Allahabad High Court
Lal Bahadur Ram vs State Of Uttar Pradesh And Ors. on 21 December, 1987
Equivalent citations: AIR1988ALL146, AIR 1988 ALLAHABAD 146
Author: R.M. Sahai
Bench: R.M. Sahai
JUDGMENT R.M. Sahai, J.
1. Aggrieved by realisation of toll tax for crossing and re-crossing over Chopan bridge, situated on river Son in Mirzapur, even after 30 years from the date it was handed over to Public Works Department on 8th Oct., 1956 for realisation of cost of construction, the petitioner has come to this Court.
2. Right to realise toll tax, an important part of public finance and recognised by Indian Constitution for compensating government to recover the expenditure made on construction of a bridge etc. is recognised under Toll Act, 1851 read with Tolls Act XV of 1954. But it is not a power which can be 'called in-aid' by the State Government for augmenting its genera! revenue. Although while compensating for the amount spent on cost of construction the government may realise collection charges and the amount spent on maintenance but it cannot claim to realise interest unless the government or its instrumentality borrows money from the financial institution and agrees to pay interest thereon (Jiya Lal v. State of U. P., AIR 1981 All 72, Shanti Swarup v. State, 1982 UPTC 773 : (1982 All LJ 1085) and Rajesh Kumar Jaiswal v. Govt. of U. P., 1983 UPTC 314).
3. On the ratio laid down in these decisions it cannot be disputed that no interest can be recovered except if the amount spent by State Government has been borrowed from some financial institutions for construction of a bridge and interest is being paid on it. The question, therefore, is if opposite party, namely, State Government can be said to be justified in collecting toll tax from the aforesaid bridge even in 1987. Admittedly the bridge was constructed in 1954 at a total expenditure of Rs. 50,00,000/-. Toll is being realised from it since October, 1956. In 1976 a notification was issued on 2nd June by State Government wereby it was stipulated that toll on any particular bridge shall be levied so long its total cost of construction including interest on the total expenditure on the bridge has not been realised in full. It was this notification which was considered in Jiya Lal's case and it was held that only that part of interest can be realised which has been borrowed from financial institutions. In counter-affidavit filed on behalf of State it is stated that till March, 1987 the State Government has realised a sum of Rs. 3,77,65,452/- as toll tax from aforesaid bridge. It, however, claims that an amount of Rs. 98,27,876/- was still due to be realised.
From the break-up of figure given in Annexure 3 to the counter-affidavit the cost of construction, collection and maintenance amounted to Rs. 50,00,000/-, Rs. 6,71,223/-and Rs. 7,75,000/- respectively. And Rs. 4,11,47,105/- has been shown as interest from 18th Oct., 1956 to 31st Mar., 1987 on balance of amount to be realised. Thus total expenditure till March 1987 is shown at Rs. 4,75,93,328/-. Out of this only Rs. 3,77,65,425/- is stated to have been realised. Right to realise the amount of Rs. 98,27,876.00 is asserted on strength of averments made in Para 6 of counter-affidavit which reads as under : --
"It is true that for the construction of any particular work/Bridge there is no any such provision that State Govt. may realise any loan, other than the State budget funds, but as a matter of fact the expenditure incurred in the construction of the bridge are met with the capital out lay of the State plan under which the State Government realise lump sum loan from the Government of India, any financial institution, life insurance corporation, nationalised bank or from the open market etc. Thus it is not possible to state that how much loan was taken for construction of any bridge. It is also not practicable to disclose the name of financial institution and amount of loan taken for specific particular work/bridge. However, on the basis of data of the Part II of the budget a true copy of which is being filed herewith and marked as Annexure C.A. 2 to this counter-affidavit, it can be easily verified how much loan was taken from the Government of India or other sources in previous years and how much liability of the interest is to be paid by the State Government.
Since the interest paid by the State Government is the part of the loan therefore until (sic) the entire loan along with the interest to realise the toll tax from the bridge in question."
This paragraph itself leaves no room for doubt that no amount for construction of bridge was borrowed from any financial institution. Mere vegue assertion that the expenditure on construction of a bridge is met with the capital outlay of the State-plan, therefore, the State is entitled to realise interest is not sufficient to warrant collection of interest in view of legal position explained in Jiya Lal's case (AIR 1981 All 72). The construction of bridge etc. is a part of welfare activity of the " State. It is not undertaken as a profiteering business or as a commercial entity yielding profit.
4. Even the Government order issued in June. 1985 providing lor method of calculation of interest on cost of construction from the date of realisation of toll tax is not helpful. The question of calculation shall arise only if it can be established that government has a right to realise interest. Since this is not established as the amount spent on construction of the bridge was not borrowed from any financial institution the question of calculation of interest on this order does not arise. Even assuming that the government was entitled to realise interest on Rs. 50 lakhs it cannot be charged in 1987 as the amount appears to have stood paid long-ago. No detail has been given about the arrears to be realised, the rate of interest etc. It is hard to believe that the amount of Rs. 50 lakhs was still outstanding even though an amount of more than Rs. 3 crores have been realised. The averments appears to have been made because of certain observations in Shanti Swarup's case 11982 All LJ 1085). The opposite party has, however, failed to establish that any amouni was still due.
5. A word about the pendency of special leave petition against decision of this Court in Civil Misc. Writ Petn. No. 903 of 1985. In that case estimated cost of construction was Rs. 12.75 lakhs whereas the government had realised only 19.78 lakhs. It could therefore, be validly urged that if it was decided that government was entitled to realise interest athen the realisation fell short of it. But the facts of present case are different. Legal position apart the claim of government is not sustainable on facts. Moreover, admission of special leave petition or grant of stay order does not amount to setting aside the judgments of this Court. The law still is as explained by this Court in Jiya Lal's case (AIR 1981 All 72).
6. In the result petition succeeds and is allowed. A direction is issued to opposite party not to realise any toll tax from aforesaid bridge either through its instrumentality or through any agent or contractor.