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Bombay High Court refuses to stay metro fares, asks FFC to decide it expeditiously

Wednesday, 25 June 2014 - 6:25am IST | Agency: dna

In a set back to the Mumbai Metropolitan Regional Development Authority (MMRDA), the Bombay high court on Tuesday dismissed its petition challenging the fares fixed by the Mumbai Metro One Private Ltd (MMOPL) (a joint venture between RInfra and MMRDA) for the Versova-Andheri-Ghatkopar metro rail.

Justice RD Dhanuka dismissed the MMRDA petition observing that MMOPL and not the state government had the right to decide on initial fares till the time the Fares Fixation Committee (FFC) decides on it. "The petition is without merit and hence dismissed," observed justice Dhanuka.

Justice Dhanuka further observed: "Perusal of the agreement (between the parties), indicates that MMOPL is empowered to fix the fares till it's decided by the FFC. Prima facie, the fares at the time of opening is to be fixed by respondent 3 (MMOPL) and not by the state government."

The HC has directed the Union government to ask the FFC to expeditiously decide on the fares as per the Metro Act.

The MMRDA had moved the HC on June 9 in an arbitration petition challenging the fares devised by its project partner, RInfra, saying the consortium had agreed on the structure under which fares were to be Rs Nine (up to 3 km), Rs 11 (from 3 to 8 km) and Rs 13 (for more than 8 km).

Upholding the arguments of RInfra and MMOPL counsels, the HC said that fares are not to be fixed by an agreement but by the FFC.

Justice Dhanuka also observed that the company was bound to start the metro rail service to recover its costs.

Without going into the merits of fixing of fares, the HC has asked the parties to decide on an arbitrator who will decide on the legality of the resolution passed by MMOPL on May 29 fixing fares. "As far as reasonableness of the fares is considered, this court (HC) cannot go into it. The issue will be adjudicated by the arbitrator," said the HC.

Taking into consideration the allegations by MMRDA that the fares decided by MMOPL are on the higher side, the court said FFC would consider the revenue earned at the time of fixing fares. "FFC can consider the fares recovered, the promotional fares and also the free rides (while fixing of fares)," observed the HC.

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