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2021 Supreme(Raj) 198

IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR
INDRAJIT MAHANTY, SATISH KUMAR SHARMA, JJ.
Udaipur Tollway Limited & Ors. - Petitioners
Versus
Union of India, through Secretary, Ministry of Road Transport and Highways & Ors. - Respondents
D.B. Civil Writ Petition No. 11042 of 2020
Decided On : 25-08-2021

Advocates Appeared:
For the Petitioners:Mr. Vikram Nankani, Senior Advocate Mr. Saurabh Kripal, Senior Advocate assisted by Mr. Sarthak Sachdev, Mr. Vinod Menon, Ms. Teresa Daulat (Through V.C.), Mr. P.C. Sharma.
For the Respondents:Mr. R.D. Rastogi, Additional Solicitor General assisted by Mr. C.S. Sinha, Mr. Sudhir Gupta, Senior Advocate assisted by Mr. Umang Gupta (Through V.C.), Ms. Priyal Kothari.

Point of Law: it appropriate to exercise writ jurisdiction under Article 226 in the aforesaid peculiar circumstances for the limited purpose of interim protection while relegating the parties to arbitration.

Headnote:

National Highways Fee (Determination of Rates and Collection) Rules, 2008 - Rule 4(9), 7(9) (1) - National Highways Act, 1956 – Sections 17,8 ,5 and 9 - Constitution of India,1950 - Article 14 ,26,.2.,1and 31 - Motor Vehicles Act, 1988 - Chapter VIII - Arbitration & Conciliation Act, 1996 - Section 9 and 17 – Equal protection of law - It is submitted that writ petition is not maintainable being related to purely contractual obligation and challenge to rules etc. is misconceived. Reliance is placed on following observations in judgment of Hon'ble Supreme Court in JWS Infrastructure - Whether NHAI compelling petitioner to perform obligation to pay premium on completion of years from COD would be manifestly arbitrary and violative of Article 14 of Constitution of India, if having first failed in its obligation to give complete "right of way" within days from COD - NHAI has itself extended date of completion beyond days from COD -

Finding of the Court:

Concession Agreements obligation of petitioners to pay premium was to commence on expiry of years from COD thereby maintaining a consistent gap of about six months between date of 'completion' and date of commencement of obligation to pay premium.- In peculiar facts of case, for various reasons handing over of right of way could not be completed by NHAI within days.- Consequently, originally scheduled "Completion Dates" were initially extended by NHAI to respectively, and finally, to respectively. During pendency of petition, petitioner completed construction on (1st Project) - Court view of being satisfied with prima facie case, Court are persuaded to deem it appropriate to exercise writ jurisdiction under Article 226 in aforesaid peculiar circumstances for limited purpose of interim protection while relegating parties to arbitration.- With above prima facie observations, court are inclined to direct petitioners and NHAI to explore arbitration for final decision on merits of their case.- To secure ends of justice, and for reasons recorded herein ,Court deem it just and expedient to protect petitioners in meanwhile –

Result: Writ petition disposed

JUDGMENT :

Indrajit Mahanty, J.

1. The petitioners have impugned Rule 4(9) of the National Highways Fee (Determination of Rates and Collection) Rules, 2008, issued under Section 9 of the National Highways Act, 1956, in the peculiar facts of the case. The petitioners have also impugned Office Memorandum dated 18.05.2020 issued by the Central Government for implementation inter alia by the Ministry of Road Transport & Highways and NHAI, and the consequent Policy Guidelines/BOT (Toll)/2020 dated 26.05.2020 issued by NHAI. That apart the petitioners have also prayed for directing the NHAI to maintain the same time gap of six months between the Revised Completion Date/ Date of Toll Tariff Revision and date of commencement of payment of premium, under the respective Concession Agreements (with the approved EOT); or in the event this Court comes to a conclusion that aforesaid prayer cannot be granted, to restrict the premium amount till the end of six months from the Revised Completion Date, to such balance amount from the fee collected in each of the previous months, which remains in Escrow Account after payment of monthly operation and maintenance charges and monthly debt servicing etc. as per the waterfall mechanism provided in Article 31 of the Model Concession Agreement, read with Section 8A of the National Highways Act, 1956 and Rule 7(1) of the National Highways Fee (Determination of Rates & Collection) Rules, 2008, and to refrain NHAI from taking any coercive action against the petitioners for the said period.

2. The respondents filed their replies opposing each of the prayers. It is submitted that the writ petition is not maintainable being related to purely contractual obligation and the challenge to the rules etc. is misconceived. Reliance is placed on the following observations in the judgment of the Hon'ble Supreme Court in JWS Infrastructure Vs. Kakinada Seaports Ltd., (2017) 14 SCC 170-

    "thus it is apparent that in contractual matters, the writ courts should not interfere unless the decision taken is totally arbitrary, perverse or mala fide."

It is the contention of the respondents that each of the petitioners is bound by Article 44 of the agreement providing for a Three Tier Dispute Resolution Mechanism. The attempt of the petitioners to link payment of premium to collection of fees is untenable and devoid of merits. Vide Article 25.4 of the agreement the petitioners have acknowledged and agreed to pay each year the premium as per Article 26.2.1 of the agreement. They have agreed to pay premium from 03.09.2020, 04.11.2020 and 21.02.2021 i.e. after 3rd anniversary year of commercial operation dated 03.09.2017, 04.11.2017 and 21.02.2018. Article 12.4 provides for 910th day from the appointed date to be scheduled date for completion of six-laning. It was contended that agreements provide for extension of completion date, but not for date for payment of premium. The payment of premium is wholly independent of toll fee collection. Article 27 and Rules, 2008 have no co-relation with the payment of premium. Challenge to the Rules is liable to the dismissed, as the presumption is always in the favour of validity of a statute. It is further contended that COVID-19 being a pandemic, is a non-political event as per Article 34.2, and not a political event as stated by the petitioners. Therefore, as per Article 34.7.2, the parties have to bear their respective force majeure costs. No grave harm, loss and prejudice is caused towards petitioners by the impugned Office Memorandum and Policy Guidelines. It was also suggested that the petitioners have given up the challenge to the constitutionality of the rule. Writ Petition aims to nullify the contract. Petitioners have waived their past claims by signing agreement for settlement. It is contended that petition should also be dismissed for want of territorial jurisdiction, and for filing one common petition. It was thus contended on behalf of the respondents that the writ petition should be

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