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Madhya Pradesh High Court · body

1987 DIGILAW 209 (MP)

UPBHOKTA HITCHINTAK SAMITI v. STATE OF M P

1987-07-09

C.P.SEN, N.D.OJHA

body1987
JUDGMENT : ( 1. ) THIS Order will also dispose of M. P. No. 1891/1985 4astha, a group of Advocates and others vs. The State of M. P. and others. In these two petitions the petitioners are challenging Notification of the State Government dated 30th June 1985 published in M. P. Rajpatra enhancing the bus fare in exercise of powers vested under section 43 (1) read with clauses (a) to (d) of the Motor Vehicles Act, 1939. ( 2. ) THE petitioner in MP. No. 1463/86 claims to be a registered society under m. P. Societies Registrikaran Adhiniyam, 1973. The object of the society is to safeguard interest of citizens who are all consumers of goods, services, facilities offered by public and private bodies, persons etc. The petitioner No. 1 in M. P. No. 1891/1985 is Astha, a group of Advocates, petitioner No. 2 is Jabalpur unit of Peoples Union for Civil liberties and petitioner No. 3 is Self-Employed Womens Association, a registered society. The State Government issued a Notification in M. P. Rajpatra on 25th May 1985 under Section 43 (1) inviting objections and suggestions for increase in bus fares as under and mentioning that the same would be considered on 26-6-1985 at 11 a. m. in Vallabh bhavan, Bhopal :- (1) In case of ordinary stage carriages : Re. 1/- per passenger to a distance of 8 kilometers and thereafter 50 paise per passenger for each slab of 4 kilometers. (2) (a) For Express buses 20%. (b) For night buses 10% and (c) For luxury buses 40% extra. The petitioner in M. P. No. 1463/86 sent a notice through its counsel on 17-6-1985 asking the Special Secretary, Home, (Transport) of the State Government seeking information regarding the proposals, reasons and grounds for proposed enhancement to enable the petitioner to submit effective and reasoned objections and suggestions. The State Government issued an advertisement on 24-6-1985 giving reasons for the proposed increase is its bus fares saying that payscales of the employees of M. P. State Road Transport Corporation have been revised, there is 47% increase in running and maintenance of buses while the proposed increase in bus fare is only 31% and in kutcha roads the increase is only 10% and there is no increase in city bus fares. It was also mentioned that the percentage of the fare so collected would be utilised in giving better facilities to the passengers, changing old buses, purchasing new buses and increasing the number of buses. However, no separate information was furnished by the state Government to the petitioner and the petitioner submitted its objections to the proposed increase in fares in writing on 25-6-1985. In M. P. No. 1891/85 after reading the notice inviting objections, the petitioner No. 2 wrote to the Divisional Manager of the corporation at Jabalpur for supplying the following documents (i) copy of the proposal sent by the Corporation to the Government for proposed increase in fares and (ii) copy of the balance sheet and annual report of the Corporation for the preceding three years. Since no reply was received, the petitioner No. 2 sought the information from the chairman of the Corporation on 7-6-1985 who also did not respond to the same and, therefore, the petitioner No. 2 demanded copies of the documents from the Special secretary, Home, (Transport) who was to hear the objections on 26-6-1985. The petitioner in M. P. No. 1463/86 and Shri Babulal Gour, B. J. P. , M. L. A. alone appeared before the Special Secretary who heard them. The other petitioners did not appear. By final Notification published in M. P. Rajpatra on 30th June 1985 the bus fares were increased as proposed in the earlier Notification but clarifying that there will be no increase in city bus fare. ( 3. ) THE petitioners case is that M. P. State Road Transport Corporation has been constituted by the State Government under Road Transport Corporation Act, 1950, in order to provide an economic, efficient, adequate and properly coordinated transport service to the people. In this State 57. 57% of the State population is living below the poverty line and most of the areas are not connected by rail lines, so the people have to rely mainly on transport services. As against its avowed purpose and object, the corporation is totally neglected and mismanaged body. Its fleet of buses and quality of service have been deteriorating during course of years. It is running into huge losses. In spite of numerous hikes in the fare from time to time, the Corporation could not improve its position. As against its avowed purpose and object, the corporation is totally neglected and mismanaged body. Its fleet of buses and quality of service have been deteriorating during course of years. It is running into huge losses. In spite of numerous hikes in the fare from time to time, the Corporation could not improve its position. As against this, its franchisees/assignees make substantial profits even after operating on lower margins of profit and paying substantial royalties to the corporation. There are numerous breakdowns and most of the buses are not roadworthy. There is indiscipline and