Research › Browse › Judgment

Kerala High Court · body

1988 DIGILAW 226 (KER)

UPABHOTHRU BKOPANA SAMITHI v. STATE OF KERALA

1988-06-01

BALAKRISHNA MENON, BHASKARAN NAMBIAR

body1988
Judgment :- 1. The petitioner, an association of consumers in Kerala represented by its General Secretary challenges Ext. P2 notification issued by the Government under S.43 of the Motor Vehicles Act revising the existing fares for stage carriage services in the State. Ext. P2 shows a general revision of rates earlier fixed in 1985 relating to the different items of services mentioned therein: 2. Ext. P2 notification is challenged on the ground of violation of the principles of natural justice. The concept of natural justice is not a straight jacketed or fixed formula. It varies in different situations. 3. The proviso to sub-section (1) of S.43 of the Motor Vehicles Act embodies the principles of natural justice required to be complied with in issuing the notifications relating to matters specified in the sub-section. The requirement is the publication of the proposed direction 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 is required to be considered in consultation with the State Transport Authority after giving the representatives of the interests affected an opportunity of being beard. There is no dispute that the requirements of the proviso had been complied with. The draft of the notification was published more than one month before the date of hearing. Several people submitted objections and suggestions. All such people were heard at a conference convened by the Minister in-charge of Transport and the fares were revised in consultation with the State Transport Authority. 4. It is next contended that the present revision of fares is arbitrary. Sub-section (1) of S.43 of the Motor Vehicles Act empowers the State Government to issue notifications with respect to the matters specified therein having regard to: (a) the advantage offered to the public, trade and industry by the development of motor transport, (b) the desirability of co-ordinating road and rail transport, (c) (be desirability of preventing the deterioration of road system, and (d) the desirability of preventing uneconomic competition among motor vehicles. The objects referred to above rule out a profit motive. Public utility service corporations such as the State Transport Corporation, the Electricity Board etc. are expected to function without any profit motive. In P. Nalla Thampy Thera v. Union of India (1983 (4) SCC. The objects referred to above rule out a profit motive. Public utility service corporations such as the State Transport Corporation, the Electricity Board etc. are expected to function without any profit motive. In P. Nalla Thampy Thera v. Union of India (1983 (4) SCC. 598) the Supreme Court considering the position of the Indian Railways stated at page 609: "We have said earlier that the Railways are a public utility service run on monopoly basis. Since it is a public utility, there is no justification to run it merely as a commercial venture with a view to making profits. We do not know-at any rate it does not fall for consideration here-if a monopoly based public utility, should ever be a commercial venture geared to support the general revenue of the State but there is not an iota of hesitation in us to say that the common man's mode of transport closely connected with the free play of his fundamental right should not be; We agree that the Union Government should be free to collect the entire operational cost which would include the interest on the capital outlay out of the national exchequer. Small marginal profits cannot be ruled out: The massive operation will require a margin of adjustment and, therefore, marginal profits should be admissible". The Supreme Court in Kerala State Electricity Board v. S.N. Govinda Prabhu and Bros. ((1986)4 SCC 198) considering the question of the validity of an upward revision of electricity tariff in the Stare stated at page 212: "Pure profit motive, unjustifiable according to us even in the case of a private trading concern, can never be the sole guiding factor in the case of a public enterprise. If profit is made not for profit's sake but for the purpose of fulfilling, better and more extensively, the obligation of the service expected of it, it cannot be said that the public enterprise acted beyond its authority". It is further stated at page 214: "The Board may not allow its character as a public utility undertaking to be changed into that of a profit motivated private trading or manufacturing house. Neither the tariffs nor the resulting surplus may reach such heights as to lead to the inevitable conclusion that the Board has shed its public utility character. When that happens the court may strike down the revision of tariffs as plainly arbitrary. Neither the tariffs nor the resulting surplus may reach such heights as to lead to the inevitable conclusion that the Board has shed its public utility character. When that happens the court may strike down the revision of tariffs as plainly arbitrary. But not until then: Not, merely because a surplus has been generated, a surplus which can by no means be said to be extravagant. The court will then refrain from touching the tariffs. After all, as has been said by this Court often enough'price fixation' is neither the forte nor the function of the court". 5. In the absence of any material to show that the revision of fares in the present case is with a view to generate a profit, it is not possible for this court to say that the revision is arbitrary and is liable to be struck down. As held by the Supreme Court price fixation is not the function of the court. 6. We see no merit in the submission that the State Government has not applied its mind in revising the fares of stage carriage services as per Ext. P2 notification. Ext. P2 has gone into detail in regard to different categories of services such as services on ghat roads, plain roads etc. It has also provided for concessional travels, students' concessions etc. It cannot therefore be said that the authority concerned has not applied its mind in issuing Ext. P2 notification. We see no merit in the O.P. It is accordingly dismissed.