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DGSCL files contempt petition against NHAI

Delhi,Business/Economy,Immigration/Law/Rights, Tue, 27 Mar 2012 IANS

New Delhi, March 27 (IANS) The Delhi-Gurgaon Super Connectivity Ltd (DGSCL) Tuesday filed a contempt petition in the Delhi High Court, saying that the National Highways Authority of India (NHAI) has refused to revise toll charges on the expressway on the ground that the contract had been terminated despite the court's stay.


The court had earlier granted a stay on NHAI's decision to terminate DGSCL's contract to operate the expressway between the capital and the Haryana city.


Senior advocate Neeraj Kishan Kaul, appearing for DGSCL, argued that the authority has not yet decided to hike the toll charges on the expressway, which has to be revised annually.


"Despite the stay order on NHAI decision to terminate contract with DGSCL, the highway authority has not taken a decision to revise the toll charges," he said


Kaul said the DGSCL has sent the proposal to revise the user fee for each category of vehicle for the next financial year but NHAI said it would not take any decision as the contract has been terminated with the private developer.


"The NHAI's termination order has been stayed by the court, it is their contractual obligation to revise the charges periodically and every year it comes in effect from April 1," he argued.


Justice S. Muralidhar posted the matter for April 12 for further hearing.


On the court's earlier direction asking NHAI to file its reply on the issue, the highway authority in its reply alleged that the Infrastructure Development Finance Company (IDFC) loaned public funds for private purpose in the garb of re-financing.


In its reply, the NHAI also said that the bank has no locus in opposing NHAI's decision to scrap the expressway deal with the private concessionaire.


"Both the bank and DGSCL have indulged in fraud of the concession agreement", said NHAI in the reply.


It claimed that the suit filed by IDFC, seeking to be heard as a party in the dispute between NHAI and the developer, is a collusive suit as the loan was approved behind the back of NHAI.


The IDBI bank had moved the court, stating that the termination of the contract to operate the toll plaza with DGSCL will cause a huge financial loss to it. The bank had provided credit facility to the tune of Rs.1,597 crore to DGSCL for its 28-km road project.


IDFC has contended that NHAI violated the tripartite agreement it had signed with the DGSCL and the government.


The court was hearing the plea filed by the DGSCL seeking direction to restrain the NHAI from taking any coercive action against it.


Relations between the two parties turned sour after the NHAI accused DGSCL of fraud in the form of re-financing the project without getting its approval.


The highways authority, while ordering termination of its deal with the private firm, had accused it of failure to improve services at the 32-lane toll plaza.


The DGSCL had approached the court after the NHAI had issued a preliminary termination notice to it on Dec 7 last year.


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