In a setback for MMRDA, the Bombay High Court on Thursday dismissed its appeal, giving a go-ahead for hike in Metro fares. The HC also came down heavily on the authorities for failing to form a Fare Fixation Committee (FFC) for over a year.
What did the court say?
The court said RInfra and Mumbai Metro One Private Ltd (MMOPL) can increase the fares as proposed by the operators at the time of starting the service last June.
What are the new fares?
MMOPL (a joint venture between Reliance Infra and MMRDA) can now increase fares to Rs10, Rs20, Rs30 and Rs40. The current promotional fares are Rs10, Rs15 and Rs20.
Counsel for MMOPL told HC that the new fares will be applicable from January 10.
Why is HC miffed at govt?
A division bench of chief justice Mohit Shah and justice BP Colabawalla has also directed that the FFC be formed by January 31 and that it decide on the fare issue within three months.
When MMRDA, through its counsel Aspi Chinoy, said, "We wish to take the matter to the apex court, and hence, seek stay on this order for three weeks," the judges refused to do so.
The HC said the Centre had failed to form the FFC for over a year, leading to escalation of the issue. The judges even noted that the operators were already suffering losses.
How much loss is RInfra/MMOPL incurring?
"The respondents (RInfra and MMOPL) have said at the current rate (of tickets) the daily loss for the company is Rs85 lakh. If the fare band is increased to Rs10-Rs40, the daily loss will come down to Rs62 lakh," observed the HC.
RInfra and MMOPL too opposed MMRDA's plea for stay. Their counsel Janak Dwarkadas said: "We are fighting to meet the operational costs. Even after the costs are increased to Rs10-Rs40, the loss will not stop, it will only come down. Moreover, the appellant has not denied our claim of losses."
Accepting the argument, the judges said if the FFC finds the new rates unreasonable, it will pass on the benefit to the commuters. "But if the FFC finds the rates reasonable, there is no way for the operator to recover the losses," the court observed.
It, however, said the observations made in its order will not affect or prejudice the FFC.
CM on verdict
Speaking to media persons at BJP state unit headquarters at Nariman Point, chief minister Devendra Fadnavis on Thursday said the state government will study the high court judgment and find out whether their side was duly represented or not, and if required, go for appeal.
Fare expected to reach Rs40 gradually
State authorities, including Mumbai Metropolitan Region Development Authority (MMRDA), are yet to get HC's judgment copy and go through the detailed order.
"We will see the detailed order and decide, in consultation with the state government, if an appeal has to be filed on the issue," said UPS Madan, MMRDA commissioner.
Also, it is unlikely that the initially planned fares of Rs10-20-30-40 will come into effect immediately. Those involved with the management of Versova-Andheri-Ghatkopar Metro may not want to give commuters an instant shock of a substantial fare hike.
There is also the possibility of Mumbai Metro marginally increasing the fares in the coming days, before an appeal is moved in the Supreme Court.
(With inputs from Shailendra Paranjpe and Ateeq Shaikh).
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