Holding

The Court held that objections to the draft scheme for the 38 routes must be heard in accordance with the statutory provisions, and the scheme cannot be deemed approved without such a hearing.

Summary

The Supreme Court examined the validity of a draft scheme under the Motor Vehicles Acts (1939 and 1988) to nationalise 39 road‑transport routes in Uttar Pradesh, of which 38 routes were distinct from the Saharanpur‑Shahdra‑Delhi route previously dealt with in Ram Krishna Verma. The Court held that the statutory right to file objections and obtain a hearing under Sections 68‑D of the 1939 Act and Section 100 of the 1988 Act is a valuable right that cannot be overridden by implication from the earlier judgment, which pertained only to the single Saharanpur‑Delhi route. Consequently, the competent authority must call for and decide objections filed within the prescribed 30‑day period for the 38 routes, and the approval of the scheme without such hearing is invalid. The Court directed the authority to schedule a hearing within four weeks and to modify or annul the scheme based on the outcome, while leaving the Saharanpur‑Delhi route approved as earlier directed. The High Court’s dismissal of the petitions was set aside and the appeals were allowed.

Issues considered

The applicability of the Supreme Court's decision in Ram Krishna Verma v. State of U.P. to the 38 additional routes in the draft scheme.
Whether the competent authority must call for objections and conduct a hearing for the 38 routes under Sections 68‑D of the Motor Vehicles Act, 1939 and Section 100 of the Motor Vehicles Act, 1988.
Whether the approval of the draft scheme without hearing the objections is valid.
Whether the draft scheme lapsed under Section 100(4) of the 1988 Act.
Whether the right to file objections is a constitutionally protected right under Article 19(1)(g) and Article 14.

Legislation cited

Constitution of Indias. Article 14, s. Article 142(1), s. Article 19(1)(g)
Motor Vehicles Act, 1939s. 68-C, s. 68-D
Motor Vehicles Act, 1988s. 100, s. 100(4), s. 217(2) clause (e)

Subjects

nationalisation of road transport routesright to be heardMotor Vehicles Actpublic interestconstitutional lawArticle 19(1)(g)objections to schemesection 68-Dsection 100Supreme Court direction

Judgment

A GAJRAJ SINGH AND ORS.
v.
STATE OF U.P. AND ORS.

MAY 1, 2001

B [DR. A.S. ANAND, CJ., R.C. LAHOTI AND
DORAISWAMY RAJU, JJ.]

Motor Vehicles Act, 1988-Section JOO-Publication of draft scheme
by competent authority calling for objections for nationalisation of
C Saharanpur-Shahdra-Delhi route-Publication of revised draft scheme
pursuant to the direction by Supreme Court in Shri Chand v. Government of
U.P.,-Draft scheme prepared by the authority for 38 additional routes besides
Saharanpur-Shah«ra-Delhi route-Implementation of the scheme by the
authority under the Act-Direction to the authority to approve the scheme
D by Supreme Court in Ram Krishna Verma and Ors. v. State of U.P. and Ors.,
for Saharanpur-Shahdra-Delhi route-Authority approving the scheme in
entirety for all the routes-Approving the additional 38 routes before calling
for objections-Validity of-Held, right to file objections is a valuable right-
Direction to the authority to call for objections against the draft scheme
relating to the 38 routes-Section 68C-Motor Vehicles Act, 1939-
E Constitution of Jndia--Artic/e J9(J)(g).

