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TMI Blog1968 (1) TMI 61X X X X Extracts X X X X X X X X Extracts X X X X ..... ication for renewal of the said permit on or about 24th October 1966 and respondent No. 2 Corporation also applied for a fresh permit along the said route. Both these applications came up for hearing at a meeting of respondent No. 1 held on 4th March 1967 when the Chairman of the tribunal and some of the other members were not present. In spite of the petitioner's objection that the tribunal was not properly constituted, the remaining members overruled the objections of the petitioner and they heard these two applications. The respondent No. 1 by its final order, Ex. 4, dated 27th April 1967, rejected the application for renewal of the permit by the petitioner and granted the application of respondent No. 2, Corporation, for the fresh permit. It is this impugned order at Ex. 4 which is challenged in this petition. Even though the impugned order was challenged in the petition on various grounds, the said challenge at the time of hearing is confined only to one ground that the members of the tribunal, who heard these two applications on 4th March 1967 and who have disposed of these applications by the impugned order at Ex. 4, had been illegally constituted the Regional Transport ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the proposition that an authority constituted under the Act could not, unless expressly so authorized, question the validity of the Act or any provisions thereof, was sound and was also supported by authority. At page 1100 their Lordships considered certain observations in the earlier decision in Bengal Immunity Co. Ltd. v. State of Bihar [1955]2SCR603 where Venkataraman Ayyar J. had observed in the context of the maintainability of a writ of prohibition on page 726 as under: Indeed, the contention that the Act is ultra vires is not one which the Tribunals constituted under the Act, whether original, appellate, or revisional, could entertain, their duty being merely to administer the Act. It is, therefore, clear from this decision that it is only a question of the vires of the statutory enactment that cannot be entertained by the Tribunal constituted under the Act. Being creatures of the statute, it would not be open to them to decide whether the very statute of which they were creatures was a valid statute or not. The same principle could not be extended when vires of a rules is challenged on the ground that it is inconsistent with the Act and goes beyond the scope of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zette, constitute.... Regional Transport authorities to exercise and discharge throughout such areas (in this Chapter IV referred to as regions), as may be specified in the notification in respect of each Regional Transport Authority, the powers and functions conferred by or under this Chapter on such authorities.... Sub-section (2) provides that.... A Regional Transport Authority shall consist of a chairman who has had judicial experience and such other officials and nonofficial, not being less than two, as the State Government may think fit to appoint.... Thereafter Sub-section (5) provides that the State Transport Authority and any Regional Transport Authority, if authorised in this behalf by rules made under Section 68, may delegate such of its powers and functions to such authority or persons and subject to such restrictions, limitations and conditions as may be prescribed by the said rules. The Rule 67 made by the State Government runs as under: 67. Regional Transport Authorities: (1) The Regional Transport Authority shall meet at such times and at such places as its chairman may appoint: Provided that it shall meet not less than once in each month unless the State Tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Government, the Legislature itself has provided in Section 44(e) for the composition of such tribunal to be constituted under Section 44(1) by the State. The said Regional Transport Authority under Section 44(2) shall consist of a chairman who has had judicial experience and such other officials and non-officials whom the State Government may think fit to appoint, provided their number is not less than two. Thus, even though the number of persons who shall constitute such Regional Transport Authority is left to be determined by the State Government, the Legislature has provided that the nature of the experience of the chairman must be judicial experience, and that the members must be officials and nonofficial, so that such a tribunal would have both official and nonofficial approach for their consideration, aided by such chairman who had judicial experience. The powers and functions conferred on the Regional Transport Authority by or under Chapter IV are both of administrative and quasi-judicial nature. Applications of stage carriage permits and for renewal of such permits are to be made under Section 46 and the procedure for consideration of such applications by the Regional Tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legation if they so choose. It is only when both these requirements are complied with viz. the authority for delegation is conferred by relevant rule made under Section 68 by the Government and there is factual delegation made by the tribunal