The central legal point established in the judgment is that the RBI has the authority to issue directives under the PSS Act and make policy decisions regarding the relaxation of AFA requirements for payment transactions. The court also emphasized that such policy decisions are not subject to interference unless they are arbitrary or violate constitutional or statutory provisions.

ORDER :

Senthilkumar Ramamoorthy, J.

(Prayer: Petition filed under Article 226 of the Constitution of India, praying to issue a writ of certiorari, to call for the records of the first Respondent relating to Section 3(b) of National Highways Fee (Determination of Rates and Collection) Second Amendment Rules, 2014 published in Gazette Notification G.S.R.831(E) published on 21.11.2014 in the Gazette of India (Extraordinary) No.616 – Part -II – Section 3 – Sub Section (i) for inserting the Proviso to Rule 6(3) of National Highways Fee (Determination of Rates and Collection) Rules, 2008 and quash the same.

Petition filed under Article 226 of the Constitution of India, praying to issue a writ of certiorari, to call for the records of the first Respondent relating to the Impugned Notification “DPSS.CO.PD.No.1227/02.31.001/2019-20” issued by the first Respondent on 30.12.2019 under Section 10(2) read with Section 18 of Payment and Settlement Systems Act, 2007 and quash the same.)

1. The constitutional validity of the proviso to Rule 6(3) of the National Highways Fee (Determination of Rates and Collection) Rules 2008 (the NH Fee Rules) is under challenge in W.P. No.35317 of 2019. The Directive dated 30.12.2019, which was issued by the Reserve Bank of India (the RBI) under Section 10(2) read with Section 18 of the Payment and Settlement Systems Act, 2007 (the PSS Act), is challenged in W.P. No.754 of 2020.

2. In view of the fact that common issues arise for consideration in both these writ petitions, they were heard jointly and are disposed of by this common order. Keeping in mind that the subject matter of these petitions is technology and technical terms-intensive, some contextual information and an explanation of the technical terms is provided in the following paragraphs.

3. The National Payments Corporation of India Limited(NPCIL), the third Respondent herein, developed the National Electronic Toll Collection (NETC) programme to meet the electronic tolling requirement of the Indian market. The NETC programme is designed as an inter-operable nation-wide toll payment solution. For this purpose, it was considered necessary to use radio frequency identification (RFID) technology for making toll payments while the vehicle is in motion. FASTag is the brand name of the device that uses RFID technology to enable toll payments while the vehicle is in motion. Towards this end, the FASTag device is affixed on the windscreen of the vehicle and enables a customer to make the toll payments directly from the account which is linked to FASTag. By this method, toll payments can be collected without the necessity for the customer concerned to stop at the toll plaza, as is necessary when toll payments are collected manually at the toll plaza. FASTag is vehiclespecific and once affixed to a vehicle, it cannot be transferred to another vehicle.

4. The RBI has enabled payments, both offline and online, for multiple purposes through various modes other than cash. For example, non-cash payments may be made through bank accounts, credit cards, debit cards or through various types of prepaid payment instruments (PPIs), including digital wallets, such as PayTM, PhonePe and Google Pay. With a view to ensuring customers' safety, the RBI has issued directions from time to time to provide appropriate standards of customer safety depending on the mode of payment and the nature and transaction value or ticket size of the transaction. For this purpose, in respect of certain modes of payment and/or certain ticket-size transactions, the RBI has mandated an additional factor of authentication (AFA). By way of illustration, when online credit card transactions are carried out, a message is sent by SMS with a personal identification number (PIN) to the registered mobile phone number of the customer and unless the said PIN is keyed-in by the customer, the transaction cannot be completed. Likewise, when a chip-based credit or debit card is used on a card reading device, the cus