The Supreme Court of India has agreed to examine a significant question concerning the interpretation of the Motor Vehicles Act, 1988, particularly the scope of powers vested in the State Transport Authorities (STAs) and Regional Transport Authorities (RTAs) in relation to grant of permits for passenger transport.
A bench comprising Justice Dipankar Datta and Justice A.G. Masih issued notice in a special leave petition raising the issue whether Section 68(3)(ca)—inserted by the 1994 Amendment—restricts the power of transport authorities of a State to issue permits on routes other than those specifically formulated by the State Government.
The order reads:
“Issue notice on the point as to whether clause (ca) inserted by an amendment in 1994 in Section 68(3) of the Motor Vehicles Act, 1988, restricts issuance of permits by the State Transport Authority of a State or the Regional Transport Authorities in a State on any route other than those formulated by the State Government.”
Section 68 of the Act provides for the constitution of State Transport Authorities and Regional Transport Authorities through government notification. These bodies are entrusted with various regulatory, coordinating, and supervisory functions in relation to road transport operations.
Under Section 68(3), the powers of the STA include:
• Coordination and regulation of the policies of different RTAs within the State.
• Performance of duties of an RTA in areas where no such authority exists or in respect of inter-regional routes.
• Resolution of disputes between RTAs.
In 1994, Parliament inserted clause (ca), mandating that “the Government shall formulate rules for plying stage carriages.” This insertion has triggered interpretative questions as to whether the role of the STA/RTAs in granting permits became subordinate to government-notified routes and whether their discretion has been curtailed.
Section 67 of the Motor Vehicles Act authorises the State Government to issue directions to STAs and RTAs in the larger interest of transport regulation. These include:
1. Fixation of fares and freights for stage carriages, contract carriages, and goods carriages.
2. Restrictions or prohibitions on long-distance goods transport.
3. Directions necessary to implement inter-governmental transport agreements and to coordinate road transport with other modes of transport.
The interplay of Section 67 and Section 68(3)(ca), therefore, lies at the heart of the present controversy—whether government-prescribed rules for stage carriages completely override the independent authority of STAs/RTAs to issue permits on new or unformulated routes.
The Case
The matter arises in the Special Leave Petition titled:
“Dharmendra Singh Yadav v. State of Madhya Pradesh & Ors.” [SLP(C) No. 21417 of 2025].
The Court’s consideration is expected to have wide implications for road transport regulation, particularly in States where disputes often arise regarding issuance of permits for passenger vehicles on routes not formally prescribed by government notifications.
Legal experts note that a ruling one way or the other will determine the extent of autonomy enjoyed by STAs/RTAs versus the policy control of the State Government. If the Court holds that Section 68(3)(ca) is restrictive, transport authorities will be bound strictly by government-framed routes, limiting flexibility. Conversely, if autonomy is upheld, RTAs and STAs may continue to issue permits independently, subject only to broad directions under Section 67.
The matter will now be listed for further hearing.
