AMBALA BUS SYNDICATE PVT. LTD. versus CHANDIGARH ADMINISTRATION & ORS. on 26 September 2018

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SUPREME COURT REPORTS

[2018] 13 S.C.R.

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AMBALA BUS SYNDICATE PVT. LTD.

v.

CHANDIGARH ADMINISTRATION & ORS.

(Civil Appeal No. 10002 of 2018)

B

SEPTEMBER 26, 2018

[KURIAN JOSEPH AND SANJAY KISHAN KAUL, JJ.]

Motor Vehicles Act, 1988 – Chapters V & VI; ss. 88 and 98 –Overriding effect provided u/s.98 – Operation of – Appellant, privateCoperator of non-air conditioned bus, was issued inter-State permitby State of Punjab – Appellant claimed counter-signatures on thesaid permit from the authority of Union Territory (U.T) of Chandigarhfor operation of non-air conditioned bus in the said U.T. – Allowedby Single Judge – Division Bench overturned the said view holdingthat the appellant cannot operate its stage carriages beyond theDterritory of Punjab in view of the 1998 Scheme of the U.T. ofChandigarh framed under Chapter VI which excludes operation ofprivate operators altogether – On appeal, held: Division Benchmissed the crucial relevance and effect of the Reciprocal Agreementof 2008 contemplated u/s.88, Chapter V which specifically providesEfor counter signature for non-A.C. buses – There is no dispute thatdespite the Scheme of 1998, the appellant operated its stage carriageup to 2008 – Scheme is unilateral, whereas the ReciprocalAgreement is bilateral – Despite the availability of Scheme, the U.Tof Chandigarh and the State of Punjab consciously entered into aReciprocal Agreement permitting the non-A.C. buses, for which theFState of Punjab had issued permits prior to 1966 and it continuedto be renewed by the State of Punjab to operate in the UnionTerritory of Chandigarh – Unless the Reciprocal Agreement issuperseded by a fresh agreement or unless there is a new schemeframed by the U.T of Chandigarh specifying the provisions to theGcontrary, the buses operated by the appellant, which had permitsissued prior to 1.11.1966 and so long as they are renewed by theState of Punjab, the U.T of Chandigarh cannot refuse countersignature – Based on s.98, it was contended that Scheme framedunder Chapter VI has overriding effect over the Reciprocal H

AMBALA BUS SYNDICATE PVT. LTD. v. CHANDIGARHADMINISTRATION

Agreement contemplated u/s.88 (Chapter V) – However, overridingeffect provided in s.98 operates only in case of an inconsistency ona legal position – There is no such situation in the present case –On the contrary, the Reciprocal Agreement is on mutually beneficialterms – Impugned order passed by the Division Bench set aside –Order of Single Judge restored.

Disposing of the appeal, the Court

HELD: 1.1 There is no dispute that despite the Scheme of1998, as amended in 2001, the appellant operated their stagecarriage up to 2008. [Para 5] [461-G-H]

Conclusion

1.2 The Scheme is unilateral, whereas the reciprocalagreements are bilateral. Despite the availability of Scheme, theUnion Territory of Chandigarh and the State of Punjab haveconsciously entered into a reciprocal agreement permitting thenon-A.C. buses, for which the State of Punjab had issued permitsprior to 1966 and it continued to be renewed by the State of Punjabto operate in the Union Territory of Chandigarh. It has also comein the affidavit of the State of Punjab that such mileage has beentaken into consideration for the mileage entitlement of the UnionTerritory of Chandigarh, in the reciprocal agreement which hascome into effect on 04.06.2008. Therefore, unless the reciprocalagreement is superseded by a fresh agreement or unless thereis a new scheme framed by the Union Territory of Chandigarhspecifying the provisions to the contrary, the buses operated bythe appellant, which had permits issued prior to 01.11.1966 andso long as they are renewed by the State of Punjab, the UnionTerritory of Chandigarh cannot refuse counter signature for thereason that the permits already issued in 1966 had outlived itslife after five years of the reorganization. The overriding effectprovided in Section 98 of the said Act operates only in case of aninconsistency on a legal position. There is no such situation inthe present case. On the contrary, the reciprocal agreement ison mutually beneficial terms. Therefore, the impugned orderpassed by the Division Bench is set aside and that of the SingleJudge of the High Court is restored. [Paras 8, 9] [460-G-H;461-A-E]

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ACIVIL APPELLATE JURISDICTION : Civil Appeal No. 10002of 2018.

