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HC orders collectors to recover ₹4,000 cr toll tax arrears for Delhi Municipal Corporation
The Bombay High Court has ordered district collectors to recover over ₹4,900 crore in toll tax arrears from MEP Infrastructure Developers Ltd on behalf of the Delhi Municipal Corporation. The Mumbai-based firm had consistently delayed payments, accumulating dues of ₹4,970.81 crore by April 2022.
Mumbai: The Bombay high court on Friday ordered the district collectors of Greater Mumbai, Mumbai Suburban, Thane, Pune, and Aurangabad districts to recover over ₹4,900 crore towards toll tax arrears for the Delhi Municipal Corporation (DMC) from MEP Infrastructure Developers Ltd. The Mumbai-based firm was engaged by the DMC to collect toll tax from commercial vehicles entering Delhi, but it had consistently delayed payments, accumulating dues of ₹4,970.81 crore by April 2022.
The district collectors had initially refused to collect the arrears on behalf of the DMC, contending that the requisition was not made by the district collector – the appropriate authority under the Land Revenue Act, but by the assistant deputy municipal commissioner. But the bench comprising justices AS Chandurkar and Firdosh P Pooniwalla ruled that since the municipal areas in Delhi did not fall under the purview of the Land Revenue Act, the requisition was appropriate.
The order was passed in connection with a writ petition filed by the DMC, which sought the court’s assistance in executing recovery certificates against the Mumbai-based contractor. As a statutory entity, one of DMC’s functions is to collect toll tax from commercial vehicles entering Delhi through 124 toll points. The corporation had engaged third parties including MEP Infrastructure to collect toll on a contractual basis due to lack of manpower, but the firm had defaulted on payments.
Unable to recover the dues, the DMC had sought the help of district collectors in Maharashtra to attach the firm’s properties, which was turned down citing procedural reasons. Aggrieved by this, the corporation then approached the high court.
According to the DMC’s counsel, since the corporation was vested with all powers under the Land Revenue Act for areas within its territory, and the municipal commissioner was the chief officer in charge of revenue administration for such areas, the commissioner was the appropriate authority for raising such a request. The collectors, however, argued that the municipal commissioner was the highest authority for a municipal area, but they could not be equated with the collector, and such request need not be honoured.
After hearing both sides, the court concluded that the municipal commissioner of Delhi was indeed in charge of land revenue administration of the area. Therefore, for the purposes of the Land Revenue Act, the commissioner was indeed the collector for municipal areas in Delhi. The court emphasised that interpreting ‘collector’ strictly under the Land Revenue Act would lead to absurdity, as there would be no collector empowered to make such requests for municipal areas.
In light of these findings, the court directed the district collectors to “take steps as per the law and discharge their statutory duty by executing warrants of distress/recovery certificates issued by the petitioner.” The judgement will be operational after a period of four weeks from the date of the order.
