National Highways Authority Of India vs Madhukar Kumar

NATIONAL HIGHWAYS AUTHORITY OF INDIA & OTHERS ... APPELLANT(S)

VERSUS

MADHUKAR KUMAR & OTHERS ... RESPONDENT(S)

J U D G M E N T

K.M. JOSEPH, J.

1. Respondent Nos. 1 to 17 in this appeal (hereinafter

referred to as, ‘the writ petitioners’), filed Writ

Petition No. 5643 of 2012. The relief sought in this

Writ Petition was to restrain the construction of a

toll plaza at 194 km of NH30 in the four-laning of

Patna-Bakhtiyarpur section of NH30, in violation of

Rule 8 of the National Highways Fee (Determination of

Rates and Collection) Rules, 2008 (hereinafter referred Signature Not Verified Digitally signed by Nidhi Ahuja Date: 2021.09.23 15:50:10 IST Reason: to as, ‘the Rules’, for short). The said Writ Petition

1 was heard along with Writ Petition No. 4526 of 2013,

filed by one Shri Ritesh Ranjan Singh @ Bittu Singh.

By Judgment dated 22.07.2014, the Writ Petitions were

allowed in the following manner by the learned Single

Judge:

“32. Thus, on the basis of aforesaid discussions, these writ petitions are allowed and respondents no. 6 and 11 are directed to shift the proposed construction of Toll Plaza at 194 km milestone of Patna-Bakhtiyarpur Section of N.H. 30 from its present location to any other place on new alignment which separates from old N.H. 30 so that the violation of Rule 8 of Rules 2008 could be avoided and the persons who do not have intend to use toll road could be exempted from paying toll tax. The respondent no. 6 should take the decision of shifting the above stated Toll Plaza to any other place as discussed above within six weeks from today and till then respondents shall not collect the toll tax from those persons who do have intend to go through the old N.H. 30 without using the new alignment of toll road. The parties shall bear their own cost.”

2

2. The appellants before us, who are NHAI, its

Chairman and the General Manager, filed LPA No. 388 of

2015 against Writ Petition No. 5643 of 2012. The said

Appeal came to be heard along with LPA No. 236 of 2015,

filed by the concessionaire, arising from Judgment in

Writ Petition No. 5643 of 2012 and LPA No. 332 of 2015

filed again by the concessionaire against Writ Petition

No. 4526 of 2013, and by the impugned Judgment, the

Division Bench confirmed the Judgment of the learned

Single Judge.

3. Before we go to set down the contentions of the

parties, it is necessary to have a look at the Writ

Petition which generated the present Appeal, viz., Writ

Petition No. 5643 of 2012. As noticed, it was filed

by Respondent Nos. 1 to 17 in the present Appeal.

THE CASE SET UP BY THE WRIT PETITIONERS

4. It was stated in the Writ Petition, inter alia, as

follows:

“4. That it is stated that there is proposal for the construction of the toll plaza at

3 194 km of NH-30 I in the four laning of Patna-Bakhityarpur section of NH-30 from 181.300 km to 231.950 Km in the state of state of Bihar on BOT (toll) basis under NHDP III. The DPR for four laning was prepared a few years back in which the toll plaza was proposed at 194 Km of NH-30.”

5. Thereafter, it is stated that, during the

preparation of the Detailed Project Report (DPR) and

its final approval, there was a sea change in the actual

ground condition in the area. A number of important

commercial institutions came up in the area.

Thereafter, the principal bone of contention, however,

was the transgression of Rule 8 of the Rules. It is

necessary, in this context, to notice:

“17. That the respondent authority has not assigned any reason for establishing the toll plaza within municipal area. It is further stated that the road in question is a national highway and it has been constructed merely for the use of the residents of Patna Municipality area.

4 18. That it is further stated that establishment of this toll plaza at its present location will cause great difficulties to the residents of the locality because they will have to cross the toll plaza on many occasions in a day and on all the occasions, they will be liable to pay toll.” (Emphasis supplied)

6. It was alleged in the Writ Petition that the Writ

Petitioners moved representation and, thereafter, the

Writ Petition is filed.

THE CASE OF THE APPELLANTS

7. In the counter affidavit on behalf of the NHAI,

the First Appellant, inter alia, stated as follows:

“7. That with regard to the statement made in paragraph no.1 of the writ petition it is humbly submitted that the said paragraph is by way of relief sought for hence reply is not needed but to give scrupulous assistance to the Hon'ble court it is humbly submitted that NHAI has made an concession agreement with M/s PBTL to construct the 4-lane project on BOT (Toll Basis) for the public

5 interest, whose contractor M/s BSC-C&(JV) respondent no.10 is constructing the Toll Plaza at km. 194 of NH-30 as per Ideation fixed in concession agreement and more than 60°/o work has been completed.

8. That the deponent further submits that the installation of Toll Plaza is not in violation of rule 8 of National Highways Fee (Determination of rates and collection) rules 2008 published in extra ordinary Gazette on 05.12.2008 even if the Toll Plaza location comes under municipal limit. It is already mentioned in rule 8 that "Provided further that here a section of the under municipal or town area limits or within five kilometres from such limits. Primarily for use of the residents of such municipal or town area, the Toll Plaza may be established within the municipal or town area limits or within a distance of five kilometres from such limits". So, the pray of relief/reliefs of petitioners are unjustified and unlawful.

9. That with regard to the statement made in paragraph no.2(i) of the writ petition it is humbly submitted that the location of Toll Plaza has been fixed at km. 194 as per the detailed survey by DPR consultant M/s

6 Meinhardt Consultant Pvt. Ltd. considering the ground condition, future development of the surrounding and viability of the project w.r.t. traffic density and its leakage as per the guidelines. If this Toll Plaza is being shifted to other location in bypass (in between km 194.7 to 231) there will huge traffic leakage from the old read and which will badly effect the viability of the project and is will be also violation of the agreement between NHAI and the concessionaire hence the project may be stopped by the concessionaire because this project is viable due to traffic count particularly at this Toll Plaza location.”

8. There are other averments, which have paled into

insignificance, as they are not canvassed by the

parties before us. We may only notice paragraph-19, as

related to concessions available to local residents.

There was a second counter affidavit. Therein it is,

inter alia, stated that the installation of the toll

plaza did not violate Rule 8, even if the toll plaza

location came within municipal limits. We may only

notice paragraph-13 in the second Counter Affidavit:

7

“13. That if this Toll Plaza is being shifted to other location in bypass (in between km. 194.7 to 231) there will huge traffic leakage from the old road and which will badly effect the viability of the project and is will be also violation of the agreement between NHAI and the concessionaire hence the project may be stopped by the concessionaire because this project is viable due to traffic count particularly at this Toll Plaza location which is obvious from the Map and strip plan of NH-30 BOT Project from Patna to Bakhtiyarpur.”

THE CASE OF THE CONCESSIONAIRE

9. In the first counter affidavit filed by

Concessionaire, the Concessionaire, no doubt, took the

contention that the proposed toll plaza at 194

kilometres, was going to be at least 13.1 kilometres

approximately from Anisabad roundabout on the new

bypass. It is thereafter stated that, thus, on the face

of it, the proposed toll plaza at 194 kms is much beyond

5 kilometres stipulated in the first proviso. It is

8 further contended that Noida toll plaza is not even one

kilometre in distance from Sector 15A Noida (U.P.),

which is purely a residential colony and within

municipal limit of Noida. It was also contended that

Gurgaon toll plaza, constructed on NH8, was well within

the municipal limit of Gurugram. Also, the Mumbai-Pune

Expressway toll Plaza is within the municipal limits

of Greater Mumbai and Pune. The Concessionaire, no

doubt, goes on to state that the idea behind the

construction of national highway or their upgradation

and construction, was for the overall population of the

said area. Such construction is a harbinger of

development. It is also stated that such upgradation

is also aimed at benefitting the local population for

the speedy movement from Patna to Bakhtiyarpur and vice

versa. The NHAI (first appellant) has invited for

proposals for request for qualification on 08.09.2009.

The Concessionaire agreement, dated 31.03.2011,

specifically contemplated construction of a toll plaza

at 194 kilometres.

9

10. Thereafter, a supplementary counter affidavit was

filed by the Concessionaire. Therein, it is, inter

alia, stated that the Bihar Government has taken up the

work of four-laning of NH30 from kilometre 181.300 to

189.500, only to reduce the excessive pressure of

traffic. Reference is made to the second proviso to

Rule 8 of the 2008 Rules. The executive summary of the

DPR Delhi-Pune Railway is relied upon to point out that

it clearly mentions that the stretch from Didarganj

ROB, from Kilometre 196 to Fatuha Kilometre 208, was

very congestive. Reference is made to other parts of

the DPR. It is, in short, the case of the Concessionaire

that it is evident that initiation of widening of

National Highway 181.30 was to ease the pressure of

local and thorough traffic. It is pointed out also that

access road is being provided from 181.3 kilometre to

194 kilometre. It is contended that writ petitioners

were required to leave 3 to 6 meters front set back,

which they have not left. It is stated that there is

compliance of second proviso to Rule 8 of the 2008

Rules, as four-Laning has been initiated to reduce the

10 pressure of local traffic as well. It is also averred

that, as such, it is primarily for the benefit of local

resident, as per the feasibility report.

THE FINDINGS OF THE LEARNED SINGLE JUDGE

11. The learned Single Judge finds that, before taking

a decision to construct a toll plaza within 10 km of

the municipal limits, the Executing Authority must

assign reasons in writing. The second proviso, being

in continuation of the first proviso, if the toll plaza

is constructed under the second proviso, the concerned

Authority, it was found, is not only duty-bound to give

reasons in writing but also adhere to the conditions

mentioned in the second proviso to Rule 8. The

appellants, it was pointed out, were found to have not

stated that the new alignment is intended primarily for

the use of the local residents of the Patna Municipal

Corporation. It was further found that the local

residents are being restrained to use even the old

NH30, and furthermore, due to construction of the toll

plaza at the point, the persons, who do not intend to

use the new alignment, would have to pay toll tax, even

11 for use of the old NH30. Therefore, it was found that

there is violation of Rule 8. Dealing with the argument

that no Fundamental Rights were violated, the learned

Single Judge finds that Rule 8 was violated and,

therefore, the court had jurisdiction under Article

226. Repelling the contention that the Writ Petitioners

had not challenged the DPR, it was found that the DPR

was only a proposal prepared by the private Consultant

Agency and it was the duty of the NHAI (appellant) to

look into the detailed Report and ascertain whether it

was prepared in accordance with the Rules. It was

further found that the proposal for construction of

toll plaza at 194 km, was apparently against Rule 8.

Nothing was brought before the court, it was found to

show that before giving approval to the DPR, the matter

was discussed. Regarding the DPR being in consonance

with the second proviso to Rule 8, it was found that

there was nothing in the DPR, which would show that the

construction of the new alignment was primarily for the

use of the local residents. Therefore, even if, there

is approval of the DPR, the said approval was not in

accordance with Rule, as there was nothing before the

12 officials of the NHAI, to conclude that the second

proviso to Rule 8, was complied with. We may further

notice:

“28. Annexure-I to the 3rd counter affidavit filed on behalf of NHAI reveals that four lane construction of N.H. 30 starts from 181 km. milestone and ends to 230 km. milestone where it touches N.H. 31. Furthermore, above stated Annexure-I reveals that between 194 km. milestone and 197 km milestone the proposed new alignment separates from old N.H. 30. It is also apparent from the above stated Annexure-1 that a person who comes from Fatuha and goes to Patna, has to pay toll tax and, similarly, a person comes from Patna and goes to Fatuha through old N.H. 30 without using proposed new alignment which turns towards N.H. 31 will also have to pay toll tax because the proposed toll plaza is being constructed much prior to the place from where the new alignment separates from old N.H. 30. As I have already stated that the site of proposed Toll Plaza at 194 km. milestone was chosen in violation of Rule 8 of Rules 2008 and it is apparent that the proposed location for establishment of Toll Plaza is not only violation of Rule 8 of Rules 2008 but also charges tax from the

13 persons who do not intend to use the toll road rather prefer to use old N.H. 30. No doubt, the expert agency proposed for location of toll plaza after taking into consideration all pros and cons particularly, keeping in mind leakage of vehicle and density and ordinarily, the court does not interfere into the decision of an expert body but in the instant case, it is obvious that the aforesaid decision of expert body is riot only the violation of rule but also the violation of fundamental rights of the petitioners. Therefore, in my view, the decision of expert body for construction of toll plaza at 194 km. milestone does not stand in the eye of law and liable to be set aside.”

