PWD issues notice to NICE over 'unauthorised' 7.5% toll hike

Bengaluru: In a setback to Nandi Infrastructure Corridor Enterprise (NICE), the Public Works Department (PWD) has issued a notice to the private firm for increasing toll charges by 7.5% without obtaining the government’s prior approval.

The department also stated that the revised tariff violates the framework agreement signed in 1994 and made it clear that it will not recognise the “unauthorised” hike. 

However, the operators of NICE Road denied receiving the notice and claimed that toll revision was within the scope of the agreement. 

Starting July 1, NICE Limited raised toll charges on the 44-km peripheral ring road and link road by about 7.5%, making it one of the expensive rides in the city, especially for cars and two-wheelers. 

Objecting to the revision, PWD Deputy Secretary N Parvathi wrote a letter to the company on July 8, stating that the revision was unacceptable. The letter cited Article 6.4 of the framework agreement, which mandates that the company must seek the Karnataka government’s approval before revising toll charges. 

Amlan Aditya Biswas, Principal Secretary to the Public Works Department, confirmed sending the notice to NICE Ltd, stating that the private company took a unilateral decision.

“They are supposed to revise tolls only after seeking permission from us. Although NICE is an autonomous entity, it is governed under the framework agreement, which it cannot violate,” he said. 

Defending the toll hike, Ashok Kheny, Managing Director of NICE, said the 1994 agreement allows the company to increase tolls by up to 10% annually. “We did not seek permission because the toll structure, which should have been implemented five years ago, has been rolled out only now. Moreover, we have increased the toll by only 7.5%, which is below the permitted limit,” he said. 

He also stated that toll charges for some vehicles are much lower than those collected on other roads, even though NICE Road is entirely cemented and the land was fully acquired by the private company, unlike other projects. 

It may be recalled that the PWD had slapped a default notice on NICE Limited in February 2016, stating that the company had failed to complete the toll roads of the Bangalore-Mysore Infrastructure Corridor Project in accordance with the agreed technical requirements. A writ petition related to this is still pending consideration. 

Subsequently, when NICE Ltd had approached the government for permission to increase tolls, the PWD denied permission, citing ongoing proceedings and the default notice.

In August last year, DH had reported that NICE had increased toll for 2024-25 without seeking government approval.