M A I N   N E W S

The Tribune investigation: Part-IV
Badal luxury bus fleet’s phenomenal growth continues
Devinder Pal
Tribune News service

Private transport companies in which Deputy Chief Minister Sukhbir Singh Badal has direct and indirect interests dominate the state transport sector in the luxury segment. The Tribune checks out the situation in the fourth of the series of investigative reports.

Orbit Aviation Private Limited is one of the transport companies in which Punjab Deputy Chief Minister Sukhbir Singh Badal has the majority stake through one of his other companies (Orbit Resorts).

Chandigarh, April 28
The Jalandhar police recently registered an FIR against the staff of Orbit Aviation Private Limited for “hijacking” passengers from a Pepsu Road Transport Corporation bus.

Orbit Aviation Private Limited is one of the transport companies in which Deputy Chief Minister Sukhbir Singh Badal has the majority stake through one of his other companies (Orbit Resorts). The incident is an example of the growing friction between private transport companies and public road sector corporations that service the bus routes in Punjab.

In September, 2011, The Tribune had published an award-winning series of reports that exposed how transport companies associated by Sukhbir Badal dominated the luxury and super luxury buses operated by private transporters controlling more than half of the 295 buses that plied. The series revealed how the private sector had come to dominate this lucrative segment to the determinant of state-owned public transport companies that had incurred huge losses.

The Tribune had also reported that apart from Sukhbir Badal, several politicians, including from the Congress, owned a fleet of buses and were in a position to influence the transport policy of the state.

Ever since the publication of the report, the number of private buses owned by companies in which Sukhbir has shares has swelled to more than 230 - marking a seven-fold increase for the Badals who owned less than 40 buses in 2007.

From having stakes in just two companies in 2007 - Dabwali Transport Company (DTC) and Orbit Transport - Sukhbir Badal and his associates today have direct and indirect interests in at least six transport companies, including Taj Travels, Hargobind Travels Private Limited, Shan E Punjab and Indo-Canadian Transport Company.

Merger & acquisition

I tried to rein in the private transport mafia by raising the issue in Cabinet meetings and through the media but to no avail. I even took up the issue of lesser tax levied on luxury buses. — Master Mohan Lal, ex-transport minister The functioning is transparent. The PSUs are running into losses due to higher expenses and a whopping employees’ salary bill. The time tables for various routes are prepared through consensus and a transporter having a grievance can approach the STC and then the State Transport Tribunal. — SS Channy, principal secretary, transport (Punjab)

The flagship transport company of the Badals, Orbit Transport (which now has permits to operate on 61 routes), acquired wings, literally, in 2010 when Orbit Transport merged into Orbit Aviation, a company that was incorporated in June 2007 - three months after the SAD-BJP formed the government in Punjab.

Then in 2012, Orbit Resorts, the holding company owned by Sukhbir Badal, took control of Orbit Aviation and now owns a majority of its shares. In Dabwali Transport Company (operating nearly 90 permits), Sukhbir has majority stake (99.74 %), while its directors are family loyalists Mohammad Jameel and Mohammad Rafiq.

The Badal group has over the years quietly been acquiring stakes in a number of other private transport companies. The inception of Taj Travels dates back to June, 1998. While Lakhvir Singh holds majority stake (98.43 %), he and Jagpal Singh are its directors.

Not only does Taj Travels show H No. 256, Sector 9, Chandigarh (private residence of the Badals), a farmland in Balasar (Haryana) and a piece of land in Palanpur (near Chandigarh), as its fixed assets, the balance sheets reflect a pending “share application money of Rs 10 lakh of Sukhbir Badal”.

Documents with The Tribune show that the well-known Indo-Canadian Transport Company, which plies buses to the Delhi International Airport, was also acquired by some of the people associated with the Badals in 2012-13.

While MCI documents of 2013 show Lakhvir Singh and Jagpal Singh as directors of Indo-Canadian, the updated shareholdings are not reflected yet.

The two are also reflected as directors in Shan E Punjab since February 2006 and Hargobind Travels since May 13, 2011. The shareholdings of the two are not reflected in MCI documents yet, though there is evidence of financial borrowings between Hargobind Travels and Dabwali Transport in which Sukhbir has majority stake.

Downturn for roadways

While the private transport companies, especially those associated with the Badals registered a phenomenal growth, the public sector undertakings in Punjab have continued to hit a bleak patch. In case of Punjab Roadways and PUNBUS, there has been a drop in the total number of buses (from 1,908 buses in 2011-12 to 1,662 in 2013-14).

While MCI documents of 2013 show Lakhvir Singh and Jagpal Singh as directors of Indo-Canadian, the updated shareholdings are not reflected yet. The two are also reflected as directors in Shan E Punjab since February 2006 and Hargobind Travels since May 13, 2011. The shareholdings of the two are not reflected in MCI documents yet, though there is evidence of financial borrowings between Hargobind Travels and Dabwali Transport in which Sukhbir has majority stake.

