REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO(S). 10002/2018

(ARISING FROM SLP(C) No(s).19092/2011)

AMBALA BUS SYNDICATE PVT. LTD. APPELLANT(S)

VERSUS

CHANDIGARH ADMINISTRATI ON & ORS. RESPONDENT(S)

J U D G M E N T

KURIAN, J.

Heard learned counsel for the parties.

2.Leave granted.

3. The appellant is aggrieved by the judgment dated

21.04.2011 passed by the Division Bench of the High

Court of Punjab and Haryana at Chandigarh in Letters

Patent Appeal No.1098 of 2010, whereby the Division

Bench overturned the view taken by the learned Single

Judge of the High Court and held that the appellant

cannot operate its stage carriages beyond the

territory of Punjab in view of the 1998 Scheme, as

amended in 2001. The relevant consideration in the

impugned order reads:-

“The 1998 Scheme and the modified Scheme of

2001 does not permit non-air conditioned

buses of the private operators

(persons/agencies) to operate in the U.T.,

Chandigarh. Section 66 of the 1988 Act

prohibits an owner of the motor vehicle to

permit use of his vehicle as a transport

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vehicle in any public place whether or not

carrying any passengers or goods without

permit granted or counter-signed by the

competent authority. This Section

necessitates a permit for a vehicle to be

used as a transport vehicle. Section 88 of

the 1988 Act provides counter-signatures of a

permit granted in any one State to be valid

in any other State. Since the 1998 Scheme of

the U.T. Chandigarh excludes the operation of

private operators altogether, which Scheme

has been framed under Section 99 read with

Section 100 of the 1988 Act falling in

Chapter VI of the 1988 Act, the same shall

have an over riding effect. If that be so,

the respondent-Company, a private operator,

has no right to claim counter-signatures from

the Authority of U.T. Chandigarh on the

permit issued to it by the Authority of the

State of Punjab under the Reciprocal

Agreement dated 4.6.2008 also.

In the light of the above conclusions

reached by us, the respondent-Company cannot

claim counter-signatures on an inter-State

permit from the Authority of U.T., Chandigarh

to operate a non-air conditioned bus in the

territory of U.T. Chandigarh.”

4. Unfortunately, the Division Bench has missed the

crucial relevance and effect of the reciprocal

Agreement of 2008, which came into effect on

04.06.2008, which specifically provides for counter

signature of non-A.C. buses. The relevant paragraph

is set out below:-

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“The routes mentioned in Annexures A,B,C

& D shall always mean the shortest direct

route connecting the two terminals lying in

the two states through the places mentioned

therein. Any discrepancy discovered later in

the name or length of route shown in the said

annexure shall promptly be corrected through

correspondence between the reciprocating

States/UT and shall not be treated as any

modification of the agreement. The Air

conditioned and Non-air conditioned buses

owned and operated by STU’s of both the

State/UT shall only be allowed subject to the

counter signatures. Integral Air Conditioned

Buses of the private operator shall be

allowed on the routes covered in annexure D

to this agreement subject to

countersignatures, provided that permits for

such Buses shall not be extended beyond

Chandigarh except in Punjab area. Non air

conditioned buses of the private operators

having permits issued before 01.11.1966 may

be allowed after verification of the original

permits and countersignatures provided that

such permits shall be countersigned only if

they fall in the scope and terms of Section

74 of the Punjab Reorganization Act, 1966 and

provisions of Motor Vehicles Act, 1988.”

5.There is no dispute that despite the Scheme of

1998, as amended in 2001, the appellant operated

their stage carriage up to 2008. According to the

learned counsel appearing for Respondent Nos.1 and 3,

reciprocal Agreement of 2008 specifically contains

the provision to deny the counter signature of the

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bus operated by the appellant in the Union Territory

of Chandigarh.

6.Despite the persuasive arguments advanced by the

learned counsel for Respondent Nos.1 and 3, we find

it difficult to appreciate the contention. Learned

counsel has specifically referred to Chapter VI of

the Motor Vehicles Act, 1988 (for short, ‘the said

Act’) and has invited our attention to Section 98 of

the said Act to canvass the point that the Scheme

under Chapter VI of the said Act has overriding

effect over the reciprocal Agreements contemplated

under Section 88, coming under Chapter V of the said

Act. Section 98 of the said Act reads as follows:-

“98. Chapter to override Chapter V and other

laws.- The provisions of this Chapter and the

rules and orders made thereunder shall have

effect notwithstanding anything inconsistent

therewith contained in Chapter V or in any

other law for the time being in force or in

any instrument having effect by virtue of any

such law.”

7.Section 88 (5) and (6) under Chapter V read as

under:-

“88 (5) Every proposal to enter into an

agreement between the States to fix the

number of permits which is proposed to be

granted or countersigned in respect of each

route or area, shall be published by each of

the State Governments concerned in the

Official Gazette and in any one or more of

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the newspapers in regional language

circulating in the area or route proposed to

be covered by the agreement together with a

notice of the date before which

representations in connection therewith may

be submitted, and the date not being less

than thirty days from the date of publication

in the Official Gazette, on which, and the

authority by which, and the time and place at

which, the proposal and any representation

received in connection therewith will be

considered.

(6) Every agreement arrived at between the

States shall, insofar as it relates to the

grant of countersignature of permits, be

published by each of the State Governments

concerned in the Official Gazette and in any

one or more of the newspapers in the regional

language circulating in the area or route

covered by the agreement and the State

Transport Authority of the State and the

Regional Transport Authority concerned shall

give effect to it.”

8.There cannot be any dispute that the Scheme is

unilateral, whereas the reciprocal agreements are

bilateral. Despite the availability of Scheme, the

Union Territory of Chandigarh and the State of Punjab

have consciously entered into a reciprocal agreement

permitting the non-A.C. buses, for which the State of

Punjab had issued permits prior to 1966 and it

continued to be renewed by the State of Punjab to

operate in the Union Territory of Chandigarh. It has

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also come in the affidavit of the State of Punjab

that such mileage has been taken into consideration

for the mileage entitlement of the Union Territory of

Chandigarh, in the reciprocal agreement which has

come into effect on 04.06.2008. Therefore, unless

the reciprocal agreement is superseded by a fresh

agreement or unless there is a new scheme framed by

the Union Territory of Chandigarh specifying the

provisions to the contrary, the buses operated by the

appellant, which had permits issued prior to

1.11.1966 and so long as they are renewed by the

State of Punjab, the Union Territory of Chandigarh

cannot refuse counter signature for the reason that

the permits already issued in 1966 had outlived its

life after five years of the reorganization. The

overriding effect provided in Section 98 of the said

Act operates only in case of an inconsistency on a

legal position. There is no such situation in the

present case. On the contrary, the reciprocal

agreement is on mutually beneficial terms.

9.Therefore, we set aside the impugned order passed

by the Division Bench and restore that of the learned

Single Judge of the High Court.

10.The appeal is, accordingly, disposed of. The

consequences will follow and needful shall be done

within four weeks from today.

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11.Pending applications, if any, shall stand

disposed of.

12.There shall be no orders as to costs.

.......................J.

[KURIAN JOSEPH]

.......................J.

[SANJAY KISHAN KAUL]

NEW DELHI;

SEPTEMBER 26, 2018.

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