12. It was further found that the alternate road

projected by the appellants, traveling through which,

the payment of toll could be avoided, would entail the

distance of more than 35 kilometres. It is on this

basis, the direction, as already noticed, was given by

the learned Single Judge.

14 THE IMPUGNED JUDGMENT

13. The Division Bench, while dealing with the question

about no Fundamental Rights being involved, and the

Writ Petitioners approaching the court with unclean

hands, opined that what is relevant, when a statutory

violation is projected, and which concerns the public

at large, was the source of power. It was further found

that it was not for the Writ Petitioners to establish

any cause of action for maintaining the Writ Petition.

Rather, it is for the NHAI to explain as to why

preference was given to commercial viability of the

project over the statutory requirement. It was further

found that from the Affidavits of the NHAI or the

Concessionaire, they have not been able to establish

that the section in the NH30 was constructed primarily

for the use of residents of the municipal area.

14. While dealing with the scope of second proviso,

the court went on to discuss the case law. Apart from

Rule 8, it was found, inter alia, that the larger the

distance of the location of the toll plaza, the lesser

was the responsibility of the Executing

15 Authority/Concessionaire. Recording of reasons, which

was found necessary by the learned Single Judge, was

found to conform to the principles of ‘substantial

justice’ and ‘in furtherance of legislative

intendment’. It was further found that until the

matters reached the court, the Appellants were not even

aware as to whether the location of toll plaza was

covered by the first proviso or second proviso. The

Appellants were found to be more concerned about the

commercial viability. Reference is made to the

Affidavits of the Appellant and the Concessionaire, to

essentially find that the case of non-application of

mind, was made out. The specific stand of the

appellants was found to be that the section was

constructed to remove traffic congestion but it was

also found that there was no conclusion that the

section was meant primarily for the use of the local

residents. A project, executed for the removal of

traffic congestion on the national highway, may be

backed with sound reasoning, as it would help long

distance travellers from not getting stuck in a long-

drawn traffic jam. The learned Judge goes on to find

16 that the requirement that, it would be primarily for

the use of residents, was satisfied. Primacy was given

to by the Legislature to the facilitation of the local

residents. What prevailed, however, was found to be

commercial viability. Equally, the contentions that

there is no challenge to the DPR, and there was an

alternate Rule, were rejected. The other learned Single

Judge, who constituted the Bench, agreed with the

aforesaid views.

CONTENTIONS OF THE PARTIES

15. We heard Shri Neeraj Kishan Kaul, learned Senior

Counsel on behalf of the appellants. We also heard Shri

Shyam Divan, learned Senior Counsel and Shri Ravi

Bharuka, learned Counsel also on behalf of the

Respondents Nos. 1 to 17.

16. The learned Senior Counsel for the appellants would

point out that the view taken that, there must be

specific reasons given within the meaning of the first

proviso to Rule 8, is erroneous. The requirements in

the second proviso, having been fulfilled, there was

no justification for the Writ Court to interfere as to

17 where a toll plaza is to be located, as long as the

decision did not fall foul of the statutory

requirement. It is not for courts to substitute its

views. Our attention was drawn to the DPR. It is

contended that the Expert Body had conducted detailed

investigation into the matter. The project road was a

little over 50 kilometres. Not only the point at

km 194, was within the municipal area, but the decision

is fully sheltered by the provisions of the second

proviso to Rule 8. Various developmental works were

carried out on a stretch beginning at 181 km. There

were, in fact, nine ‘U’ turns provided. It conduced to

the benefit of the local residents. Reliance was placed

on the Judgment of this Court in Chairman, National

Highways Authority of India & others v. R. Murali &

others1. It is also contended that this Court has taken

the view that there is only limited judicial review in

such matters.

17. Per contra, Shri Shyam Divan, learned Senior

Counsel, would point out that a holistic view of

1 (2015) 15 SCC 647

18 Rule 8 would result in the following inevitable

conclusions. It is pointed out that, in words, which

are couched in unambiguously mandatory terms, the toll

plaza shall not be located within 10 km from a municipal

or town area limits. This is the Rule. The first proviso

carves out an exception. It permits the construction

of toll plaza within a distance of 10 km but subject

to it being five or more kilometres away. Conscious of

the hazards of diluting the mandatory requirements

contained in Rule 8(1), the Rule-maker has imposed the

limitation that such dilution shall be accompanied by

reasons. It is obvious that the reasons must be

rational and bear a nexus between the decision and the

object. The second proviso, sought to be invoked by the

appellant, makes a drastic inroad into the 10 kilometre

plus distance, proclaimed in Rule 1. It enables the

Authority to put up the toll plaza even within the

municipal or town area limits. Therefore, having regard

to the consequences that would ensue of departing from

the Rule, not only, should the requirements in the

second proviso, be clearly established, but also,

reasons, within the meaning of the first proviso, must

19 be provided. The view of High Court represents the

correct position in law. It is further contended that

the residents in the area are compelled to pay toll

even for using the old national highway, which branches

of just a little distance being travelled after

crossing the toll. Ideally and legally, the plaza ought

to have been located on the construction, which is made

after the road branches of as a bypass. The location

of toll plaza at km 194, results in persons, who do not

use the new bypass, also being called upon to pay the

toll. This is impermissible, besides being unfair.

18. He drew out attention to the definition of the

words “Executing Authority” in Rule 2(f), wherein it

is defined to mean an Officer or Authority notified by

the Central Government under Section 5 of the Act

(National Highways Act, 1956).

19. The National Highways Authority of India Act, 1988,

defines “Authority” as meaning the National Highways

Authority of India, constituted under Section 3.

20. Shri Shyam Divan, learned Senior Counsel, would,

therefore, contend that the decision to be supportable,

20 with reference to the second proviso to Rule 8 in the

first place, must be taken by the Executing Authority.

He would further point out that the second proviso to

Rule 8 must be construed, by subordinating it to the

Rule, in keeping with the true province of a proviso.

He drew our attention, also in this regard, to a similar

proviso contained in Rule 8(2), which also has a

proviso followed by a second proviso. Shri Ravi

Bharuka, learned Counsel, also ably supplemented the

submissions by seeking to persuade us to take a view,

which would preserve the sacrosanctity of Rule 8(1) and

stress the absence of circumstances in this case, to

hold otherwise. It is also contended that two Writ

Petitions were disposed of by a common Judgment by a

learned Single Judge. The appellant filed one Appeal,

which was against Writ Petition No. 5643 of 2012. The

Appellant did not impugn the Judgment in Writ Petition

No. 4526 of 2013, which was styled as Public Interest

Litigation initially, and thereafter, made over to the

learned Single Judge. Having not filed any appeal from

the Judgment in Writ Petition No. 4526 of 2013, the

appellants are precluded from challenging the Judgment

21 in Writ Petition No. 5643 of 2012. This is for the

reason that the Judgment of the Division Bench, in Writ

Petition No. 4526 of 2013, attained finality. It was

pointed out that it was the Concessionaire, who is

Respondent No. 26 in the present Appeal before us,

which filed appeals challenging the Judgment in both

the Writ Petitions. The Concessionaire has not pursued

the matter in this Court.

21. The learned Counsel for the appellant would point

out that it suffices in law that, the Judgment in Writ

Petition No. 5643 of 2012, is challenged, having regard

to the decision of this Court rendered in Shenoy and

Co. and others v. Commercial Tax Officer, Circle II,

Bangalore and others2.

THE STATUTORY FRAMEWORK

22. Section 7 of National Highways Act provides for a

levy of fee. The relevant portion of Section read as

follows:

2 (1985) 2 SCC 512

22 “Section 7.(1) The Central Government may, by notification in the Official Gazette, levy fees at such rates as may be laid down by rules made in this behalf for services or benefits rendered in relation to the use of 1 ferries, [permanent bridges the cost of construction of each of which is more than rupees twenty-five lakhs and which are opened to traffic on or after the 1st day of April, 1976,] temporary bridges and tunnels 2 on national highways [and the use of sections of national highways].”

“Rule 7.(2) Such fees when so levied shall be collected in accordance with the rules made under this Act.”

23. It will be noticed that the words, “and the use of

Sections of National Highway”, came to be inserted by

Act 1 of 1993, with retrospective effect from

23.10.1992. The Rules, contemplated under Section 7,

are the Rules and they came into force on 05.12.2008.

24. The Rules were in supersession of the National

Highways (Collection Of Fees By Any Person For The Use

Of Section Of National Highways/Permanent Bridge/

23 Temporary Bridge On National Highways) Rules, 1997,

inter alia. Under the Rules of 1997, Section 2(b)

defined as follows: -

“Rule 2 (b). ‘Section of national highway/ permanent bridge/ temporary bridge’ means that length of national highway/ permanent bridge/ temporary bridge on national highway notified by Central Government in Official Gazette for the development/ maintenance of which an agreement has been entered into between the Central Government and any person”.

Rule 3 provided for the ‘Agreement and the rate

of fee’; there was no provision similar to Rules 8

of the Rules in the Rules made in 1997.

25. The Rules were issued in supersession of the

National Highway (Fees For The Use Of National Highways

Section And Permanent Bridge – Public Funded Project)

Rules, 1997. In the said Rules, Rule 2(k) defined

“National Highway Section”, as follows: -

“Rule 2 (k). ‘National Highway Section’ means continuous length of any national

24 highway or by-pass which shall be, notified for separately levy of fee collection.”

The rules separately provided for departmental fee

collection and fee collection through franchisee.

26. Rule 2(c), of the 2008 Rules, defines “by-pass”,

“means a section of the National Highway by passing a

town or city.”

27. Rule 3 provides for levy of fee. It reads, inter

alia, as follows: -

“Rule 3.(1) The Central Government may by notification, levy fee for use of any section of national highway, permanent bridge, by-pass or tunnel forming part of the national highway, as the case may be, in accordance with the provisions of these rules:

Provided that the Central Government may, by notification, exempt any section of national highway, permanent bridge, by-pass or tunnel constructed through a public funded project from levy of such fee or part thereof, and subject to such conditions as may be specified in that notification.

25 (2) The collection of fee levied under sub-

rule (1) of rule 3, shall commence within forty-five days from the date of completion of the section of national highway, permanent bridge, by-pass or tunnel, as the case may be, constructed through a public funded project.

xxx xxx xxx

(4) No fee shall be levied for the use of the section of national highway, permanent bridge, by-pass or tunnel, as the case may be, by two wheelers, three wheelers, [tractors, combine harvesters] and animal drawn vehicles:

Provided that three wheelers, [tractors, combine harvesters] and animal-drawn vehicles shall not be allowed to the use the section of national highway, permanent bridge, by-pass or tunnel, as the case may be, where a service road or alternative road is available in lieu of the said national highway, permanent bridge, by-pass or tunnel:

Provided further that where service road or alternative road is available and the owner, driver or the person in charge of a two-

26 wheeler is making use of the section of national highway, permanent bridge, by-pass or tunnel, as the case may be, he or she shall be charged fifty per cent of the fee levied on a car.

Explanation I .- For the purposes of this rule,--

(a) "alternative road" means such other road, the carriageway of which is more than ten meters wide and the length of which does not exceed the corresponding length of such section of national highway by twenty per cent thereof;

(b) "service road" means a road running parallel to a section of the national highway which provides access to the land adjoining such section of the national highway.” (Emphasis supplied)

28. Rule 4 deals with the base rate of fee. It goes

on, in careful detail, to provide for the regulation

of the fee.

27

29. Rule 5 deals with Annual Revision of the rate of

fee. Rule 6 deals with Collection of Fee. Rule 6 reads,

inter alia, as follows:

“Rule 6.(1) Fee levied under these rules shall be collected by the Central Government or the executing authority or the concessionaire, as the case may be, at the [fee plaza].

xxx xxx xxx”

30. Rule 8, being the provision at the centre of the

controversy, reads as follows:

“Rule 8(1) The executing authority or the concessionaire, as the case may be, shall establish a [fee plaza] beyond a distance of ten kilometres from a municipal or local town area limits:

Provided that the executing authority may, for reasons to be recorded in writing, locate or allow the concessionaire to locate a [fee plaza] within a distance of ten kilometres of such municipal or local town area limits, but in no case within five

28 kilometres of such municipal or local town area limits:

Provided further that where a section of the national highway, permanent bridge, by-pass or tunnel, as the case may be, is constructed within the municipal or town area limits or within five kilometres from such limits, primarily for use of the residents of such municipal or town area, the [fee plaza] may be established within the municipal or town area limits or within a distance of five kilometres from such limits.

