2000 (2) TMI 858 - SC - Indian Laws

Summary

Issues Involved:
1. Extent of the State Government's power to levy toll u/s 2 of the Indian Tolls Act, 1851.
2. Validity of the State Government's inclusion of various costs in the toll levy.
3. Interpretation of the 1976 notification regarding toll collection.

Summary:

1. Extent of the State Government's Power to Levy Toll u/s 2 of the Indian Tolls Act, 1851:
The appeals concern the State Government's authority to levy tolls on roads and bridges u/s 2 of the Indian Tolls Act, 1851. Section 2 allows the State Government to levy tolls at rates it deems fit for roads or bridges constructed or repaired at the expense of the Central or State Government.

2. Validity of the State Government's Inclusion of Various Costs in the Toll Levy:
The Gai Ghat bridge, constructed by the State Government, became the subject of a writ application challenging the State's right to recover tolls beyond the actual construction cost. The High Court ruled that the State could not include interest or maintenance charges in the toll levy unless the construction funds were borrowed. The Supreme Court found that the State Government had recovered more than four times the initial construction cost by way of tolls.

3. Interpretation of the 1976 Notification Regarding Toll Collection:
The 1976 notification issued by the State Government allowed toll collection until the total construction cost, including interest and maintenance, was recovered or for 50 years, whichever was earlier. The Supreme Court noted that the State Government had improperly included costs such as stationery and interest on maintenance in the toll levy, which was not permissible under the notification. The Court clarified that the State could recover the actual construction cost, interest on that cost, and maintenance expenses but not interest on interest or stationery costs.

Conclusion:
The Supreme Court set aside the High Court's orders but declared that the State Government could not include stationery costs, interest on stationery and maintenance, or interest on interest in future toll levies. The appeals were disposed of with no order as to costs.