NHAI pays firm Rs 4.5 cr, after holding back Rs 20L bill for 9 yrs

The NHAI ended up paying Rs 4.5 crore to a private firm after it held back on clearing their bills for Rs 20 lakh about nine years back, a TOI report has said.

The NHAI made the final payment in December 2019, documents accessed by TOI showed, after the firm won an arbitration award and two cases in the Delhi High Court.

The private firm, registered under the MSME Development Act (2006), managed to extract the big sum as it was entitled to a 27 per cent interest during the period.


Nitin Gadkari, Union transport and highways minister, said his ministry "will investigate the matter".

The National Highways Authority of India signed the agreement with the private firm in February 2010 to oversee the collection at 11 toll plazas, documents produced in court showed. Then it held back payments saying the firm did not "carry out continuous observations of the assignments" and had delayed submitting its reports.

After the NHAI later cleared invoices worth Rs 20 lakh, the private firm took the matter to the MSME Facilitation Council pointing out the payment was delayed.

After conciliation proceedings failed, the case was referred to the Delhi International Arbitration Centre, which, in June 2018, passed an award of Rs 2.24 crore and an interest of 27 per cent per annum.

The private firm then successfully appealed in the Delhi High Court for execution of the award. After the HC;s order to pay Rs 4.18 crore in November 2018, the NHAI paid Rs 3.79 crore in July 2019.

The firm then went back to the High Court seeking Rs 83.78 lakh as additional interest -= from November 2018 to July 2019 -- on the original award amount. After the HC upheld it, NHAI got legal advice to pay the amount on time to "avoid further interest”.