In the High Court of Judicature at Madras Dated: 9 - 1 - 2008 Coram: The Honourable Mr.Justice S.J.Mukhopadhaya and The Honourable Ms.Justice K.Suguna W.P.Nos.20332 of 1998, 3826, 19802 and 5459 of 1999 and 7366 of 2003 and W.M.P.Nos.30810 of 1998, 5480 and 29066 of 1999, 17367 of 2000 and 9497 and 9498 of 2003 G. Jayakumar ...Petitioner in WP.No.20332/98 Citizens Voice Club rep by its President V. V. Karthikeyan ...Petitioner in WP. Nos.3826 & 19802/99 Coimbatore District Bus Owners Association (South) rep by its Secretary ...Petitioner in WP.No.5459/99 S. Maheswari ...Petitioner in WP.No.7366/03 VS Union of India, rep. by Chief Engineer (Planning and Private Investments), Ministry of Surface Transport, 1, Parliament Street, New Delhi-110 001. ...1st respondent in WP.20332/98 Chief Engineer, National Highways, Department of Highways, Chennai-600 005. ..2nd respondent in WP.20332/98 https://hcservices.ecourts.gov.in/hcservices/ The General Manager (Developmental Project), Larsen & Tubro Ltd., E.C.C. Construction Group, Manapakkam, Chennai-89. .. 3rd Respondents in W.P.No.20332 of 1998 The Government of India, rep by its Secretary, Ministry of Surface Transport (Road wings) Transport Bhavan 1,. Parliament Street, New Delhi 1. 1st respondent in WP. Bos.3826, 19802, 5459/99 & 7366/03 M/s Larsen & Toubro Ltd., L & T House, Ballard Estate Mumbai 1. 2nd respondent in WP.Nos.3826, 19802 & 5459/99 The Secretary Department of Highways, State of Tamil Nadu, Chennai 9. ...3rd respondent in WP.nos.3826 19802, 5459/99 & 2nd respondent in WP.No.7366/03 L & T Transportation Infrastructure Ltd., Mount Poonamallee high Road, Manappakkam, Madras 89 ...4th respondent in WP.5459/99 (R4 impleaded as per oder dated 1.12.99 in WMP.26658/99 The Secretary to Government, Department of Highways, State of Tamil Nadu, Fort St George, Chennai 9. ...2nd respondent in WP.7366/03 The District Collector, Coimbatore District Collectorate, Coimbatore 18. ...3rd respondent in WP.7366/03 https://hcservices.ecourts.gov.in/hcservices/ The Commissioner Corporation of Coimbatore Big Bazaar Street, Coimbatore 641 001. ....4th respondent in WP.No.7366/03 L & T Transportation Infrastructure Ltd., L & T House, Ballard & Estate, Mumbai-1 ....5th respondent in WP.No.7366/03 Writ Petition No.20332 of 1998 (Public Interest Litigation) filed under Article 226 of the Constitution of India, praying for issuance of a Writ of Mandamus, forbearing the third respondent from collecting the toll amount for the vehicles passing through the New and Old Bridges or Aathu Palam at Coimbatore City falling on the National Highways No.47, on the strength of contract entered into between the respondents 1 and 2 and 3 dated 3.10.1997 and subsequently direct the respondents 1 and 2 to take over the maintenance of bridge for themselves. Writ Petition No.3826/98 filed under Article 226 of the Constitution of India praying for issuance of a writ of Declaration declaring section 8(A) of the National Highways Act 1956 read with the notification of the Ist respondent dated 21.8.98 under Section 8 (A) of the Act, authorising the levy of collecting of fees by the 2nd respondent for the use of Athupalam bridge across the river Noyyal in KM 161/2 of NH 47 as illegal unconstitutional and violative of Article 14 of the constitution of India and principle of the Indian contract Act and inconsistent with the statutory requirements of the National Highways Act 1956. Writ Petition No.19802/99 filed under Article 226 of the Constitution of India praying for issuance of a writ of declaration declaring section 8(A) of the national Highways Act 1956 read with the notification of the Ist respondent No.530 New Delhi dated 21.8.98 authorising the levy of collecting of fees by the 2nd respondent for the use of part of National Highways i.e Coimbatore by-pass starting from km.141.0 NH 47 at Salem side rejoining NH 47 at km.171/200 at Palghat side as illegal, unconstitutional and violative of Article 14 of th constitution of India and principle of the Indian contract Act and inconsistent with the statutory requirements of the National Highways Act 1956. Writ of Petition