Vijay Kr Sharma v.

State of
Karnataka, (1990) 2 SCC 562
Posted on August 17, 2020 by dullbonline

*Vijay Kr Sharma v. State of Karnataka (1990) 2 SCC 562 AIR

1990 SC 2072

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*Not Printed

Writ Petns. Nos.723, 238, 170, 759 and 1120 of 1989 decided on
27/02/1990

Headnote

(A) Constitution of India , Art.254— Karnataka Contract Carriages

(Acquisition) Act (21 of 1976) , S.14, S.20— Nationalisation of
Contract Carriages – Scheme for, under Karnataka Act – Not
repugnant to provisions for grant of permits under Motor Vehicles
Act – Karnataka Act and Motor Vehicles Act occupy different fields –
Ss.14, 20 of Karnataka Act not impliedly repealed by Motor Vehicles
Act. Motor Vehicles Act (59 of 1988) , S.74, S.80— Constitution of
India , Art.254—

Majority view – The provisions of Ss.14, 20 of the Karnataka Act are not
impliedly repealed by the provisions of Motor Vehicles Act, 1988. There is no
repugnancy in the provisions of Ss.14 and 20 of the Karnataka Act and S. 74
and 80 of the M.V. Act, 1988.(Para 20 35)
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 Per Sawant, J. (R. Misra, J. concurring) – The Karnataka Act and the M.V.
Act, 1988 deal with two different subject-matters. The Karnataka Act is
enacted by the State Legislature for acquisition of Contract Carriages under
Entry 42 of the Concurrent list read with Article 31 of the Constitution to
give effect to the provisions of Arts.39(b) and (c) thereof. The M.V. Act,
1988 on the other hand is enacted by the Parliament under Entry 35 of the
Concurrent list to regulate the operation of the motor vehicles. The objects
and the subject-matters of the two enactments are materially different.
Hence the provisions of Article 254 do not come into play and hence there is
no question of repugnancy between the two legislations. The object of the
Karnataka Act is to nationalise the contract carriage service in the State
with a view to put an end to the abuse of the contract carriage services by the
private operators and to provide better transport facilities to the public, and
also to prevent concentration of the wealth in the hands of the few and to
utilise the resources of the country to subserve the interests of all. To secure
the objective of the Act, it was also necessary to prohibit the grant of the
contract carriage permits to private individuals and to reserve them
exclusively to the State Undertaking which was done by Sections 14 and 20
of the Act.Unlike the M.V. Act, 1988, which is admittedly enacted by the
Parliament under Entry 35 of the Concurrent List, to regulate the operation
of the motor vehicles, the object of the Karnataka Act is not only the
regulation of the operation of the motor vehicles. Nor is its object merely to
prevent the private owners from operating their vehicles with the exclusive
privilege of such operation being reserved in favour of the State or the State
Undertaking. For if that were the only object, the same could have been
achieved by the Transport Undertaking of the State following the special
provisions relating to State Transport Undertakings in Chapter IV-A of the
Motor Vehicles Act,1939 which was in operation when the Karnataka Act
was brought into force.(Para 25 28)

The provisions of Sections 14 and 20 of the Karnataka Act, it cannot be said,

are in direct conflict with the provisions of Ss.74 and 80(2) of the M.V. Act,
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 1988 on ground that while the Regional Transport Authority (RTA) is
enjoined by the provisions of S.74 read with S.80(2) of the M.V. Act,1988,
ordinarily not to refuse to grant an application for permit of any kind, the
provisions of Secs.14 and 20 of the Karnataka Act prohibit any person from
applying for, and any officer or authority from entertaining or granting,
application for running any contract carriage in the State. The objects of the
two legislations are materially different. Moreover the provisions of Ss.51
and 57 of the old M.V. Act further correspond to provisions of Ss.74 and 80
of the new M.V. Act and the Karnataka Act had received the assent of the
President in spite of the provisions of Ss.51 and 57 of the old Act.So also
Section 98 of the M.V. Act, 1988 in terms clearly states (as did Sec. 68B of
the M.V. Act, 1939) that Chapter VI relating to the special provisions about
the State Transport Undertaking 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. Section 74 and 80
relating to the grant of the contract carriage permit and the procedure in
applying for the grant of such permits respectively are in Chapter V. This
means that when under Chapter VI, a scheme is prepared by the State Govt.
entrusting the contract carriage services in relation to any area or route or
portion thereof, to a State Transport Undertaking to the exclusion –
complete or partial of other persons, the provisions of Ss.74 and 80 would
have no application, and the private transport operators cannot apply for the
grant of contract carriage permits under Sec.80 nor can such permits be
granted by the Transport Authority. In other words, the M.V. Act,1988 also
makes a provision for nationalisation of routes, and envisages a denial of
permits to private operators when routes are so nationalised. Hence it is not
correct to say that there is a conflict between the provisions of the two Acts.
(Para 29)