State Road Transport Corporation published a draft scheme in 1959
under Section 68C of the Motor Vehicles Act, 1939 to nationalise Saharanpur-
Shahdra-Delhi route. Operators filed Writ Petitions against the proposed
scheme before High Court. The High Court upheld the scheme against some
F operations and quashed the same against 50 operators as no opportunity for
hearing was granted. This Court upheld the judgment of the High Court in
Jeewan Nath Waha/ v. State Transport Appellate Tribunal (C.A. No. 1616
decided by SC on 3.4.1968). Due to pendency of the scheme for over 20 years
on account of legal disputes, this Court in Shri Chand v. Government of U.P.,
G [1985) 4 sec 169 quashed the scheme and directed the State Government
to frame the scheme afresh. Pursuant to the direction, the Transport
Corporation drafted another scheme in 1986 for 39 routes which included
the Saharanpur-Shahdra-Delhi route. When the draft scheme was pending,
the Motor Vehicles Act, 1988 came into force. The government authority
H held the proposed scheme to have lapsed under section 100 of the Act of
344
GAJRAJ SINGH v. STATE 345

A
•• )A
1988. This Court in Ram Krishna Verma and Ors. v. State of U.P. and Ors.,
[1992) 2 SCC 620, which was confined to Saharanpur-Shahdra-Delhi route
only, directed the competent authority to approve the scheme. The competent
authority approved the scheme in its entfrety which included the remaining
,,, 38 routes also. Several petitions were filed by the petitioners before High
Court against the approval of the remaining routes. The High Court dismissed
the petitions. Hence these appeals and interim applications. B

Disposing of the appeals and interim applications, the Court

r HELD: 1.1. The provisions for nationalisation of routes and excluding
<rv

''
operation on such routes by private operators consequent thereupon are
reasonable restrictions in public interest on the fundamental right to carry
c
' . on trade or business under Article 19(1)(g) of the Constitution. It is on the
hearing of the objections that the competent authority would form an option
on the question whether the proposed nationalisation would provide a
convenient, adequate, economical and properly coordinated road transport
service and therefore it was necessary to do so in public interest. The right D
to file objections and to secure hearing thereon is statutorily provided and
is a valuable right of the private operators who would be eliminated, completely
..i.
·or par:tially from operation on the routes covered by the scheme depending
upon how and to what extent it is approved. The decision of this Court in Ram
Krishna Verma and Ors. v. State of U.P. and Ors., does not refer to the 38
E
routes and therefore this Court has not excluded the hearing in so far as
such 38 routes are concerned. Such exclusion of right of hearing cannot be
read in the judgment by implication. A doubt arising from reading a judgment
of the Court can be resolved by assuming that the judgment was delivered
consistently with the provisions of law and therefore a course or procedure
in departure from or not in conformity with statutory provisions cannot be F
said to hav~ been intended or laid down by the Court unless it has been so
stated specifically. (349-H; 350-A-D]
___.
1.2. In the peculiar facts and circumstances of this case allowing a
hearing to the operators on their objections and not disturbing the status
quo as to operation of buses on the routes in question would meet the end
G
-- of justice. It is directed that the objections filed against the draft scheme
relating to 38 routes shall be heard and disposed of by the competent authority
on merits and in accordance with law. Only such objections should be heard
" and decided which were filed within 30 days of the date of publication of the
draft scheme in the official gazette and which are maintainable and available H
-+- ,.
346 SUPREME COURT REPORTS [2001] 3 S.C.R.

A to be heard in accordance with Section 68-D of the 1939 Act read with sub-
.-;
section (2) of Section 100 of the 1988 Act. If the objections are allowed, the
draft scheme shall meet the fate consistently with the decision on objections -"-
and the approved scheme shall be accordingly modified or annulled for the
38 routes. In the event of the objections being dismissed, the approved scheme
'"
shall continue to remain in operation. [352-G-H; 352-A-C]
B
Shri Chand v. Government of U.P., [1985) 4 SCC 169; Ram Krishna
Verma and Ors. v. State of U.P. and Ors., [1992) 2 SCC 620 and Nisar Ahmad
and Ors. v. State of U.P. and Ors., [1994) Suppl. 3 SCC 460, referred to.
~
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3446 of .,.
c 2001. I

From the Judgment and Order dated 19 .11.1999 of the Allahabad High
Court in CMWP No. 22930of1993. .. ',

WITH
D Civil Appeal Nos. 3447/2001, 3448/2001, 3449/2001, 3450/2001, 3451-52/
2001, 3453/2001, 3434-3455/2001, 3456/2001, 3457/2001, 3458/2001, 3459/2001,
3460/2001, 3461-63/2001, 3464/2001, 3465/2001, 3466-67/2001, C.A. No. 3471/
>
2001, C.A. No. 3468-70-71.