(2) Any other [fee plaza] on the same section of national highway and in the same direction shall not be established within a distance of sixty kilometres:

Provided that where the executing authority deems necessary, it may for reasons to be recorded in writing, establish or allow the concessionaire to establish another [fee plaza] within a distance of sixty kilometres:

Provided further that a [fee plaza] may be established within a distance of sixty

29 kilometres from another [fee plaza] if such [fee plaza] is for collection of fee for a permanent bridge, by-pass or tunnel.”

31. Rule 9 provides for Discounts. Rule 11 provides

for categories of persons exempted from the collection

of fee. Rule 16 deals with Collection of fee in respect

of Private Investment Project, which reads as follows:

“Rule 16. - (1) The fee levied under the provisions of sub-rule (3) of rule 3 shall be collected by the concessionaire till its agreement is in force.

(2) On and from the date of expiry of the agreement specified under sub-rule (3) of rule 3, the fee levied shall be collected by the Central Government or the executing authority, as the case may be.”

32. Rule 17 deals with Bar for installation of

additional barrier and needs to be noticed; this is the

framework we may also notice:

“Rule 17 - No barrier shall be installed at any place, other than at the [fee plaza], except with the prior permission in writing of the Central Government or the executing

30 authority, as the case may be, who after being satisfied that there is evasion of fee, may allow on such terms and conditions as it may impose, the installation of such additional barrier by the Central Government, the executing authority or the concessionaire, as the case may be, within ten kilometres from the [fee plaza], to check the evasion of fee:

Provided that the Central Government or the executing authority, as the case may be, may, at any time, for reasons to be recorded in writing, withdraw such permission: Provided further that where the Central Government or the executing authority, as the case may be, do not allow installation of an additional barrier by the concessionaire, the reasons for such refusal shall be communicated to such concessionaire within a reasonable period.”

BRIEF LOOK AT THE DPR

33. In the portion of the final feasibility report

produced by the appellants, we may notice

paragraph-1.4 of development plans:

31 “Para 1.4 Developmental Plans.

The projects being implemented or proposed for implementation in the near future are related to 4- lanning of NH-31 section from Bakhtiyarpur to Begusarai via Mokama by NHAI on DBFO basis, 4/6 laning of NH-841 NH-30 from Patna to Buxar via Ara by NHAI on DBFO basis and up gradation of adjoining State Highways, Digha Didarganj Ganga Expressway by Path-Nirman Vibhag/IL&FS, Major district roads, ordinary district roads and village roads by State/Local authorities etc. These projects are going to enhance traffic circulation in and around the project area.

As per the available information, the Patna Buxar road is proposed to be started from Km 181.3 at Saristabad while Khagaria- Begusarai-Bakhtiarpur section of NH-31 is proposed to be starting from Km 153.30 on NH 31 (1100 meter south of Bakhtiarpur intersection). Accordingly, after confirmation from NHAI, the project road is planned to be developed between these two start and end points as 4 lane access- controlled facility DBFO basis.

34. The DPR was prepared by an international

consultant. In fact, what is produced before the court,

32 is not the entire DPR, only the portions of the

Executive Summary.

35. We may notice the following portions of the DPR,

again the Executive Summary thereof, filed by the writ

petitioners:

(Page no. 46 of the reply affidavit of respondents nos. 3 to 7) “Para 1.2. Existing road Network

National Highway 30 connects Patna City, the state of Bihar with Bakhtiyarpur, a township on the eastern side around 50 km away in Patna District along the Ganga River on north of it. NH-30 starts from Mohania in Kalmur District on the west side of Patna and ends up at Bakhtiyarpur at T junction at Km 154.4 of NH-31 connecting Bihar Sharif to Mokama. The project road is crossed by National Highway NH-83 and NH-19 connecting Chapra and Muzzafurpur via Hajipur in North Direction and with Gaya in south direction.

Apart from these, a number of MDR/village roads meet Nh-30. Railway line runes from east to west and crosses Nh-30 at km 195.75 where a ROB exists.”

33 “Para 1.3 The Project Road (National Highway – 30)

The project road starts from Anisabad Junction at km 178.6 of NH-30 and continues along Patna bypass towards east. Enroute, it passes through existing bypass from Patna City to Didarganj, Sabbalpur, Fatehganjpur, Kachi Dargah, Fatua, Baikatpur and Ghoswari. At km. 182+500 it crosses railway line (Patna-Gaya section) through a 2-lane ROB. Near to this ROB, NH-83 starts and proceeds toward south direction (towards Gaya). From km 180.0 to km 190.0 of bypass section there is a very congested stretch due to the presence of Transport Nagar, residential buildings & commercial activity. Further NH- 30 intersects with NH-19 at km 188+500. At km 188+800, SH-1 starts from the Patna bypass and traverses towards south (towards Masaurhl). From km 190 km to km 195 of bypass section there is agricultural land on both side of road. At km. 195+750, it further crosses railway line (Patna-Kolkata section) through a newly built 4-lane ROB. Further it traverses through Didarganj (km.197). Thereafter upto km 210 of NH 30 road is passing through commercial & residential settlement area. Near Didarganj

34 (km 197) Kachhi Dargah (Km 200) & Fatua town (km 205) road is passing through heavily congested area. There is a major bridge crossing over Punpun river near km 203.8. From km 210 to km 226, NH-30 is passing through agricultural & residential area with scattered settlements and the project road ends at near Km 230 of NH-30 near Bakhtiyarpur.

The stretch of NH-30 on new bypass and from Didarganj ROB (km 196) to Fatua (km 208) is very congested with local and thorough traffic all along. However, while new bypass area upto Didarganj has available ROW of 60 m for widening to 4/6 laning, the area between Didarganj to Fatua is being encroached/ has built up settlement on both sides with available ROW less than 15-20m. Immediately after Fatua town (km 208) to Bakhtiyarpur (Km 227), this area is relatively less congested, but has pockets of staggered settlement in between, including at Bakhtiyarpur. Due to above-

mentioned existing features, widening of existing road to standard 4-lane configuration would present considerable

difficulty due to the physical constraints. In view of above-mentioned features, the

35 proposed alignments have been considered on the southern side of the existing NH-30.”

36. Under traffic studies, it is stated that, the total

tollable traffic, at km 195 and 215 km, is 27161 PCU

and 19201 PCU, respectively, considering 35 percent

leakage on car and 15 percent leakage on other

vehicles. It is further stated as follows:

“Para 6.6. Toll plaza location

The project road is proposed to be developed as Tolled Road. The project road being only 50 km long, only one toll plaza will be feasible to be provided. During site reconnaissance it was observed that free space is available near km 194 suitable for development of Toll Plaza System. Same is already discussed with NHAI officials during site visit.” (Emphasis supplied)

37. The very same thing, as stated in paragraph-6.6,

is stated in paragraph-12.2.5, also under Miscellaneous

Facilities:

36

“The concept of service road is being conceived at built-up area and grade separated intersections (Flyover & Underpass locations) which will come along the proposed alignment. The list of proposed service road stretches are as follows

i. 181.3 to 189.11

ii. 206.8 to 207.4”

38. In the document, which is produced as part of the

invitation for proposal, and which, according to the

appellant, forms part of the DPR, there are various

features, including grade intersections, grade

separated intersections, railway over bridges and other

features mentioned. The grade separator/flyovers

intersections, are seen provided at 182.55 km, 188.47

km, 207.4 km and 231.4 km. There are bridges, major and

minor, also contemplated.

ANALYSIS

THE IMPACT OF THE DPR

39. The fact that the DPR was not challenged by the

Writ Petitioners, cannot by itself, pose a hurdle in

the allowing of the writ petition. It is, admittedly,

37 a study with recommendations. Therefore, it constitutes

the opinion of the Expert Body at best. However, what

it does mean, is that, the court can proceed on the

basis of the facts, which are brought out in the Report,

and in the absence of a challenge to the same, proceed

on the basis that, they are correct. In fact, the only

case of the Writ Petitioners in this regard, is that,

after the preparation of the Report, certain

developments took place, but which are in the form of

constructions which were made. Equally, the fact that

the Report was not challenged, would allow the court

to acknowledge that there was, indeed, a study by an

Expert Body. More pertinently, the Expert Body did

recommend the location of the toll plaza at km 194.

Equally, there is nothing expressly stated that the

location is justified with reference to the second

proviso to Rule 8.

DUTY TO GIVE REASONS

40. An Administrative Authority, exercising judicial

or a quasi-judicial power, must record reasons for its

decision. This is subject to the exception where the

38 requirement has been expressly or by necessary

implication done away. [See S.N. Mukherjee v. Union of

India3].

41. In M/s. Mahabir Jute Mills Ltd., Gorakhpore v. Shri

Shibban Lal Saxena and others4, one of the questions,

which arose, was whether the refusal to refer a dispute

under Section 4K of the U.P. Industrial Disputes Act,

1947, was to be supported with reasons. This Court,

inter alia, held as follows:

“3. … In a diverse society such as ours the Government has to work through several administrative agencies which have got a very wide sphere and if every administrative order is required to give reasons it will bring the governmental machinery to a stand- still. It is well-settled that while the rules of natural justice would apply to administrative proceedings, it is not necessary that the administrative orders should be speaking orders unless the statute specifically enjoins such a requirement. But we think it desirable that such orders should contain reasons when they decide matters affecting rights of parties. …”

42. In Star Enterprises and others v. City and

Industrial Development Corpn. of Maharashtra Ltd. and

3 (1990) 4 SCC 594 4 (1975) 2 SCC 818

39 others5, the question arose in the following facts.

Under a Statue, a Government Company was empowered to

dispose of land vested in it. The question arose,

whether there was a duty to give reasons, and the

highest offer obtained in response to the invitation

by public tender, could be rejected without assigning

any reason. The Court went on to hold as follows:

“10. In recent times, judicial review of administrative action has become expansive and is becoming wider day by day. The traditional limitations have been vanishing and the sphere of judicial scrutiny is being expanded. State activity too is becoming fast pervasive. As the State has descended into the commercial field and giant public sector undertakings have grown up, the stake of the public exchequer is also large justifying larger social audit, judicial control and review by opening of the public gaze; these necessitate recording of reasons for executive actions including cases of rejection of highest offers. That very often involves large stakes and availability of reasons for actions on the record assures credibility to the action; disciplines public conduct and improves the culture of accountability. Looking for reasons in support of such action provides an opportunity for an objective review in appropriate cases both by the administrative superior and by the judicial process. The submission of Mr Dwivedi, therefore,

5 (1990) 3 SCC 280

40 commends itself to our acceptance, namely, that when highest offers of the type in question are rejected reasons sufficient to indicate the stand of the appropriate authority should be made available and ordinarily the same should be communicated to the concerned parties unless there be any specific justification not to do so.”

The Court, however, did not apply the test to the

case before it.

43. In a different context, the question again arose

before this Court in Union of India and others v. E.G.

Nambudiri6. The respondent was communicated certain

adverse remarks. His representation, being rejected,

he moved the President of India. He received partial

relief but some of the adverse remarks were not

expunged. One of the contentions taken was that the

President was obliged to record reasons. The said

contention was rejected by this Court. It is apposite

that we refer to following discussion by this Court:

“10. There is no dispute that there is no rule or administrative order for recording reasons in rejecting a representation. In the absence of any statutory rule or 6 AIR 1991 SC 1216 / (1991) 3 SCC 38

41 statutory instructions requiring the competent authority to record reasons in rejecting a representation made by a government servant against the adverse entries the competent authority is not under any obligation to record reasons. But the competent authority has no licence to act arbitrarily, he must act in a fair and just manner. He is required to consider the questions raised by the government servant and examine the same, in the light of the comments made by the officer awarding the adverse entries and the officer countersigning the same. If the representation is rejected after its consideration in a fair and just manner, the order of rejection would not be rendered illegal merely on the ground of absence of reasons. In the absence of any statutory or administrative provision requiring the competent authority to record reasons or to communicate reasons, no exception can be taken to the order rejecting representation merely on the ground of absence of reasons.

