Koshal, J. - (1.) The bone of contention in this appeal by special leave consists of two stage carriage permits granted under the Motor Vehicles Act (hereinafter called the Act) in relation to the route Chirala Railway Station to Vetapalem, the claimants to which now are Venkaiah (the appellant), Krishna Rao (respondent No. 1) and Nagendrudu (respondent No. 5). By the impugned judgment a Division Bench of the High Court of Andhra Pradesh has dismissed an appeal under clause 15 of the Letters Patent and has upheld the judgment of a single Judge of that Court by which the order of the State Government was reversed and the permits were granted to respondents Nos. 1 and 5.
(2.) Before we proceed to lay down the facts leading to the present contest we may refer with advantage to Rule 212 of the A. P. Motor Vehicles Rules, 1964 which have been framed under the Act and are hereinafter referred to as the Rules. The marginal note to that rule reads: "Grant, Variation, Suspension or Cancellation of stage carriage permit- Guiding principles" The rule is divided into six clauses out of which we are concerned only with Cls. (i), (ii), (iii) and (iv) and the same, in so far as they are relevant for the purposes of this appeal, are reproduced below: (i) Routes shall be classified as:- (a) Short routes including shuttle services - This class or route will cover a distance of up to 50 kilometres. (b) Medium routes - This class of route will cover a distance varying from 50 kilometres to 120 kilometres. (c) Long routes - This class of route will cover a distance of more than 120 kilometres. " (ii) Other things being equal, preference shall be given to applicants as follows: (a) for short routes including shuttle services to new entrants, (b) for medium routes to applicants with 1 to 4 stage carriages (excluding spare buses). " (iii) The Transport authorities shall in deciding whether to grant or refuse to grant a stage carriage, permit, have regard to the following matters in addition to those specified in sub-sec. (1) of Section 47. The applicants shall first be screened and those who are found to be unsuitable on one or more of the following principles shall be disqualified, reasons being given for the decision of the transport authority whenever an applicant is disqualified. (1) Financial instability ............ (2) If the history sheet is not clean... (3) If there is evidence that the applicant has been trafficking in permits, either benami or otherwise. (4) If the applicant has no workshop facilities or other arrangements to attend to repairs efficiently: .... ..... ..... .... .... .... .... .... .... ..... ..... .... .... .... .... .... (5) If the applicant has no main office or branch office on the route or resides beyond 8 kilometres from the route applied for to control the service. (6) If the application is on behalf of others in order to evade rules. " (iv) After eliminating the applicants in the manner laid down in clause (iii) above, marks shall be assigned as follows for assessing the different qualifications of the applicants for the grant of permits- (a)Sector or residential qualifications - (1) Four marks may be awarded to the applicant who has his place of business or residence at either terminus of the route applied for, and two marks may be awarded to the applicant who resides on the route (but not at either terminus) or within 8 kilometres from the route. (2) Marks may be awarded to the applicant who has sector qualification on the route applied for, as follows: (i) where the sector qualification is between 1 per cent and 25 per cent of the total distance of the route applied for - One mark; (ii) where the sector qualification is between 26 per cent and 50 per cent of the total distance of the route applied for - Two marks; (iii) where the sector qualification is between 51 per cent and 75 per cent of the total distance of the route applied for - Three marks; and (iv) where the sector qualification is above 75 per cent of the total distance of the route applied for - Four marks: Provided that if the applicant has both residential and sector qualifications, he may be given marks either for residential qualification or for sector qualification, whichever is more advantageous to him. (b) and (c) ........................" It will be seen that the rule lays down a scheme for the evaluation of the merit of various applicants for a stage carriage permit and for that purpose classifies routes as short routes, medium routes and long routes. According to Clause (ii) preference has to be given to those applicants in the matter of grant of permit for short routes who are "new entrants". Clause (iii) provides criteria for weeding out undesirable applicants. After the elimination process is over, the evaluation of the merit of the remaining applicants starts under Clause (iv) which provides for marks being awarded for sector or residential qualifications as laid down in paras (1) and (2) of sub-clause (a) thereof. To sub-clause (a) has been added a proviso which states that if an applicant is possessed of both residential and sector qualifications he shall be awarded marks only for one of them so, however, that he is given credit for the qualification more advantageous to him mark-wise.
(3.) We may now state the relevant facts. In the year 1957 road transport was nationalised in the State of Andhra Pradesh. Just before that the appellant, respondent No. 1 and respondent No. 5 held 1, 3 and 1 stage carriage permits respectively, but on nationalisation they were deprived thereof. Subsequently the appellant and respondent No. 5 were granted one such permit each while none was issued in favour of respondent No. 1. For the two routes in question the Regional Transport Authority (hereinafter referred to as the RTA) considered the claims of 20 applicants out of which 16 appear to have been eliminated in pursuance of the provisions of Cl. (iii) of Rule 212. The case was then taken up for consideration under Clause (iv) and out of the remaining four applicants, each one of the three present contestants was awarded 5 marks, i.e., one mark for business or technical experience and 4 for residential/sector qualification. On further consideration of the case the RTA granted one permit to the appellant and the other to respondent No. 5. In appeal the State Transport Authority (hereinafter referred to as the STA) noted the fact that respondent No. 1 did not hold any stage carriage permit at the time of the consideration of the respective claims of the parties and was, therefore, a new entrant within the meaning of that expression as used in sub-clause (a) of Clause (ii) of Rule 212, while the appellant and the respondent No. 5 did not have that qualification as each one of them was holding one such permit at the relevant point of time. One permit was, therefore, granted by him to respondent No. 1 and the other to respondent No. 5 who was held to have an edge over the appellant for the reason that although each of them had to his discredit a conviction for an offence under the Act, the offence brought home to the appellant was more serious than that of which respondent No. 5 was found guilty. The third round of litigation took place before the State Government in revision under Section 64A of the Act. The State Government held that the appellant and respondent No. 5 were entitled to preference over respondent No. 1 because of their longer experience in the field of motor transport (in addition to full sector qualification possessed by each of them) in spite of the fact that respondent No. 1 was a "new entrant." The matter was then agitated by the rival claimants in two petitions under Article 226 of the Constitution of India filed before the High Court, a learned single Judge of which held that respondent No. 1 was a new entrant who was entitled to preference over the other contestants by reason of the provisions of sub-cl. (a) of Cl. (ii) of Rule 212. The other route was granted by the learned single Judge to respondent No. 5 on the same ground as had weighed with the STA in that behalf. As already stated the judgment of the learned single Judge was upheld in the Letters Patent Appeal.;