no control over the staff and large scale pilferage in tickets and fares. Bus terminals are only in bigger places but do not provide the basic needs of the travelling public. Travel in Corporation buses is an ordeal and only undertaken out of some compulsion. There is no co-ordination and trips are abruptly cancelled. Late departure is a rule and timely arrival is an exception. Bus fares were revised in the year 1983 and again within a span of 2 years there has been further hike in bus fares. The present revision in bus fares is only to help the Corporation which is in a very bad shape. The enhancement of bus fare is under Section 43 (1) and the petitioner in M. P. No. 1463/86 sought information regarding the proposals, reasons and grounds of proposed enhancement to enable it to submit effective suggestions and objections but the respondents did not supply necessary information, with the result there was no proper opportunity and violation of Section 43. Whatever objections were raised by the petitioner, they were heard and decided post-haste. It appears that the authorities had already pre-determined mind to increase the fares. In M. P. No. 1891/85 the petitioner no. 2 had applied for copies of the proposals sent by the Corporation and the copies of its balance sheet and the annual reports for the last 3 years. Since the documents were not supplied, the petitioner No. 2 could not submit its suggestions and objections and there is violation of proviso to Section 43. 2 had applied for copies of the proposals sent by the Corporation and the copies of its balance sheet and the annual reports for the last 3 years. Since the documents were not supplied, the petitioner No. 2 could not submit its suggestions and objections and there is violation of proviso to Section 43. Revision in the bus fare is liable to be struck down on the grounds (i) the conditions precedent for issuing of a direction under section 43 were non-existing for the impugned fare increase; (ii) there is no category like night bus service under M. P. Motor Vehicles Rules, 1974, and, therefore, no extra charges could be levied for the night bus service. Proviso to Section 43 requires an adequate opportunity of being heard to the persons affected and there was denial of such opportunity to the petitioners inasmuch as no information was furnished to show reasons and basis for the increase; (iii) there is a discrimination shown in favour of the corporation and is violative of Article 14 of the Constitution and (iv) there is also violation of fundamental rights guaranteed under Articles 19 and 21 of the Constitution. ( 4. ) THE respondents in their return denied that the Corporation is mismanaged and is inefficient and uneconomical. The increase in bus fare is for all the operators i. e. the Corporation and private operators. The Corporation operates on 47% of the total number of routes while the balance of 53% is provided by the private services. Section 43 of the Act provides sufficient safeguards regarding fixation of bus fares in the interest of public. The State Government published a draft notification in the official gazette inviting suggestions and objections. The fare charged in the State is only 9. 50 paise per kilometer while it is more than 9. 97 paise per kilometer in other States. There is considerable increase in the prices of petrol, diesel and spares. There is also increase in the wages of the employees. So far as the Corporation is concerned, in view of the recent Pay Commission Report, it has to incur additional burden of 4 crore of rupees per annum for improving the pay scales of its employees. In fact, there is 47% increase in the cost of maintenance of transport services while the fare increase is only 31% on the pucca road and 10% on the Kutchcha road. In fact, there is 47% increase in the cost of maintenance of transport services while the fare increase is only 31% on the pucca road and 10% on the Kutchcha road. The increase will compensate only in a small way the Corporation and other operators. A direction has been given to the corporation to keep a margin of 0. 5 paise per kilometer per passenger for providing additional facilities and amenities to the passengers. Therefore, it is only in public interest that the bus fare has been increased. The increase is net only meant for the corporation but for all the operators and there is no discrimination as alleged. Before the date of hearing, public were informed by advertisement in the newspaper on 24th june 1985 the reasons and basis for increasing the bus fare. There is no increase in city bus fare. Therefore, the petitioners were aware of the reasons and basis for increase in bus fare and they could effectively give suggestions and raise objections. Only the petitioner in M. P. No. 1463/86 and Shri Babulal Gour, B. J. P. , M. L. A. appeared at the time of hearing while the other petitioners did not appear and can have no grievance that they were not given hearing. Nothing prevented the petitioners in inspecting the record which was available with the Special Secretary, Home, (Transport) who heard the objectors. There is no provision for giving certified copies of the balance sheet and annual report of the Corporation. The notification in question does not