The Supreme Court on December 20 upheld the decision of the Allahabad High Court, which had revoked the Noida Toll Bridge Company’s right to collect tolls on the DND Flyway that connects Noida and Delhi. The apex court ruled that the company had already recovered the project costs, maintenance expenses, and substantial profits, leaving no justification for further toll charges.
The court also criticized the formula used to calculate the project cost, stating that it was structured in a way that would allow for perpetual recovery, which was deemed inconsistent with the Constitution. The Noida Authority was reprimanded for failing to invite competitive bids before selecting the Noida Toll Bridge Company.
IL&FS, which holds a 26.37% stake in the Noida Toll Bridge Company, is the promoter behind the firm. In 2016, the Allahabad High Court ruled that the company could no longer charge toll fees or user fees, as the firm had already recouped its investment, interest, and returns. The High Court had previously highlighted the flaws in the formula, claiming that even a 100-year time span would not be sufficient to recover the costs under the current system.
Despite this, Noida Toll Bridge Co appealed the ruling in the Supreme Court, which declined to stay the order in 2017, resulting in the DND Flyway remaining toll-free to this day.
Following the Supreme Court’s latest ruling, Noida Toll Bridge Company’s shares dropped by over 5%, trading at ₹18.52 on the NSE at 11:15 am.
