Landmark Judgment by Supreme Court on Toll Collection Dispute

In a significant legal development, the Supreme Court of India has delivered a landmark judgment on the toll collection dispute involving the National Highways Authority of India (NHAI). The ruling allows NHAI to resume the collection of fees at Runni Toll Plaza on National Highway-77, following a petition by Arvind Kumar Thakur. The judgment addresses key aspects and facts highlighted by NHAI, providing clarity on the ongoing dispute. Read on to learn more about this crucial legal decision.

Facts

• The appeal by the National Highways Authority of India challenges the judgment allowing Arvind Kumar Thakur’s writ petition regarding the levy of fees at Runni Toll Plaza on National Highway-77.
• The judgment directed NHAI to not collect any fee from users at the toll plaza from 07.07.2015 onwards and to refrain from levying any fee until the completion of the project per Rule 3(1) of the 2008 Rules.
• The term ‘section of national highway’ under Rule 3(1) was discussed but deemed unnecessary in the current case.
• Length of 20.38 kilometres of the bypasses has been completed
• Central Government proposed to levy and collect fee from road users
• Fee for 61.70 kilometres is 60% of the base rate specified in the notification
• Fee for 20.38 kilometres is at the rate of 90% of the base rate specified in the notification
• Independent contractor examined and verified the Muzaffarpur-Sonbarsa Section of National Highway-77
• Provisional completion certificate issued on 29.06.2015
• Toll being collected by NHAI under ‘Build, Operate and Transfer’ basis
• Contractor being paid annuity as per the contract
• Section length of 61.70 kilometres for two laning with paved shoulder completed

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Analysis

• The impugned judgment of the High Court is unsustainable due to lack of interpretation of key aspects and facts highlighted by NHAI.
• The private contractor responsible for laying the highway has been paid the annuity.
• Notification issued under Section 11 of the NHAI Act, 1988, related to the Muzaffarpur-Sonbarsa Section of National Highway-77 has been referenced.
• NHAI collects toll until the actual costs are recovered, after which the fee reduces to 40% of the user fee.
• It is impossible to return the toll/fee collected to the road users as it is currently deposited in a bank.
• Modifying the interim order would be harmful to road users as additional amounts would need to be collected to cover the cost of the highway.

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Decision

• The Union of India and NHAI are advised to clarify the expression ‘section of national highway’ as per the law.
• The judgment dated 05.04.2016 is set aside and the present appeal is allowed.
• Civil Writ Jurisdiction Case no. 12858/2015 is treated as dismissed and accounted towards the actual cost.
• The amount deposited in the nationalized bank along with interest can now be utilized by NHAI as toll/fee collected from users.
• The annuity specified is payable at the rate specified for 15 years.

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Case Title: THE CHAIRMAN, NATIONAL HIGHWAYS AUTHORITY OF INDIA Vs. ARVIND KUMAR THAKUR (2024 INSC 556)

Case Number: C.A. No.-002996-002996 – 2017

Click here to read/download original judgement