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2012 DIGILAW 228 (ORI)

All Orissa Bus Owners Association v. Orissa State Road Transport Corporation

2012-05-03

B.N.MAHAPATRA, V.GOPALA GOWDA

body2012
JUDGMENT V. GOPALA GOWDA, C.J. : The first petitioner is an association of All Orissa Bus Owners Association in the State of Orissa having its office at Barmunda Bus Stand, Bhubaneswar, District Khurda whereas petitioner Nos. 2 to 5 are the old and existing bus operators operating their vehicles on different inter-regional routes on the strength of permits granted by S. T. A., Orissa, Cuttack (O.P. No. 3). Part B of the permanent permit granted in favour of petitioners 2 to 5, is annexed as Annexure-1 series. It is stated that the first petitioner association is a pioneer organization constituted under the provisions of the Road Transport Corporations Act, 1950 (for short the RTC Act) with a view to espouse the cause of the private bus operators of the State before the appropriate authorities to strengthen free flow of travelling public and to provide efficient passenger transport facilities to the commuters and also to protect the interest of the bus operators, this writ petition has been filed seeking for issuance of a writ of mandamus or an appropriate writ declaring that the action of the first opposite party-Orissa State Road Transport Corporation (for short the Corporation) in allowing private persons to operate their vehicles as outsourcing agents by virtue of an agreement, is illegal and unauthorized. The petitioners have further sought for a direction to O. Ps. 3 & 4 to cancel all the permits granted in favour of the Corporation on the route for which the Corporation has entered into agreements with private persons as outsourcing agents for operation of road transport services on the notified routes, urging various facts and legal contentions. The petitioners have further sought for issuing a direction to the O. Ps 3 & 4 not to grant any more temporary permit or permits in favour of the Corporation on the route or routes already outsourced to the private persons as its agents. It is the case of the petitioners that the Corporation, a State owned transport undertaking, has provided different transport services to the commuters in different inter-region and inter-State routes on the strength of the permit granted by the STA. The Corporation has been constituted under the provisions of the RTC Act with the object of providing efficient, adequate, economical and properly co-ordinated system of road transport services in the State and inter-State to its commuters. The Corporation has been constituted under the provisions of the RTC Act with the object of providing efficient, adequate, economical and properly co-ordinated system of road transport services in the State and inter-State to its commuters. It is their further case that nearly about 300 buses are provided by the Corporation which are operating on different routes in the interest of travelling public. Chapter VI of the Motor Vehicles Act, 1988 (for short the MV Act) confines to the special provision relating to State Transport Undertakings to provide transport services by exclusive operation on the routes or areas notified by the State Government. By virtue of the aforesaid provisions of Chapter VI of the MV Act, the routes or areas notified by the State Government, the S. T. A. or R. T. A. shall not grant any permit in favour of any private operators. In fact, the State Government has notified several routes under Section 100 of Chapter VI of the M. V. Act for exclusive operation of State Transport Undertaking (OSRTC). It is the further case of the petitioners that the said notification/scheme has not been implemented since the Corporation in our State has miserably failed to provide road transport services to the commuters on account of mismanagement of the Corporation and has also failed to achieve the very object of providing efficient and adequate transport services to the commuters. Keeping in view the interest of the travelling public, the Government of Orissa has introduced mixed transport system thereby allowing the private operators to operate their vehicles on all the routes along with services of the Corporation. 2. It is their further case that the transport authorities, STA or RTA has granted permits in favour of Corporation giving preference over the private operators as provided under Section 71(3)(d) of the M. V. Act. The Corporation has provided about 300 buses (passenger vehicles) which are operating on different inter-region and inter-State routes. However, most of the buses are operated and managed by the private persons by virtue of agreements executed between the Corporation and private individuals as outsourcing agents. The aforesaid fact came to light when the private person engaged as outsourcing agents to operate the Corporation vehicles operated in a clandestine manner affecting the existing services of the petitioners making unauthorized and unspecified halting stations. The aforesaid fact came to light when the private person engaged as outsourcing agents to operate the Corporation vehicles operated in a clandestine manner affecting the existing services of the petitioners making unauthorized and unspecified halting stations. On query, the petitioners came to know that the Corporation has engaged private persons as outsourcing agents for operation of its passengers on different routes in order to generate revenue. The petitioners have sought for information from the Corporation under the RTI Act as to how the services of the Corporation are managed and operated by the private persons. The Corporation refused to supply information in respect of vehicles. However, it has provided certain information with copy of the agreements executed between the Corporation and outsourcing agents. Some of the agreements entered into by the Corporation with the outsourcing agents are not in force, but the Corporation entered into further agreements with the agents for a subsequent period. True copy of some of the agreements furnished to the petitioners under the RTI Act is annexed as Annexure-2 series. 