KOCHI: Guruvayoor Infrastructure Pvt Ltd (GIPL), a unit of Bharat Road Network Ltd (BRNL) that operates the Thrissur-Edapally highway, owes nearly Rs 441 crore to the government in the form of penalties and dues, according to the Comptroller and Auditor General (CAG).
In its report on the toll operator published earlier this month, the auditor criticised the National Highway Authority of India (NHAI) for having failed to put in safeguards to prevent the company from defaulting on payments.
The pending dues to NHAI “running at Rs 440.5 crore as of March 2021” were calculated by CAG as part of its audit. Of the Rs 449.5 crore, nearly Rs 296 crore is owed in the form of a premium that is GIPL’s share of the toll collection up to March 2021, including interest on account of delays.
Another Rs 137.74 crore is due as a penalty for deficiency in the maintenance of the stretch of NH-544. The company also owes NHAI another Rs 7.21 crore for wrongfully collecting tolls on the stretch of the road under the management of the Kochi Metro Rail Ltd (KMRL).
The Thrissur-Edapally highway was the first major project won by BRNL, which is promoted by Srei Infrastructure Finance Ltd.
BRNL has seen its stock price plummet to Rs 33.30 (as of August 24) from around Rs 200 nearly five years ago even as its promoter, Srei, went into bankruptcy. However, GIPL continues to operate the stretch and collect tolls.
Merry-go-round of claims
The four-lane highway from Angamaly to Edapally was originally constructed by the state government’s Public Works Department (PWD). It was later handed over to NHAI, which wanted to convert the whole length from Thrissur to Edappally into a four-lane highway.
NHAI handed over the four-laning contract to GIPL for Rs 313 crore in 2006. Under the contract, GIPL is entitled to collect tolls on the stretch up to 2028.
However, GIPL won the contract after it promised to pay a premium “also known as a negative grant” of Rs 215 crore to NHAI in six annual instalments. According to the CAG, the company paid only the first instalment of Rs 15 crore in December 2006.
The remaining amount of Rs 200 crore was due between 2014 and 2018. By March 2021, the company owed NHAI a total of Rs 295.78 crore under this header, including interest. NHAI made a demand for the amount in April 2021.
CAG pointed out that GIPL, instead of sending the money, asked NHAI to wait till the Kerala government cleared some of its dues. The company claimed that Kerala government owed it money as compensation for free passes issued to local residents. GIPL also claimed that it was due some amount as user fee from KSRTC. In addition to premium, GIPL owes Rs 137 crore for not carrying out maintenance on the Thrissur-Aluva stretch since July 2014. The Rs 441 crore also included Rs 7.2 crore which was excessively collected from road users.
Road users should have been given a discount in toll from 2013 as GIPL was no longer required to maintain or repair an 11km stretch from Aluva to Edappally. This was because this stretch was handed over to KMRL in April 2013.
CAG noted that, although NHAI raised the demand, the amount had not been recovered as of July 2021. TNIE reached out to BRNL, but could not elicit a response.