suffer from any infirmity and has been issued after fully complying with the provisions of Section 43. There is no violation of Articles 14, 19 and 21. The petition is misconceived and devoid of any merit ( 5. ) THE main question to be considered is whether there is a compliance to proviso to Section 43 (1) of the Act by the State Government while revising the bus fares and whether non-supply of documents sought by the petitioners prevented the petitioners from raising effective objection against revision in bus fares. ) THE main question to be considered is whether there is a compliance to proviso to Section 43 (1) of the Act by the State Government while revising the bus fares and whether non-supply of documents sought by the petitioners prevented the petitioners from raising effective objection against revision in bus fares. Section 43 (1) is as under : - "a State Government, having regard to - (a) the advantages offered to the public, trade and industry by the development of motor transport; (b) the desirability of co-ordinating road and rail transport; (c) the desirability of preventing the deterioration of the road system; and (d) the desirability of preventing uneconomic competition among motor vehicles; may from time to time, by notification in the Official Gazette, issue directions to the State Transport Authority - (i) regarding the fixing of fares and freights (including the maximum and minimum in respect thereof) for stage carriages, contract carriages and public carriers; provided that no such notification shall be issued unless a draft of the proposed directions is published in the Official Gazette, specifying therein a date being not less than one month after such publication, on or after which the draft will be taken into consideration and any objection or suggestion which may be received has, in consultation with the State Transport authority, been considered after giving the representatives of the interests affected an opportunity of being heard. " It is not disputed that as per requirement of this sub-section the draft of the proposed increase in bus fares was duly published in M. P. Gazette and objections and suggestions were invited within one month and 26-6-1985 was fixed for hearing the representatives of the interests affected and giving them an opportunity of being heard. It is true that in m. P. No. 1463/86 the petitioner sought information regarding the proposals, reasons and grounds for proposed enhancement to enable the petitioner to submit effective and reasoned objections and suggestions. In M. P. No. 1891/85 the petitioner No. 2 asked for supply of copy of the proposal sent by the Corporation to the Government for the proposed increase in bus fares and copies of the balance sheet and annual report of the corporation for the last 3 years. In M. P. No. 1891/85 the petitioner No. 2 asked for supply of copy of the proposal sent by the Corporation to the Government for the proposed increase in bus fares and copies of the balance sheet and annual report of the corporation for the last 3 years. It is also not disputed that these information and documents were not furnished to the petitioners but on 24-6-1985 an advertisement was issued in the newspaper by the State Government giving reasons for the proposed increase in bus fares saying that pay scales of the employees of the Corporation have been revised, there is 47% increase in running and maintenance cost of buses while the proposed increase in bus fare is only 31% and in kutcha roads it is only 10%, while there is no proposal for increase in city bus fare. It was also mentioned that part of the increase would be utilised for giving better facilities and amenities to the passengers, old buses will be replaced and new buses introduced and there will be increase in number of buses. On the date of hearing before Special Secretary, Home, (Transport) on 26-6-1985 only counsel for the petitioner in M. P. No. 1463/86 and Shri Babulal Gour, BJP, MLA, alone appeared and they were heard. None of the petitioners in M. P. No. 1891/85 appeared before the Special Secretary. So it is not open to them to say that they did not get any effective hearing. It may be seen that the proposed increase in bus fares was on account of rising cost of running and maintaining bus services. Last time bus fares were revised in the year 1983. Thereafter the respondents claimed that there has been 47% increase in running cost and maintenance of transport services, while the proposed increases were only 31%, only 10% on kutcha roads and no increase in city bus fares. This aspect was never controverted by anyone and not also by the petitioners and not even in the petition. A judicial notice can also be taken that there has been considerable rise in prices since the year 1983. So the petitioners were aware of the reasons and basis for the proposed increases in bus fares. This aspect was never controverted by anyone and not also by the petitioners and not even in the petition. A judicial notice can also be taken that there has been considerable rise in prices since the year 1983. So the petitioners were aware of the reasons and basis for the proposed increases in bus fares. Even if they thought that the information and documents sought by them are still