No order of an administrative authority communicating its decision is rendered illegal on the ground of absence of reasons ex facie and it is not open to the court to interfere with such orders merely on the ground of absence of any reasons. However, it does not mean that the administrative authority is at liberty to pass orders without there being any reasons for the same. In governmental functioning before any order is issued the matter is generally considered at various levels and the reasons and opinions are contained in the notes on the file. The reasons contained in the file enable the competent authority to formulate its opinion. If the order as communicated to the government servant rejecting the representation does not contain any reasons, the order cannot be held to be bad in law.

42 If such an order is challenged in a court of law it is always open to the competent authority to place the reasons before the court which may have led to the rejection of the representation. It is always open to an administrative authority to produce evidence aliunde before the court to justify its action.”

(Emphasis supplied)

44. Again, in Maharashtra State Board of Secondary and

Higher Secondary Education v. K.S. Gandhi and others7,

the question arose about the duty to give reasons in

the following factual matrix. The appellant, in the

said case, conducted examinations. It was found that

the moderators marksheets, relating to certain

examinees, were tampered with. The results were

withheld. An inquiry was conducted through seven

Inquiry Officers, who proceeded to conduct an inquiry.

The inquiry itself involved issuing notices to the

students, inter alia. The Inquiry Officer submitted

reports finding that the moderators marksheets had been

fabricated. The students challenged the action of the

Authority to withhold the results, as a measure of

7(1991) 2 SCC 716

43 punishment, accepting the Inquiry Report. Dealing with

the argument that no reasons were recorded by the

Inquiry Officers, this Court held as follows:

“20. Unless the rule expressly or by necessary implications excludes recording of reasons, it is implicit that the principles of natural justice or fair play does require recording of reasons as a part of fair procedure. In an administrative decision, its order/decision itself may not contain reasons. It may not be the requirement of the rules, but at the least, the record should disclose reasons. It may not be like a judgment. But the reasons may be precise. In S.N. Mukherjee v. Union of India [(1990) 4 SCC 594 : 1991 SCC (L&S) 242 : 1990 SCC (Cri) 669 : JT (1990) 3 SC 630] , the Constitution Bench of this Court surveyed the entire case law in this regard, and we need not burden the judgment to reiterate them once over and at page 614, para 40 it held that except in cases where the requirement has been dispensed with expressly or by necessary implication, an administrative authority exercising judicial or quasi-judicial functions is required to record the reasons for its decision. In para 36 on pp. 612-13 it was further held that recording of reasons … excludes chances of arbitrariness and ensures a degree of fairness in the process of decision making. The said principle would apply equally to all decisions and its applications cannot be confined to decisions which are subject to appeal, revision or

44 judicial review. “It is not required that the reasons should be as elaborate as in the decision of a court of law.” The extent and nature of the reasons would depend on particular facts and circumstances. What is necessary is that the reasons are clear and explicit so as to indicate that the authority has given due consideration to the points in controversy. The need for recording of reasons is greater in a case where the order is passed at the original stage. The appellate or revisional authority, if it affirms such an order, need not give separate reasons. If the appellate or revisional authority disagrees, the reasons must be contained in the order under challenge.

21. Thus it is settled law that the reasons are harbinger between the mind of the maker of the order to the controversy in question and the decision or conclusion arrived at. It also excludes the chances to reach arbitrary, whimsical or capricious decision or conclusion. The reasons assure an inbuilt support to the conclusion/decision reached. The order when it affects the right of a citizen or a person, irrespective of the fact, whether it is quasi-judicial or administrative fair play requires recording of germane and relevant precise reasons. The recording of reasons is also an assurance that the authority concerned consciously applied its mind to the facts on record. It also aids the appellate or revisional authority or the supervisory jurisdiction of the High Court

45 under Article 226 or the appellate jurisdiction of this Court under Article 136 to see whether the authority concerned acted fairly and justly to mete out justice to the aggrieved person.

22. From this perspective, the question is whether omission to record reasons vitiates the impugned order or is in violation of the principles of natural justice. The omnipresence and omniscience (sic) of the principle of natural justice acts as deterrence to arrive at arbitrary decision in flagrant infraction of fair play. But the applicability of the principles of natural justice is not a rule of thumb or a strait-jacket formula as an abstract proposition of law. It depends on the facts of the case, nature of the inquiry and the effect of the order/decision on the rights of the person and attendant circumstances. It is seen from the record and is not disputed, that all the students admitted the factum of fabrication and it was to his or her advantage and that the subject/subjects in which fabrication was committed belong to him or her. In view of these admissions the Enquiry Officer obviously did not find it expedient to reiterate all the admissions made. If the facts are disputed, necessarily the authority or the Enquiry Officer, on consideration of the material on record, should record reasons in support of the conclusion reached. Since the facts are admitted, the need for their reiteration was obviated and so only conclusions have been

46 stated in the reports. The omission to record reasons in the present case is neither illegal, nor is violative of the principles of natural justice. Whether the conclusions are proved or not is yet another question and would need detailed consideration.”

(Emphasis supplied)

45. It will, at once, be noted that, the facts in the

said case, were not disputed, and therefore, the

omission to record reasons, was found neither illegal

nor violative of principles of natural justice.

46. In C.B. Gautam v. Union of India and others8, under

Section 269-UD of the Income-Tax Act, 1961, an order

for compulsory purchase, was made. Section 269-UD

specifically mandate for reasons to be recorded in

writing for the making of an order for purchase by the

Central Government. The contention, which was raised,

was that, recording of reasons did not obviate

providing of an opportunity of hearing to the person

8 (1993) 1 SCC 78

47 who had an agreement to purchase. It is only necessary

to notice the following discussion in this regard:

“31. The recording of reasons which lead to the passing of the order is basically intended to serve a two-fold purpose:

(1) that the “party aggrieved” in the proceeding before (sic the appropriate authority) acquires knowledge of the reasons and, in a proceeding before the High Court or the Supreme Court (since there is no right of appeal or revision), it has an opportunity to demonstrate that the reasons which persuaded the authority to pass an order adverse to his interest were erroneous, irrational or irrelevant, and (2) that the obligation to record reasons and convey the same to the party concerned operates as a deterrent against possible arbitrary action by the quasi-judicial or the executive authority invested with judicial powers.

32. Section 269-UD(1), in express terminology, provides that the appropriate authority may make an order for the purchase of the property “for reasons to be recorded in writing”.

Section 269-UD(2) casts an obligation on the authority that it “shall cause a copy of its order under sub-section (1) in respect of any immovable property to be served on the transferor”. It is,

48 therefore, inconceivable that the order which is required to be served by the appropriate authority under sub-section (2) would be the one which does not contain the reasons for the passing of the order or is not accompanied by the reasons recorded in writing. It may be permissible to record reasons separately but the order would be an incomplete order unless either the reasons are incorporated therein or are served separately along with the order on the affected party. We are, of the view, that reasons for the order must be communicated to the affected party.”

(Emphasis supplied)

47. In Sarat Kumar Dash and others v. Biswajit Patnaik

and others9, this Court rejected the argument that when

promotion was to be made on the basis of merit-cum-

suitability basis, with due regard to seniority, it was

incumbent on the Public Service Commission to give

reasons for its recommendations. It was also found not

necessary for the Government, which accepted the

recommendation, to give reasons. In the course of its

9 1995 Supp (1) SCC 434

49 opinion, this Court observed that natural justice is

not a rigid or inflexible principle.

48. In Kranti Associates (P) Ltd. v. Masood Ahmed

Khan10, the National Consumer Disputes Redressal

Commission (NCDRC), dismissed Revision Petition, only

taking note of the fact that there were concurrent

findings. This Court went on to find that the Order was

vitiated but it is obvious that the Order of the

Commission cannot be described as an administration

decision.

49. Finally, we may notice a very recent Judgment in

Rajeev Suri v. Delhi Development Authority and others11,

which arose in the context of the decision, to go in

for construction of the new Parliament building and

certain other structures. While dealing with the

question relating to non-application of mind, this

Court also dealt with the impact of there being no

reasons. We may notice the following discussion from

the majority Judgment authored by A.M. Khanwilkar, J.:

10(2010) 9 SCC 496 11 Transferred Case (Civil) No. 229 of 2020, Judgment dated 05.01.2020

50 “289. Rules of natural justice are not embodied rules. They are means to an end and not end in themselves. The goal of these principles is to prevent prejudice. It is from the same source that the requirement of application of mind emerges in decision making processes as it ensures objectivity in decision making. In order to ascertain that due application of mind has taken place in a decision, the presence of reasons on record plays a crucial role.

The presence of reasons would fulfil twin objectives of revealing objective application of mind and assisting the adjudicatory body in reviewing the decision. The question that arises here is, whether the statement in the recorded minutes of the CVC meeting (“the features of the proposed Parliament building should be in sync with the existing Parliament building”) is or is not indicative of application of mind.

290. In cases when the statute itself provides for an express requirement of a reasoned order, it is understandable that absence of reasons would be a violation of a legal requirement and thus, illegal. However, in cases when there is no express requirement of reasons, the ulterior effect of absence of reasons on the final decision cannot be sealed in a straightjacketed manner. Such cases need to be examined from a broad perspective in the light of overall circumstances. The Court would look at the nature of decision-making body, nature of rights involved, stakeholders, form and substance of the decision etc. The list is not exhaustive for the simple reason that drawing a

51 conclusion of non-application of mind from mere absence of reasons is a matter of pure inference and the same cannot be drawn until and unless other circumstances too point in the same direction. …”

(Emphasis supplied)

50. Thereafter, the Court, in Rajeev

Suri (supra), relied upon the judgment in E.G.

Nambudiri (supra): Thereafter it held:

“293. Had it been a case of any other administrative committee required to adjudicate upon the rights of individuals, merely because it is not mandatory to record reasons would not absolve it of the requirement of objective consideration of the proposal. The ultimate enquiry is of application of mind and a reasoned order is merely one element in this enquiry. In a given case, the Court can still advert to other elements of the decision-making process to weigh the factum of application of mind. The test to be applied in such a case would be of a reasonable link between the material placed before the decision- making body and the conclusion reached in consideration thereof. The Court may decide in the context of overall circumstances of the case and a sole element (of no reasons or lack of elaborate reasons) cannot be enough to make or break the decision as long as judicial mind is convinced of

52 substantial application of mind from other circumstances. Even in common law jurisprudence, there is no absolute requirement of reasoned order in all decisions. In Lonrho plc v. Secretary of State for Trade and Industry & Anr., it was contended that the decision is not based on convincing reasons and therefore, must be declared as illegal. The House of Lords refused to entertain this contention and noted that mere absence of reasons would not render the decision as irrational. Lord Keith, in his opinion, noted that the only significance of absence of reasons would be that if circumstances overwhelmingly point towards a different conclusion that the one reached by the body, it would be fatal. He noted thus:

“The absence of reasons for a decision where there is no duty to give them cannot of itself provide any support for the suggested irrationality of the decision. The only significance of the absence of reasons is that if all other known facts and circumstances appear to point overwhelmingly in favour of a different decision, the decision- maker who has given no reasons cannot complain if the court draws the inference that he had no rational reason for his decision.”

In Administrative Law, P.P. Craig notes that it is relevant to consider the context in which decision operates thus:

53 “The court will consider the nature of the decision maker, the context in which it operates and whether the provision of reasons is required on grounds of fairness.”

Mr. Craig also refers to R. v. Ministry of Defence, Ex p. Murray wherein certain principles relating to duty of reasons were elaborated. Lord Chief Justice Bingham, in his opinion, observed that the requirement of giving reasons may be outweighed by concerns of public interest in certain cases, for instance, when it would unduly burden the decision maker. We are not importing any rider of public interest to negate the requirement of reasons; however, the above exposition is useful to understand the effect of absence of reasons on an otherwise legal, rational and just decision.

294. Notably, this Court in Maharashtra State Board353 and in Mahabir Jute Mills354 noted that if the function/decision of the Government is administrative, in law, ordinarily there is no requirement to be accompanied by a statement of reasons unless there is an express statutory requirement in that regard. Again, in Sarat Kumar Dash, the Court observed that in the field of administrative action, the reasons are link between maker of the order or the author of the decision and the order itself. The record can be called to consider whether the author had given due consideration to the facts placed before him before he arrives at the decision.