3. The petitioner No.2 brought the aforesaid fact of the Corporation entering into agreements with the outsourcing agents, to the knowledge of the Transport Commissioner-cum-Chairman, S. T. A., Orissa by way of filing petition. In the petition, it is stated that the action of the Corporation giving its passenger vehicles to the private persons to operate in the route is unauthorized and illegal. Further it is submitted that the existing services is being affected by the clandestine operation of the Corporation services managed by the outsourcing agents. Therefore, request was made to the Chairman, S. T. A. to cancel the permit granted in favour of the Corporation and not to grant any further permit in respect of such vehicles. 4. Despite the said representation and objections, the Chairman, S. T. A. has not taken any action to prevent illegal activities of the Corporation or to cancel the permits of the Corporation. Further it is stated that the action of the Corporation in giving its vehicles to private persons as outsourcing agents for operation of its road transport services, is illegal and unauthorized and violation of the provision of Section 82 of the M. V. Act. Further it is submitted that Section 19 of the RTC Act provides power of the Corporation to operate road transport services in the State and in extended area. Further it is submitted that Section 19 of the RTC Act provides power of the Corporation to operate road transport services in the State and in extended area. Section 19(2)(h) of the Road Transport Corporations Act confers power upon the Corporation to purchase or otherwise secure by agreement vehicles, garages, sheds, office buildings, depots, land, workshops, equipment, tools, accessories to and spare parts for vehicles, or any other article owned or possessed by the owner of any other undertaking for use thereof by the Corporation for the purpose of its undertakings. Further it is stated that the sole object for establishment of the Corporation is to operate road transport services in the State and for that purposes the Corporation shall purchase or otherwise secure by agreement, vehicles etc. as stated above. The said power does not authorise the Corporation to give its vehicles to the private persons/outsourcing agents by agreements for operating road transport services and in view of the aforesaid provision, the action of the Corporation is illegal and improper. 5. It is further submitted that the Corporation cannot under law allow its nominee to operate the permits. Section 66 of the M. V. Act provides, necessity for permits. It further states that no owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any prescribed authority authorising him the use of the vehicle in that place in the manner in which the vehicle is being used. In support of the aforesaid contention, learned counsel for the petitioners has placed reliance upon the decision of the Apex Court in the case of Brij Mohan Parihar v. M. P. Road Transport Corporation and others, AIR 1987 SC 29 wherein with reference to the provisions under Sections 42, 59 and 68-D of the M. V. Act, 1939 (repealed) considering the fact that the Corporation entered into agreement with the private vehicle owner allowing to operate its vehicle under the permit obtained by it as its nominee, held the same to be bad in law. Therefore, learned counsel on behalf of the petitioners submits that the action of the Corporation in entering into the agreements with the private persons as outsourcing agents to run their vehicles on the notified routes for which the Corporation has got monopoly to operate their services, is a stage carriage services or inter-State services. 6. The writ petition is opposed by the learned counsel for the Corporation as well as learned Standing Counsel (Transport) appearing for the STA and Transport Commissioner (O. Ps. 3 & 4 respectively) justifying the action of the Corporation in engaging the outsourcing agents to operate its vehicles on the notified routes upon which the Corporation has got monopoly to operate their services to provide economically viable transport facilities to commuters in the State and further submitted that all the factual and legal contentions raised in this writ petition with reference to the provisions under Sections 82 or 66 of the M. V. Act has no application to the fact situation of the present case. Further they have justified the action of the Corporation in engaging outsourcing agents to operate the vehicles on the notified routes to facilitate the economically viable transport facilities to the commuters in the State. By careful reading of the terms and conditions of the agreement, it is very clear that the same