K.K. Venugopal, D.D. Thakur, Dinesh Dwivedi, Rajeev Dhawan and
E Yogeshwar Prasad, Ms. Meenakshi Singh, Rani Chhabra, Ms. Manjula Gupta,
Shambhu Prasad Singh, Anitha Shinoy, Manoj Goel, S. Roy, Avinash Kumar,
Pankaj Kalra, Pramod Swamp, Praveen Swamp, Ms. Pareena Swarup, Kamlendra r
(
Misra, Ms. Sangeeta Sharma, RB. Misra, Bhim Singh, H.P. Dubey, RP. Gupta,
Rachana Gupta, Anil Karnwal and S.U.K. Sagar for the appearing parties.
F The Judgment of the Court was delivered by

R.C. LAHOTI, J. A draft scheme under Section 68-C of the Motor
Vehicles Act, 1939 to nationalise Saharanpur-Shahdra-Delhi route, prepared
by Uttar Pradesh State Road Transport Corporation, Lucknow was published
G on 29.9.1959. The Allahabad High Court by its judgments dated 31.10.1961
and 7.2.1962 upheld the scheme as against 50 operators but quashed the same
as against 50 operators holding that they should be granted an opportunity
of hearing. These 50 operators were those who had laid challenge to the ·
validity .of the scheme by filing two groups of writ petitions consisting of 32 •
and 18 operators respectively. Judgments of Allahabad High Court were
H upheld by this Court in Jeewan Nath Wahal v. State Transport Appellate
GAJRAJ SINGH v. STATE [R.C. LAHOTI, J.) 347
Tribunal (Civil Appeal No. 1616of1968 decided on 3.4.1968). Out of these A
50 operators some· of them filed suits in different courts and by virtue of
interim orders they were successful in scuttling the hearing and keeping the
scheme pending for well over 20 years. The matter came up before t~is Court
in Shri Chand v. Government of UP., [1985] 4 SCC 169 wherein vide its
judgment dated 23.8.1985 a two-Judge Bench of this Court directed the scheme
to be quashed solely on the ground that the delay of 26 years in disposing B
of the objections had resulted in violation of Articles 14 and 19 (l)(g) of the
Constitution. The Government was directed to frame the scheme afresh, if
necessary.

Pursuant to the above direction, the U.P.S.R.T.C., Lucknow framed a C
draft scheme and published the same vide notification No. 1239 RW/1056 RW-
f
. 85 dated 13.2.1986. The scheme so published included not only Saharanpur-
Delhi route but 38 others - in all 39 routes. Objections were preferred against
the scheme. While the draft scheme and the objections were so pending the
Motor Vehicles Act, 1988 came into force with effect from 1. 7.1989. Clause (e)
of sub-section (2) of Section 217 of the 1988 Act provided that notwithstanding D
repeal of the 193 9 Act any scheme made under Section 68-C of the 1939 Act
and pending immediately before the commencement of this Act shall be
disposed of in accordance with the provisions of Section 100 of the 1988 Act.
The competent authority held the proposed scheme to have lapsed by
operation of Section 100(4) of the 1988 Act which provides that where a E
proposed scheme is not approved within a period of one year from the date
of its publication, the proposal shall be deemed to have lapsed. The matter
travelled upto this· Court and was disposed of by judgment dated 3 lst March,
1992 delivered in C.A. Nos. 1198-1201of1992 (Ram Krishna Verma & Ors.
v. State of UP. & Ors., (since reported as - [1992] 2 SCC 620). This case was
confined to Saharanpur-Shahdra-Delhi route only. This Court held that in F
Jeewan Nath Wahals case (Civil Appeal No. 1616of1968 decided on 3.4.1968),
this Court while dealing with this very scheme had held that the scheme had
become final except for the purpose of hearing the 50 operators who had
challenged the scheme and the two-Judge Bench which dealt with and decided
Shri Chand 's case (supra) was not justified in quashing the proposed scheme
G,
bypassing Jeewan Nath Wahal 's case which was a three-Judge Bench decision.
This Court further held that the fresh draft scheme under Section 68-C dated
13.2.1986 must therefore be construed to be a draft scheme only in relation
to 50 existing operators as per the directions ultimately emerging in Jeewan
Nath Wahal 's case. The Court further observed that the 50 operators who
were to be heard (regarding Saharanpur-Delhi route) had made a blatant abuse H
348 SUPREME COURT REPORTS [2001] 3 S.C.R.
,.._
A of the process of the court by delaying hearing as directed in Jeewan Nath
Waha/ s case and therefore they had forfeited their right of hearing. In exercise -'\

