Harman Singh and Others vs Regional Transport Authority

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No. 112 of 1953

Decision Date: 24 November, 1953

Coram: Mehr Chand Mahajan, M. Patanjali Sastri, Ghulam Hasan, B. Jagannadhadas

In the matter titled Harman Singh and Others versus Regional Transport Authority, the Supreme Court of India rendered its judgment on 24 November 1953. The case was authored by Justice Mehr Chand Mahajan and was decided by a bench comprising Justice Mehr Chand Mahajan, Justice M. Patanjali Sastri, Justice Ghulam Hasan and Justice B. Jagannadhadas. The petitioners were Harman Singh and several other individuals, while the respondents were the Regional Transport Authority of Calcutta together with other parties. The judgment was recorded on the date mentioned above and the decision is reported in the citations 1954 AIR 190 and 1954 SCR 371, with subsequent citations R 1970 SC 564 (192) and R 1989 SC 2105 (7). The principal statutory provisions examined were Articles 14 and 19(1)(g) of the Constitution of India, which relate respectively to equal protection of the laws and the right to carry on any occupation, trade or business.

The factual backdrop concerned the regulation of motor taxis in Calcutta. Since 1940, taxis operating in the city were required to have an engine capacity not less than 22 horse-power (H.P.) and not exceeding 30 H.P., and Rule 179 of the Bengal Motor Vehicles Rules, as amended in 1944, prescribed a fare of one rupee for the first mile and two annas for each one-sixth of a subsequent mile. In 1952 the Regional Transport Authority issued a notification inviting applications for permits to operate small taxis with an engine capacity not below 10 H.P. and not above 19 H.P. A proviso to Rule 179 was added, fixing the fare for these small taxis at eight annas for the first mile and two annas for each quarter of a subsequent mile. Permit holders of larger taxis challenged the notification before the Calcutta High Court under Article 226, contending that the new classification and reduced tariff infringed their fundamental rights under Articles 19(1)(g) and 14. The Court held that the classification of taxis based on engine capacity was rational and therefore did not violate Article 14. Furthermore, the larger-taxi permit holders were not barred from continuing their occupation, and the introduction of competition did not amount to a breach of Article 19(1)(g), which does not guarantee a monopoly. Consequently, the writ sought against the Regional Transport Authority was denied. The judgment formed part of Civil Appeal No. 112 of 1953, an appeal under Article 132(I) of the Constitution from the High Court order dated 9 January 1953.

The appeal was filed under article 132(I) of the Constitution of India against a judgment of the Calcutta High Court, rendered by Justice Himansu Kumar Bose, dated 9 January 1953, which dismissed an application filed under article 226 of the Constitution. The appeal was heard on 24 November 1953, and the judgment was delivered by Justice Mahajan. Counsel for the appellants were R. Choudhry and A. K. Das Gupta, while counsel for respondents 1 and 2 was the Attorney-General for India, assisted by B. Sen.

The dispute arose from a notification dated 13 May 1952 issued by the Regional Transport Authority, Calcutta Region, inviting applications from persons licensed to drive motor cabs or possessing knowledge of motor mechanisms for permits to operate small motor-taxi cabs having horsepower not less than ten and not more than nineteen. The same notification invited any person or association to make representations against the issuance of such permits. Accordingly, the Calcutta Taxi Association, the Bengal Taxi Association and several other persons submitted objections. The Regional Transport Authority heard those objections on 5 July 1952 and, on 21 August 1952, rejected them and issued forty-eight permits for the small taxis. Under the Motor Vehicles Act of 1940, taxis operating in Calcutta were required to have horsepower of at least twenty-two and at most thirty, and the applicable tariff was prescribed by Rule 179 of the Bengal Motor Vehicles Rules, which originally allowed a single tariff of two annas per quarter mile with a minimum charge of eight annas. In 1944, responding to rising costs of motor parts, tyres, oil, lubricants and petrol, Rule 179 was amended to impose a minimum charge of one rupee for the first mile or part thereof, two annas for each one-sixth of a subsequent mile, waiting charges of one rupee fourteen paise per hour or two annas for every four minutes, and a charge of four annas per mile for empty return trips. This higher tariff was reaffirmed by a further notification dated 13 January 1951. After the May 1952 notification seeking applications for small-taxi permits, another notification issued on 7 June 1952 amended Rule 179 once again, exercising the power conferred by section 51 of the Motor Vehicles Act, 1939, as authorized by the Governor.