From the Judgment and Order dated 21.04.2011 of the High Courtof Punjab and Haryana at Chandigarh in Letter Patent Appeal No. 1098of 2010.

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P.S. Patwalia, Sr. Adv., Rohit Kapoor, Ms. Neelam Kalsi,Mrs. Rani Chhabra, Ms. Priyal Agarwal, Advs. for the Appellant.

Sudhir Walia, Ms. Niharika Ahluwalia, Abhishek Atrey, Ms. UttaraBabbar, Ms. Bhavana Duhoon, Ms. Deboshree Mukherjee, Jagjit SinghChhabra, Advs.for the Respondents.

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The Judgment of the Court was delivered by KURIAN, J. 1. Heard learned counsel for the parties.

2. Leave granted.

3. The appellant is aggrieved by the judgment dated 21.04.2011Dpassed by the Division Bench of the High Court of Punjab and Haryanaat Chandigarh in Letters Patent Appeal No.1098 of 2010, whereby theDivision Bench overturned the view taken by the learned Single Judgeof the High Court and held that the appellant cannot operate its stagecarriages beyond the territory of Punjab in view of the 1998 Scheme, asEamended in 2001. The relevant consideration in the impugned orderreads:- “The 1998 Scheme and the modified Scheme of 2001 does notpermit non-air conditioned buses of the private operators (persons/agencies) to operate in the U.T., Chandigarh. Section 66 of the1988 Act prohibits an owner of the motor vehicle to permit use ofhis vehicle as a transport vehicle in any public place whether ornot carrying any passengers or goods without permit granted orcounter-signed by the competent authority. This Sectionnecessitates a permit for a vehicle to be used as a transport vehicle.Section 88 of the 1988 Act provides counter-signatures of a permitgranted in any one State to be valid in any other State. Since the1998 Scheme of the U.T. Chandigarh excludes the operation ofprivate operators altogether, which Scheme has been framed underSection 99 read with Section 100 of the 1988 Act falling in ChapterVI of the 1988 Act, the same shall have an over riding effect. If F

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that be so, the respondent-Company, a private operator, has noright to claim counter-signatures from the Authority of U.T.Chandigarh on the permit issued to it by the Authority of the Stateof Punjab under the Reciprocal Agreement dated 4.6.2008 also.

In the light of the above conclusions reached by us, therespondent-Company cannot claim counter-signatures on an inter-State permit from the Authority of U.T., Chandigarh to operate anon-air conditioned bus in the territory of U.T. Chandigarh.”

4. Unfortunately, the Division Bench has missed the crucialrelevance and effect of the reciprocal Agreement of 2008, which cameinto effect on 04.06.2008, which specifically provides for counter signatureof non-A.C. buses. The relevant paragraph is set out below:- “The routes mentioned in Annexures A,B,C & D shall alwaysmean the shortest direct route connecting the two terminals lyingin the two states through the places mentioned therein. Anydiscrepancy discovered later in the name or length of route shownin the said annexure shall promptly be corrected throughcorrespondence between the reciprocating States/UT and shallnot be treated as any modification of the agreement. The Airconditioned and Non-air conditioned buses owned and operatedby STU’s of both the State/UT shall only be allowed subject tothe counter signatures. Integral Air Conditioned Buses of theprivate operator shall be allowed on the routes covered in annexureD to this agreement subject to countersignatures, provided thatpermits for such Buses shall not be extended beyond Chandigarhexcept in Punjab area. Non air conditioned buses of the privateoperators having permits issued before 01.11.1966 may be allowedafter verification of the original permits and countersignaturesprovided that such permits shall be countersigned only if they fallin the scope and terms of Section 74 of the Punjab ReorganizationAct, 1966 and provisions of Motor Vehicles Act, 1988.”