of the power conferred by Article 142 (1) of the Constitution this Court held
that the 50 operators could not be. permitted to drag the litigation which
should be brought to an end and as the objections preferred by them had
outlived their purpose, hearing of their objections was rendered a procedural
B formality with no tangible result. The Court therefore directed the competent
authority to approve the scheme within a period of 30 days from the date of
receipt of the judgment and publish the approved scheme in the gazette.
..,,
It appears that the competent authority, which was seized of the hearing
c of several objections filed before it and had in fact appointed a date of
hearing, abruptly closed the hearing, approved the scheme and directed the
same to be published. The approved scheme was published in the Government )Jo
Gazette vide notification No. 1635/XXX-2-93-365-85 dated 29.5.1993. The
preamble to the notification states that the approved scheme was being
published in exercise of the powers under sub-section (2) of Section 100 of
D the 1988 Act and "in view of the directions given by the Hon'ble Supreme
Court in C.A. Nos.1198, 1199, 1200 and 1201of1992 Shri Ram Krishna Verma
& Ors. v. State of U.P. & Ors." The approved scheme includes all the 39
routes as proposed in the draft scheme published vide notification dated
13.2.1986.
E
Several petitions were filed in Allahabad High Court laying challenge to t
the approved scheme. Vide impugned judgment dated 19 .11.1999 a Division
Bench of High Court has dismissed all the petitions forming an opinion that
the scheme had stood approved by the Supreme Court in Ram Krishna
Verma s case (supra) and so was the view taken also in Nisar Ahmad & Ors.
F v. State of U.P. & Ors., [1994] Suppl. 3 SCC 460 and therefore nothing survives
for hearing and decision on the draft scheme.

Feeling aggrieved by the judgment of the High Court several petitions
seeking special leave to appeal have been filed. There are a few intervention
G applications also filed by a few operators.

Delay condoned and leave granted in all the SLPs.

Having heard learned counsel for the parties we are satisfied that the
judgment of the High Court cannot be sustained and has to be set aside as
H regards 38 routes, i.e., routes other than Saharanpur- Delhi route finding
GAJRAJ SINGH v. STATE [R.C. LAHOTI, J.] 349
... "
I,

