, is clearly unacceptable. f .
While deciding the question of malu-fides. the very fact that in certain cases.
F the authorities have acted without application of mind, is itself sufficient to
attach vulnerability to the action. Therefore. we do not think it necessary to
go into the other questions and the appeals are dismissed. All the interim
orders consequently passed stand vacated. The contempt proceedings initiated
shall stand quashed.
G An application for interwntion has been filed taking a stand that certain
observations made by this Court in U. P. State Road Transport Corporation
through its Chairman v. Umaditya Verma and Ors., (2005] 4 SCC 424 are >--
not correct. We do not consider it necessary to deal with that question in this
application. The application for intervention is. therefore, rejected.
H S.K.S. Appeals dismissed.