No.5459/99 filed under Article 226 of the Constitution of India praying for the issuance of a writ of certirari calling for the records of the ISt respondent pertaining to the notification published in gazette of India Extraordinary part II Section 3, Sub Section (II) of Government of India dated https://hcservices.ecourts.gov.in/hcservices/ 21.8.1998 authorising the II Respondent to collect the fees for crossing of Athupalam Bridge across Noyyal river at KM 161/2 on NH 47. Writ Petition No.7366 of 2003 filed under Article 226 of the Constitution of India praying for the issuance of a writ of Mandamus forbearing the ISt and 5th respondents from collecting toll fees from the motor vehicle owners who pass through the Athupalam Bridge over Noyyal River on the South of Coimbatore city and refund the amount collected in excess of the cost of construction of the Bridge in the above mentioned Athupalam to the 4th Respondent. For petitioner in W.P.No.20332 of 1998 : Mr.S.Karthikeyan For Petitioner in W.P.No.3826 and 19802/99 : Mr.K.M.Vijayan SC for M/s Law and Law For Petitioner in W.P.No.5459 of 1999 : Mr.M. Palani For Petitioner in W.P.No. 7366 of 2003 : Mr.R.Gandhi SC for Mr.M.Kamalanathan For respondent-1 in all W.Ps.: Mr.V.T.Gopalan, Addl. Solicitor General of India assisted by Mr.P.Wilson, Asst. Solicitor General of India For respondent-2 in W.P.3826/99,19802/99 5459/99 and for 3rdrespondent in W.P.20332/98 & for the 5th respondent in W.P. 7366 of 2003 :Mrs.Nalini Chidambaram, Senior Counsel for M/s.R.Murari For 2nd respondent in WP 20332/98, W.P.7366/2003 and for 3rd respondent in WP 3826/99,19802/99,5459/99 &7366 : Mr.D.Srinivasan, AGP 4th Respondent in W.P.7366/03 Common Order S.J.Mukhopadhaya,J In all these Writ Petitions, almost similar prayer having been made and as common question of law is involved, they were heard together and disposed of by this common order. 2. In two Writ Petitions, namely W.P.Nos.3826 and 19802 of 1999, the petitioner-Citizen Vice Club, represented by its President, has prayed for a declaration that Section 8-A of the National Highways Act, 1956 (hereinafter referred to as 'the N.H. Act') read with Notification No.530, New Delhi, 21.8.1998, issued by the respondent-Union of India, i.e. Ministry of Surface Transport https://hcservices.ecourts.gov.in/hcservices/ (Road Wings), authorising levy of collection of fees by the respondent-M/s.Larsen and Toubro Limited (for short, "L & T")-- (i) for use of "Aathu Paalam" Bridge across the River 'Noyyal' in Km.161/2 of N.H.47 in W.P.No.3826 of 1999 and (ii) for use of part of National Highways i.e. Coimbatore by-pass starting from Km.141.0 of N.H.47 at Salem Bridge and re-joining N.H.47 at Km.171/200 at Palghat side in W.P.No.19802 of 1999, as illegal, unconstitutional and violative of Article 14 of the Constitution of India and the principle of the Indian Contract Act and inconsistent with the statutory requirements of the N.H.Act. The very same Notification No.530, New Delhi, 21.8.1998 is challenged in W.P.No.5459 of 1999. 3. In two other Writ Petitions, namely W.P.Nos.20332 of 1998 and 7366 of 2003, prayer has been made to issue a Writ of Mandamus, (i) in W.P.No.20332 of 1998: forbearing the respondent-L & T from collecting the toll amount from the vehicles passing through the New and Old Bridges of Aathu Paalam at Coimbatore city falling on N.H.47 on the strength of contract entered into between the respondents 1 and 2 and 3, dated 3.10.1997 and subsequently to direct the Union of India, represented by Chief Engineer (Planning and Private Investments), Ministry of Surface Transport and the Chief Engineer of the National Highways of the Department of Highways of the State to take over the maintenance of the Bridge for themselves and (ii) in W.P.No.7366 of 2003: forbearing the respondent-Union of India, Ministry of Surface Transport (Road Wings) and the respondent-L & T from collecting toll fees from the motor vehicle owners who pass through the Aathu Paalam Bridge over Noyyal River on the South of Coimbatore City and refund the amount collected in excess of the cost of construction of the Bridge in the said Aathu Paalam to the respondent-Commissioner of the Corporation of Coimbatore. 