Case Note & Summary
The appeal was filed by the National Highways Authority of India (NHAI) against the judgment of the High Court dated 05.04.2016, which allowed the writ petition of respondent No. 1, Arvind Kumar Thakur, directing NHAI not to levy or collect any fee from users at Runni Toll Plaza on Muzaffarpur-Sonbarsa section of National Highway-77 with effect from 07.07.2015, and not to levy fee under Rule 3(1) of the National Highways Fee (Determination of Rates and Collection) Rules, 2008 till completion of the project. The facts reveal that a notification dated 26.11.2013 was issued under Section 11 of the National Highways Authority of India Act, 1988, stating that a section length of 61.70 kilometres for two laning with paved shoulder and 20.38 kilometres of bypasses had been completed, and fee was prescribed at 60% and 90% of the base rate respectively. An independent contractor issued a provisional completion certificate on 29.06.2015. The toll was being collected by NHAI on a Build, Operate and Transfer basis, with the contractor being paid annuity. The Supreme Court noted that the High Court judgment merely referred to Rule 3(1) but did not interpret or consider the facts highlighted by NHAI. The Court had earlier stayed the High Court judgment subject to the condition that the toll amount collected be deposited in a nationalized bank. The Court observed that returning the toll to users would be impossible and detrimental, as additional amounts would need to be collected. Therefore, the Supreme Court set aside the High Court judgment, allowed the appeal, and directed that the deposited amount along with interest be utilized by NHAI and treated as toll collected. The Court also left open the issue of defining 'section of national highway' and suggested that the Union of India and NHAI may examine the need for clarification.
Headnote
A) National Highways - Toll Collection - Completed Section - Rule 3(1) of National Highways Fee (Determination of Rates and Collection) Rules, 2008 - The issue was whether NHAI could levy toll on a completed section of a national highway before the entire project was finished. The Supreme Court held that the High Court's direction to stop toll collection was unsustainable as it did not consider the facts and the notification under Section 11 of the NHAI Act, 1988, which specified completed lengths. The Court allowed the appeal and set aside the High Court judgment, permitting NHAI to utilize the deposited toll amount. (Paras 1-7) B) National Highways - Interpretation - 'Section of National Highway' - Rule 3(1) of National Highways Fee (Determination of Rates and Collection) Rules, 2008 - The expression 'section of national highway' is not defined in the National Highways Act, 1956 or the 2008 Rules. The Supreme Court left the issue open but observed that the Union of India and NHAI may examine the need for clarification. (Paras 2, 7)
Issue of Consideration
Whether NHAI can levy and collect toll on a completed section of a national highway under Rule 3(1) of the National Highways Fee (Determination of Rates and Collection) Rules, 2008, before completion of the entire project.
Final Decision
The Supreme Court set aside the High Court judgment dated 05.04.2016, allowed the appeal, and dismissed Civil Writ Jurisdiction Case No. 12858/2015. The amount deposited in the nationalized bank along with interest may be utilized by NHAI and treated as toll collected.
Law Points
- Toll collection on completed section of national highway is permissible under Rule 3(1) of National Highways Fee (Determination of Rates and Collection) Rules
- 2008
- even if entire project not complete
- expression 'section of national highway' not defined but left open
- interim order staying High Court judgment with deposit condition upheld
- impossibility of refund to road users considered.
