₹22K-crore yet to be recovered from toll on Mumbai-Pune Eway: MSRDC to Bombay HC

In response to a public interest litigation (PIL) challenging extension of toll collection on Mumbai-Pune Expressway till April 2030, the Maharashtra State Road Development Corporation (MSRDC) has disputed calculations by the Comptroller and Auditor General (CAG) that the entire capital outlay of the expressway was recovered by 2019.

In response to a public interest litigation (PIL) challenging extension of toll collection on Mumbai-Pune Expressway till April 2030, the Maharashtra State Road Development Corporation (MSRDC) has disputed calculations by the Comptroller and Auditor General (CAG) that the entire capital outlay of the expressway was recovered by 2019.

Urse toll naka on Mumbai-Pune Expressway. (HT FILE)

MSRDC has, in its affidavit, stated that the CAG audit was faulty as it did not consider various aspects such as traffic flow in initial years, fluctuation in interest and value of money at the time when the first contract was awarded in 2004, and hence the cash flow and revenue collection figures in the CAG audit report till 2019 are not accurate and cannot be relied upon.

It further said that while the cost of the project was in excess of ₹4,000 crore in 2004, the corporation had received an upfront amount of ₹918 crore only. After taking into consideration the internal rate of return at 16%, the total amount recoverable in 2021 was ₹22,370 crore and hence the extension of contract was justified and the PIL should be dismissed.

The PIL has alleged that as the entire capital outlay of the project has been recovered as per the CAG, further extension granted to the contractor to collect toll will not only result in a burden on commuters but also rob the state exchequer of revenue as the contractor will make illegal gains.

The affidavit filed by Kamlakar Phand, chief general manager, MSRDC, stated that the PIL is not bona fide and is motivated and a publicity-seeking proceeding. Phand said as the PIL raises technical and scientific issues which involve experts, the court should not involve itself in it unless there is an allegation of mala fide, which is absent in the case.

Refuting the claims of the petitioner Pravin Wategaonkar, MSRDC said the allegations are based on the CAG report which is erroneous. The affidavit states that the allegation in the PIL that the contract was granted for a mere ₹918 crore while the CAG report held that the cash flow could be up to ₹3,946 crore, thus recovering the entire capital outlay of the project, were misconceived.

It further states that the CAG report estimations were based on revenues apart from toll collection in the form of income from real estate, land leased, etc. However, as the latter did not materialise, the revenue collected by the contractor in the form of toll over a 15-year period sufficed to fulfil his contract agreement only and there was no recovery of capital outlay.

In light of these submissions, the affidavit states that taking into consideration the net present value and cash flow, an amount of ₹22,370 crore was yet to be recovered. In view of this, MSRDC was justified in extending the contract in 2020 for a period of 10.2 years, it said.