54 295. Therefore, the requirement of reasons in cases which do not demand it in an express manner is based on desirability and the same is advised to the extent possible without impinging upon the character of the decision-

making body and needs of administrative efficiency.”

(Emphasis supplied)

51. In England, the Courts have not recognised a

general duty on the part of the Administrator to

perform administrative functions to give reasons.

52. In Regina v. Secretary of State for the Home

Department (Original Appellant and Cross-respondent)

ex parte Doody (A.P.)12, the Court, inter alia, had to

consider the question, as to whether, if in regard to

a prisoner convicted for murder, and in regard to whom,

the view of the Court, in respect of the sentence to

be undergone, was to be departed from by the Secretary

of State, the Secretary was obliged to give reasons for

such difference of opinion. The Court took the view

that the decision of the Home Secretary vitally

12 (1994) 1 A.C. 531

55 affected the future of the prisoner. The Court went on

to make the following observations, inter alia:

“What does fairness require in the present case? My Lords, I think it unnecessary to refer by name or to quote from, any of the often-cited authorities in which the courts have explained what is essentially an intuitive judgment. They are far too well known. From them, I derive that:-

1. Where an Act of Parliament confers an administrative power there is a presumption that it will be exercised in a manner which is fair in all the circumstances. 2. The standards of fairness are not immutable. They may change with the passage of time, both in the general and in their application to decisions of a particular type. 3.

The principles of fairness are not to be applied by rote identically in every situation. What fairness demands is dependent on the context of the decision, and this is to be taken into account in all its aspects. 4. An essential feature of the context is the statute which creates the discretion, as regards both its language and the shape of the legal and administrative system within which the decision is taken.” (Emphasis supplied)

53. Still further, we may notice the following

discussion:

56

“Turning to the present dispute I doubt the wisdom of discussing the problem in the contemporary vocabulary of "prisoner's rights", given that as a result of his own act the position of the prisoner is so forcibly distanced from that of the ordinary citizen, nor is it very helpful to say that the Home Secretary should out of simple humanity provide reasons for the prisoner, since any society which operates a penal system is bound to treat some of its citizens in a way which would, in the general, be thought inhumane. I prefer simply to assert that within the inevitable constraints imposed by the statutory framework, the general shape of the administrative regime which ministers have lawfully built around it, and the imperatives of the public interest, the Secretary of State ought to implement the scheme as fairly as he can. The giving of reasons may be inconvenient, but I can see no ground at all why it should be against the public interest:

indeed, rather the reverse. This being so, I would ask simply: Is refusal to give reasons fair? I would answer without hesitation that it is not. As soon as the jury returns its verdict the offender knows that he will be locked up for a very long time. For just how long immediately becomes the most important thing in the prisoner's life. …” (Emphasis supplied)

The Court finally declared that the Secretary of

State was obliged to give reasons for departing from

the period recommended by the judiciary as the period

57 which he was to serve for the purpose of retribution

and deterrence.

54. This view has been reiterated in a planning case,

which came to be decided in the year 2017 in Dover

District Council v. CPRE Kent13. The question, which

actually arose was, when the Local Planning Authority

granted permission for a controversial development

against the advice of its own Professional Advisor,

whether it was under a duty to state reasons for its

decision. The Court, inter alia, held as follows:

“51. Public authorities are under no general common law duty to give reasons for their decisions; but it is well- established that fairness may in some circumstances require it, even in a statutory context in which no express duty is imposed (see R v Secretary of State for the Home Department, Ex p Doody [1994] 1 AC 531; R v Higher Education Funding Council, Ex p Institute of Dental Surgery [1994] 1 WLR 242, 263A-D; De Smith’s Judicial Review 7th ed, para 7-099).

xxx xxx xxx

55. Doody concerned fairness as between the state and an individual citizen. The same principle is relevant also to

13 (2017) UKSC 79

58 planning decisions, the legality of which may be of legitimate interest to a much wider range of parties, private and public (see Walton v Scottish Ministers [2012] UKSC 44; [2013] PTSR 51, paras 152-153 per Lord Hope). Here a further common law principle is in play. Lord Bridge saw the statutory duty to give reasons as the analogue of the common law principle that “justice should not only be done, but also be seen to be done” (see para 25 above).

That principle of open justice or transparency extends as much to statutory inquiries and procedures as it does to the courts (see Kennedy v The Charity Commission [2014] UKSC 20; [2015] AC 455, para 47 per Lord Mance, para 127 per Lord Toulson). As applied to the environment it also underpins the Aarhus Convention, and the relevant parts of the EA Directive. In this respect the common law, and European law and practice, march together (compare Kennedy para 46 per Lord Mance). In the application of the principle to planning decisions, I see no reason to distinguish between a Ministerial inquiry, and the less formal, but equally public, decision- making process of a local planning authority such as in this case.

56. The existence of a common law duty to disclose the reasons for a decision, supplementing the statutory rules, is not inconsistent with the abrogation in 2013 of the specific duty imposed by the former rules to give reasons for the grant of permission. As the explanatory memorandum made clear, that was not intended to detract from the general

59 principle of transparency (which was affirmed), but was a practical acknowledgement of the different ways in which that objective could normally be attained without adding unnecessarily to the administrative burden. In circumstances where the objective is not achieved by other means, there should be no objection to the common law filling the gap.”

55. In Regina v. Higher Education Funding Council Ex

parte Institute of Dental Surgery14, the applicant, an

educational institution, sought judicial review to

quash the decision of the Funding Council, to place the

applicant at Level 2, for the purpose of determining

the grant for research for 1993-1994. Failure by the

Council to provide reasons, was canvassed by the

applicant. The Court held, inter alia, as follows:

“In summary, then: (1) there is no general duty to give reasons for a decision, but there are classes of case where there is such a duty. (2) One such class is where the subject matter is an interest so highly regarded by the law (for example, personal liberty), that fairness requires that reasons, at least for particular decisions, be given as of right. (3) (a) Another such class is where the decision appears aberrant. Here fairness may require 14 [1994] 1 WLR 242

60 reasons so that the recipient may know whether the aberration is in the legal sense real (and so challengable) or apparent; (b) it follows that this class does not include decisions which are themselves challengeable by reference only to the reasons for them. A pure exercise of academic judgment is such a decision.

56. In “Administrative Law Text and Materials”, by

Beatson, Mathews and Elliots, reference is made to the

three dimensions in regard to duty to give reasons,

which reads as under:

“Fordham, 'Reasons: The Third Dimension'15

A first dimension is that the giving of reasons serves the interests of the court (or other tribunal) reviewing the decision. This rationale has to do with disclosure, to the court. The approach is illustrated by the comments of the Court of Appeal in R v. Lancashire County Council, ex parte Huddleston (1986) 2 All ER 941 at 945g and 947e, where reasons were encouraged in a spirit of co-operation by the public authority with the judicial review process.

A second dimension is that the giving of reasons serves the interests of the person affected by the decision. This

15 [1998] JR 158

61 has to do with disclosure, to the 'parties'. It is exemplified by the decision of the House of Lords in R v.

Secretary of State for the Home Department, ex parte Doody [1994] 1 AC 531, where reasons were required because of the prisoner's basic interest in knowing why decisions affecting liberty had been taken.

The third dimension is that the giving of reasons serves the interests of the decision-maker in reaching the decision. This has to do not with disclosure, but discipline. The central point is simple. Consciously duty-bound to articulate their reasons, decision- makers' minds are the more focused and their substantive decision-making the better. This was recognised by the Divisional Court in R v. Higher Education Funding Council, ex parte Institute of Dental Surgery [1994] 1 WLR 242 at 256H (cited with approval in R v. City of London Corporation, ex parte Matson [1997] 1 WLR 765 (CA) at 783D and in R v. Ministry of Defence, ex parte Murray [1998] COD 134 (DC)), as the first of a series of factors in favour of requiring reasons, namely that 'the giving of reasons may among other things concentrate the decision-maker's mind on the right questions...”

57. We notice the following discussion also in the same

work:

“A General Duty to Give Reasons?

62 The clear virtues of reason-giving give rise to an obvious question: why does English law not recognize a general duty on the part of decision-makers to give reasons? We noted at the outset of this chapter that the starting-point of English law is that no such duty exists, albeit that certain circumstances may trigger a requirement to give reasons.

The concerns which underlie the reluctance of English law to embrace a general duty were summarized in the following terms by the JUSTICE-All Souls Committee in their report, Administrative Justice: Some Necessary Reforms (Oxford 1988) at 70-71:

a) Efficient administration requires free and uninhibited discussion among decision-makers, unimpeded by considerations of what can or cannot be made public subsequently.

b) A general requirement of reasons will impose an intolerable burden on the machinery of government.

c) Delays in the handling of business will inevitably follow and additional expense will be caused. The public at large will suffer. The benefit will not match the cost.

d) The imposition of a general duty will have far-reaching implications for central government, local government, and for many other bodies of a public or semi-public character Many more decisions will be opened up to the possibility of legal challenge and a further step down the road of

63 ‘judicialization’ of affairs will be taken.

e) The Imposition of a [general] duty to give reasons will not necessarily mean that the true or complete reasons will be stated. Decision-makers will adapt to the new regime and acquire the art of stating sufficient by way of reasons to preclude successful challenge, but candour will not always be displayed.”

58. In Jurgen Schwarze’s European Administrative Law,

we notice the following position in regard to duty to

give reasons. In regard to France, it is stated as

follows:

”.. the duty to give reason for administrative act is regulated by the law of 1979, the statutory duty to give reasons applies to all unfavourable administrative decisions. The reasons must be in writing and must contain the essential matter concerning the factual and legal situation (Article 3).”

59. In regard to the duty to give reasons in Italy, it

is stated as follows:

“Italian administrative law does not recognise a general duty to give reasons. In addition to the case in which the duty to give reasons is

64 expressly laid down by statute, the courts have developed in a vast line of cases groups of decisions in which the duty of the administration to give reasons for its decisions results “from the nature of the matter,”. This applies in particular to negative or unfavourable administrative decisions, as well as to discretionary decisions. In so far as there exists a duty to give reasons, the authority must set out in writing the considerations which led it to the adoption of the administrative act. It will suffice, however, if the grounds of the decision are available simply in the documents which accompany the decision. Exceptionally a tacit statement of reasons is also permissible. The statement of reasons sets out the circumstances of fact and law which were decisive for the formation of the decision by the authority. The infringement of the duty to give reasons does not necessarily lead to the annulment of the decision by the administrative courts, but rather only where a different decision would have been taken on the facts. The position is different for discretionary decisions: here insufficient reasons will generally lead to the annulment of the administrative act, because the judge may not put his discretion the place of the discretion of the authority.” (Emphasis supplied)

60. We would hold that as noticed by the Bench of three

Judges in M/s. Mahabir Jute Mills Ltd., Gorakhpore 65 (supra), there is no general duty, when an

administrative decision is taken, to give reasons. A

Statute may, however, explicitly provide that the

Executive Authority must provide reasons and it must

be recorded in writing. A case in point is the first

proviso to Rule 8 of the Rules itself. The desirability

of a general duty, in the case of administrative action

to support decisions with reason, is open to question.

One of the most important reason is, the burden it

would put on the administration. It is apposite, at

this juncture, to notice that administrative decisions

are made in a wide spectrum of situations and contexts.

The executive power of the Union and States are

provided in Articles 73 and 162 of the Constitution of

India, respectively. Undoubtedly, in India, every state

action must be fair, failing which, it will fall foul

of the mandate of Article 14. It is, at this juncture,

we may also notice that the duty to give reasons, would

arise even in the case of administrative action, where

legal rights are at stake and the administrative action

adversely affects legal rights. There may be something

in the nature or the context, under which, the

66 administrative action is taken, which may necessitate

the authority being forthcoming with rational reasons.

There are other decisions, which essentially belong

more to the realm of executive policy-making, which

ordinarily may not require the furnishing of reasons.

The advantages, undoubtedly, of introducing a reasons

driven regime, are as follows.