4. For determination of the issues, it becomes necessary to set out few essential facts, as it appears from the pleadings and other records and noticed hereunder: (a) Pursuant to Amendment by Act 26 of 1995 with effect from 16.6.1995, the Union of India introduced Section 8-A of the N.H. Act, authorising the Central Government to enter into an agreement with any private person other than the State or Local Body, for the development and maintenance of the whole or any part of a National Highway and to collect and retain fees by the private persons at such rate, for services or benefits rendered by them as the Central Government by the Notification provide. Pursuant to the aforesaid provision, a Scheme called "Build-Operate-Transfer" (for short, "B.O.T") was introduced on 1.9.1995, by the Government of India from its Ministry of Surface Transport, by issuing a Global Tender for National Highway Projects on B.O.T. basis for different parts of different Highways including Coimbatore By-pass, which includes Road-Over-Bridge and Cross Drainage Structures on N.H.47 in the https://hcservices.ecourts.gov.in/hcservices/ State of Tamil Nadu. The interested companies/consortium of companies were asked to purchase the tender documents which were to be submitted on or before 18.12.1995. Under the B.O.T. Scheme, the contractor was required to construct and maintain the facility for the entire construction period out of their own funds and expected to recoup the cost incurred by collection of a fee from the users of the facility. In the global tender notice, as also in the tender documents, it was specifically mentioned that the entrepreneurs will be permitted to recover the investment along with the returns through levy of fees from users of facility for a certain specified period, after which the facility will revert to the Government. (b) The respondent-L & T, along with others, submitted the tender papers. The Union of India has felt that the project should be an integrated project for the construction of by-pass road as well as two additional lane-bridges on K.M.162/2 on N.H.47, apart from strengthening and refurbishing the existing two lane-bridges. The respondent-L & T being the best tenderer, was accepted and awarded the work and a construction agreement was entered into between the respondents on 3.10.1997. According to the construction agreement, it is the obligation of the respondent-entity to construct the by-pass road and bridges and to maintain and operate the same for the respective construction period, and at the end of the construction period, the bridges and the bye-pass road will be transferred to the Union of India by the respondent-L & T Ltd. (c) The respondent-L & T completed the work and the projects were thrown open to public in December 1998 and the bye-pass road had been completed and thrown open for the traffic purpose since 19th January, 2000. (d) Union of India, in exercise of its power conferred by Section 8-A of the N.H. Act, 1956 issued Gazette Notification in Nos.S.O.716(E) and S.O.717(E), both dated 21.8.1998, fixing the toll for both Aathu Paalam Bridge and Coimbatore By-pass road respectively. It was revised from time to time by the subsequent Notifications, including Notification Nos.S.O.383(E) and S.O.384(E), both dated 3.5.2000, Notification Nos.716(E) and 717(E), both dated 19.6.2003, Notification Nos.1087(E) and 1088(E), both dated 1.8.2005, Notification Nos.943(E) and 944(E), both dated 23.6.2006, etc. It is only when the Aathu Paalam Bridge was constructed and the Notifications were issued on 21.8.1998, most of the Writ Petitions were preferred between 1998 and 1999, except the one which was preferred subsequently in 2003. 