Constitution of India – Articles 226 & 227 – Motor Vehicles Act, 1988 – Sections 71, 72, 80 & 89 – Stage Carriage Permit – Intra-Court Appeal – Whether an intra-court appeal is maintainable against an order of a Single Judge passed in exercise of jurisdiction under Article 226 challenging an order of the State Transport Appellate Tribunal, and whether a permit application can be rejected merely because the applicant had been granted another permit or had offered the same vehicle? – Held, Yes; No.
The appellant applied for a stage carriage permit on specified routes under the Motor Vehicles Act. The State Transport Authority rejected his application on the ground that he had already been granted another permit. The State Transport Appellate Tribunal affirmed the rejection. The writ petition filed under Article 226 was dismissed by the Single Judge, who held that since the appellant had offered the same vehicle for different routes, the transport authority was justified in allocating another route. The Division Bench dismissed the intra-court appeal as not maintainable, treating the proceedings as one under Article 227. Whether the intra-court appeal was maintainable and whether the authorities were justified in rejecting the permit application without recording legally sustainable reasons? – Held, Yes; No.
The Supreme Court held that the Division Bench committed a fundamental error in treating the writ petition as one under Article 227. Whether jurisdiction is invoked under Article 226 or Article 227 must be determined from the substance of the entire petition, including the pleadings, grounds, reliefs, and the jurisdiction actually invoked, and not merely from the nature of the prayers. Since the appellant had invoked Article 226, the intra-court appeal was maintainable under the applicable High Court Rules. On the merits, the Court held that after the omission of Section 71(4) of the Motor Vehicles Act, there is no statutory restriction on the number of stage carriage permits that may be granted to an individual operator. The transport authorities failed to record reasons as mandated by Section 80 while rejecting the application. The Single Judge also sustained the rejection on a ground never assigned by the statutory authorities. The Court further held that possession of a ready vehicle on the date of applying for a permit is not a statutory pre-condition; the vehicle may be produced after selection but before issuance of the permit, although possession of a ready vehicle may constitute a relevant factor where competing applicants are otherwise similarly situated. The impugned orders were accordingly set aside and the appeal before the State Transport Appellate Tribunal was restored for fresh consideration.
Ratio Decidendi
A challenge to the order of a statutory tribunal may validly be maintained under Article 226, Article 227, or both (where the High Court Rules so permit), and the maintainability of an intra-court appeal depends upon the nature of the jurisdiction actually invoked, not merely upon the form of the prayers. After the deletion of Section 71(4) of the Motor Vehicles Act, there is no statutory ceiling on the number of stage carriage permits that may be held by an operator. Further, rejection of a permit application must be supported by recorded reasons as required by Section 80, and possession of a ready vehicle at the time of application is not a mandatory statutory requirement, though it may be a relevant comparative factor while considering rival applicants. 2026 INSC 733
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