In this case, the Court examined an amendment to a rule that had originally been published under a notification of the Government of Bengal issued by the Home (Transport) Department bearing number 9354-T and dated 28 September 1946, and that had later been amended. The amendment directed that a proviso be added to the existing rule. The proviso read: “Provided that in the case of small motor cabs of not exceeding 19 H.P., but not below 10 H.P., registered under the Motor Vehicles Act, 1939, in the city of Calcutta or in the district of 24 Parganas, the tariff on each occasion of hiring shall, for a period of eight months commencing on 1 May 1952, be annas 8 for the first mile or part of a mile and annas 2 for every quarter of each subsequent mile.” The effect of this notification was that the fare for small taxis became fixed at eight annas for the first mile or part thereof and two annas for each quarter-mile thereafter, whereas the fare for large taxis continued to be one rupee for the first mile and two annas for every one-sixth of each subsequent mile. This difference in fares created a competitive situation between owners of small taxis and owners of large taxis and generated a fear among the latter that their livelihood might be seriously threatened by the entry of small taxis charging lower rates. Consequently, on 21 October 1952, the appellants filed a petition in the Calcutta High Court under article 226 of the Constitution. The petition was filed against the Regional Transport Authority and the forty-eight permit holders, and it sought a writ of prohibition that would prevent the Regional Transport Authority from implementing the notification of 7 June 1952 and from permitting or authorising small taxis to operate on the streets of Calcutta. The appellants alleged that the notification infringed their fundamental rights under articles 19(1)(g) and 14 of the Constitution. The High Court, by an order dated 24 October 1952, granted a rule and issued an interim order restraining the respondents in accordance with the relief sought in the petition. The matter was then placed before Justice H. K. Bosc for a hearing. By his judgment on appeal, dated 9 January 1953, the learned judge dismissed the petition and awarded costs to the respondents. The Court held that the mere possibility that the notification of 7 June 1952 might affect the economic interests of taxi-cab owners did not, by itself, justify a finding that the notification violated article 19(1)(g) of the Constitution. The Court further held that there was no breach of the fundamental right guaranteed by article 14, because the differentiation in tariffs between the two classes of taxis was based on a rational classification. The learned judge expressed the view that small taxis had been introduced for the benefit of the general public and that the classification of tariffs was not unreasonable.

The Court noted that the learned Judge had granted a certificate under article 132(I) of the Constitution. Mr Choudhry, who argued the appeal before the Court, repeated the contentions that had been raised before the High Court and stressed the point found in favour of the petitioners by Bose J. He argued that owners of large taxis were not permitted to charge a tariff below the prescribed minimum and that, in such circumstances, the business of those proprietors would be forced to cease, thereby constituting a breach of their fundamental right guaranteed under article 19(1)(g) of the Constitution. The Court held that none of the contentions raised by the learned counsel possessed any substance. The Court further explained that it would not finally decide the proper construction of rule 179 of the Bengal Motor Vehicles Rules read with section 42 of the Motor Vehicles Act, because that issue did not arise directly in the appeal. Consequently, the Court could not affirm Bose J.’s view that large-taxi owners could not charge a lower tariff if they so desired. The learned Attorney General, appearing for the Regional Transport Authority, expressed a tentative agreement with the Court’s view on this point, although he was unwilling to concede the issue in the absence of a specific directive. The learned Advocate General advanced a similar argument before the High Court. The Court then examined section 42 of the Motor Vehicles Act, which prohibits the owner of a motor vehicle from using the vehicle except in accordance with the conditions of a permit. The permit form, in item 8, specifies the minimum fare that may be charged for a vehicle. Relying on these provisions, the lower court had concluded that a vehicle owner had no option to charge a tariff lower than the prescribed minimum. However, the Court observed that rule 179, which sets a minimum tariff for different classes of taxis, does not forbid an owner from charging a rate below that minimum if the owner wishes to do so. The rule merely bars the imposition of a tariff higher than the fixed minimum and obliges the hirer of a taxi on demand to pay that rate. Because the rule contains no explicit provision prohibiting a tariff below the prescribed minimum, the Court was not satisfied that Bose J.’s construction of the provisions was correct. Notwithstanding this, the Court noted that the rule prescribing a minimum rate of one rupee for large taxi cabs, as issued in the notifications of 1944 and 1951, was not challenged in the present proceedings. The Court remarked that, had the rule been an unreasonable restriction on the occupation of large-taxi owners and infringed the fundamental right contained in article 19(1)(g), the parties could have contested it, but since no such challenge was made, the Court did not consider that question.