5. The petitioners, while challenging the vires of Section 8-A of the N.H. Act, 1956 and the Notifications dated 21.8.1998, took the following pleas to assail the Notifications: https://hcservices.ecourts.gov.in/hcservices/ (a) The respondent-Union of India and the respondent-L & T entered into a contract in a secret manner without inviting an open tender to reduce the cost of the public at large. (b) The cost for the said Scheme, i.e. construction of Aathu Paalam Bridge which is within the municipal area of Coimbatore Corporation and the by-pass road to an extent of 26 Kms. were estimated to be constructed at the cost of Rs.6 crores and Rs.95 crores respectively, but the agreement was entered at the rate much higher than the schedule of rates available under the Highway Manual, which is Rs.58 lakhs for the Bridge and around Rs.30 crores for the by-pass road. Further plea was taken that the B.O.T. Scheme was entered into between the respondent-Union of India and the respondent-L & T in a secret manner without being considered by a competent tender issued and while repaying the cost of the Bridge, much advantage was made in favour of the respondent-L & T, which was able to collect a very higher amount than the actual construction cost which they incurred in constructing the Bridges as well as the by-pass road for a period of 21 years and 32 years respectively. (c) Inspite of the fact that Section 8-A of the N.H. Act authorises the "B.O.T " Scheme, as per the guidelines, while the contract was awarded, not even a single guideline had been taken care of. (d) Though it was essential under Section 10 of the N.H. Act to place the Notifications/agreement before the Parliament, the same had not been carried out. (e) There is a clandestine understanding between the respondent-Union of India and the respondent-L & T Ltd. right from the entry into the agreement in fixation of fees. The agreement was originally planned for the by-pass road, but later on it was deliberately coupled with the existing Aathu Paalam Bridge, which costs hardly about Rs.50 lakhs to Rs.60 lakhs as per the Highways estimate. (f) The respondent-L & T Ltd. was authorised to put toll points at two places, one at Aathu Paalam Bridge and another at the by-pass Road. (g) Inspite of Section 2 of the N.H. Act which specifically exclude such operation of the Highways within the Municipal limits from the purview of National Highways, the Government had brought Aathu Paalam Bridge, which falls within the Municipal limits, and the respondent-Union of India has no jurisdiction at all to couple the Aathu Paalam Bridge extension within the purview of the N.H. Act, which is ultra-vires Section 2 of the N.H. Act. https://hcservices.ecourts.gov.in/hcservices/ (h) The power under Section 8-A of the N.H. Act cannot be exercised by the authorities in respect of the portion of the Road or Bridge which had not been declared as 'National Highway'. (i) Section 8-A of the N.H. Act so far as it authorises a private person to collect fees without representation from the persons who pay the fees, would amount to excessive delegation of essential Legislative function between the Executive and the private person. (j) Section 8-A of the N.H. Act insofar it imposes an obligation on a citizen in respect of a contract between the Central Government and the private person without any privity or representation from the citizens, is Constitutionally impermissible, as it violates the principle of enforceability of an agreement under the Indian Contract Act. (k) Section 8-A of the N.H. Act is also a direct infringement between the Panchayat and the local authorities after their acquisition of Constitutional status pursuant to Constitution's 73rd Amendment. (l) The levy of fee under Section 8-A of the N.H. Act in respect of Highways coming within the local limits of the Municipality, is ultra-vires Section 2 of the N.H. Act read with Articles 243-W and Schedule 12 of the Constitution of India, wherein the maintenance etc. of Roads and Bridges are under the exclusive domain of the State Government. (m) Section 8-A of the N.H. Act insofar as it delegates a public duty to a private person for collecting the toll/fee is violative of Article 266 of the Constitution of India. 