Legal hitch hinders green tax on commercial vehicles entering Delhi

Authorities in Delhi failed to implement a Supreme Court order to collect a green tax from commercial vehicles entering the Capital, raising questions over a plan to clear the city’s air and ease traffic. The collection of the tax is stuck due to contractual legalities over who will collect the tax.

SMYR Consortium LLP, which collects toll from vehicles on behalf of the Municipal Corporation of Delhi, said it has not been mandated to collect the green tax. It said that its contract will have to be reworked if it is also to collect the ‘Green tax’.

Speaking to BusinessLine , an SMYR Consortium official said: “We were mandated to collect only commercial tax. Neither MCD nor the Transport Department officials have engaged with us on how to collect the Green Tax. Besides, collecting environment tax will also lead to diversion of vehicles away from Delhi, which will negatively impact the business.”

Following a Supreme Court order of October 9, the Transport Department of Delhi imposed an “environment charge” of ₹700 on light commercial vehicles and two-axle trucks, and ₹1,300 on three-axle trucks and above for each entry into Delhi.

This was to be levied by MCD toll collectors, along with tolls, on commercial traffic entering Delhi. The levy was to take effect on November 1, for four months.

The Indian Foundation of Transport Research and Training (IFTRT), a road transport tracking agency, noted that the toll collection agency had not started collecting the environment tax on November 1. Even requisite changes in the software to enable collection of fees have not been made.

SMYR Consortium LLP bagged the MCD tax collection project in mid-May by offering to pay ₹551 crore annually to the corporation for three years. So, irrespective of the actual tax collected, SMYR will have to pay the MCD ₹551 crore annually, the SMYR official said.

“There is resistance from truckers to pay the levy,” he added, noting that while MCD allows for monthly passes to be issued to truckers, the environment tax is supposed to be levied “per entry”, which adds to the agency’s work. These issues have been raised with the Supreme Court.

Taking serious note of non-implementation of the levy, the Delhi government said there should be “no excuses” by the authorities in collecting the tax in the national capital. Deputy Chief Minister Manish Sisodia said that any laxity in implementing effective steps to counter air pollution will be “detrimental” for the national capital. 

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