necessary, nothing prevented them from taking inspection of those documents even if copies were not supplied and it is not their case that they were prevented from taking inspection. According to us, the information and documents sought by the petitioners were not at all very material for effectively raising objections and giving suggestions against proposed increases. In fact, the main grievance of the petitioners seems to be that the Corporation is being mismanaged and being run uneconomically resulting in huge losses every year. There may be some basis for this assertion in spite of denial by the respondents. But here we are not concerned as to how the Corporation is being run and as to whether it is being mismanaged causing loss to the public exchequer. We are here concerned with increase in bus fares due to rising prices. A probe in the affairs of the Corporation may result in giving suggestions for improving the working of the Corporation so that it may run more efficiently and profitably and thereby prevent the losses which it is sustaining every year. But there can be no denial that there has been high rise in prices of running and maintaining transport services and so there was justification for increase in bus fares. We are, therefore, of the opinion that the increase in bus fares as per notification dated 30th June 1985 was done after hilly complying with the requirements of proviso to Section 43 (1) by giving opportunity to all concerned and the representatives of the interests affected thereby and there was no denial of principles of natural justice. By advertisement dated 24-6-1985 all necessary information was given as to why there is a proposal for increase in bus fares and the petitioners could on the basis of that information effectively raise objections and give suggestions. ( 6. By advertisement dated 24-6-1985 all necessary information was given as to why there is a proposal for increase in bus fares and the petitioners could on the basis of that information effectively raise objections and give suggestions. ( 6. ) THE Supreme Court in Premier Automobiles vs. Union of India, AIR 1972 SC 1690 , has held that while determining the return to which a manufacturer is reasonably entitled the main objective is to protect the interest of the consumer while at the same time provide a reasonable margin of profit to the producer. The Supreme Court in S. I. Syndicate Ltd. vs. Union of India, AIR 1975 SC 460 , held that price fixation is more in the nature of a legislative measure even though it may be based upon objective criteria found in a report or other material. It could not, therefore, give rise to a complaint that a rule of natural justice has not been followed in fixing the price. Nevertheless, the criterion adopted must be reasonable. The Supreme Court in Prag Ice and Oil Mills vs. Union of India, AIR 1978 SC 1296 , has held that in the ultimate analysis, the mechanics of price fixation has necessarily to be left to the judgment of the executive and unless it is patent that there is hostile discrimination against a class of operators, the procedural basis of price fixation has to be accepted in the generality of cases as valid. Recently, the supreme Court in M/s. Rohtas Industries Ltd vs. Chairman, B. S. E. B. , AIR 1984 SC 657 , has held that we have declined to go into those factors which are really in the nature of matters of price fixation policy and the Court will be exceeding its jurisdiction if it is to embark upon a scrutiny of matters of this kind which are essentially in the domain of the executive to determine, subject, of course, to the Constitutional limitations. Therefore, in view of these decisions, the increase in bus fares is essentially in the domain of the executive to determine and the Court will be exceeding its jurisdiction if it were to embark upon a scrutiny of the matter. Therefore, in view of these decisions, the increase in bus fares is essentially in the domain of the executive to determine and the Court will be exceeding its jurisdiction if it were to embark upon a scrutiny of the matter. Revision in bus fares is due to rise in the cost of running and maintenance of transport services which have gone unrebutted and there can be no doubt that the State Government did consider the relevant factors before deciding to increase the bus fares. According to the respondents, cost of increase is about 47%, while the increase in fares is only 31% and 10% on kutcha roads and no increase in city bus fares. Increase in bus fares will be applicable to all operators including the private operators and so it cannot be said that the increase has been aone only to favour the Corporation. ( 7. ) THE Supreme Court while considering Section 68-D (2) of the Motor Vehicles act which required the State Government to give an opportunity to objector or its representatives to be heard in the matter before approving or modifying the proposed scheme, which is similar to the proviso to Section 43 (1), held in G. Nageshwara Rao vs. A. P. S. R. T. Corpn. , AIR 1959 SC 308 , that it cannot be said that the nature of hearing in this case makes the State Government a quasi-judicial tribunal and the decision a quasi-judicial act. This Court in Jogindra Singh vs. Govt. of M. P. , 