6. On the other hand, following stand has been taken by the respective counsel for the respondent-Union of India and the respondent-L & T, who prayed to dismiss the Writ Petitions: (i) The agreement reached between the Union of India and the L & T in 1995, having not been challenged by the petitioners and they having not taken part in the bid, the Writ Petitions are not maintainable. (ii) The Vires of any law cannot be challenged in a Public Interest Litigation. (iii) If there is a conflict between the Central Government Legislation and State Legislation relating to Municipality, Central Act will prevail. (iv) Before the issuance of the Notification dated 21.8.1998, Parliamentary approval as required under Section 10 of the N.H. Act was taken. https://hcservices.ecourts.gov.in/hcservices/ (v) Legislative competence having not been challenged, and in the absence of any violation of fundamental right, Section 8-A of the N.H. Act should not be held to be ultra-vires. (vi) L & T, having already spent a sum of Rs.1.5 crores, after completion of work, the challenge to the Notification and the Laws, is uncalled for. (vii) The respondent-Union of India has explained the basis for fixing the rates of toll/fee, and the Central Government in the year 1978, made Rules for the services rendered relating to use of permanent Bridges costing more than Rs.25 lakhs completed and opened to traffic on or after 1st April, 1976. When the Notification of the above said Rules, 1978 was issued, the rates of fee chargeable is given under the Schedule to the said Notification and the levy of toll/fee shall be for a period of considered adequate to recover the cost of the Project and the said Rules were further modified by the Ministry's Notification, dated 19.2.1992, by which cost of the Project which qualify for levy of toll/fee, was raised to Rs.1 crore, but toll/fee rates remained unchanged. The rates of fees to be levied for Bridges costing more than Rs.1 crore, as laid down by the Notification dated 19.2.1992, is as follows: Sl.No Name of the Vehicle Amount in Rs. 1 Car/Jeep Rs.5/- 2 Bus/Truck Rs.15/- 3 Other Mechanically propelled vehicles like Mobile Crane, Earth Movers, Road Roller and Dozers. Rs.20/- (viii) In the year 1997, the Rule was further modified to the extent that the levy of toll was made applicable to permanent Bridges, as also the upgraded Sections of National Highway. No time limit for collection of those toll was prescribed, which is to be charged in perpetuity by the Executive Agency. As per the 1997 Notification, the Rules, called as "National Highways (Fees for use of National Highway Section and Permanent Bridges-Public Funded Projects) Rules, 1997, was framed. Rule 10 of the above said Rules deals with special condition when Section or Project built by the Government are used for developing adjacent "B.O.T" Projects of private parties. The above Rule provides to improve the financial viability of the B.O.T. Project as decided by the competent authority, and the Concessionaire may be allowed to collect and retain the fees to collect it for the full concession period as agreed to in specific agreement in respect of the facility offered to him. Under Rule 10 of the above said 1997 Rules, the Central Government can allow the Concessionaire to collect and retain the https://hcservices.ecourts.gov.in/hcservices/ fee, which is being followed in the B.O.T. Cases for the work allotted under Section 8-A of the N.H. Act. 7. We have heard the learned counsel for the respective parties and noticed their contentions, as also the Laws, as referred to, and the Notifications. We have also noticed the judgments referred to by one or other parties. 8. One of the questions raised is that Section 8-A of the N.H. Act in respect of the Highways which is coming within the local limits of the Municipality, is ultra-vires Section 2 of the N.H. Act read with Article 243-W and 12th Schedule of the Constitution, as the maintenance etc. of Roads and Bridges are within the exclusive domain of the State. 