itself of its powers and functions to any other authority or persons, that such delegation is permitted by the Statute subject to the restrictions, limitations and conditions which are prescribed in the relevant rules in that behalf. This is the interpretation of Section 44(5) by the Division Beach of the Assam High Court, consisting of Sarjoo Prasad C.J. and Ram Labhaya J., in Labanya Chandra v. State of Assam A.I.R. 1953 Assam 199 (200), with which I am in complete agreement. In view of these two safeguards, it would not be open to any outside body, including even the State Government to delegate directly powers and functions of such tribunal to any other authority or persons. It is only after the concurrence of the tribunal is obtained by the factual delegation by this tribunal that delegation would be effective. Section 44(2) thus contemplates initial constitution of the tribunal as per the composition indicated by the Legislature, whose n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial resolution of the State Transport Authority and actually, such a resolution was brought on the record of the case. In fact Mr. Hegde relies on the ratio of this decision for the proposition that in absence of such delegation, in the present case the smaller body could not function. His only contention is that the 'Legislature having provided only one exception in Section 44(5) for the statutory tribunal to function with lesser number, it was not open to the rule making authority to empower by a rule of quorum, like the present Rule 67(5) a smaller body to exercise the functions of this statutory tribunal. In such an event, the rule making authority would be adding a further exception and would not be exercising ancillary power of making a procedural rule, but would be extending the scope of the Act by adding another substantive provision which the Legislature in its wisdom refused to incorporate in Section 44. I cannot, therefore, accept the contention of the respondents that this matter was concluded by the aforesaid decision of the Division Bench, as in the present case there is no such delegation under Section 44(5) and, in fact, both Mr. Desai and Mr. Vidyarthi rightly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and beyond that the Legislature has not provided any further exception by enacting a quorum rule. When the Legislature set up a tribunal for exercising quasi-judicial functions in such important matters affecting fundamental rights of the citizens, it is implicit in the very constitution of such tribunal that the tribunal shall act as a whole and its members cannot be a fluctuating body. Their number would get fixed once the State Government exercises its discretion to fix up initially the number of the persons who are to compose this statutory tribunal under Section 44(2), and issues notification under Section 44(1) constituting such a tribunal. A smaller number than the number initially fixed can act only when such exception is made by the Legislature as in the case of delegation under Section 44(5). The other section which is relied upon by the respondents is Section 68, empowering the State Government to make procedural rules. Section 68(1) provides that the State Government may make rules for the purpose of carrying into effect the provisions of this Chapter (Chapter IV). Sub-section (2) then provides that without prejudice to the generality of the foregoing power, rules may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Legislature itself. In The United Commercial Bank Ltd. v. Their Workmen (1951)ILLJ621SC , their Lordships of the Supreme Court had to consider this question in connection with the constitution of an Industrial Tribunal under the Industrial Disputes Act, 1947. Under Sections 5(4) and 6(3) of the said Act while providing for the establishment of the Conciliation Board, or a Court of Inquiry, the Legislature had provided that a Board or a Court of Inquiry having prescribed quorum might act, notwithstanding absence of the chairman or any of its members or any vacancy in its number. No similar provision was made in case of constitution of an Industrial Tribunal under Section 7. Section 7(1) provided that that the appropriate Government may constitute one or more Industrial Tribunals for the adjudication of the industrial disputes in accordance with the provisions of the Act. Sub-clause (2) provided that the tribunal shall consist of such number of members as the appropriate Government thinks fit. Thus, the language of Section 7(1) and (2) was identical with our present Sections 44(1) and (2). The only exception which was created in the Industrial Disputes Act by the Legislature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d this position has not been disputed that if a Tribunal has been constituted as consisting of three members as in the present case, then subject to any exception that may be created by any other provision of the Act, all the three members of the Tribunal must sit together. At page 245, he further pointed out that an Industrial Tribunal can be constituted only in accordance with the provisions of Section 7, Industrial Disputes Act, and unless a Tribunal is properly constituted, it cannot be invested with jurisdiction to adjudicate on industrial disputes. Under Sub-section (2) of Section 7 the