SDMC, contractor tiff deepens over green tax collection

It seems like there is no end in sight in the toll tax tussle between South Delhi Municipal Corporation (SDMC) and the contractor over green tax collection. After the latter refused to pay the stipulated amount to the SDMC, the Supreme Court-appointed mediator Harish Salve informed the court that no solution can be reached between the two parties and the court will have to take its decision over the issue. 

The Concessionaire has been claiming that there has been a huge drop in tax collection since the introduction of the green tax, expressing unwillingness to bear extra burden in tax collection. The SDMC has been claiming that there was provision in concession agreement; hence, the operator is bound to comply with the order.

The Supreme Court, in order to reach a break-even point over the ongoing tussle, had earlier appointed senior lawyer Salve as the mediator in the issue. According to the SC order, Delhi Pollution Control Committee, Delhi government, SDMC and the toll tax collecting agency would have to be present to reach a decision. 

Meanwhile, there are persisting rumours that the toll contractor might quit from toll tax collection duty. If that happens, SDMC will be left with no toll tax contractor and will have to undergo the due process of issuing a tender to another one.

In the first week of December, the Supreme Court had ordered a 100 per cent increase in the Environment Compensation Charge (ECC) on light and heavy trucks plying on Delhi roads. 

While the light duty vehicles will now have to pay Rs 1,300, heavy duty vehicles will be charged Rs 2,600. The South Corporation said that the increased prices will invariably bring down the number of commercial vehicles entering the Capital, which will in turn hamper the toll tax collection.

The rift between the contractor and SDMC began as the former paid 30 per cent reduced amount to SDMC. Till that period, the SDMC used to get Rs 11 crore per week from toll tax collection but after imposition of green tax, the contractor submitted nearly Rs 7.30 crore per week. 

Meanwhile, the Corporation also took a firm stance against SMYR Consortium last week, the agency, which is authorised to collect the taxes on SDMC’s behalf. They en-cashed the bank guarantee for two months as the contractor deducted the share from toll tax collection after the green tax was imposed.