Section 40 of The Road Transport Corporations Act, 1950
Compensation for acquisition of road transport undertakings.
Whenever a Corporation acquires under this Act the whole or any part of any undertaking, there shall be paid by the Corporation compensation the amount of which shall be determined in the manner and in accordance with the procedure hereinafter set out, that is to say,--
- (a)where the amount of compensation can be fixed by agreement, it shall be paid in accordance with such agreement;
- (b)where no such agreement can be reached, the amount shall be determined by an arbitral Tribunal consisting of one nominee of the Corporation, one nominee of the person to be compensated, and a Chairman to be nominated by the Chief Justice of the 1[High Court of Delhi];
- (c)an appeal shall 2[lie to the High Court of Delhi] against the decision of the Tribunal and the 3[order of that High Court] on such appeal shall be final.
Summary
- The Corporation must pay compensation when it takes over a road transport business.
- The amount of money to be paid can be decided through a mutual agreement.
- If no agreement is reached, an official Tribunal with three members will determine the amount.
- The Tribunal includes one person chosen by the Corporation and one by the business owner.
- A Chairman for the Tribunal is appointed by the Chief Justice of the High Court of Delhi.
- Anyone unhappy with the Tribunal's decision can appeal to the High Court of Delhi.
Practical examples
FAQ
1. What happens if a business owner and a Corporation cannot agree on a price under Section 40 of The Road Transport Corporations Act, 1950?
Under Section 40 of The Road Transport Corporations Act, 1950, if no agreement is reached, an arbitral Tribunal is formed to determine the amount of compensation.
2. Who chooses the members of the Tribunal under Section 40 of The Road Transport Corporations Act, 1950?
According to Section 40 of The Road Transport Corporations Act, 1950, the Corporation and the person being compensated each choose one nominee, and the Chief Justice of the High Court of Delhi chooses the Chairman.
3. Can a decision on compensation be challenged under Section 40 of The Road Transport Corporations Act, 1950?
Yes, Section 40 of The Road Transport Corporations Act, 1950, allows for an appeal to the High Court of Delhi against the decision of the Tribunal.
Test yourself
1.Under Section 40 of The Road Transport Corporations Act, 1950, who nominates the Chairman of the arbitral Tribunal?
2.Which court has the final authority on compensation appeals under Section 40 of The Road Transport Corporations Act, 1950?
3.How many members make up the arbitral Tribunal under Section 40 of The Road Transport Corporations Act, 1950?
4.Under Section 40 of The Road Transport Corporations Act, 1950, what is the first preferred method for determining compensation?