number of members constituting the Tribunal has got to be determined by appropriate Government and that is an integral part of the Tribunal itself. A change in the number of members of a Tribunal could be made, therefore, only in pursuance of the provision contained in Sub-section (2) of Section 7. Further proceeding His Lordship observed: I am not impressed by the argument of Mr. De. that a Tribunal is to be conceived of as an entity different from the members of which it is composed and whatever changes might occur in the composition of the Tribunal, the identity of the Tribunal remains i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this decision to the facts of the present case, the only exception provided by the Legislature being one in Section 44(5), those two conditions precedent must be strictly complied with. If otherwise than as provided in Section 44(5), any other smaller body is to be delegated with powers of the tribunal as constituted under Section 44(2) of the Act, it would not be within the competence of the tribunal viz. the Regional Transport Authority or even the Government to extend the limits of the said exception. That can be done only by a substantive provision as the one in Section 44(5) and not by a procedural rule. The ratio of this decision has been applied by the Division Bench of the Madras High Court, consisting of Rajamannar C.J. and Venkataram Ayyar J. (as he then was), in IsaAmmal v. Rama Kudemban AIR1953Mad129 , where the tribunal was to be constituted under Section 8(1) of the Madras Estates (Abolition and conversion into Ryotwari) Act (26 of 1948). Under Section 2 of that Act it was expressly provided that each tribunal shall consist of three members. By a procedural rule the Government had provided that not less than 2 members shall be necessary to constitute a tribunal. Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by a tribunal may be either as to the kind and nature of the action and matters of which the particular tribunal can take cognizance or as to the area to which its jurisdiction extends; or it may be with regard to its constitution and composition. In the case before their Lordships they were concerned with the limitation with regard to the composition of the tribunal. Their Lordships held that by reason of the limitation imposed by the statute, the tribunal can exercise its jurisdiction only when its composition is in conformity with the requirements of the statute. Therefore, if the statute requires that the tribunal should be composed of certain number of members, obviously a lessor number cannot perform the functions of the tribunal. It was sought to be argued by the respondents that this decision is inconsistent with the decision of our Division Bench in Rajkot Transport Co. 2 G.L.R. 211. There is no inconsistency whatever for the simple reason that in view of the exception in Section 44(5), which provided for a statutory delegation to a smaller number, our Division Bench had upheld the constitution of that appellate committee. No such delegation was relied upon before the Full ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar J., for himself and the learned Chief Justice Sarkar, C.J., with whom His Lordship Bachawat J. concurred in a separate judgment of this question. His Lordship Hidayatullah J. has concurred with his Lordship Shelat J., who represented the minority view, in the aforesaid decision on this material question. Taking up first the majority view, the question before their Lordships was as found at page 315, regarding the effect of Rule 3 of distribution of business, under which the chairman, with the previous approval of the Central Government, by order in writing could distribute the business of the Board among himself and the other number or members, and specify the cases or case which should be considered jointly by the Board. The power in question was one under Section 237 which was delegated by the Central Government on the Company Law Board. The question had, therefore, arisen whether under the said rule of distribution of business, the chairman could allocate the power of the Board under Section 237 to himself or whether such sub-delegation of the power to himself would be illegal. His Lordship Mudholkar J. at page 305 observed that bearing in mind the fact that the power conferr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruction of a statute. Prima facie, a discretion conferred by a statute on any authority is intended to be exercised by that authority and by no other. But the intention may be negatived by any contrary indications in the language, scope or object of the statute. The construction that would best achieve the purpose and object of the statute should be adopted. Applying these principles to the case before their Lordships, His Lordship Bachawat J. observed at page 312 that His Lordship was inclined to construe this rule making power liberally. As rules can be made to regulate procedure of the Board and generally to carry out the purposes of the Act, the Government had power to constitute the Company Law Board, to delegate its functions to the Board and to control the Board in the exercise of its delegated functions. In this background, by conferring on the Central Government the additional power of framing rules regulating the procedure of the Board and generally to carry out the purposes of Section 10E, the Parliament must have intended that the internal organisation of the Board and the mode and manner of transacting its business should be regulated entirely by rules framed by the Go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould no longer be part of the procedural rules. The question of conduct of business would arise when the tribunal starts functioning after it is properly constituted as required by the statute. Therefore, this decision could not be pressed in aid by the respondents. 