61. Persons, who may have a right or an interest, would

know, what are the reasons which impelled the

Administrator to take a particular decision. Judicial

review, in India, which encompasses the wide contours

of public interest litigation as well, would receive

immeasurable assistance, if the reasons for particular

decisions, are articulated to the extent possible. The

giving of reasons also has a disciplining effect on the

Administrator. This is for the reason that the reasons

would capture the thought process, which culminated in

the decision and it would help the Administrator steer

clear of the vices of illegality, irrationality and

also disproportionality. Reasons could help establish

application of mind. Conversely, the absence of reasons

67 may unerringly point to non-application of mind. The

duty to act fairly, may require reasons to be recorded

but the said duty, though there is a general duty on

all state players to act fairly, may have its

underpinnings, ultimately in legal rights.

62. It is one thing to say that there should be

reasons, which persuaded the Administrator to take a

particular decision and a different thing to find that

the reasons must be incorporated in a decision. The

question, relating to duty to communicate such a

decision, would arise to be considered in different

situations, having regard to the impact, which it, in

law, produces. In fact, the second proviso to Rule 17

of the Rules, provides not only for there being

reasons, but the reasons for refusal to permit

barricades, must be communicated. If the law provides

for a duty to record reasons in writing, undoubtedly,

it must be followed and it would amount to the violation

of the Statute, if it were not followed. Even if, there

is no duty to record reasons or support an order with

reasons, there cannot be any doubt that, for every

68 decision, there would be and there must be, a reason.

The Constitution does not contemplate any Public

Authority, exercising power with caprice or without any

rationale. But here again, in the absence of the duty

to record reasons, the court is not to be clothed with

power to strike down administrative action for the mere

reason that no reasons are to be found recorded. In

certain situations, the reason for a particular

decision, may be gleaned from the pleadings of the

Authority, when the matter is tested in a court. From

the materials, including the file noting’s, which are

made available, the court may conclude that there were

reasons and the action was not illegal or arbitrary.

From admitted facts, the court may conclude that there

was sufficient justification, and the mere absence of

reasons, would not be sufficient to invalidate the

action of the Public Authority. Thus, reasons may, in

certain situations, have to be recorded in the order.

In other contexts, it would suffice that the reasons

are to be found in the files. The court may, when there

is no duty to record reasons, support an administrative

69 decision, with reference to the pleadings aided by

materials.

AN OFFICE MEMORANDUM AND A DIRECTION

63. The Writ Petitioners have produced Office

Memorandum dated 5th September, 2017 and communication

dated 2nd November, 2018 issued by MoRTH. We may notice

that the communication dated 5th September, 2017, as

produced in I.A. No.103415 of 2021, is as follows:

“Office Memorandum

Subject:Location of Toll Plazas on National Highways

- reg,

The undersigned is directed to refer to the subject above and convey that toll plaza locations recommended by the consultants engaged for preparation of DPRs for NH projects sometimes pose problems at site during project implementation. Ensuring accountability on the part of DPR consultants and adequate participation and commitment of the concerned State Government authorities while finalizing toll plaza locations for NH projects is likely to address this issue.

2.Accordingly, the following guidelines shall be followed in this behalf for NH Projects to be awarded in future:

70 (i) Toll Plaza locations recommended by the DPR consultants should be in conformity with the provisions of the National Highways Fee (Determination of Rates and Collection) Rules, 2008 including applicable amendments in this behalf. In case of any deviations from the above Rules vis -a-vis the recommended locations for the Toll Plazas, a reasoned justification shall have to be provided by the •DPR consultants. This requirement shall be suitably made a part of the Terms of Reference (ToR) for the DPR consultants;

(ii) The Project execution authorities shall obtain the concurrence of the concerned State Government(s) regarding the locations of Toll Plazas upfront before inviting bids for the projects or declaring the 'Appointed Dates' in respect of road projects, especially in cases where a NH project is being implemented near a state capital or any urban area eg. Ring roads/ bypasses around capital cities. The concerned State Government should be required to furnish a written consent in this behalf to the project authority.

(iii) The concerned State government must provide an undertaking to the project execution authority to continuously support the toll fees collection and compensate such authority for any loss/ foregone toll revenues on account of any disruption in collection of toll fees

71 for any reasons attributable to the state Government.

(Debjani Chakrabarti) Director (Highways)”

(Emphasis supplied)

64. Thereafter, in the second memorandum, the

communication dated 2nd November, 2018 after referring

to O.M. dated 5th September, 2017, it is directed as

follows:

“Para 3. However, it has been observed that on several occasions the user fees plazas are being established in deviation to the provisions of NH Fee Rule 2008, and subsequently approval of the Competent Authority is being sought on various grounds.”

“Para 4. In this regard, it has been decided that guidelines as below are to be followed for establishment of user fees plazas in all the projects under implementation as well as those in the planning stage:

(i) For all National Highways Project, that have been awarded post 5th September, 2017, the guidelines specified vide NH-37012/0/2016-H dated

72 05.09.2017 shall be scrupulously followed.

(ii) As a one-time measure, all the fee plazas, established in deviation to Rule 8 of NH Fee Rule 2008, may be notified as temporary fee plazas, with the condition that the Executing Agency shall relocate the fee plaza as per the provisions of the rule within a period of two years.

(iii) All the Executing Agencies shall ensure that, for the projects currently under execution, establishment of user fee plazas must be in conformity to NH Fee Rule 2008, and amendments there-to from time to time.

(iv) Location of the user fee plaza w.r.t the nearest municipality area and w.r.t adjacent fee plazas on the same section, will also be specifically clarified in all cases taken up for approval by the SFC/EFC in future.”

Reasoned justification by DPR consultants for

deviation from the Rules. This guideline is to be

73 followed; it is reiterated for projects awarded after

05-09-2017.

RULE 8 DEMYSTIFIED

65. Rule 8(1) provides that the Executing Authority or

the Concessionaire shall establish toll plaza beyond a

distance of 10 kilometres from a municipal or local

town area limits. In this context, it is useful to bear

in mind that under Rule 6, fee levied under the Rules,

has to be collected by the Central

Government or the Executing Authority or the

Concessionaire at the toll plaza. We have already found

that the Executing Authority has been defined in Rule

2(f), as an Officer or Authority notified under Section

5 of the National Highway Act. It would appear,

therefore, that the Executing Authority, as defined,

or the Concessionaire, is empowered to establish the

toll plaza beyond a distance of 10 kilometres from a

municipal or local town area limits.

66. The first proviso contemplates power with the

Executing Authority to locate or allow the

74 Concessionaire to locate a toll plaza within a distance

of 10 km of such municipal or town area limits. However,

the proviso engrafts a limitation on the power of the

Executing Authority in that the exercise of power under

the first proviso, should not result in the toll plaza

being located within 5 kilometres of such municipal or

local town area limits. A closer look at the first

proviso will indicate the following features. Unlike

the main Rule, where the power is conferred on the

Executing Authority and the Concessionaire, to locate

a toll plaza, which must, indeed, be more than 10

kilometres from the municipal or local town area

limits, there is no power conferred on the

Concessionaire to locate a toll plaza within the

distance of 10 kilometres. In other words, the

Executing Authority is the only Authority, which can

locate or allow the Concessionaire to locate within a

distance of 10 kilometres but not less than 5 km. In

other words, the exercise of power, under the first

proviso, can result in the location of a toll plaza at

a distance of five or more kilometres and below 10

kilometres from the municipal or local town area

75 limits. The further important sine qua non for the

exercise of the discretionary power conferred on the

Executing Authority, is that, the Executing Authority

must record reasons in writing at the time when he

exercises the power to locate or permit the

Concessionaire to locate the toll plaza within the

distance as already mentioned.

67. Moving forward to the second proviso, it commences

with the words “provided further”. Therefore, for all

intents and purposes and at first blush, it is a

proviso. More about it, a little later. Continuing the

narrative, the second proviso, as it is described,

consists of the following features. If a section of the

national highway, permanent bridge, bypass or tunnel,

is constructed within the municipal or town area

limits, then, the toll plaza may be established within

the municipal or town area limits. This is subject to

the only requirement that the construction of the

section of national highway, permanent bridge, bypass

or tunnel, whichever may be the case, is constructed

within the municipal or town area limits, primarily for

76 the use of residents of such municipal or town area

limits. If the aforesaid two requirements are

fulfilled, then, the embargo that the toll plaza must

be located beyond 10 kilometres from the municipal or

local town area limits, contained in Rule 8, would

cease to apply. Equally, the second proviso

contemplates that, if a section of the national

highway, permanent bridge, bypass or tunnel is located

within 5 kilometres from the municipal or town area

limits, then, the last limb of the proviso, would

apply, and the toll plaza may be located within a

distance of 5 kilometres from such limits.

68. It will be seen that whether the construction of

the section of the national highway, permanent bridge,

bypass or tunnel is constructed within the municipal

or town area limits or within 5 kilometres from such

limits, the common requirement for invoking the power

under the second proviso and to locate the toll plaza,

either within the municipal limits or town limits or

within a distance of 5 kilometres from such limit, is

that the construction in question, must be primarily

77 for the use of the residents of such municipal or town

area.

69. To further recapitulate, we may summarise as

follows:

The second proviso produces the following results:

i. Upon construction being made of a section of the

national highway (which is what we are concerned

with in this case) within municipal or town area

limits and upon the construction being primarily

for the use of the residents of the municipal or

town area then the toll plaza can be located

within the municipal or town area limits.

ii. Similarly, if the construction of section of the

national highway is made within 5 km from the

municipal or town area limits and the

construction is primarily for the use of the

residents of such municipal or town area the toll

plaza may be set up within a distance of 5 km

from such limits.

78 70. Therefore, a perusal of the second proviso leaves

us in no doubt, whatsoever that the statutory

requirements to apply the second proviso and to locate

a toll plaza within the municipal or town area limits,

is the factum of construction of a section of the

national highway, inter alia, within the municipal or

town area limits, subject to the only condition that

it must be primarily for the use of the residents of

such municipal or town area. It would be noticed

further that, unlike the main Rule and the first

proviso, the second proviso does not indicate as to,

in whom, the power to locate the toll plaza under the

second proviso, stands vested with. In other words,

unlike the main Rule and the first proviso, the Rule-

maker has not indicated the person or Authority, who

is to decide. Lastly, we must notice that, unlike the

first proviso, the second proviso does not contemplate

that the reasons for exercising the discretionary

power, is to be recorded in writing.

79

71. It would be apposite to enquire into the rationale,

why the requirement of reasons being recorded, is not

incorporated in the second proviso. The answer is not

far to seek. The first proviso does not provide any

condition precedent for locating a toll plaza at a

distance of less than 10 kilometres but 5 or more

kilometres from the municipal or local town area

limits. The requirement is the recording of reasons.

No other guidance is forthcoming. In fact, the only

check on the power to relax the rigour of the Rule,

that the toll plaza must be located at a distance of

more than 10 kilometres from the municipal or local

town area limits, are two in number. Firstly, the power

is located only with the Executing Authority. Secondly,

the Executing Authority is obliged, in law, to give

reasons, which must be recorded in writing. Besides

these safeguards, there are no other indispensable

requirements to reduce the distance, as provided in the

Rule. This is in stark contrast with the purport of the

second proviso. The second proviso deals with a

specific situation. We have already spelt out the

80 requirements. These requirements alone would justify

the location of the toll plaza either within the

municipal or town limits or within a distance of 5

kilometres from such limits. The requirements are

neatly articulated and cast in stone. They are

objective criteria. They become the requirements of the

Statue. If those requirements are met, then, the toll

plaza can be established, relaxing the Rule.

72. In such circumstances, we are of the clear view

that the High Court has erred in reading the second

proviso in continuation with the first proviso and

thereby concluding that, even the requirement of the

first proviso, viz., the recording of reasons in

writing, would also become necessary to invoke the

power under second proviso. We would think that such

an interpretation would fly in the face of the clear

words used in the second proviso, and would, what is

more, amount to rewriting the Rule. The real safeguard,

which is present in the second proviso, is the nature

of the objective and inflexible requirements, which are

declared therein.

81

73. With regard to a proviso, the reliance placed by

the Writ Petitioners on the Judgment of this Court in

Mohan Kumar Singhania v. Union of India16, is misplaced.

In the said case, the Court was dealing with the

challenge to the second proviso to Rule 4 therein. The

Court went on repel the contention, no doubt, that the

second proviso travelled beyond the intent of the main

Rule. In fact, it is pertinent to note the following

paragraphs:

“Para 69. Maxwell in his 12th edition has quoted a passage from Attn. Gen. v. Chelsea Waterworks Co. [(1731) Fitzg 195] which reads that if a proviso cannot reasonably be construed otherwise than as contradicting the main enactment, then the proviso will prevail on the principle that “it speaks the last intention of the makers”.

