Force majeure in toll contracts suspended future remittances from the COVID-19 date, while accrued dues and termination notice survived.

In a toll-collection contract, the force majeure regime was treated as operative from 26.03.2020 under the governmental COVID-19 response and later tolling directions, without requiring a separate notice. Accrued arrears up to 25.03.2020 remained payable, but the weekly remittance obligation was modified and suspended from 26.03.2020 until traffic recovered to 90% of the pre-lockdown level, with deposits to be made after permitted deductions. A termination notice issued by the municipal authority was upheld as timely on the Court's calculation, and appointment of a retired Judge to decide the disputes was declined, leaving the writ proceedings to continue before the Single Judge.

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Issues: Whether the force majeure clause became operative for the toll collection contract and from what date; whether the weekly remittance and related arrears could be enforced or stood suspended during the force majeure period; whether the termination notice issued by SDMC could be sustained; and whether a retired Judge could be appointed to adjudicate the disputes.

Issue (i): Whether the force majeure clause became operative for the toll collection contract and from what date.

Analysis: The contract had to be read in the light of the governmental treatment of the COVID-19 pandemic and the later MORTH directions governing toll collection contracts. The relevant force majeure relief for tolling contracts was held to apply from 26.03.2020, with the period of suspension and the post-resumption period treated separately. The Court also held that, in the circumstances, no separate notice was necessary where the governmental declaration itself brought the clause into operation.

Conclusion: The force majeure clause was held operative from 26.03.2020 and remained applicable until traffic resumed to 90% of the pre-lockdown weekly level.

Issue (ii): Whether the weekly remittance and related arrears could be enforced or stood suspended during the force majeure period.

Analysis: The Court distinguished between amounts that had already accrued before the force majeure period and recurring weekly payments thereafter. It held that the arrears quantified as due up to 25.03.2020 were not displaced by force majeure and had to be cleared. For the subsequent period, the contractual remittance obligation was modified in light of the force majeure regime, with toll collections to be deposited after deduction of permitted administrative and toll collection expenses.

Conclusion: The arrears were held payable, while the weekly remittance obligation stood modified and suspended from 26.03.2020 until restoration of 90% traffic.

Issue (iii): Whether the termination notice issued by SDMC could be sustained and whether a retired Judge could be appointed to adjudicate the disputes.

Analysis: The termination notice was upheld as having been issued in advance of the final due date on the Court's calculation. The Court declined to treat the matter as one requiring appointment of a retired Judge at that stage, though it left open the possibility of consensual alternative dispute resolution before the Single Judge. The earlier direction that the writ proceedings should progress expeditiously was maintained.

Conclusion: The termination notice was upheld and no retired Judge was appointed.

Final Conclusion: Both appeals were disposed of with modification of the interim arrangement, preservation of pre-force-majeure dues, regulated remittance during the force majeure period, and continuation of the writ proceedings before the Single Judge.

Ratio Decidendi: In a contractual toll-collection arrangement, a governmental force majeure regime may suspend future recurring remittance obligations from the operative date of the declared disruption, but accrued pre-existing dues and an otherwise valid termination notice are not displaced unless the contract or controlling directions require a contrary result.

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