Delhi: All new Commercial road transport sector

New Delhi, Apr 22: The country's commercial road transport sector is poised for a major shake-out with the government deciding to re-introduce The Carriage by Road Bill, 2005 in the ongoing Budget Session of Parliament to replace a 142-year-old legislation that has governed the sector so far.

Touted as the single largest attempt to reform the commercial road transport sector since independence, the Bill, once approved by Parliament, will replace the Carriers Act, 1865 and streamline the goods transport business and protect the trade and industry.

Industry experts and some leading transport bodies have been quick to hail the bill, saying the long overdue measure will fix accountability on transport companies, bring transparency in their functioning and end the menace of overloading of trucks, the most serious threat to the longevity of highways.

Under the proposed Bill, goods transport companies will be penalised for overloading of trucks as per Section 194 of the Motor Vehicle Act, 1988 --- at par with the drivers/owners of motor vehicles.

More importantly, it will tighten the noose on 'fly-by-night' transport operators by making it mandatory for all the goods booking companies to get registered with authorities concerned and file periodic details of their goods booking and delivery operations.

In effect, all the people engaged in business of collecting, storing, forwarding or distributing goods, to be carried by goods carriage by motorised transport on road, will be registered. This will include goods booking companies, contractors, agents and brokers.

There will be a single registration for a common carrier, which will be valid for the entire country.

It also mandates that the absolute liability of the goods booking firm for safe delivery of cargo shall be at par with invoice value of the cargo. However, if a consignee fails to take delivery of the consignment, a goods booking company (GBC) can recover the dues by disposing of the consignment.

The amended bill, approved by the Union Cabinet earlier this week for its re-introduction in Parliament, was first introduced in the Rajya Sabha on December 7, 2005. It was later referred to the Parliamentary Standing Committee on Transport, Tourism and Culture.

Road Transport and Highways Minister T R Baalu says most of the provisions of the 1865 Act had become obsolete with the transport trade undergoing a sea change over the last 142 years.

The liability of the common carrier in case of loss or damage to the goods will be prescribed under the rules, to be framed with regard to value, freight and nature of goods.

Every consignor would have to execute a Goods Forwarding Note about the value of the consignment and also make a declaration about dangerous and hazardous goods. Further, it will be the duty of a transporter to ensure that such goods are covered by insurance.

Electronic submission of application for registration will be encouraged and Registration Authorities will have to issue certificate of registration or renewal within a period of 90 days,'' Mr Baalu says.

The registration of the main office of a Goods Booking Company (GBC) will be valid for 10 years throughout the country and details of its branch offices are to be reflected in the certificate of registration.

The new Act will help the planner and the industry to generate proper and regular data base on movement of various types of cargo in the country. It will work as a scanner on the movement of taxed and non-taxed cargoes, says Mr S P Singh, Convenor, Indian Foundation of Transport Research and Training (IFTRT).

There are over 130,000 GBCs in the country, which transport goods by road. Almost 75 per cent of the national cargo is handled by these GBCs with annual freight charges of Rs. 1,60,000 crore.

Mr Singh points out that the unregulated mass of goods booking firms are engaged in ferrying unaccounted cargo at premium freight charges. Even after introduction of the revolutionary tax regime of Value Added Tax (VAT) two years ago, the belligerent goods booking firms continue to run their transport business in an unaccounted manner, causing huge revenue loss to the exchequer.

The goods booking/road transport companies from mid-nineties onwards have been campaigning for repeal of the Carriers Act, describing it as ''archaic'' and not in tune with present-day requirements of trade and transport. ''This obsolete law suited the transporters well, before the enactment of the Consumer protection Act, 1986. The only recourse consignors (consumers) of cargoes that went missing had was to enter the tortuous route of court litigation at whose end a pittance awaited them as compensation.

''Consequently, the requisite financial benefit arising out of prolonged litigation was inadvertently loaded in favour of the powerful goods booking companies,'' Mr Singh says.

There have been numerous instances when a transport company would even elope with high value cargo and make a smart exit much to the chagrin of consignor and normally start afresh under a new name and title.

However, consumer courts formed under the Consumer Protection Act changed this situation dramatically and started awarding claims with despatch. The Act provided to the consignor a cost-free instant justice with additional damages against an erring transporter or a goods booking company over and above the actual value of claim for non-delivery or short delivery of cargoes.

Thus many goods booking companies vanished from the market even before the consignor was able to approach the consumer forum.

''This resulted in extraordinary pressure on common carrier and led to a shrill demand from the powerful lobby of Goods Transport Associations to seek the repeal of Carriers Act on the plea that it was 'outdated' in the present-day requirements of transport trade,'' Mr Singh points out.

Mr Baalu says the proposed legislation would make the transport system transparent and modernise the transportation trade through registration and equitable apportionment of liability between a GBC and the consignor.

UNI