The Delhi High Court yesterday ordered India’s central roads authority to refrain from imposing a ruling that adversely affects the way concessionaires calculate their annual toll rate increases, two sources told Infralogic.

The court issued a notice to the National Highways Authority of India (NHAI) and a verbal order, and listed the matter for hearing again on 17 October.

NHAI’s latest ruling dated 13 September directed concessionaires to use a revised linking factor of 1.561 to determine annual toll rate increases, compared to 1.641 that it had specified in 2018.

The linking factor is used to convert wholesale price index data between different base years and is essential to ensure a continuity in applying the index to contracts and projects.

The petitioners — Highway Operators’ Association (India) (HOAI) and Roadstar Infra Investment Trust (RIIT) — had challenged the 13 September circular, alleging that the linking factor was revised “without any prior intimation or industry consultation”.

In their petitions, HOAI and RIIT said that the 2018 decision formed the basis for bids by concessionaires for various public-private partnership (PPP) projects as well as financing decisions by lenders, including state-run and private sector banks.

Enforcing the latest circular would lead to losses of millions of rupees to the stakeholders, the petitioners alleged.

The negative impact from using the revised figure is between 3% and 5% to annual toll revenue, a concessionaire source told Infralogic.

HOAI was represented by Senior Advocate Gopal Subramaniam, assisted by a team from law firm Cyril Amarchand Mangaldas (CAM). RIIT was represented by Senior Advocate Rajiv Nayar, assisted by CAM.

The team from CAM was led by partners Raunak Dhillon, Manmeet Singh, and Uday Khare.

The HOAI is comprised of infrastructure investors and their associated asset management companies focusing on highway concessions. HOAI members hold 105 concessions covering more than 8,800km across India, according to its website.

RIIT is a roads trust sponsored by Roadstar Infra, which derives its experience from IL&FS Transportation Networks, an IL&FS group entity.

The NHAI, RIIT, HOAI and CAM did not respond to requests for comment.