does not amount to operate their services on the routes by engaging the outsourcing agents with certain terms and conditions in the agreements entered with them. The same is in conformity with Section 19(2)(h) of the RTC Act. The terms and conditions do not amount to transfer all the permits in favour of the outsourcing agents as alleged by the petitioners. Therefore, without obtaining permission from the STA or RTA to operate the vehicles of the Corporation on the notified routes by the outsourcing agents, as contended by the learned counsel for the petitioners, is not tenable and above decision, upon which reliance has been placed by him, has no application to the fact situation of the present case. On the other hand, the Apex Court at paragraph-4 of the said judgment with reference to Section 19(2)(h) of the RTC Act has observed; that provision only authorises the Corporation to purchase or otherwise secure by agreement vehicles owned or possession by the owner of any other undertaking for use thereof by the Corporation for the purposes of its undertaking. On the other hand, the Apex Court at paragraph-4 of the said judgment with reference to Section 19(2)(h) of the RTC Act has observed; that provision only authorises the Corporation to purchase or otherwise secure by agreement vehicles owned or possession by the owner of any other undertaking for use thereof by the Corporation for the purposes of its undertaking. In the case on hand, outsourcing agents of the services has been taken by entering into agreements with the persons to operate the vehicles of the Corporation on the notified routes. Therefore, it does not amount to transfer all permits in favour of the outsourcing agents as contended by the petitioners. Hence they have prayed for dismissal of the writ petition. 7. It is further contended that the petitioners have no locus standi to challenge the action of the Corporation in entering into agreements with the outsourcing agents for the purpose of operating their vehicles on the notified routes as they are not entitled to apply for grant of permits on the routes in question and undisputedly the first petitioner-association and the petitioners 2 to 5 are the rival bus operators, who cannot file this writ petition in the nature of PIL and in fact on this score, this writ petition is liable to be rejected and this being a private interest litigation, the action of the Corporation cannot be challenged as the petitioners cannot be said to be aggrieved for the reason that they are not entitled to get the permits in respect of the notified routes. 8. With reference to the above-said rival legal contentions, the following points arise for consideration. (i) Whether the petitioners have got locus standi to challenge the agreements entered into by the Corporation with the outsourcing agents to operate its vehicles on the notified routes? (ii) Whether entering into agreements with the outsourcing agents as per the terms and conditions, will be in contravention of the provision under Sections 66 and 82 of the M. V. Act? 9. The first point is answered against the petitioners for the following reasons. Undisputedly, the State Government has notified several routes under Section 100 of Chapter VI of the M. V. Act. Those notified routes could not be opposed by the first petitioner association or the petitioners 2 to 5 have no right to apply for grant of permits in respect of those routes. Undisputedly, the State Government has notified several routes under Section 100 of Chapter VI of the M. V. Act. Those notified routes could not be opposed by the first petitioner association or the petitioners 2 to 5 have no right to apply for grant of permits in respect of those routes. They can apply for grant of either permanent or temporary permits in respect of other routes which are not notified under Section 100 of Chapter VI of the M. V. Act. It is not the case of the petitioners that the Corporation has entered into agreements with the outsourcing agents to operate the motor vehicle on the notified routes inter-region or interstate affecting the public interest not following the procedure of inviting fresh tenders. The petitioners have no locus standi to question the action of the Corporation in entering into the agreements with the outsourcing agents for the purpose of operating their vehicles on the notified routes of inter-region or inter-State. It is on the basis of the terms and conditions which have been obtained by the Corporation as it has got the monopoly to operate their services in respect of such notified routes. Therefore, we have to hold that the petitioners have no locus standi to challenge or question the action of the Corporation in entering into the agreements with the outsourcing agents for the purpose of operating their vehicles on the notified routes. Answer to point No. (ii) 10. It is an undisputed fact that the Corporation has entered into agreements with the outsourcing agents. By careful reading of the agreements entered into between the Corporation and the outsourcing agents, it is very clear that for the purpose of running their vehicles, only the services of the outsourcing agents is availed with certain terms and conditions for a period of one year. It is indeed their vehicles which are being operated by outsourcing agents. The terms and conditions would clearly go to show that it is not the transfer of the permits in favour of the outsourcing