5. There is no dispute that despite the Scheme of 1998, as amendedin 2001, the appellant operated their stage carriage up to 2008. Accordingto the learned counsel appearing for Respondent Nos.1 and 3, reciprocalAgreement of 2008 specifically contains the provision to deny the countersignature of the bus operated by the appellant in the Union Territory ofChandigarh.

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A6. Despite the persuasive arguments advanced by the learnedcounsel for Respondent Nos.1 and 3, we find it difficult to appreciatethe contention. Learned counsel has specifically referred to Chapter VIof the Motor Vehicles Act, 1988 (for short, ‘the said Act’) and has invitedour attention to Section 98 of the said Act to canvass the point that theScheme under Chapter VI of the said Act has overriding effect over theBreciprocal Agreements contemplated under Section 88, coming underChapter V of the said Act. Section 98 of the said Act reads as follows:- “98. Chapter to override Chapter V and other laws.- Theprovisions of this Chapter and the rules and orders made thereundershall have effect notwithstanding anything inconsistent therewithcontained in Chapter V or in any other law for the time being inforce or in any instrument having effect by virtue of any suchlaw.”

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7. Section 88 (5) and (6) under Chapter V read as under:- D“88 (5) Every proposal to enter into an agreement between theStates to fix the number of permits which is proposed to be grantedor countersigned in respect of each route or area, shall be publishedby each of the State Governments concerned in the OfficialGazette and in any one or more of the newspapers in regionallanguage circulating in the area or route proposed to be coveredEby the agreement together with a notice of the date before whichrepresentations in connection therewith may be submitted, andthe date not being less than thirty days from the date of publicationin the Official Gazette, on which, and the authority by which, andthe time and place at which, the proposal and any representationreceived in connection therewith will be considered.F

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(6) Every agreement arrived at between the States shall, insofaras it relates to the grant of countersignature of permits, be publishedby each of the State Governments concerned in the OfficialGazette and in any one or more of the newspapers in the regionallanguage circulating in the area or route covered by the agreementand the State Transport Authority of the State and the RegionalTransport Authority concerned shall give effect to it.”

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8. There cannot be any dispute that the Scheme is unilateral,whereas the reciprocal agreements are bilateral. Despite the availabilityof Scheme, the Union Territory of Chandigarh and the State of Punjab H

have consciously entered into a reciprocal agreement permitting the non-A.C. buses, for which the State of Punjab had issued permits prior to1966 and it continued to be renewed by the State of Punjab to operate inthe Union Territory of Chandigarh. It has also come in the affidavit ofthe State of Punjab that such mileage has been taken into considerationfor the mileage entitlement of the Union Territory of Chandigarh, in thereciprocal agreement which has come into effect on 04.06.2008.Therefore, unless the reciprocal agreement is superseded by a freshagreement or unless there is a new scheme framed by the Union Territoryof Chandigarh specifying the provisions to the contrary, the buses operatedby the appellant, which had permits issued prior to 1.11.1966 and so longas they are renewed by the State of Punjab, the Union Territory ofChandigarh cannot refuse counter signature for the reason that thepermits already issued in 1966 had outlived its life after five years of thereorganization. The overriding effect provided in Section 98 of the saidAct operates only in case of an inconsistency on a legal position. Thereis no such situation in the present case. On the contrary, the reciprocalagreement is on mutually beneficial terms.

9. Therefore, we set aside the impugned order passed by theDivision Bench and restore that of the learned Single Judge of the HighCourt.

10. The appeal is, accordingly, disposed of. The consequenceswill follow and needful shall be done within four weeks from today.

11. Pending applications, if any, shall stand disposed of.

12. There shall be no orders as to costs.

Divya Pandey

Appeal disposed of.

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