No new contractor yet, MCDs may have a tough time ahead

Municipal Corporations of Delhi (MCDs) are likely to face problems in getting a new contractor for toll tax collection. As the bone of contention between the contractor and the corporation increased with the amount being paid by the former citing decline in entry of vehicles as the reason, it is noteworthy at what minimum reserve price will the tenders be passed and if at all the corporation will get a contractor within the end of this month.

“The last date for bidders to register is January 31 and we have started floating the tenders in a bid to get a new contractor for toll tax collection. Court has asked the SMYR consortium to pay us the sanctioned amount till the end of this month,” said Radhe Shyam Sharma, Chairman Standing Committee of South Delhi Municipal Corporation, nodal agency which collects tax on behalf of all the three MCDs.

However, Sharma said that the Corporation will not settle down for anything lesser than Rs 551 crore, that is, the amount SMYR consortium was entitled to pay. “We will not pass any tender for lesser than Rs 551 crore. It doesn’t make sense to take a contractor at lesser rates than the current amount,” said Sharma.

Meanwhile, a look into the past shows that the three corporations lost Rs 239 crore last year as floating of toll tax tender was delayed by over a year. 

The move comes after the Supreme Court on Thursday allowed the private contractor to discontinue its contract with the Municipal Corporation of Delhi. 

During the hearing, the consortium said the imposition of the ECC and the subsequent 100 per cent hike on it had resulted in nearly 35 per cent fall in the vehicles entering the national Capital and had adversely impacted its toll collection and business interest.