In the appeal, the sole issue for determination was whether the granting of licences to small taxi cabs having engines between ten and nineteen horse power to ply on the streets of Calcutta, together with the fixing of tariff rates for that class that were lower than the rates prescribed for taxis of twenty-two to thirty horse power, infringed the fundamental rights of the appellants, who owned taxi cabs falling in the twenty-two to thirty horse power range, under articles 14 and 19(1)(g) of the Constitution. The Court held that the answer to that issue was in the negative. It reiterated that, when construing article 14, courts must not adopt a rigid doctrinal approach that would suffocate all beneficial legislation, and that legislation based on a rational classification is permissible. A law that applies to a particular class is constitutionally valid if there is a sufficient basis or reason for the classification. In other words, statutory discrimination cannot be struck down as a denial of equal protection of the laws unless no conceivable state of facts can be imagined to justify it. The Court observed that it was clearly in the interest and for the benefit of a segment of the public to introduce small taxis and to fix cheaper rates for them, taking into account the smaller size, lower horse-power and reduced operating expenses of such vehicles. No unreasonable classification or discrimination that would offend article 14 was discerned. Consequently, the contention raised by counsel for the appellants that the introduction of smaller taxis at lower tariff rates violated article 14 could not be sustained. The next contention advanced by the same counsel was that the entry of small taxis on Calcutta streets would cause a total stoppage of the existing motor-taxi business of large-taxi owners in a commercial sense, thereby infringing the fundamental right guaranteed under article 19(1)(g). The Court rejected that argument as well. Article 19(1)(g) declares that every citizen has the right to practice any profession, or to carry on any occupation, trade or business. The appellants had not been denied the right to pursue their occupation or to ply their taxis. The provision does not confer a monopoly on any individual or association; the presence of competition, when other persons are also permitted to carry on the same occupation and when the authorities act without bad faith, does not amount to a violation of article 19(1)(g). The Court further noted that, under the Motor Vehicles Act, the Regional Transport Authority possessed discretionary power to issue permits at varying tariff rates to different classes of vehicles plying on Calcutta streets, and that the exercise of that power in good faith for the benefit of the citizens did not, by itself, bring the licence holders within the ambit of article 19(1)(g). Accordingly, the Court concluded that the appeal lacked merit and dismissed it with costs.

The Court observed that the Regional Transport Authority possessed the power to prescribe different tariff rates for different classes of vehicles plying on the streets of Calcutta, and that the exercise of this power in a bona fide manner for the benefit of Calcutta’s citizens was permissible. It further held that the mere fact that, by granting licences at varying tariff rates to holders of different taxis and to owners of distinct vehicle classes, some existing licence holders might be affected did not render the action violative of article 19(1)(g) of the Constitution. Consequently, the Court found that the appeal lacked any substantive merit based on the reasons already set out. Accordingly, the Court dismissed the appeal, ordered that the costs of the proceedings be borne by the appellant, and entered a final order dismissing the appeal. The agent representing the appellant was identified as Sukumar Ghose, while the agents representing respondents numbered one and two were identified as P. K. Bose.