The provisions with regard to application and grant of permits in Ss.14 and
20 of Karnataka Act have nothing in common with the provisions of Ss.74
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 and 80 of the Motor Vehicles Act,1988. The former provisions are ancillary
to giving effect to the acquisition and nationalisation of the road transport
within local territorial limits. The later provisions are general in nature and
in furtherance of the object of the Act which is to regulate transport. The
subject-matters of both the statutes and the object of the two sets of
provisions are, therefore, materially different. Both these statutes can stand
together. The legislative intent is clear. Since, the Parliament had enacted the
later statute knowing fully well the existence of the earlier statute and yet it
did not expressly repeal it, it will be presumed that the Parliament felt that
there was no need to repeal the said statute.(Para 31)Per R. Misra, J.
(Concurring) – The State Act intended to eliminate private operators from
the State in regard to contract carriages acquired under the existing permits,
vehicles and ancillary property and with a view to giving effect to a
monopoly situation for the State Undertaking made provision in S.20 for
excluding the private operators. The M.V. Act, 1988 does not purport to
make any provision in regard to acquisition of contract carriage permits
which formed the dominant theme or the core of the State Act. Nor does it in
S.73 or S.74 indicate as to who the applicant shall be while laying down how
an application for a contract carriage permit shall be made and how such a
permit shall be granted. Section 80 of the 1988 Act does contain a liberalised
provision in the matter of grant of permits but the ancillary provision
contained in S.20 of the Acquisition Act to effectuate acquisition does not
directly run counter to the 1988 provision.

Since Ss.73,74 and 80 of the M.V. Act,1988 do not contain any provision
relating to who the applicants for contract carriages can or should be. A
provision in the State Act excluding a particular class of people for operating
contract carriages or laying down qualifications for them would not run
counter to the relevant provisions of the 1988 Act. As there is no direct
inconsistency between the two Acts there is no necessary invitation to the
application of Cl.(1) of Art. 254 of the Constitution.(Para 17 18 20)

Per K. Ramaswamy, J. (Dissenting) – The Parliament and the legislature of

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 a State derive their power to legislate on a subject / subjects in List I and
List II of Seventh Schedule to the Constitution from Art. 246(1) and (3)
respectively. Both derive their power from Art.246(2) to legislate upon a
matter in the Concurrent List III subject to Art. 254 of the Constitution.
The respective lists merely demarcate the legislative field or legislative heads.
The Parliament and the legislature of a State have concurrent power to
legislate upon any subject / subjects in the Concurrent List III of Seventh
Schedule to the Constitution. Article 254(1) and proviso to Article 254(2)
give paramountcy to the law made by the Parliament, whether existing or
made afresh or amended, modified, added or repealing the law subsequent in
point of time to the State law made under Art.254(2). The exercise of the
power by a State Legislature to make impugned law under one entry or other
in the Concurrent List is not decisive. The concerned entry or entries are
not the source of power to make impugned law.(Para 50)

Section 14 read with Sec. 20 of the Karnataka Act (21 of 1976) freezed the
right of a citizen to apply for and to obtain permit or special permit to run a
contract carriage in terms of the permit and monopoly to run a contract
carriage was conferred on the S.T.U., Karnataka. But the new M.V. Act
evinces its intention to liberalise the grant of contract carriage permit by
saying in S.80(2) that the Regional Transport Authority “shall not
ordinarily refuse to grant the permit”. It also confers the right on an
applicant to apply for and authorises the Regional Transport Authority to
grant liberally contract carriage permit except in the area covered by S.80(3)
and refusal appears to be an exception, that too, obviously for reasons to be
recorded.

It may be rejected if the permit applied for relate to an approved or notified

route. The new M.V. Act accords the right, while the Karnataka Act negates
and freezes the self-same right to obtain a permit and to run a contract
carriage and prohibits the authorities to invite or entertain an application
and to grant a permit to run contract carriage. The new M.V. Act and the
relevant rules cover the entire field of making an application in the
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 prescribed manner and directs the Regional Transport Authority to grant
permit with conditions attached thereto to run contract carriages vide
Ss.66(1), 73,74 and 80 of the new M.V. Act. Thus, the existence of two sets
of provisions in the new M.V. Act, 59 of 1980 and Karnataka Act,21 of 1976
is sufficient to produce conflicting results in their operation in the same
occupied field.