agents, obtained from STA or RTA in respect of notified routes, upon which exclusive right is conferred upon the Corporation under Section 100 of Chapter VI of the M. V. Act. The terms and conditions would clearly go to show that it is not the transfer of the permits in favour of the outsourcing agents, obtained from STA or RTA in respect of notified routes, upon which exclusive right is conferred upon the Corporation under Section 100 of Chapter VI of the M. V. Act. The relevant clauses of the terms and conditions of one of the agreements entered into between one Pravash Chandra Thatoi, the second party to the said agreement, produced at Annexure-2 series, is extracted herein below to show that the agreements with outsourcing agents to operate the services on the notified routes is not transfer of permits in favour of the outsourcing agents: 1. That the agreement is valid for a period of one year from May, 2011 to April, 2012. 2. That the rate of calculation indicated above shall be subject to revision of fare as to be decided from time to time. 3. That the 2nd party shall achieve fixed month wise income/payload per day in Bhubaneswar-Deulatara service and shall deposit the amount of sale proceeds of the round trip with the D. T. M.(A), OSRTC, Bhubanes-war after completion of trip and three hours before the schedule departure of the bus for the next scheduled trip on each date. In case of violation to deposit the sale proceeds 03 hours before the schedule departure, he shall not be allotted the vehicle further. 4. That the 2nd party shall ensure booking of the tickets in the OSRTC ticket counters with the ticket books of OSRTC to be purchased by him. Any violation in this regard shall be treated to be violation of this agreement. The 2nd party may himself book the ticket outside the counter mentioned above but at his own risk and only with the ticket books of OSRTC. 5. That the 2nd party shall not exceed the KMPL fixed for the vehicles and for the route. In case excess KMPL has been consumed/reported to have been utilised, the excess KMPL.HSD oil shall be recovered from the 2nd party. 6. That the 2nd party shall take steps to ensure utmost protection to the vehicles in the matter for carriage of luggage. The 2nd party shall not carry any luggage without ticket. In case excess KMPL has been consumed/reported to have been utilised, the excess KMPL.HSD oil shall be recovered from the 2nd party. 6. That the 2nd party shall take steps to ensure utmost protection to the vehicles in the matter for carriage of luggage. The 2nd party shall not carry any luggage without ticket. In case the luggage loaded is more than 500 kgs., the 2nd party shall be liable to penalty as to be decided by the 1st party. In the event, the 2nd party is detected for carriage of excess luggage by OSRTC or any other authorities, the 2nd party shall be liable to penalty as decided by such authority. 7. That the 2nd party shall operate its vehicles at his own cost. No conductor shall be allotted by the OSRTC in the above route. Only the OSRTC will allow its drivers to operate the trip and back. 8. That the 2nd party shall follow the provision of M. V. Act and shall operate the vehicle with the valid conductor license and badge. In case any failure reported by the authorities under the M. V. Act, the cost and amount of the fine imposed by the concerned M. V. Authorities shall be realised from the security deposit of the 2nd party. 9. That the 2nd party has deposited Rs. 50,000.00 towards security deposit. In case of failure to comply the terms and conditions specified in the agreement as regards deposit of agreed amount, same can be terminated by the 1st party at any time without any notice and the security deposit shall be forfeited and in future the Agent shall be debarred from further registration with the OSRTC in any matter. 11. The aforesaid clauses of the terms and conditions of the agreement are extracted above for better appreciation of the fact that the services are operated under the control, supervision and management of the Corporation through the second party outsourcing agent. Therefore, the same cannot be termed that there is a transfer of permits in favour of outsourcing agents to operate the vehicle or vehicles on the notified routes for which permission of either STA or RTA, is required under the provision of Section 68-D of the M. V. Act, 1939 (repealed) as contended by the learned counsel for the petitioners. 12. 12. For the reasons stated above, the decision in Brij Mohan Parihar : ( AIR 1987 SC 29 ) (supra), upon which reliance has been placed by the learned counsel for the petitioners, has no application to the fact situation of the present case. On the other hand, in view of the observations made at paragraph-4 of the said judgment with reference to the provision under Section 19(2) (h) of the RTC Act, it supports the case of the Corporation. By careful reading of the agreements with reference to the aforesaid provision, the agreements entered into between the Corporation and the outsourcing agents, is perfectly legal and valid. There is no arbitrary action on the part of the Corporation. There is also no statutory violation either under Section 66 or 82 of the M. V. Act as contended by the learned counsel for the petitioners. The writ petition is misconceived and need not be entertained. Hence the writ petition fails and is accordingly dismissed. Petition dismissed.