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Appeal No. 27 of 1948-49, decided on 14th July, 1949.

Motor Vehicles Act (IV of 1939)-

Regional Transport Authority-- Accommodating shares of old company in new company in the name of an allottee-Subsequently eliminating the allottee---Original allotment, held, fair and legal.

The Deputy Custodian declared on the 18th May, 1948, that the transfer of shares worth Rs. 30,000 from Sujan Singh to the appellant was bona fide and registerable and not against the prescribed objects. This order was confirmed by the Custodian on the 19th June, 1948.

In their order dated the 3rd September, 1948, the Regional Trans port Authority admitted the claim of the appellant to the extent of Rs, 27,000 in the new company.

That order, so far as it concerns the appellant and the new company, ;appears to me to be a fair and legal one.

Nasir Ahmad, for appellant.

Muhammad Zafar, for respondent.

This is an appeal by one Syed Nazir Hussain against the order of the Regional Transport Authority, Rawalpindi, dated the 26th March, 1949, in which that Authority ordered that he should be eliminated from a new company, known as the New District Bus Service Company Ltd., Rawalpindi, which had been formed in place of a company known as the District Transport Company, Ltd., Rawalpindi, from which a large number of the share-holders had become evacuees. The original order of the Regional Transport Authority in this case was dated the 3rd September, 1948, and was to the effect that the present appellant should be accommodated in the new company to the extent of Rs. 27,000 he being willing to forego the remaining Rs. 3,000. Against that order the New District Bus Service Company Ltd., appealed and having taken some evidence produced by the parties I remanded the case to the Regional Transport Authority for reconsideration and a fresh order which that Authority passed on the 26th March 1949, and which is now appealed against by Syed Nazir Hussain.

The facts of the case are as follows :-

The appellant purchased preference shares of the value of Rs. 30,000 from one Sujan Singh, formerly Chairman and share-holder of the District Transport Company Ltd., Rawalpindi, on the 20th August, 1947, at Delhi is exchange of his two trucks and became share-holder and Chairman of the Board of Directors of the District Transport Company Ltd., on the i 5th September, 1947, and as Chairman received a salary of Rs. 630 per mensem for about six months. In his note dated the 9th January, 1948, addressed to the Regional Transport Authority, Rawalpindi, the O. S. D. (T) allowed eight Muslim Share-holders of the Karnal General Transport Company Ltd., to amalgamate with the Muslim share-holders of the District Transport Company Ltd., and run a new service. He suggested that the permits of the old company should be cancelled and re-issued to the new combine. He further asked the Authority to request the District Magistrate, Rawalpindi to hand over the vehicles, garages, stores etc., of the old company to the, new combine under an agreement that the latter would abide by the conditions laid down by Government from time to time. On the 20th February, 1948, the O. S. D. (T) in his capacity as Assistant Rehabilitation Commissioner passed an order requisitioning fourteen vehicles of the old company and allotting the same to the new company. On the same day O. S. D. (T) addressed another note to the Regional Transport Authority, Rawalpindi, explaining that in the old company Muslims held shares to the value of Rs. 50,000 while non-Muslims held shares to the extent of Rs. 1,55,000. in the same note he suggested that the shares of non-Muslims in the old company should be re-allotted to members of the new combine as under :-

By their order dated the 1st April, 1948, the Regional Transport Authority, Rawalpindi, decided that the new combine should function immediately. As regards the appellant the Authority decided that if his claim were admitted by the Deputy Custodian, then the Authority-would go into the question of adjusting his interests in the new combine in the light of the decision arrived at. The Authority further decided that, if the appellant were admitted as a share-holder as a result of the decision of the Deputy Custodian, then both the Karnal group and the old Muslim operators would be called upon to forego a portion of their interests to accommodate the new comer. The Deputy Custodian declared on the 18th May, 1948, that the transfer of shares worth Rs. 30,000 from Sujan Singh to the appellant was bona fide and registerable and not against the prescribed objects. This order was confirmed by the Custodian on the 19th June 1948.

In their order dated the 3rd September, 1948, the Regional Transport Authority admitted the claim of the appellant to the extent of Rs. 27,000 in the new company.

The new company preferred an appeal against the Regional Transport Authority's order of the 3rd September, 1948, when on the 8th January, 1948, as stated above, I remanded the case back to the Authority for a fresh decision.

It is clear that the appellant is a share-holder to the extent of Rs, 30,000 in the District Transport Company Ltd., Rawalpindi. That company held permits and owned vehicles etc. The O. S. D. suggested on the 9th January, 1948, that these permits should be cancelled, but this has never been done by the Regional Transport Authority. The O. S. D. in his capacity as Assistant Rehabilitation Commissioner ordered on the 20th February, 1948, that all the vehicles should be requisitioned and handed over to the New District Bus Service Company Ltd., Rawalpindi. Whether this latter order is a legal one is not a matter for me to decide, but it would be outrageous if it involved the handing over without compensa tion of property in which a person is a share-holder to some other body in which that person is not permitted to be a share-holder. I am concerned with the matter of permits and in this regard the appellant claims that the order of the Authority dated the 3rd September. 1948, should be upheld. That order was to the effect that shares to the value of Rs. 27,000 (the appellant was required to forego Rs. 3,000) should be allotted to the appellant in the new company to which the permits of the old company would be transferred. That order, so far as it concerns the appellant and the new company, appears to me to be a fair and legal one. I am completely unable to understand the order of the Regional Transport Authority dated the 26^th March, 1949, in which on remand on an appeal by the new company against the order of the 3rd September, 1948, the Regional Transport Auth6rity has refused to allow the appellant any share, I accept the appeal to this extent that I order that the appellant retains his share in the permits which have been transferred from the District Transport Company, Ltd., Rawalpindi to the New District Bus Service Company Ltd., Rawalpindi.

K. M. A. Appeal allowed.

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