1977 MPLJ 130 = AIR 1977 mp 51 held that a bare perusal of the language of the proviso to Section 43 (1) of the Act would show that an opportunity of being heard is to be given only to the representatives of the interests affected and not to every individual affected. In this case, opportunity was given to the representatives of the interests affected before revising the bus fares and there is no violation of the proviso to Section 43 (1 ). However, reliance has been placed by the learned counsel for the petitioners on a decision in Mohinder Singh vs. Chief Election Commr. , AIR 1978 SC 851 , that principles of natural justice have many colours and shades, many forms and shapes and, save where valid law excludes, it applies when people are affected by acts of authority. However, reliance has been placed by the learned counsel for the petitioners on a decision in Mohinder Singh vs. Chief Election Commr. , AIR 1978 SC 851 , that principles of natural justice have many colours and shades, many forms and shapes and, save where valid law excludes, it applies when people are affected by acts of authority. Reliance has also been placed on a decision of the Supreme Court in Mohd. Rashid Ahmad vs. State of U. P. , AIR 1979 SC 592 , that the impugned orders, unless they conform to the rules of natural justice, were liable to be struck down as invalid. We have already held that there is no violation of principles of natural justice. In fact, these principles have been required to be followed under proviso to Section 43 (1) and that has been, in fact, followed by the State government in letter and spirit before revising bus fares and no prejudice has been caused to anyone nor there is denial of reasonable opportunity to raise objections and give suggestions. Even personal hearing was given to those who had chosen to appear before the Special Secretary before deciding the matter. ( 8. ) THE counsel for the petitioners mainly relied on the decision of the Gujarat high Court in Consumer Education and Research Centre, Ahmedabad and others vs. State of Gujarat and others, Special Civil Application No. 1373/79 decided on 28-10-1983, quashing hike in bus fares on the ground that there was denial of fair hearing as required by proviso to Section 43 (1) and recommending appointing of a Rating Committee for revision of bus fares. There, the State Government published a draft notification on 5-9-1975 under proviso to Section 43 (1) in the matter of fixation of fares. After hearing the interests affected, the State Government finally fixed the fares on 2-1-1976. A fresh notification was issued on 13-1-1978 for further revision. The petitioner, namely, consumer Education and Research Centre,, raised objection to the said draft notification and its representative also attended the hearing held by the State government For the reasons which are not clear, the State Government did not pursue the matter and withdrew the draft notification which the Centre claimed was as a sequel to its weighty and considered objections against the proposed increase in fares. But thereafter the State Government resorted to power under Section 43 (2) to achieve the same purpose, which it could not effectively do in exercise of powers under Section 43 (1 ). The State Government, therefore, issued a notification on 1-1-1979 under Section 43 (2) proposing to increase the bus fares earlier fixed on 2-1-1976. The Centre sought a copy of statement of the case for variation of fares and certain other documents in support thereof. There was correspondence between the State Government and the corporation for appointing a Rating Committee to consider whether the fares should be revised. According to the petitioner, in that case, the Minister had informed it that the state Government has accepted in principle for establishing a Rating Committee but contrary to the promise, bus fares were revised on 12-4-1979. Therefore, Gujarat High court held that non-supply of the documents resulted in denial of reasonable opportunity to the petitioner to effectively raise objections and give suggestions. The petitioner was only supplied financial and administrative reports of the Corporation for 5 years i. e. from 1973-74 to 1977-78 while the State Government took into consideration financial position of the Corporation for the years 1978-79 to 1980-81 and also the income-tax liability of three crore rupees on the Corporation. These documents were not furnished to the petitioner. The petitioner was also not supplied statement of the case furnished by the Corporation to the Government for revision of the fares. The gujarat High Court held that the State Government could not have taken into consideration the factors prior to 1978-79 inasmuch as the proposed revision of bus fares in 1978 was withdrawn and, therefore, only on the basis of subsequent change in the circumstances, there could be revision in die fares. That is not the case here. In this case, the proposed increase was due to rise in cost of running and maintenance of transport services which was not disputed. ( 9. ) WITH the result, both the petitions fail and they are dismissed. There shall be no order as to costs. The outstanding security amount be refunded to the petitioners. Petitions dismissed.