Para 70. It is pointed out in Piper v. Harvey [(1958) 1 QB 439 : (1958) 1 All ER 454] that if, however, the language of the proviso makes it plain that it was intended to have an operation more extensive than

16 1992 Supp (1) SCC 594

82 that of the provision which it immediately follows, it must be given such wider effect.”

74. Lush, J., observed in Mullins vs. Treasurer of

Survey17, “when one finds a proviso to a section, the

natural presumption is that, but for the proviso, the

enacting part would have included the subject matter

of the proviso.” The general Rule is that, the function

of the proviso is to qualify or provide an exception

to the main provision to which it is a proviso. It can

be a guide to glean the purport of the provision, in

case there is ambiguity in the main provision.

Ordinarily, the proviso is not permitted to operate

beyond the ken of the main provision to which it is a

proviso. At the same time, proviso, in a case, may be

a substantive provision. In other words, having regard

to the wording and the object sought to be achieved, a

proviso may transcend its ordinary province and may be

intended to operate as a substantive provision [See in

this regard Commissioner of Commercial Taxes, Board of

17 1880 QBD 170

83 Revenue, Madras & Anr. v. Ramkishan Shrikishan Jhaver

etc.18, which is being relied upon in Indore Development 19 Authority v. Manoharlal and others .]. These are well

settled principles and we do not intend to burden the

Judgment with further case law. Having regard to the

provision in question, viz., Rule 8, we are of the

clear view that the second proviso to the Rule is an

instance of the proviso representing a substantive

provision in itself. In other words, while the Rule

proclaims a total embargo against the location of the

toll plaza within ten kilometres of the municipal or

town area limits, the second proviso permits the

location of the toll plaza even within the municipal

limits or town area limits. Even if it were treated as

constituting an exception to the Rule, full effect must

be given to its mandate.

75. As far as the question, as to who can take a

decision under the second proviso, we would think, on

a conspectus of Rule 8, that, in the absence of any

express reference to the power to take a decision,

18 AIR 1968 SC 59 19 2020 (8) SCC 129

84 within the meaning of the second proviso, being lodged

with any particular Body, the said power must be found

vested with the Executive Authority. We say this for

the reason that, some person must, indeed, take the

decision that the situation warrants locating the toll

plaza, in exercise of the power under the second

proviso. We certainly cannot lodge that power with a

Concessionaire. The Rule-maker has conferred the power

on the Concessionaire, expressly when it declared in

Rule 8, that the Concessionaire may, apart from the

Executing Authority, locate the toll plaza beyond 10

kilometres from the municipal or town area limits. The

power under the first proviso, is conferred only upon

the Executing Authority. Having regard to the nature

of the power, viz., to locate the toll plaza, in

complete contradiction with the mandate of the Rule,

within the municipal area, inter alia, we hold that,

the power to take decision under the second proviso,

is lodged with the Executing Authority.

76. To invoke the second proviso, what is required is,

the existence of the conditions, as explained.

85

77. However, a decision must be taken. It must be taken

by the Competent Authority. The Authority, we have

found is the Executing Authority. It must apply its

mind and be convinced that a section of the national

highway, inter alia, is constructed within the

municipal or town area limits. This is a pure question

of fact. Secondly, it must conclude that the said

construction is ‘primarily’ or ‘mainly’ for the ‘use’

of the residents of the municipal limits. This is again

a factual matter. We may also find that the second

proviso does not compel the Authority to locate the

plaza within the municipal or town area limits. It is

a matter of discretion to be exercised, no doubt,

taking into consideration the maximization of toll

collection also and avoiding of leakage of toll,

bearing in mind the fact that the Concessionaire is

permitted to collect the toll only for the period of

the Concessionaire Agreement under Rule 16. To show

application of mind, there must be material. Even in

the absence of reasons, recorded as such, there must

86 be proper pleadings with materials, unless facts are

not in dispute.

WHETHER INVOCATION OF THE SECOND PROVISO TO RULE 8 IN THE FACTS ILLEGAL?

78. Though originally, the Ministry of the Road

Transport and Highways (MoRTH), proposed upgradation

of the existing two-lane stretch from Patna to

Bakhtiyarpur to four/six-lane highway based on the

appraisal notes of the Planning Commission and DEA, the

Patna-Bakhtiyarpur project received final approval for

the development of the stretch as a four-lane highway.

This is evident from the record note of discussion of

the meeting of the Public Private Partnership Appraisal

Committee (PPPAC) dated 10th February, 2010. Even prior

to the same, a Detailed Project Report (DPR) was

prepared by an International Consultant. Thereafter,

the Cabinet Committee cleared the project under NHDP

Phase III on DBFOT basis, i.e., Design, Build, Finance,

Operate and Transfer. It is apposite to notice, in the

appraisal note [when the proposal was for four/six-

87 laning of the Patna-Bakhtiyarpur section], the

following:

“Para 3.4. As observed from Schedule A and B in the DCA, new bypass starting from km 195 to km 231 has been proposed. This appears in continuation to an existing bypass from km 178 to km 196. It has also been observed the entire Project highway has urban/ built up settlements across the stretch. Thus, providing for a bypass for through traffic appears justified. However, the distribution of local traffic and through traffic is not provided in the documents. The same may be provided to the members of the PPPAC. Through the traffic details will be the base for revenue assessments and therefore beneficial to suitably analyse the viability of the Project.” (Emphasis supplied)

79. The broad scope of the work is shown as follows:

“Para2. Scope of work

2.1 The broad scope of work as per the Schedules B and C of the DCA consists of construction and up-gradation to 4/6-lane road (km 178.60 at

88 Patna) – (Km 230 at Bakhtiyarpur) from 2-lane with provision of project facilities, operation and maintenance (O&M) of the Project and performance and fulfilment of all other obligations of the Concessionaire. It includes:

i. By pass 36.4 km, from km (195-231.4) ii. Service Road on both Total length of 8.5 km sides of the road iii. Major intersections, 2 nos. at km 181.3 (Anisabad) 3-legged at-grade & km 188.47 (Zero mile) iv. Minor junctions 11nos.

v. Grade separated 4 nos. At km (188.25, 188.47, intersections 207.6 & 231.4) vi. Vehicular underpass 1 vii. Cattle underpasses 7 nos. at village roads viii. Reconstruction of 57 nos. culverts ix. Bus bayes 6 nos. x. Road furniture and signages and plantations”

80. By Notification dated 07.05.2010, in exercise of

power under Section 11 of the National Highway

Authority of India Act, 1988, the Central Government

entrusted the project, which consisted of the stretch

from 181.300 km to 231.950 km. of the NH 30, in the

State of Bihar, to NHAI. On 12.02.2011, NHAI made a

89 general Notification inviting objections from the

general public towards the proposed construction to the

toll plaza at 194 km. This is on the basis of the DPR,

which, after detailed study, recommended the

construction of the toll plaza at 194 km. The public

meeting/hearing on 12.02.2011, was allegedly attended

by about 71 local residents. The appellant invited

proposals for construction, operation and maintenance

of the project in question. The Concessionaire

Agreement was entered into with the highest bidder,

i.e., PBTC, on 31.03.2011. The Agreement provided,

inter alia, for the toll plaza being located at 194 km.

Work was apparently in progress, when the Writ

Petitions came to be filed.

81. We may further notice from the Executive Summary

of the Detailed Project Report. It reads as under:

“The Project Road (National Highway -30)

From km 180.0 to km 190.0 of bypass section there is a very congested stretch due to the presence of Transport Nagar, residential buildings & commercial activity. Further NH- 30 intersects with NH-19 at Km 188+500. At

90 Km. 188+800, SH-1 starts form the Patna bypass and traverses towards south (towards Masaurhi). From km 190 to km 195 of bypass section there is agricultural land on both side of road. At Km. 195+750, it further crosses railway line (Patna-Kolkata section) through a newly built 4-lane ROB.

Further it traverses through Didarganj (Km.

197).

The stretch of NH-30 on new bypass and from Didarganj ROB (Km 196) to Fatua (Km 208) is very congested with local and thorough traffic all along. However, while new bypass area upto Didarganj has available ROW of 60 m for widening to 4/6 lanning, the area between Didarganj to Fatua is being encroached/has built up settlement on both sides with available ROW less than 15-20m. Immediately after Fatua town (Km 208) to Bakhtiyarpur (Km 227), this area is relatively less congested, but has pockets of staggered settlement in between, including at Bakhtiyarpur. Due to above-

mentioned existing features, widening of existing road to standard 4-lane configuration would present considerable

difficulty due to the physical constraints. In view of above-mentioned features, the

91 proposed alignments have been considered on the southern side of the existing NH-30.

Toll Plaza Location

The project road is proposed to be developed as Tolled Road. The project road being only 50km long, only one toll plaza will be feasible to be provided. During site reconnaissance it was observed that free space is available near km 194 suitable for development of Toll Plaza System. Same is already discussed with NHAI officials during site visit.

Service Road

The concept of service is being conceived at built up area and grade separated intersections (Flyover & Underpass locations) which will come along the proposed alignment. The list of the proposed service road stretches are as follows:

i. 181.3 to 189.11

ii. 206.8 to 207.4”

(Emphasis supplied)

82. We have referred to the pleadings. We have also

noticed the relevant parts of the DPR. In the Writ

Petition, petitioners themselves have pleaded that the

92 road in question is a national highway, and what is

more, that it has been constructed merely for the use

of the residents of the Patna Municipality Area. In our

view, this pleading is fatal to the case of the

petitioner that there is violation of the second

proviso. As already found by us, the only requirement

to locate the toll plaza within the municipal limits,

is that a section of the national highway, inter alia,

is constructed within the municipal limits and the

construction must be primarily for the residents living

in the said municipal limits. There is hardly any

dispute that the national highway, which means the

project road, commences from 181.300 kms from the Patna

side and it goes to the east and till 196 kms, it is

located within the municipal limits. After 196 kms, it

branches of towards the south, which is the new bypass

consisting of nearly 36 kms. The total stretch consists

of a little over 50 kms. For nearly 14 kms, the road

project road passes through the municipal limits.

83. The DPR would show that the construction of the

project road and other roads, will bring about greater

93 circulation of traffic in the area. In other words, it

means that, the project road which begins from 181.300

kms, which was a two-lane road was widened to a four-

lane road and the project road ends at 231 kms, where

NH30 meets NH31. The Project Report also makes it clear

that from km 180 to km 190 of the bypass section, there

is a very congested stretch. From km 190 to km 195, it

is further stated that there is agricultural land on

both sides. Didardanj is located even further to the

east, and still further is, Fatua town. Construction

of the bypass in that area, was found to be

impracticable and it is accordingly that from 196 kms,

the new alignment towards the south, was carried out.

The Project Report further reveals that the project

road is only 50 kilometres long. Only one toll plaza

could be provided. In this regard, Rule 8(2)

contemplates the distance of 60 kilometres between two

toll plazas. The Project Report further reveals that

the NHAI Officials were available at the site along

with the persons who prepared the DPR, and it is

thereafter that this location was quite clearly

accepted by the NHAI, as when it entered into the

94 agreement with the Concessionaire, the agreement itself

provides for the site of the toll plaza being km 194.

It may be true that there may not be any decision which

specifically incorporates the view of the NHAI

regarding the site. What has apparently happened is,

in keeping with the newly introduced Rule (Rule 8 of

the 2008 Rules), the NHAI has proceeded to accept the

recommendation of the Expert Body to locate the toll

plaza at km 194.

84. We are not unmindful of the fact that counter

affidavit of the appellants betrays a certain degree

of ambiguity. This is for the reason that, what is

pleaded in both the counter affidavits, was that, even

if the toll plaza is located within the municipal

limits, the second proviso to Rule 8 comes to the rescue

of the appellant. This is sought to be exploited by the

Writ Petitioners to point out that even appellants were

not clearly aware, whether the toll plaza was being

located within the municipal limits or not. Writ

Petitioners also harp upon the clarity being infused

by the counter affidavit filed by the Municipal Council

95 of Patna that the toll plaza was located within the

municipal area. We also agree that the matter becomes

a little worse, when we read the pleadings of the

Concessionaire. In the first counter affidavit, it was

contended that the proposed toll plaza at km 194 is

much beyond 5 kilometres stipulated in the first

proviso. There is also pleading, which indicates that

understanding of the Concessionaire was that the

construction was for the overall population of the

area. However, we must also not ignore that the

upgradation was stated to be also aimed at benefitting

the local population for the speedy movement from Patna

to Bhaktiyarpur and vice-versa. In the second

supplementary counter affidavit, it is contended that

the four-laning was initiated to reduce the pressure

of the local traffic as well and that it is primarily

for the benefit of the local residents.

