Supreme Court: Hearing the reference made to resolve the conflict in the decisions reported in Karnataka State Road Transport Corporation, Bangalore Vs. B.A.Jayaram, 1984 (Supp) SCC 244 ( Jayaram case), Pandiyan Roadways Corporation Ltd. Vs. M.A.Egappan – 1987 (2) SCC 47 (Egappan Case), the 5-judge bench of T.S. Thakur, CJ, Fakkir Mohamed Ibrahim Kalifulla, S.A. Bobde, R. Banumathi and U.U. Lalit, JJ held that the decision in Jayaram Case is no longer a good law and the decision reported in Egappan Case stands approved which is in tune with the Constitution Bench decision reported in Adarsh Travels Bus Service and another Vs. State of U.P.  (1985) 4 SCC 557 (Adarsh Travels Case).

The reference that was made in R. Raghuram Vs. P. Jayarama Naidu, 1990 (Supp) SCC 361, called upon the Court to interpret the Chapter IV vis-à-vis Chapter IV-A of the Motor Vehicle Act, 1988.  Stating that Chapter IV-A supersedes any inconsistent provisions in Chapter IV, it was held that the policy of the Legislature is clear from Section 68C that the State Transport Undertaking may initiate a scheme for the purpose of providing an efficient, adequate, economical and properly coordinated road transport service to be run and operated by the State Transport Undertaking in relation to any area or route or portion thereof. It may do so if it is necessary in the public interest. It was further held that Section 57(8) is controlled by Section 68FF falling under Chapter IV-A, by virtue of the superseding effect of Section 68B also falling under Chapter IVA of the Act. The Court, hence, held that the ruling of the Courtin Jayaram Case where it was held that application for variation dealt with under Section 57(8) of the Act cannot be construed as an application for a new permit, was not a good law as Grant of variation under Section 57(8) will be as good as grant of a new permit.

Referring to the Adarsh Travels Case, the Court noted that the provisions in Chapter IV-A are devised to override the provisions of Chapter IV and it is expressly so enacted, the provisions of Chapter IV-A are clear and complete regarding the manner and effect of the “takeover” of the operation of a road transport service by the State Transport Undertaking in relation to any Area or Route or portion thereof. A necessary consequence of those provisions is that no private operator can operate his vehicle on any part or portion of a notified area or notified route unless authorized so to do by the term of the scheme itself. He may not operate on any part or portion of the notified Route or Area on the mere ground that the permit as originally granted to him covered the notified Route or Area. [G.T. Venkataswamy Reddy v. State Transport Authority, 2016 SCC OnLine SC 714, decided on 19.07.2016]

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