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Madras HC issues notice to govt over discounts to FASTag users

Credit: Soumyarendra Barik

The Madras High Court, on March 6, directed the Centre and the National Highways Authority of India (NHAI) to respond to a January circular that gave discounts on return journeys only to FASTag-equipped vehicles. On January 15, 2020, NHAI had issued a policy circular restricting discounts on return journeys (made within 24 hours) only to vehicles having FASTags. The local area exemption was also only made available to such vehicles. The court’s direction came after a petitioner challenged the notification claiming that it was discriminatory and had no statutory backing. This was first reported by Live Law.

The January 2020 circular had come four years after the the Ministry of Road Transport and Highways first came out with the National Highways Fee (Determination of Rates and Collection) Rules, 2008, which allowed for discounts on multiple journeys, irrespective of the payment mode. Subsequently, the 2008 Rules were amended in 2016 to include an “exclusive lane” for the movement of vehicles equipped with FASTags.

The petitioner argued that the government can not amend the 2016 rules by means of a notification, and it has to be “necessarily backed by a legislation”. The petition had also said that the January 2020 circular was discriminating between the vehicles that don’t have a FASTag and the ones that do. Also, the mode of payment (cash vs FASTag) can not be a basis for availing discounts, the petitioner argued.

A division bench of Chief Justice AP Shah and Justice Subramonium Prasad agreed with the petitioner, stating that circulars, like the one issued in January 2020, cannot amend Rules that have statutory backing. It said:

“…circulars cannot amend rules having statutory force. Similarly, the power to give discount or withdraw them is ordinarily in the domain of the State. Similarly, if executive instructions are contrary to the rules, then the rules and not the executive instructions would prevail. We have therefore now to examine as to whether the impugned circular issued by the Government can limit the discount which was available to users of fee plaza by paying cash can be withdrawn to their disadvantage.”

“Rule 9 of the 2008 Rules as well as 2016 Rules provides for discounts where multiple journeys were undertaken to cross the toll plaza without making any difference as to the mode of payment,” the bench held, and added that even after the introduction of FASTags in the 2016 Rules, payment modes did not dictate the terms of discounts.

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In the affidavit, which are to be filed by March 13, the division bench has directed the Union of India and NHAI to explain:

  1. whether the January 15, 2020 circular has effect of amending the Rule 9 of 2016 Rules.
  2. If the answer is yes, then is not the circular ultra vires (beyond the legal authority) the rule.
  3. If the circular in the nature of a direction which can be issued under Section 6, then can such direction be issued which will have an effect of amending the rule itself.

A copy of the Madras High Court’s order is here.

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