The incident occurred this afternoon at Anna Salai area, in the heart of the city.
The passengers of the bus, around 35 of them, evacuated the vehicle after the driver raised an alarm and the car's occupant jumped out after the earth started buckling in.
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Incidentally, the tunnelling work had last month caused a foam leakage close to the spot where the road caved in today.
The bus was stationary at the Gemini stop and the car was passing alongside it when the road caved in. The front portions of the vehicles sank into the crater that was around four to five feet deep.
The spot of the incident is about 1-km from the area where the Chennai Metro Rail Ltd (CMRL) has undertaken tunnelling work for its project along Anna Salai.
"The bus halted at the Gemini bus stop as usual and suddenly, we realised the bus was going down. Immediately, the driver alerted the passengers to evacuate," bus conductor Ramesh told reporters.
Initially, the driver thought it was a puncture, he said.
Pradeep, the sole occupant of the car, said, "As soon as the car went in, I jumped out."
Tamil Nadu Finance Minister D Jayakumar, and top police and district officials have inspected the spot.
Talking to reporters, the minister said there were no casualties in the incident.
"Normally, soil test is conducted randomly whenever metro rail officials take up tunnelling work. We will take this incident as an experience and work in future so that these kind of accidents does not recur," he said.
Jayakumar said traffic has been diverted in the area and it is expected to be "fully restored" by tomorrow evening.
Chennai District Collector V Anbuselvan said the incident might have occurred due to the tunnelling work, but the exact cause can be ascertained only after an inspection by state government and CMRL officials.
The car and bus were later pulled out using cranes.
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