8. The more fundamental objection which comes in the way of the respondents is the essential difference in the two concepts, one of a provision for a quorum and the other provision for delegation. In case where the Legislature provides for a delegation what happens is that the powers of the statutory tribunal, consisting of a certain fixed number of members, gets delegated to a committee or a Bench of a smaller number but even then the said tribunal remains a fixed tribunal. Right from the very beginning of the hearing till the end, its constitution is not a fluctuating one. In case of a rule of quorum, however, the position is materially different, because even though the member of the tribunal may come and go at their sweet will, the effect of the quorum rule would be that the validity of the composition of the tribunal would remain unaffected. Therefore, even though some members who were present at the commencemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed to function at all. Therefore, in the absence of requisite delegation as provided in the exception in Section 44(5), the entire statutory tribunal was bound to sit and unless it was so properly constituted, it could not function at all. Mr. Vidyarthi argued that there was no provision in the Act for the members remaining constant at all stages and he pointed out that Section 44(2), as interpreted by the Division Bench, only provided for the initial constitution and, therefore, the Act was silent in so far as functioning of the tribunal or the stage of reaching decision was concerned. Mr. Desai had also argued that question by stating that the field occupied by the rule was a totally different field. It did not impeach upon Section 44(2), and it also did not impeach upon the field of delegation, which was dealt with in Section 44(5). It was only in the field in which the Legislature was silent that the rule operated and, therefore, there was no inconsistency whatever between the rule and the constitution of the tribunal at the stage of the conduct of the business of the statutory tribunal. This argument of both the respondents ignores the nature of this statutory tribunal a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... function in case of such a quasi-judicial tribunal, the rule would be clearly inconsistent with the section itself, which did not sanction such a breach and in which the principles of natural justice were clearly implicit when a quasi-judicial tribunal was set up to deal with substantial rights about permits, affecting the fundamental rights of the citizens to carry on their trade. Therefore, the quorum rule must be held to be inconsistent with the scheme of a quasi-judicial tribunal set up under Section 44(1) and (2) of the Act, in so far as the requisite quorum would make the composition of lesser number of statutory tribunal a valid composition and would not affect the validity of its constitution. 9. There is also a further reason in the present case on which it can be held that the quorum rule would be inconsistent with Section 44. As I have already considered, Section 44(5) is the only exception provided by the Legislature to permit delegation and such delegation even has to be done with the prescribed safeguards. All these safeguards would be done away with and there would be an effective delegation to a smaller body if such quorum rule were to be upheld, whereby two mem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this special exception in Section 44(5) as permitting a valid delegation of the powers of the tribunal to a smaller committee or Bench makes the whole scheme of the Act completely workable and it is at the same time not destructive of the quasi-judicial character of this tribunal. 10. It is, however, important to bear in mind that though the rule of quorum in Rule 67(5) is inconsistent with Section 44(1)(2) and (5), in so far as it relates to the quasi-judicial functions of the statutory tribunal, the rule would not suffer from any such infirmity in so far as it deals with the administrative functions. When the rule made by the rule-making authority would be rendered ultra vires as being inconsistent with the Act, I should adopt such a construction which would harmonise it with the Act and make it consistent with the Act by confining the rule in its operation to its proper field viz. in the present case, in so far as the administrative functions of the Regional Transport Authority are concerned. I, therefore, hold that the quorum Rule 67(5) is applicable only when the Regional Transport Authority exercises its administrative functions and it is inapplicable when the said Authori ..... X X X X Extracts X X X X X X X X Extracts X X X X
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