HC shoots down state’s demand for lower Metro fares

Commuters may have to start paying between Rs 10 and Rs 40 in different slabs as per the distance.

Written by MANASI PHADKE , Aamir Khan | Mumbai | Published: January 9, 2015 3:22:18 am
Commuters may have to start paying between  Rs 10 and Rs 40 in different slabs as per the distance from the present tariff of Rs 10 and Rs 20. Commuters may have to start paying between Rs 10 and Rs 40 in different slabs as per the distance from the present tariff of Rs 10 and Rs 20.

After a long-drawn tussle between the state government and the Reliance Infrastructure-led operator of
Mumbai’s first Metro, the Bombay High Court on Thursday ruled in the latter’s favour, dismissing the state’s appeal seeking a lower tariff structure.

This means, commuters using the Versova-Andheri-Ghatkopar Metro may have to start paying between Rs 10 and Rs 40 in different slabs as per the distance from the present tariff of Rs 10 and Rs 20. However, the MMOPL is yet to decide on when the new tariff will come into effect.

The Reliance-Infrastructure (RInfra)-led Mumbai Metro One Private Limited (MMOPL), which is managing the Mumbai Metro rail, contended that it is suffering a daily cash loss of Rs 85 lakh with an average commute of 2.65 lakh passengers.

According to the state government’s Mumbai Metropolitan Region Development Authority (MMRDA), both Reliance Infrastructure and MMOPL were bound by a concession agreement when the project was initiated under the Tramways Act and they could not have decided on the initial fares.

The MMRDA had earlier said that when initial fares are fixed by the concession agreement, which is a contractual obligation, RInfra and MMOPL could go to the Fare Fixation Committee (FFC) for a revision, but in no way revise their own fare.

RInfra and MMOPL through their lawyers contested MMRDA’s  arguments saying they had the right to fix initial fare being the Metro Rail Administrator under the Metro Act. The project was brought under the purview of the Central Metro Act in 2013. The administrators, however, contended that all future revisions were at the discretion of the Fare Fixation Committee (FFC).

Chief Justice Mohit Shah and Justice B P Colabawalla observed that it was “most unfortunate” that the Central government was sitting on the appointment of FFC for over one-and-a-half years.

The HC has, therefore, ruled in favour of RInfra and MMOPL while noting that the Centre is likely to appoint FFC by January 31. The HC has also directed that the FFC should make recommendations on the tariff within three months.
When the MMRDA pressed for the present fares to continue till January 31 (likely appointment of FFC), the judges observed that going by the losses incurred by RInfra, it would have perhaps suffered a loss of Rs 5.29 crore. The HC, therefore, rejected MMRDA’s plea.

A single judge of the High Court had on June 24 dismissed a petition filed by the MMRDA challenging the fare hike by RInfra on the opening fares. The MMRDA had then appealed against the order before a bench headed by the Chief Justice.

According to MMRDA, the consortium had agreed on the structure under which fares were to be Rs 9 (upto 3 km), Rs11 (from 3 to 8 km) and Rs13 (for more than 8 km).

MMOPL has, however, fixed the initial fares as Rs10, Rs 20, Rs 30 and Rs 40.

With there being a major conflict over the initial tariff for the Versova-Andheri-Ghatkopar Metro, the MMRDA had filed a petition seeking arbitration and also an injunction to the fare hike notified by the Reliance Infrastructure-led MMOPL.

RInfra-led MMOPL has constructed the 11.4-km Versova-Andheri-Ghatkopar Metro on a public private partnership model. The company along with private firm Veolia Transport holds a 74 per cent stake in the consortium, while the remaining 26 per cent is held by MMRDA.

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