P. VENKAIAH versus G. KRISHNA RAO & OTHERS.

Citation: [1982] 1 S.C.R. 380 · Decided: 25-08-1981 · Supreme Court of India · Bench: D.A. DESAI · Disposal: Dismissed

Judgment (excerpt)

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380 
P. VENKAIAH 
v. 
G. KRISHNA RAO & OTHERS. 
August 25, 1981 
[D. A. DESAI, A. 0. KOSHAL AND 
R. B. MISRA, JJ.] 
Andhra Pradesh Motor Vehicles Rules 1964 Rule 212(ii) (a) proviso-Scope 
of-Whether hit by article 19 of the Constitution·" new entrant'' meaning of. 
For evaluating the merit of various applicants for a stage carriage permiti 
rule 212 of the Andbra Pradesh Motor Vehicles Rules 1964 classifies routes as 
short, medium and long routes. In the matter of grant of permit for short 
routes clause (ii) envisages preference being given to those applicants who are 
"new entrants". Clause (iii) provides criteria for weeding out undesirable appli-
cants, while clause (iv) provides for marks being awarded for sector or residential 
qualifications. If an applicant possesses both residential and sector qualifica-
tions the proviso to sub·clause (a) to clause (iv) requires that he shall be awarded 
marks only for one of them so that he is given credit for the qualification more 
advantageous to him marks-wise. 
With the nationalisation of road transport in the State, the appellant, 
respondent no. 1 and respondent no. 5 were deprived of the stage carriage permits 
which they were holding before nationalisation. 
Subsequently the Regional Transport Authority granted one permit to the 
appellant and another to respondent no. 5. 
In appeal, the State Transport 
Authority, holding that respondent no. 1 was a ''new entrant" within the mean-
ing of the rule 212(ii)(a) granted one permit to him and the other to respondent 
no. 5 who was held to have an edge over the appellant for another reason. 
In revision, the State Government held that the appellant and respondent 
no. 5 were entitled to preference over respondent no. 1 by reason of their longer 
experience in the field of motor transport, in spite of the fact that respondent 
:oo. 1 was a "new entrant". 
A single Judge of the High Court held that respondent no. 1 who was a 
''new entrant" was entitled to preference over the others by reason of rule 
212(ii)(a). The second route was granted to respondent no. 5. 
On further appeal it was contended before a Division Bench of the High 
Court that (1) the proviso to clause (iv){a) of rule 212 imposed an unreasonable 
restriction on the right of citizens to carry on business and was hit by article 19 
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P. VENKAIAH V. G.K. RAO 
381 
of the Constitution; (2) that the expression ''new entrant" covered only persons 
who took up the business of motor transport for the first time and (3) that even 
if contention (2) is not accepted, a "new entrant" would not mean a person not 
having a-permit at the time when the question of granting a permit arose but 
would apply only to a person who never held any stage carriage permit. 
All the contentions, rejected by the Division Bench, were again raised 
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before this Court. 
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Dismissing the appeal, 
HELD : The proviso to sub clause (a) of clause (iv) of rule 212 is not hit 
by the provisions of article 19 of the Constitution. It merely states that if an 
applicant p_ossesses both residential and sector qualifications he is to be given 
credit only for the one which is more advantageous to him. 
The rule is salutary 
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and is meant to avoid inonopolies. It is reasonable that an applicant is given 
an option of choosing either the residential or the sector qua1ification for the 
award of mark._s inasmuch as .the merit accruing to the applicant by reason of 
being" clothed with one of thenl would overlap that for which he might get credit 
by reason ol' the other. [389 C·DJ 
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(2) From the context in which the term .. new entrant" is used the rule 
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making authority clearly intended that a «new entrant" to the stage carriage 
business must have preference over the existing operators in respect of short 
routes. The fact that responde~ t N<;l. ~. had a public ca,rricr pe,rmit was wholly 
irrelevant. He was undoubtedly a "new entrant" to the stage carriage business. 
[390 BJ 
s~ Chinf!a ,NarasO Reddy v. iJ. Jagadeeshwara Rao and Others, [1972f4 
SCC734=·Am 1972 SC 1'536 followed. 
(3) A set of things which is different from that immediately preceding it 
may well be called new. A situation Which once existed and then ceased 'to exist 
may properly attract the word 'new' on re·appearance. The adjective 'new' 
would. be applicable . to a person who ,was once in the line of operators of stage 
carri~ges but who had long .ceased ·to be SO: and who

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