DND flyway: SC asks CAG to verify claim of Noida Toll Bridge

The Supreme Court today granted eight weeks time to the Comptroller and Auditor General of India (CAG) for verifying the total cost of the Delhi-Noida Direct (DND) flyway project and the claim of Noida Toll Bridge Company Ltd that it has not recovered the expenses.
A bench of Chief Justice J S Khehar and Justices N V Ramana and D Y Chandrachud allowed the plea of CAG seeking time to submit a report after verifying the claim of the company and listed the matter for final hearing after eight weeks.
The apex court had on November 11, 2016 asked CAG to assist in the matter and verify the company's claim that the total cost of the project has not been recovered and submit a report within four weeks.

It had also directed the firm to place before CAG the entire record pertaining to recovery of the total project cost for the DND flyover as per the agreement.
The court had passed the order while disagreeing with the company that its refusal to stay the Allahabad High Court's verdict making DND flyway toll free for commuters would cause irreparable loss to the firm.
It had said that while the company can be compensated later if it succeeds in its appeal, it will be impossible to provide restitution to the lakhs of commuters from whom the toll fee would be collected to repay them on dismissal of the special leave petition (SLP).

While declining the firm's plea to stay the high court's October 26 last year judgement restraining it from levying the cess, the bench had said, "We do not agree with the submission that the petitioner (firm) would suffer irreparable loss if the judgement of the high court is not stayed."

The high court had brought cheers to millions of commuters by ruling that no toll will be collected henceforth from those using the 9.2 km-long, eight-lane DND flyway. The order was passed when the high court allowed a PIL by the Federation of Noida Residents' Welfare Association.
The firm had challenged the high court verdict saying it

did not take into account all aspects and submitted that factors like interest on construction cost, depreciation and maintenance expenses, which come to around Rs 12.5 lakh per day, have not been duly considered.
To this, the apex court had said prima facie the issue that arose in the appeal required a detailed scrutiny as conflicting claims have been made regarding recovery of the total cost of the project by the concessionaire.
"To resolve the dispute, it is appropriate that an independent agency is requested to examine the relevant records of the DND flyway. The said agency should examine the reports of the independent auditors appointed by the petitioner and submit a report regarding the correctness of the petitioner's claim that the total cost of the project has not been recovered," it had said while asking CAG to verify the firm's claims.

In an over 100-page judgement, the high court had held "the user fee which is being levied/realised is not supported by the legal provisions relied upon by the concessionaire (Noida Toll Bridge Company), Infrastructure Leaning and Financial Services (promoter and developer of the project) and Noida Authority."
The court had said that the "right to levy and collect user fee from the commuters as conferred upon the concessionaire under the concession agreement suffers from excessive delegation and is contrary to the provisions UP Industrial Development Act".
It had noted that "the concessionaire, according to their own financial statements, has recovered Rs 810.18 crore (approx) from toll income from the date of commencement of the project till March 31, 2014 and after deduction of operation and maintenance expenses and corporate income tax, the surplus was Rs 578.80 crore (computed before interest, depreciation, and lease rental received by the concessionaire)".

"They have further realised user fee/toll for two-and-a half-year thereafter between April 1, 2014 and September 30, 2016 which, as per the collection of user fee in the year 2013-14 would work out to an additional sum of Rs 300 crore (approx).
"We are, therefore, more than satisfied that the concessionaire cannot now recover the user fees from the users/ commuters of the Noida Toll Bridge the DND Flyover," the high court had said.