mention in the draft and approved schemes at serial No. I. The High Court A
)<
has, in our opinion, clearly erred in holding that the decision of this Court
in Ram Krishna Verma s case had the effect of approving the draft scheme
. dated 13 .2.1986 in its entirety and after the decision in Ram Krishna Verma s
case nothing had remained to be done by the competent authority except to
approve the draft scheme and notify the same as approved scheme. We have
carefully perused the decision in Ram Krishna Verma s case. The decision is B
confined to Saharanpur-Shahdra-Delhi route alone. The tracing of the history
of the litigation and the reference to earlier decisions of this Court wherein
the nationalisation of this route was put in issue clearly shows that this Court
was dealing with Saharanpur- Delhi route and the conduct of those 50 operators
who had objected to the nationalisation of that route and were thereafter c
f
. indulging into wanton and vexatious litigation and thereby frustrating the
hearing. In the judgments of the High Court dated 31.10.1961 and 7.2.1962,
referred to in the earlier part of this judgment, and the decisions of this Court
in Jeewan Nath Wahal (supra) and Shri Chand (supra) the dispute which had
-i come up for determination was confined to that route alone. In Shri Chand s
case this Court had directed the Government to frame the scheme afresh, if D
necessary, and obviously that direction related to Saharanpur-Delhi route.
Acting on that direction, notification dated 13.2.1986 was published which
included not only Saharanpur-Delhi route but 38 other routes as well.
Objections were now filed as against the proposed nationalisation of 38
routes also. By reference to decision in Ram Krishna Verma s case the E
competent authority could not have abruptly closed the hearing of objections
which related to such 38 routes nor the High Court could have upheld
approval of the scheme without disposal of the objections preferred against
> proposed nationalisation of 38 routes (other than Saharanpur-Delhi route).

It is pertinent to note that Section 68-D of the 193 9 Act provided for F
filing of objections within 30 days of the publication of the proposed scheme
and consideration of the objections by the State Government after giving an
opportunity of hearing to the objectors or their representatives and the
representatives of the Staie Transport Undertaking. A similar provision for
filing of the objections and hearing thereon is included in Section I 00 of the
new Act. The provision for filing of objections and hearing to base the G
decision thereon, as contained in the old Act, being not inconsistent with the
successor provision rather beingpari materia therewith, continues to survive.
The provisions for nationalisation of routes and excluding operation on such
routes by private operators consequent thereupon are a reasonable restriction
in public interest on the fundamental right to carry on trade or business under H
350 SUPREME COURT REPORTS [2001) 3 S.C.R.

A Article 19(1)(g) of the Constitution. It is on the hearing of the objections that
the competent authority would form an o~inion on the question whether the
proposed nationalisation would provide a convenient, adequate, economical
and properly coordinated road transport service and therefore it was necessary
to do so in public interest. The scheme may then be annulled, modified or
B approved. The right to file object~ons and to secure hearing thereon is
statutorily provided and is a valuable right of the private operators who
would be eliminated, completely or partially, from operation on the routes
covered by the.scheme depending upon how and to what extent it is approved.
This Court did not and could not have taken away such valuable right of
hearing on the objections which were.already before the competent authority.
C The decision of this Court in Ram Krishna Verma s case does not refer to the
38 routes and therefore this Court has not excluded the hearing insofar as
such 38 routes are concerned. Such exclusion of right of hearing cannot be
read in the judgement by implication. A doubt arising from reading a judgment
of the Court can be resolved by assuming that the judgment was delivered
consistently with the provisions of law and therefore a course or procedure ,_
D in departure from or not in conformity with statutory provisions cannot be
said to have been intended or laid down by the Court unless it has been so
stated specifically.

We have carefully perused the decision of this court dated 9. 9.1994 in
E Nisar Ahmad & Ors. V. State of U.P. & Ors., [1994] Suppl. 3 sec 460 also.
Therein also these very schemes had come for the consideration of this Court.
Almost the same pleas were raised as were raised in and disposed of by Ram
Krishna Verma s case. Vide para 2 this Court has said that "the direction
issued by this Court under Article 142 (1) are binding on all the parties
including the 50 operators and were declared to be bound by the orders
F passed by this Court in Ram Krishna Verma s case". Two contentions were
advanced before this Court on behalf of Nisar Ahmad & Ors. : firstly, that
prior approval.of.the Central Government relating to the scheme on the inter-
state route was mandatory under Section 100(3) of the 1988 Act and yet not
having been obtained the scheme was vitiated; and secondly, that the scheme
G having not been published under Section 100 (4) within a period of one year
from the date of the draft scheme it had lapsed. This Court found no force
in the contentions. The first plea was turned down on the authority of Jeewan
Nath Wahal and Ram Krishna Vermas cases as.also on the ground that prior
approval of the Central Government had in fact been obtained on 9.9.1959. As ·
to the second contention it was held that. the scherre .was. not the .. one
H proposed under the 1988 Act but under the 1939 Act· and. therefore .the
GAJRAJ SINGH v. STATE [R.C. LAHOTI, J.] 351