9. Section 8-A of the N.H. Act empowering the Central Government to enter into an agreement with private persons for development and maintenance of National Highways, was inserted by National Highway (Amendment) Act, 1995 with effect from 16.6.1995. Subsequently, Section 2 of the N.H. Act which relates to declaration of certain Highways to be National Highways, was amended by the National Highway Laws (Amendment) Act, 1997 with effect from 24.1.1997 and the words "except such part thereof as are situated within any Municipal area" were omitted, thereby, apart from each of the Highways specified in Schedule to the N.H. Act, 1956, the Central Government was empowered to include any other Highway to be National Highway including parts which are situated within any Municipal area. As such, after the amendment of Section 2 of the N.H. Act, no Legislation is necessary to add or delete the Highways from the Schedule to the Act, as evident from the amended Section 2 of the N.H. Act and quoted hereunder: "Section 2: Declaration of certain highways to be national highways-- (1) Each of the highways specified in the Schedule is hereby declared to be a national highway. (2) The Central Government may, by notification in the Official Gazette, declare any other highway to be a national highway and on the publication of such notification, such highway shall be deemed to be specified in the Schedule. (3) The Central Government may, by like notification, omit any highway from the Schedule and on the publication of such notification, the highway so omitted shall cease to be a national highway." https://hcservices.ecourts.gov.in/hcservices/ In view of the amendment to Section 2 of the N.H. Act, it cannot be alleged that Section 8-A of the N.H. Act is in conflict with Section 2 of the N.H. Act. 10. In the present case, the petitioners have questioned the Legislative competence of Central Government to enact Section 8-A of the N.H. Act, alleged to be "ultra-vires" Section 243-W of the Constitution of India. While dealing with the Legislative competence of the Parliament to enact a Law, the Supreme Court in the decision reported in 1994 (5) SCC 54 (Attorney General for India vs. Amratlal Prajivandas), noticed its earlier decision of the Constitution Bench of seven Judges, reported in 1971 (2) SCC 779 (Union of India vs. H.S.Dhillon) and observed as follows: "23. ...... The test evolved in the said decision is this in short: Where the legislative competence of Parliament to enact a particular statute is questioned, one must look at the several entries in List II to find out (applying the well-known principles in this behalf) whether the said statute is relatable to any of those entries. If the statute does not relate to any of the entries in List II, no further inquiry is necessary. It must be held that Parliament is competent to enact that statute whether by virtue of the entries in List I and List III or by virtue of Article 248 read with Entry 97 of List I. .... " 11. To find out the Legislative competence so far as National Highways and other Roads/Bridges are concerned, one may refer to List-I-Union List and List-II-State List, of Schedule 7 and Schedules 11 & 12 of the Constitution of India and the following facts emerge from those Schedules: Nature of Road/Highway List Schedul e Entry Legislative competence / Competent body 1. Highway declared by or under law made by Parliament to be national highways I 7 23 Union List/ Central Government https://hcservices.ecourts.gov.in/hcservices/ Nature of Road/Highway List Schedul e Entry Legislative competence / Competent body 2. Communications, that is to say, roads, bridges, ferries, and other means of communication not specified in List-I (i.e. State Roads and Bridges) II 7 13 State List / State Government 3. Roads, culverts, bridges, ferries, waterways and other means of communication (Article 243-G of the Constitution of India – Powers, authority and the responsibilities of Panchayat). It relates to Panchayat Roads and Bridges. - 11 13 Panchayats 4. Roads and Bridges (Article 243-W of the Constitution of India-Powers, authority and responsibilities of Municipalities, etc.). It relates to Municipal Roads and Bridges. - 12 4 Municipalities 12. The Legislative powers of the Parliament and the State Legislatures, is governed by Articles 246 and 258 of Part-XI of the Constitution of India and the Parliament has exclusive power to Legislate with respect to any of the matters enumerated in List-I (Union List)