Summary
| Category | Data |
|---|---|
| Court | Supreme Court of India |
| Case Number | C.A. No.-010522-010522 – 2025 |
| Diary Number | 7372/2015 |
| Judge Name | HON’BLE MR. JUSTICE DIPANKAR DATTA |
| Bench |
|
| Precedent Value | Binding authority |
| Overrules / Affirms | Affirms Constitution Bench decisions in Adarsh Travels Bus Services v. State of U.P. |
| Type of Law | Statutory interpretation of the Motor Vehicles Act, 1988 (transport law) |
| Questions of Law | Whether a stage carriage permit can be granted to a private operator under Section 88 of the Motor Vehicles Act for an inter-State route overlapping a notified intra-State route approved under Chapter VI thereof. |
| Ratio Decidendi | The Court held that an inter-State reciprocal transport agreement under Section 88 is not a “law” and cannot override an approved intra-State scheme or notified route under Chapter VI of the 1988 Act. Section 98 gives Chapter VI provisions priority over Chapter V and any inter-State agreement. Binding Constitution and larger Bench precedents (Adarsh Travels Bus Services and T.V. Nataraj) confirm that private operators cannot ply on overlapping stretches of notified routes absent express exclusion. |
| Judgments Relied Upon |
|
| Logic / Jurisprudence / Authorities Relied Upon by the Court | The Court applied the statutory hierarchy in the Motor Vehicles Act: Section 98 (Chapter VI override) supersedes Section 88 (Chapter V IS-RT agreements); treated IS-RT agreements as non-legislative instruments; adhered to Constitution Bench rulings rejecting coordinate-Bench divergences; emphasised public interest and need for express scheme terms to exclude overlapping portions. |
| Facts as Summarised by the Court | Under an inter-State reciprocal transport agreement between Madhya Pradesh and Uttar Pradesh, Schedule B routes were reserved for MPSRTC and Schedule A for private operators. Upon MPSRTC winding up, Schedule B routes would be deemed included in Schedule A. Private operators obtained temporary permits from STA MP; STA UP refused countersignature. The Madhya Pradesh High Court directed permanent permits and countersignature by UP, leading to these appeals. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts and transport authorities |
| Persuasive For | State transport authorities and High Courts |
| Overrules | None |
| Distinguishes | Coordinate-Bench decision in Mysore SRTC v. Mysore Revenue Appellate Tribunal [MSRTC (I)] (1975) 4 SCC 192 |
| Follows |
|
What’s New / What Lawyers Should Note
- Reaffirms that inter-State transport agreements under Section 88 do not override approved intra-State schemes or notified routes under Chapter VI.
- Clarifies that Section 98 of the Motor Vehicles Act gives priority to Chapter VI over Chapter V, binding on all transport authorities.
- Confirms that an IS-RT agreement is not legislative and cannot exclude private operators on notified routes without clear, express terms.
- Emphasises the necessity for States to include explicit provisions in IS-RT agreements addressing overlapping routes to protect public interest.
- Highlights the Court’s expectation that States coordinate to amend agreements or schemes if one State’s transport undertaking ceases operations.
Summary of Legal Reasoning
- Statutory hierarchy: Chapter VI (Sections 97–103) overrides Chapter V (Section 88) under Section 98 of the Motor Vehicles Act, 1988.
- Nature of IS-RT agreements: Held to be non-legislative instruments; cannot override approved schemes.
- Precedent analysis: Rejected coordinate-Bench decisions (MSRTC (I)) and followed larger Bench and Constitution Bench rulings (MSRTC II, Adarsh Travels, T.V. Nataraj).
- Outcome: Private operators have no right to stage carriage permits on overlapping stretches of a notified intra-State route absent express exclusion in the scheme.
- Policy note: Encouraged States to renegotiate or amend schemes and agreements by consensus if one State’s transport corporation winds up.
Arguments by the Parties
Petitioner
- The PIL by a private individual lacked bona fide and was not maintainable.
- No legal right exists for private operators to ply stage carriages on inter-State routes overlapping notified intra-State routes under an approved scheme.
- Reliance on statutory exclusions and binding precedents barring overlap.
Respondents
- The IS-RT Agreement binds both States and, upon winding up of MPSRTC, Schedule B routes became available to private operators.
- Permits validly issued by STA MP; UP must countersign under Section 88(6).
- No Central Government approval for notification means routes never notified under Chapter VI, so no exclusion applies.
Factual Background
Madhya Pradesh and Uttar Pradesh executed an IS-RT Agreement under Section 88, reserving certain inter-State routes (Schedule B) for MPSRTC and others (Schedule A) for private operators. Upon MPSRTC’s winding up, Schedule B routes were deemed part of Schedule A. Private operators obtained temporary permits from STA MP only to have STA UP refuse countersignature. The Madhya Pradesh High Court directed permanent permits and countersignature by UP. This led to multiple appeals and petitions before the Supreme Court.
Statutory Analysis
- Section 88 (Chapter V): Procedure for inter-State transport agreements, publication, and countersignature of permits.
- Sections 97–103 (Chapter VI): Formulation, publication, objections, approval and notification of intra-State schemes; power to exclude other operators; cancellation/modification; overriding effect (Section 98).
- Section 100 Proviso: Approval by Central Government required for inter-State routes in an approved scheme.
Alert Indicators
- ✔ Precedent Followed – Existing Constitution Bench and larger Bench rulings reaffirmed.
- 🔄 Conflicting Decisions – Resolved coordinate-Bench conflicts in Mysore SRTC (I) by endorsing larger Bench and Constitution Bench views.