SC Says Law Bars Private Buses on Madhya Pradesh–Uttar Pradesh Routes Overlapping UPSRTC Services

The Supreme Court recently held that private bus operators cannot ply on inter-State routes between Madhya Pradesh and Uttar Pradesh that overlap portions of notified routes reserved for the Uttar Pradesh State Road Transport Corporation (UPSRTC), unless the two states mutually revise their transport agreement.

A bench of Justices Dipankar Datta and Augustine George Masih on November 4, 2025, set aside multiple Madhya Pradesh High Court orders that had directed the Uttar Pradesh transport authorities to countersign permits issued by Madhya Pradesh to private operators. Court also dismissed a writ petition filed by certain operators seeking similar directions.

An Inter-State Reciprocal Transport (IS-RT) Agreement was signed between Uttar Pradesh and Madhya Pradesh in 2006, allocating specific routes between the two states. While Schedule A listed routes for private operators, Schedule B reserved others exclusively for the Madhya Pradesh State Road Transport Corporation (MPSRTC). Following the winding up of MPSRTC, those routes were de-notified, prompting private operators to seek temporary permits from Madhya Pradesh and countersignature from Uttar Pradesh.

However, the Uttar Pradesh transport authority refused to countersign, citing that the concerned routes overlapped with notified intra-State routes operated solely by UPSRTC under Chapter VI of the Motor Vehicles Act, 1988, which overrides Chapter V dealing with private operations.

The Madhya Pradesh High Court, in a 2014 public interest litigation by Kashmiri Lal Batra, had ordered the Madhya Pradesh government to issue permanent permits and directed Uttar Pradesh to countersign them. UPSRTC challenged the order, arguing that it amounted to permitting private players to operate in violation of nationalisation schemes that reserve specific routes for state-run transport corporations.

Upholding UPSRTC’s challenge, the Supreme Court referred extensively to earlier Constitution Bench decisions, including Adarsh Travels Bus Services v. State of Uttar Pradesh (1985), which established that once a route is notified under a state transport scheme, no private operator can ply even on a small overlapping portion of it unless the scheme itself provides for an exception.

The bench observed that Chapter VI of the Motor Vehicles Act overrides Chapter V, and that inter-State agreements between two states 'are not laws and cannot override notified schemes under Chapter VI. “Grant of relief to private operators seems well-nigh impossible unless it is conclusively shown that MPSRTC has been wound up,” the court said, noting that no clinching evidence to that effect was produced.

While setting aside the High Court orders, the Supreme Court expressed concern over the administrative indifference of both state governments. “Much was expected of the States of UP and MP… but the lack of application of mind has frustrated the public interest underlying inter-State transport,” Justice Datta remarked.

Nevertheless, court urged cooperation between the two states, directing the Principal Secretaries of their Transport Departments to meet within three months to explore a modified arrangement under the existing IS-RT Agreement. If MPSRTC’s winding-up is confirmed, both states may consider transferring those routes to the private operators’ pool under Schedule A, the court suggested.

Case Title: UP State Road Transport Corporation Through its Chief General Manager Vs Kashmiri Lal Batra & Ors

Judgment Date: November 4, 2025

Bench: Justices Dipankar Datta and Augustine George Masih