M. S. SHVANANDA vs KARNATAKA STATE ROAD TRANSPORT CORPORATION AND OTHERS

The Supreme Court held that employees of erstwhile contract carriage operators in Karnataka did not acquire a vested right of absorption under sub-clause (3) to clause 20 of the Karnataka Contract Carriage (Acquisition) Ordinance, 1976. The Court affirmed the High Court's finding that no action had been taken to effectuate such absorption, thus dismissing the appeal and writ petitions challenging the vires of the Act. The ruling clarified that the change in absorption ratios from the Ordinance to the Act did not confer any rights to the employees.