R.A. Sharma, J. - (1.) PETITIONERS in Writ Petition No. 23135 of 1988 are holding contract carriage permits for Matador Bajaj Tempo. Petitioners in Writ Petition No. 14890 of 1989 are holding contract carriage (Motor Cab) permits. Petitioners in Writ Petition No. 17331 of 1989 is the Union of owners of Matador vehicles and it is claimed that its members had made applications for grant of motor cab permits. Petitioners in Writ Petitions Nos. 21921 of 1988 and 11488 of 1989 had also applied for grant of contract carriage (motor cab) permits before the transport authorities. All the petitioners have challenged by means of these writ petitions the Notification dated 3.4.1987, issued by the Government of U.P. under Sec. 43 -A of the Motor Vehicles Act, 1939 (as added by the State of U.P.), directing the transport authorities in the State of U.P. not to renew the contract carriage (motor (cab) permits granted to Station Wagons or utility Care of Matador types of Vehicles, Mahindra -20 Diesel 260 -D Station wagon type of vehicles, Hindustan tracker and Diesel Jeep type of vehicles and the like in which the seating capacity exceeds six excluding driver, on the expiry of the existing period of the permits. The petitioners have assailed the impugned Notification on the ground: firstly, that after the repeal of Motor Vehicles Act, 1939 and enforcement of New Act of 1988 with effect from July 1, 1989 Section 43 -A being inconsistent with the new Act has been repealed and secondly that it is outside the purview of Section 43 -A.
(2.) IN 1972 Motor Vehicles Act, 1939 was amended by U.P. Act No. 25 of 1972, introducing new Section 43 -A under which the State Government was authorised to issue direction for grant of permits to all eligible applicants. The Government under the new section issued direction on March 30, 1972 with the result the transport authorities were required to grant permits to all the applicants without any restriction or limitation on number of permits. This amendment was upheld by the Supreme Court in the case of Hans Raj Kehar v. State of U.P. : A.I.R. 1975 S.C. 389. As the liberal grant of permits had resulted unproductive capital expenditure, unnecessary consumption of fuel and elimination of small operators as a consequence of unreasonable competition. State of U.P. enacted U.P. Amendment Act No. 15 of 1976, whereby sub -section (2) of Sec. 43 -A was substituted resulting in the reversal of earlier policy of liberal grant of permits to all. The Government of U.P. however, issued a Notification dated 10.1.1981 under the amended Sec. 43 -A, directing the transport authorities in State of U.P. to issue permit to all applicants. This Notification has been struck down by the Supreme Court in the case of Rameshwar Prasad v. State of U.P. : 1983 (9) A.L.R. 77 (Sam.) : A.I.R. 1983 S.C. 383, on the ground that after the amendment of Sec. 43 -A in 1976, permits cannot be granted liberally and the transport authorities can grant permit only after fixing limit of number of permits. Relevant extracts from this judgment are quoted below: "Even without the aid of the Statement of Objects and Reasons it has to be held that by the substitution of the former sub -section (2) by the new sub -sec. (2) in Sec. 43 -A the Legislature clearly expressed itself against the policy of granting permits to all eligible applicants without any consideration to the needs of any particular locality or route or to the qualifications of applicants." ................................. Therefore, after the amendment at any rate it has to be held that sub -section (1) of Sec. 43 -A of the Act did not comprehend within its scope the power to issue directions for issuing permits to all eligible applicants without any sort of restriction relevant to the scheme of the Act. Section 43 -A as it now stands after its amendment in 1976 is quoted below: 43 -A: Power of State Government to issue directions to Transport Authorities - -(1) The State Government may issue such directions of a general character as it may consider necessary or expedient in the public interest in respect of any matter relating to road transport to the State Transport Authority or to any Regional Transport Authority, and such Regional Transport Authority shall give effect to all such directions. (2) Without prejudice to the generality of the provisions of sub -section (1), such directions may be given in respect of any of the following matters, namely - - (a) the number of stage carriage or contract carriage permits that may be granted in respect of any route or area; (b) the preference or the order of preference to be given to or the quota to be fixed for specially deserving categories such as ex -army personnel, educated unemployed persons, such persons holding driving licences as are members of co -operative Societies formed for passenger transport business, persons belonging to the Scheduled Castes and Scheduled Tribes; (c) the procedure for grant of permits, and for selection from among the applicants, including selection by drawing of lots from among persons belonging to the same category. (3) Any direction under sub -section (1) may be issued with retrospective effect. (4) Where any direction is issued under sub -section (1) to any Transport Authority, then any appeal or revision pending before the State Transport Appellate Tribunal shall be decided in such manner as to give effect to such direction. (5) Where any direction is issued under sub -section (1) with retrospective effect then - - (a) any Transport Authority or the State Transport Appellate Tribunal may review any order, passed earlier by it with a view to making it conform to such direction, any may for that purpose cancel any permit already issued; (b) any Transport Authority may apply to the High Court for review of any order passed by such Court earlier with a view to enabling such Authority to comply with such direction. (6) The provisions of this section shall have effect notwithstanding anything contained in Sections 47, 50 and 57. - -U.P. Act 25 of 1972, Sec. 2 of which sub -section (2) subs. by new sub -section (2) to (6) by U.P. Act 15 of 1976 (1.5.1976) and deemed always to be substituted. Sec. 43 -A as it now stands authorises the Government of U.P. to issue direction for fixing number of permits to be granted, reservation in favour of Scheduled Castes and Scheduled Tribes and fixation of quota for specially deserving categories and for procedure for grant of permits by drawing of lots. Under this Section it is not open to the transport authorities to grant permit liberally.
(3.) UNDER Sec. 71 of the New Act of 1988, Regional Transport Authority is to grant permit having regard to the object of the Act. The object of this Act is to grant permit liberally. Sub -sec. (2) of Sec. 80 requires the Regional Transport Authority ordinarily not to refuse to grant permit. Unlike Old Act there is no provision for fixation of limit of number of permit to be granted on any route or area and the transport authorities are also not required to consider various factors, which were specified under sub -section (1) of Sec. 47 of the Old Act. Sec. 81, which deals with the renewal of permit lays down that Regional Transport Authority may reject an application for renewal of permit on the ground that, (i) financial condition of the applicant as evidenced by insolvency or decree for payment of debts remaining unsatisfied for certain period, and (ii) the applicant had been punished twice or more for certain offences relating to plying any vehicle without payment of tax or on an unauthorised route and making unauthorised trips within 12 months prior to the date of consideration of the application. In short the new Act provides for grant of permit liberally without any restriction. There is also no provision for reservation or fixation of quota. Procedure has also been simplified. Right to refuse renewal has also been restricted to contingencies.;