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Special Provisions Relating to State Transport Undertakings

 


Introduction

State Transport Undertakings (STUs) are government-run entities responsible for providing public transport services within a state or across multiple states. The Motor Vehicles Act, 1988 provides special provisions to regulate and facilitate their operations. These provisions aim to ensure efficient, accessible, and affordable transportation services for the public, particularly in areas where private operators may not find it economically viable to operate.

Legal Framework: Special Provisions Under the Motor Vehicles Act, 1988

1. Section 98 – Power of the Government to Make Special Provisions

  • The State Government has the authority to create special schemes for STUs.
  • These schemes may grant exclusive rights to STUs for operating certain routes.
  • The provision ensures public transport accessibility in rural and remote areas.

2. Section 99 – Preparation and Publication of Transport Schemes

  • The State Government may prepare a scheme for providing road transport services by an STU.
  • The scheme should be published in the Official Gazette, inviting objections from private operators or stakeholders.
  • It must specify the routes covered, types of vehicles used, and reasons for the scheme’s necessity.
  • The government must consider objections before finalizing the scheme.

3. Section 100 – Approval of the Scheme

  • After considering objections, the State Government may approve or modify the scheme.
  • Once approved, it is published in the Official Gazette and becomes binding.
  • It may exclude private transport operators from specific routes to prevent competition with STUs.

4. Section 101 – STU’s Right to Operate Transport Services

  • Once a scheme is approved under Section 100, the STU gets priority or exclusive rights to operate on those routes.
  • The STU may either directly operate transport services or authorize private operators to run vehicles under contract.
  • Private transporters cannot operate in areas reserved for STUs without permission.

5. Section 102 – Modification of Approved Schemes

  • The State Government can modify an approved scheme as per public interest.
  • It must follow the same procedure of notification, objections, and approval as in Sections 99 and 100.

6. Section 103 – STU’s Power to Acquire Transport Undertakings

  • If a private transport business is operating in an area where an STU scheme is implemented, the State Government can acquire such businesses.
  • The acquisition is subject to compensation, as determined by the government.
  • This ensures a smooth transition to state-run transport services.

7. Section 104 – Prohibition of Private Transport Services on Notified Routes

  • No private transport operator can operate on a route covered under an STU scheme without the State Government’s permission.
  • However, the government may allow limited private operation where STU services are insufficient.

8. Section 105 – Compensation for Private Operators

  • If a private operator’s business is affected due to the implementation of an STU scheme, they are entitled to compensation.
  • The State Government determines the amount of compensation.

Objectives of Special Provisions for STUs

  1. Public Welfare: Ensures affordable and reliable public transport, especially in rural and backward areas.
  2. Government Regulation: Prevents monopolization by private operators and ensures state control over essential transport routes.
  3. Transport Accessibility: Provides connectivity to remote locations where private operators may not operate due to low profitability.
  4. Fare Control: Helps in regulating fares and preventing exploitation of passengers by private transporters.
  5. Employment Generation: Promotes direct and indirect employment in the public transport sector.

Challenges Faced by State Transport Undertakings (STUs)

  1. Financial Losses: Many STUs operate at a loss due to government-imposed fare caps and subsidies.
  2. Competition from Private Operators: Despite exclusivity, unauthorized private operators often compete on STU routes.
  3. Operational Inefficiencies: Many STUs suffer from poor fleet management, outdated vehicles, and lack of modern technology.
  4. Infrastructural Issues: Inadequate bus depots, lack of proper maintenance, and poor road conditions affect operations.
  5. Subsidy Dependence: Over-reliance on government subsidies makes them financially unsustainable in the long run.

Conclusion

The special provisions related to State Transport Undertakings (STUs) under the Motor Vehicles Act, 1988 aim to strengthen public transport by giving STUs special rights and protections. The legal framework ensures that STUs can operate efficiently while maintaining affordability and accessibility. However, challenges such as financial sustainability and competition from private operators must be addressed through modernization, better management, and technological integration to improve public transportation services in India.

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