85. We are, indeed, troubled by the manner in which

the case was approached by the Concessionaire, in

particular. However, the appellants definitely set up

the case under Rule 8 in both the counter affidavits

96 filed by it. The statement that the second proviso

applies, even if the construction is made within the

municipal limits, is emphasised by the Writ

Petitioners, to show the non-application of minds. We

must, in this regard, bear in mind the nature of the

lis, as also the rights of the Writ Petitioners. The

High Court did not find any Fundamental Rights with the

writ petitioners in the matters. The only issue is

relating to violation of Rule 8. We have already found

that upon the satisfaction of the objective criteria

laid down in the second proviso, construction of the

toll plaza, as provided therein, is permissible. Apart

from the statement of the Writ Petitioners themselves,

that the road is a national highway and it is merely

for the use of the local residents, the undeniable fact

is that, in place of the two-lane road, after a huge

investment, it was upgraded to a four-lane road and

nearly 14 kilometres of the project road, indisputably,

passed through the municipal limits and the most

important beneficiary of the said construction, can

clearly be stated to be the residents in the municipal

area. The project road, did enure chiefly to the

97 residents of the Patna Municipality. The road from 180

to 190 kms was found to be a very congested stretch.

The construction of the widened road, undoubtedly,

helped mainly the residents of the municipal area.

There are other features, apart from widening,

including the graded separators. No doubt, it may be

true that many persons may be using the said stretch,

who may not be residents of the Patna Municipality,

would also benefit from the construction, but that

cannot detract from requirement of the second proviso

being fulfilled, viz., that the construction was

primarily for the benefit of the residents of the

municipal area. The second proviso does not require

that the construction must be solely for the benefit

of the residents of the municipal area.

86. There is another aspect, which we cannot ignore.

The construction was completed in accordance with the

agreement with the Concessionaire. The Judgment of the

Division Bench came to be stayed by this Court and the

toll has been collected from the toll plaza. Secondly,

the High Court may not be justified in finding that the

98 commercial expediency trumped the law. Commercial

expediency is, undoubtedly, a relevant fact. The exact

location of the toll plaza is also geared to garner

maximum revenue. Concessionaire Agreement lasts for a

particular period of time. It is the Concessionaire,

who makes the construction, after making the entire

investment. The contract contemplates “Design, Build,

Finance, Operate and Transfer (the “DBFOT”) under Rule

16 of the Rules, upon the expiry of the agreement, the

fee is to be collected by the Central Government or the

Executing Authority. Therefore, in such circumstances,

any leakage in the toll, would naturally be sought to

be avoided. As long as the site of the toll plaza is

otherwise supportable, with reference to the second

proviso, then, the area of judicial review, in such

matters, would be extremely narrow.

87. We may notice one dimension. In the Rules of 2008,

Rule 2C defines a bypass as a section of the national

highway bypassing a town or a city. Therefore, the

question may arise, whether, when Rule 8 speaks of

construction of a section of the national highway,

99 which is within a municipal or town area limits, it

will include a bypass, in view of the new definition.

There is indication in the case that from 178 km, there

was an existing bypass. The new construction was over

the existing bypass. However, we do not explore this

matter further as none of the parties addressed us on

this and we proceed on the basis that there was

construction of a National Highway partly within the

municipal limits.

RULE 17; CLOSING OF SERVICE ROADS

88. Rule 17 permits additional barriers to prevent

evasion of fees at the toll plaza. At places, other

than “at the toll plaza”, with prior permission of the

Central Government or Executing Authority, additional

barriers are permitted but within 10 kilometres from

the toll plaza. We notice these provisions to pronounce

on the complaint of the Writ Petitioners that there is

blocking of the service roads near the toll plaza. We

make it clear that barriers shall be permissible only

in compliance with Rule 17 of the Rules.

100 IMPACT OF APPELLANTS NOT CHALLENGING JUDGMENT IN WRIT PETITION NO. 4526 OF 2013

89. The further question to be considered, is the

effect of appellant not challenging the Judgment

rendered in the Writ Petition No. 4526 of 2013, filed

by one Ritesh Ranjan Singh. The said petitioner filing

the Writ Petition, was filing it as Public Interest

Litigation and it was so treated. It was, however, made

over to learned Single Judge, who heard it along with

Writ Petition No. 5643 of 2012. We have already noted,

in first paragraph of this judgment, the manner in

which both Writ Petitions were disposed of.

90. It is true that the appellant filed LPA in 2015

only against Writ Petition No. 5643. Concessionaire

filed two Appeals. All the three Appeals came to be

dismissed. The present Appeal is filed only against the

Judgment in LPA No. 388 of 2015, which in turn, was

directed against Writ Petition No. 5643 of 2012,

therefore, the obstacle, which is sought to be set up

by the Writ Petitioners (Respondent Nos. 1 to 17) that

the Judgment in Writ Petition No. 4526 of 2013 has

101 become final. In other words, if the present Appeal

is allowed, it would lead to a consistent decision, one

by this Court and another contradiction with our

Judgment rendered final, viz., the Judgment in Writ

Petition No. 4563 of 2013.

91. The contention, which is pressed before us by the

learned counsel for the appellant, is by drawing

support from the Judgment of this Court in Shenoy & Co.

v. Commercial Tax Officer, Circle II, Bangalore and

Others20 .

92. No doubt, that was the case where the

constitutionality of a statute was challenged in a

number of writ petitions. The provisions were struck

down by the High Court. From the Judgment of the High

Court, only one of the Writ Petition was challenged

before this Court. While so, there were other

developments, insofar as there was legislative activity

aimed at removing infirmities of the law, which was

struck down by the High Court and giving it

retrospective effect also. More importantly, this Court

20 (1985) 2 SCC 512

102 allowed the Appeal and set aside the Judgment of the

High Court. Thereafter, fresh notices were issued after

the Judgment of this Court, upholding the original

enactment of the year 1979. Notices were sent to all

the Writ Petitioners, who had secured Judgment from the

High Court, which Judgments were not appealed against.

This Court was dealing with the contention that, as far

as their cases are concerned, since no Appeal was

carried in their case, Judgment of the High Court

remained intact. While rejecting this argument, Court

drew upon the provision of Article 141. The Court,

inter alia, held as follows:

“23. …..To contend that this conclusion applies only to the party before this Court is to destroy the efficacy and integrity of the judgment and to make the mandate of Article 141 illusory. But setting aside the common judgment of the High Court, the mandamus issued by the High Court is rendered ineffective not only in one case but in all cases.

24. A writ or an order in the nature of mandamus has always been understood to mean a command issuing from the Court, competent to do the same, to a public servant amongst others, to perform a duty attaching to the office, failure to perform which leads to

103 the initiation of action. In this case, the petitioners-appellants assert that the mandamus in their case was issued by the High Court commanding the authority to desist or forbear from enforcing the provisions of an Act which was not validly enacted. In other words, a writ of mandamus was predicated upon the view that the High Court took that the 1979 Act was constitutionally invalid. Consequently the Court directed the authorities under the said Act to forbear from enforcing the provisions of the Act qua the petitioners.

The Act was subsequently declared constitutionally valid by this Court. The Act, therefore, was under an eclipse, for a short duration; but with the declaration of the law by this Court, the temporary shadow cast on it by the mandamus disappeared and the Act revived with its full vigour, the constitutional invalidity held by the High Court having been removed by the judgment of this Court. If the law so declared invalid is held constitutionally valid, effective and binding by the Supreme Court, the mandamus forbearing the authorities from enforcing its provisions would become ineffective and the authorities cannot be compelled to perform a negative duty. The declaration of the law is binding on everyone and it is therefore, futile to contend that the mandamus would survive in favour of those parties against whom appeals were not filed.

25. The fallacy of the argument can be better illustrated by looking at the

104 submissions made from a slightly different angle. Assume for argument's sake that the mandamus in favour of the appellants survived notwithstanding the judgment of this Court. How do they enforce the mandamus? The normal procedure is to move the Court in contempt when the parties against whom mandamus is issued disrespect it. Supposing contempt petitions are filed and notices are issued to the State. The State's answer to the Court will be: “Can I be punished for disrespecting the mandamus, when the law of the land has been laid down by the Supreme Court against the mandamus issued, which law is equally binding on me and on you?” Which Court can punish a party for contempt under these circumstances? The answer can be only in the negative because the mandamus issued by the High Court becomes ineffective and unenforceable when the basis on which it was issued falls, by the declaration by the Supreme Court, of the validity of 1979 Act.”

93. Actually, this is a plea, which may really not be

available to the Writ Petitioners. At any rate, if we

were to apply the same principles to the facts of this

case, we would come to the conclusion that if we were

to find that there is no violation of Rule 8, the

location of toll plaza at 194 kilometre is not flawed

and the judgment of the Court is set aside, then, it

would attract Article 141. The relief, which has been

105 granted in other Writ Petition, is in the form of

mandamus to shift the toll plaza, which may become

unenforceable, in view of our finding that toll plaza

was constructed lawfully and, therefore, need not be

removed. As already noticed, the appellants have

challenged the Judgment in the Writ Petition filed by

the Writ Petitioners.

WHETHER THE DECISION IS ARBITRARY

94. It is the case of the Writ Petitioners that the

decision to locate site of toll plaza at 194 kilometre

is arbitrary. Under Article 14 of the Constitution,

no State action can pass muster, if it is found to be

arbitrary. But, then, a different or even an incorrect

decision, would not make an otherwise lawful decision

vulnerable to judicial scrutiny. An arbitrary decision

would be one which is bereft of any rationale or which

is capriciously wrong, and not merely an erroneous

view, in the perception of the Court. Any other view

would tantamount to substituting its view for that of

the Authority. Judged by the said standard, and also

106 the nature of dispute, it cannot be held that toll

plaza, having been located at a point where there was

sufficient space and which would prevent the leakage

of traffic, and also noticing that stretch itself

consisted of a little over 50 kilometres, quite

clearly, the case based on arbitrariness, is only to

be repelled.

95. We have found that the Executing Authority is the

Competent Authority to take decision under the second

proviso to Rule 8 of the Rules. We, no doubt, have

found, there is no duty to record reasons. In

paragraph-77 of our Judgment, we have explained the

duty of the Executing Authority. In the light of this,

the Executing Authorities must maintain record, which

must contain the decision to locate a toll plaza,

invoking the second proviso.

96. Rule 9 of the Rules provides for discounts. The

appellants and the Concessionaire are duty bound to

extend the concessions to the local residents, in

particular. We have noticed the stand of the

appellants that this Court may issue appropriate

107 direction in this regard as this Court finds fit. We

notice that there is no appeal by the Concessionaire

against the impugned order.

97. The upshot of the above discussion is that we find

as follows:

(1) The construction of the toll plaza at 194

kilometre was not illegal or arbitrary;

(2) The direction by the High Court, to shift toll

plaza, cannot be upheld and it is liable to be

set aside;

(3) The appellants will look at the barricades

(closing of service roads) in regard to the toll

plaza and permit such barricades only as are

permitted in Rule 17 of the Rules. Any

unauthorised barricades will be removed without

any delay and at any rate within 2 weeks from

today.

(4) The First Appellant will issue suitable

directions to all Executive Authorities to

maintain distinct records containing the

decision, invoking the second proviso to Rule 8

108 of the Rules. Such direction shall be issued

within 3 weeks from today.

(5) We direct the appellants as also the

Concessionaire to extend the fullest benefits of

the concessions under Rule 9 of the Rules.

(6) Resultantly, we allow the Appeal and set aside

the impugned Judgment and the direction to shift

the toll plaza is set aside.

(7) There shall be no order as to costs.

……………………………………………J. (K.M JOSEPH)

…………………………………………J. (S. RAVINDRA BHAT)

NEW DELHI;

SEPTEMBER 23, 2021.

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