.. scheme could not lapse as what is required by the proviso to sub-section (3)
of Section 100 (of the 1988 Act) is a scheme proposed under "the Act".
A
,.. Further, a draft scheme was published under the direction of this Court. All
these observations clearly go to show that Nisar Ahmad & Ors. ~case (supra)
related to that scheme which was dealt with by this Court in earlier two
decisions. Needless to say the 38 routes were not subject-matter of those two
decisions.
B

The upshoot of the above discussion is that the appeals are liable to
be allowed insofar as the said 38 routes (i.e. other than Saharanpur-Delhi
r route) are concerned.

However, it is brought to our notice that on all the 39 routes, the State
c
Road Transport Corporation of U.P. is operating buses ever since 1993 and
for that purpose it has made substantial investment by putting the buses on
the routes and recruiting employees to conduct, oversee and maintain operation
on such nationalised routes. While protecting the statutory right of the
operators to be heard under sub- section(2) of Section 100 of the 1988 Act, D
we have to keep in view the public interest also and therefore we do not deem
it proper to quash post haste the notification dated 29.5.93 which has notified
._,(
the draft scheme d~ted 18.2.86 as the approved scheme. In the peculiar facts
and circumstances of this case allowing a hearing to the operators on their
objections and in the meantime not disturbing the status quo as to operation E
of buses on the routes in question would meet the ends of justice and we
propose to direct accordingly.

The appeals are allowed. The impugned judgment of the High Court
dated 19th November, 1999 is set aside. The writ petitions are partly allowed.
~
It is directed that the objections filed against the draft scheme dated 18.2.86 F
in so far as they relate to 38 routes listed at serial nos. 2 to 39 of the scheme,
shall be heard and disposed of by the competent authority on their own
merits and in accordance with law for which purpose the competent authority
shall, within a period of four weeks from today, appoint and notify a date of
hearing. We make it clear that only such of the objections shall be available
to be heard and decided as were filed within 30 days of the date of publication
G
of the draft scheme in the official gazette and which are maintainabl~ and
available to be heard in accordance with Section 68-D of the 1939 Act read
with sub-section (2) of Section 100 of the 1988 Act. The draft scheme was
notified under Section 68-C of the 1939 Act on 13.2.1986. The period of 30
days for filing objections haq come to an end before 1. 7.1988, the date of H
352 SUPREME COURT REPORTS [2001] 3 S.C.R.

A coming into force of the 1988 Act. All that had remained to be done was to
hear and dispose of the objections which were already preferred and shall be •
deemed to have been preferred under Section 100 (1) of the 1988 Act and were
avai~able to be heard and determined by virtue of the saving clause contained
in clause (e) of sub-section (2) of Section 217 of the 1988 Act. Thus, the
competent authority shall hear all such parties who were entitled in law to be
B heard on the crucial date, if they had filed their objections within the stipulated
period. If all the objections or any of them are allowed, the draft scheme shall
meet the fate consistently with the decision on objections and the approved
scheme dated 29.5.93 shall be accordingly modified or annulled in so far as
routes specified at serial nos. 2 to 39 are concerned. In the event of the
C objections being dismissed, the approved scheme, as notified on 29.5.93, shall
continue to remain in operation. At the risk of repetition we would like to make
it clear that in so far as Saharanpur-Delhi route is concerned, no objection in
that regard shall be heard and the scheme as regards the said route shall be
deemed to have been approved and maintained in terms of this court's
dire~tion in Ram Krishna "Verma s case (supra). No order as to t~e costs.
D
All the appeals· and the intervention applications shall be deemed to
have been disposed of in terms of the above direction.

B.S. Appeals anad I.As. disposed of.