THE MOR MODERN CO-OPERATIVE TRANSPORT SOCIETY LTD. versus FINANCIAL COMMISSIONER AND SECRETARY TO GOVT. HARYANA AND ANR.

Citation: [2002] SUPP. 1 S.C.R. 87 · Decided: 09-07-2002 · Supreme Court of India · Bench: M.B. SHAH · Disposal: Appeal(s) allowed

Judgment (excerpt)

THE MOR MODERN CO-OPERATIVE TRANSPORT 
SOCIETY LTD. 
v. 
FINANCIAL COMMISSIONER AND SECRETARY 
TO GOVT. HARYANA AND ANR. 
JULY 9, 2002 
[M.B. SHAH, BISHESHWAR PRASAD SINGH AND 
H.K. SEMA, JJ.] 
Motor Vehicles Act, 1988-Section 68(2): 
Employee of State Transport Authority-Whether having financial 
interest-Held, yes-Financial interest of an employee may not be direct-
However it includes the financial interest which he may have as an employee 
A 
B 
c 
of the Undertaking. 
D 
Notification appointing employee of Transport Authority as Chairman/ 
Member of Regional Transport Authority-Validity of-Held, the words 
employed in Section 68(2) are of wide amplitude and expressly include an 
employee of an Undertaking-Proviso to Section 68(2) debars such appointment 
since he is an employee-Hence Notification quashed 
E 
Legislative intention-Court to ascertain the intention by directing its 
attention not n1erely to the clauses to be construed but to the entire statute-
Expression used in a Statute to be understood in a sense in which they best 
harmonize with the object of the Statute and which effectuate the object of the 
Legislature. 
F 
Words and Phrases: 'Undertaking'-Meaning in the context of Section 
68(2) of the Motor Vechicles Act. 
Appellant, a Co-operative Society, carrying on business of public 
transport under state carriage permit in the State of Haryana has G 
challenged the Notification issued by the State Government-respondents, 
appointing the Transport Commissioner as Chairman of the Regional 
Transport Authority, on the ground that Notification was illegal in as much 
as Section 68(2) of the Act was a complete bar to the appointment of the 
employee of the State Government having financial interest in the 
87 
H 
88 
SUPREME COURT REPORTS [2002] SUPP. I S.C.R. 
A Government Undertaking as Chairman/Member of the Regional 
Transport Authority (RT A). The Writ Petition was dismissed by the High 
Court on the ground that the appellant had failed to show that in 
consequence of such appointment the business of appellant was affected 
adversely and that the challenge to Notification was purely academic and 
B did not warrant exercise of writ jurisdiction by the High Court. Hence 
appeal before this Court. 
it was contended for the appellant, that the Transport Commissioner 
etc. working in Haryana Roadways have a financial interest in it within 
the meaning of Section 68(2) of the Act which expressly prohibits the 
C appointment of such person as member of the State or Regional Transport 
Authority; that the Haryana Roadways compete with private operators, 
hence its employees are ineligible for appointment as members of Regional 
Transport Authority and that having regard to the nature and extent of 
powers of the authority, the legislature in its wisdom sought to exclude 
any person having any financial interest in any Transport Undertaking 
D from membership of the R.T.A. with a view to ensure its independent and 
impartial functioning. 
On behalf of the respondents, it was contended that the Transport 
Commissioner has been appointed as the Chairman of the Authority in 
accordance with law and has no personal interest, and that his 
E appointment was in the interest of the undertaking to provide economical 
and efficient transport service for the people at large. 
F 
Allowing the appeal, the Court 
HELD: 1. High Court should have considered the challenge to the 
appointment of the ?fficials concerned as members of the Regional 
Transport Authority on the ground of breach of statutory provisions. The 
mere fact that they had not acted in a manner prejudicial to the interest 
of the appellant could not lend validity to their appointment, if otherwise, 
the appointment was in breach of statutory provisions of a mandatory 
G nature. (95-F, G) 
2.1. Sub-section (2) of Section 68 of the Motor Vehicles Act 
mandates that no person who has any financial interest, whether as 
proprietor, employee or otherwise in any transport undertaking shall be 
appointed or continue to be a member of a Regional Transport Authority. 
H Thus a proprietory concern also comes within the ambit of sub-section 
-
-. 
MOR MOD. CO-OP TPT SOCTY. LTD. H FIN. COfvf1.1RANDSECTY TO GOVT 
89 
(2) of Section 68. 197-C-DI 
2.2. Even applying the dictionary meaning of the word 
"undertaking", an entity such as the Haryana Roadn'ays, 'vhich is engaged 
in the business of providing transport service to the people must be held 
A 
to be an "underta

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