Downturn for roadways

While the private transport companies, especially those associated with the Badals registered a phenomenal growth, the public sector undertakings in Punjab have continued to hit a bleak patch. In case of Punjab Roadways and PUNBUS, there has been a drop in the total number of buses (from 1,908 buses in 2011-12 to 1,662 in 2013-14).

The two organisations accumulated losses, had a drop in the total kilometres operated by their fleets, besides having a reduction in the number of route permits. Sources said it was no different in the PEPSU Roadways Transport Corporation (PRTC). The number of buses of PRTC has come down from 1,094 in 2011-12 to 1,003 buses as has the total mileage done by the fleet.

Inter-state agreements

From plying ordinary buses on short routes till 2007, the Badal-owned buses are now traversing states and its bus fleet boasts of luxury and integral coaches, which far exceed their rivals. They even have inter-state agreements, including the one with the UT of Chandigarh on March 12, 2008, which has turned out to be not only one-sided but gives a clear advantage to the Badal-run bus companies.

This was preceded by a demi-official letter by Punjab Chief Minister Parkash Singh Badal to then Punjab Governor and UT Administrator Gen SF Rodrigues (retd) in September, 2007 to give directions “for allowing entry into Chandigarh of private AC buses from Punjab”.

Race for permits

How did the Badal-associated transport companies grow? Besides acquiring new permits, the companies associated with the Badals have been on a permit-buying spree from other private transporters. This is especially so after December, 2012 order of the Division Bench of the Punjab & Haryana High Court which put a blanket ban on issuance of new permits.

The Transport Gazette, which has details of all permits bought and purchased, suggests in 2007, as many as 24 permits were bought - 12 each by DTC and Orbit. In 2008, the three companies (DTC, Orbit and Taj) took over 20 permits and in 2009 took over another 10 permits. In 2010, when an internal reorganisation resulted in Orbit Transport merging into Orbit Aviation, only one permit was acquired. However, in 2011, a total of 23 permits were acquired. In 2012, Badal-owned companies acquired 11 permits from other companies. And the trend continues - in 2013, a total of 17 permits were acquired by the Badal-associated companies.

As exposed in the earlier series by The Tribune, private companies have also benefitted from the manipulation of the tax structure, which favours luxury buses. Out of the 84 luxury bus permits operating in Punjab, at least 52 are with the transport companies patronised by the Badals.

Fare play

While the passenger fare of luxury buses (166 paise per passenger per km) is double that of ordinary buses (83 paise per passenger per km), the formulae for calculating the motor vehicles tax (MVT) that is charged is diametrically opposite of this. The MVT per km per vehicle in a day is Rs 3 for ordinary buses and on luxury buses (integral coaches) it is as little as Rs 1.75.

Turning the (time) tables

In fact, the MVT was as low as 50 paise for luxury buses till four years ago. BJP leader Master Mohan Lal, who was the then Transport Minister, claims to have protested in a meeting of the Punjab Council of Ministers and forced a revision to Rs 1.75 per km. Mohal Lal told The Tribune: “I tried to rein in the private transport mafia by raising the issue in Cabinet meetings and through the media but to no avail. I even took up the issue of lesser tax levied on luxury buses.”

There have also been allegations of manipulations of bus time tables of private operators to suit them. It is alleged that while “halt time” of buses belonging to other companies, including public sector undertakings, is reduced, a long rope is given to the “favoured private companies”. It is also common knowledge that multiple buses of the “favoured” companies are allowed to run on a single permit.

Mohan Lal admits on record: “As minister, I observed that buses owned by private companies were causing huge losses to the PRTC and the Punjab Roadways through clever methods. The private operators were running their buses on the same route as the government-owned buses but a few minutes prior to their schedule. As a result, while private buses get a house full, the government-run buses are empty. Besides, private operators run four to five buses on a single permit.”

Jagdish Sahni, former Chief Parliamentary Secretary in the SAD-BJP government and working president of the Punjab Motor Union, alleges: “In Punjab only the companies owned by the Badal family are pocketing profits and the other transport companies are facing huge losses. The transport companies of the Badals manipulate the time table - while other companies get 2-4 minute slots at bus stops, buses of Badal-owned companies are allowed to wait for as long as their buses are filled to capacity.”

But SS Channy, Principal Secretary, Transport (Punjab), says: “The functioning is transparent. The losses of the PSUs are due to higher expenses and a whopping employees’ salary bill. The time tables for various routes are prepared through consensus and a transporter having a grievance could approach the STC and then the State Transport Tribunal. Similarly, the tax structure is to ensure viability of various kinds of buses.”

Sukhbir Badal also denies that his companies have been shown any undue favour and, as reported earlier in the series, had told The Tribune last fortnight: “The transport company is owned by the Badal family since 1947 and my hotel business is also scrutinised by government agencies concerned.” When The Tribune reached him over the telephone on Monday, he said, “I am not giving my version as I am not answerable to you.”