SC allows SMYR Consortium to exit from collecting toll in Delhi

The Supreme Court on Thursday permitted SMYR Consortium LLP, which collects toll from vehicles entering the national capital for Delhi's municipal corporations, to exit from the contract as it contended that imposition of Environment Compensation Charge had adversely impacted the toll collections and its business.

The SMYR Consortium has said that imposition of ECC by the apex court's October 9, 2015 order and its being doubled by the court order of December 16, 2015, had resulted in nearly 35 percent fall in the vehicles entering the national capital, thereby adversely impacting its toll collections and business interest.

Telling the consortium that its contract would cease on the morning of February 1 at 6 a.m., a bench comprising Chief Justice T.S.Thakur, Justice A.K.Sikri and Justice R. Banumathi said that it would continue to collect toll and ECC for the next three weeks, and said that it would pay the municipal body a contractual sum of Rs.10.5 crore every week for next three weeks.

The court said that any default in the payment of contracted toll amount of Rs.10.5 crore would result in the forfeiture of its bank guarantees and securitry amount which SMYR Consortium said stood at Rs.58 crore.

The court asked Additional Solicitor General Pinki Annand appearing for South Delhi Municipal Corporation to put in place, well in advance, a mechanism that will step in for collecting the toll in as soon as SMYR Consortium exits on February 1.

Accepting SMYR Consortium's plea that it was incurring an additional expenditure of Rs.2 crore per month after the imposition of ECC which for three months of November, December and January came to Rs.6 crore, the court said that it was entitled to its reimbursement by the municipal body.

However, this sum was adjusted against shortfall of Rs.7.24 crore that SMYR had to pay to the municipal body as a part of toll collection under the contract. The court accepted amicus curiae Harish Salve plea and waved off the balance of Rs. 1.24 crore.

The apex court by its October 9, 2015 order had imposed ECC of Rs.700 on light commercial vehicles with two axles and of Rs.1,300 on commercial vehicles with three and four axles.

By its December 16 order, it doubled charge for loaded light commercial vehicles but retained the earlier rate for empty commercial vehicles.