The two sets of provisions run on collision course, though an applicant may
waive to make an application for a permit. Thereby, there exists the
operational incompatibility and irreconcilability of the two sets of provisions.
Sections 14(1) and 20(3) of the Karnataka Act are repugnant and
inconsistent with Ss.73,74 and 80 of the new M.V. Act. By operation of
proviso to Art.254(2) of the Constitution, the embargo created by Ss.14(1)
and 20(3) of the Karnataka Act (21 of 1976) to make or invite an application
and injunction issued to Regional Transport Authority prohibiting to grant
contract carriage permit to anyone except to S.T.U., Karnataka within the
State of Karnataka became void.(Para 51)

For the applicability of the principle that special law prevails over the
general law, the special law must be a valid law in operation. Voidity of law
obliterates it from the statute from its very inception. Since Ss.14(1) and
20(3) of Karnataka Act are void the rule that the special law prevails over the
general law cannot be pressed into service.(Para 52)

Under Arts. 252 and 253, the loss of legislative power of the States is
complete and, thereafter, the States can no longer make any law on a subject
on which Parliament has made a law and, therefore, their existing laws and
any laws that they may venture to make in future will be null and void and
for that matter Art.254(1) cannot be invoked. But that is not the case with
matter enumerated in the Concurrent List. The State Legislature did not
surrender its power or jurisdiction. The Parliament, with a view to lay down
general principles makes law or amends the existing law. The State
Legislature still may feel that its local conditions may demand amendment
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 or modification of the Central law. Their reserve power is
Art.254(2).Therefore even if it be found that Ss.14, 20 of the Act have
become void after enforcement of new M.V. Act that does not preclude the
Karnataka State Legislature to make afresh the law similar to Ss.14(1) and
20(3) of the Acquisition Act with appropriate phraseology and to obtain the
assent of the President. Until then there is no prohibition to making of
applications for the grant of contract carriage permits under the new M.V.
Act and consideration and grant or refusal thereof according to law by the
concerned Regional Transport Authority.(Para 54)

(B) Constitution of India , Art.254— State and Central legislations –

Repugnancy – Determination – Legislations under different entries of
Concurrent List – Doctrine of pith and substance can be applied.

Per Sawant, J. (K. Ramaswamy dissenting) – Whenever repugnancy

between the State and Central Legislation is alleged, what has to be first
examined is whether the two legislations cover or relate to the same subject-
matter. The test for determining the same is the usual one, namely, to find
out the dominant intention of the two legislations. If the dominant
intention, i.e. the pith and substance of the two legislations is different, they
cover different subject-matters. If the subject-matters covered by the
legislations are thus different, then merely because the two legislations refer
to some allied or cognate subjects they do not cover the same field. The
legislation, to be on the same subject-matter must further cover the entire
field covered by the other.A provision in one legislation to give effect to its
dominant purpose may incidentally be on the same subject as covered by the
provision of the other legislation. But such partial coverage of the same area
in a different context and to achieve a different purpose does not bring about
the repugnancy which is intended to be covered by Article 254(2). Both the
legislations must be substantially on the same subject to attract the Article.
Not to apply the theory of pith and substance when the repugnancy between
the two statutes is to be considered under Art.254 of the Constitution would
be illogical when the same doctrine is applied while considering whether
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 there is an encroachment by the Union or the State Legislature on a subject
exclusively reserved for the other. When the legislative encroachment is
under consideration the doctine of pith and substance comes to the aid to
validate a legislation which would otherwise be invalid for the very want of
legislative competence. When the repugnancy between the two legislations is
under consideration, what is in issue is whether the provision of the State
enactment though otherwise constitutionally valid, has lost its validity
because the Parliament has made a legislation with a conflicting provision
on allegedly the same matter. If it is open to resolve the conflict between two
entries in different Lists, viz. the Union and the State List by examining the
dominant purpose and therefore the pith and substance of the two
legislations, there is no reason why the repugnancy between the provisions
of the two legislations under different entries in the same List, viz. the
Concurrent List should not be resolved by scrutinizing the same by same
touchstone. What is to be ascertained in each case is whether the legislations
are on the same subject-matter or not. In both cases the cause of conflict is
the apparent identity of the subject-matters. The tests for resolving it
therefore cannot be different.(Para 34 30)

Per Ramaswamy, J. (Dissenting) – The doctrine of pith and substance or the

predominant purpose, or true nature and character of the law have no
application when the matter in question is covered by an entry or entries in
the Concurrent List and has occupied the same field both in the Union and
the State Law. It matters little as to in which entry or entries in the
Concurrent List the subject-matter falls or in exercise whereof the Act /
provision or provisions therein were made. The Parliament and Legislature
of the State have exclusive power to legislate upon any subject or subjects in
a Concurrent List. The question of incidental or ancillary encroachment or
to trench upon forbidden field does not arise. The determination of its `true
nature and character’ also is immaterial.(Para 48)
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