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NATIONAL HIGHWAYS AUTHORITY OF INDIA ACT, 1988
68 of 1988
16th December, 1988
The development and maintenance of national highways is fully financed by the Central Government as this function comes within entry 23 of the Union List of the Seventh Schedule to the Constitution. Further,
S.5of the National Highways Act, 1956 provides that the Central Government may direct that any function in relation to the development or maintenance of national highways shall also be exercisable, among others, by any officer or authority subordinate to the Central Government. Under this provision, the function of execution of the filed activities including survey, investigations and preparation of projects on national highways have been delegated to the respective State Governments; The Central Government retaining the activities pertaining to planning, approval of design and estimates, monitoring, etc. This system is commonly known as the 'Agency System' since the State Governments are paid 'Agency Charges' incurred by them on works executed on the national highway system. 2. Though the 'Agency System' of execution of national highway works by the Slate Public Works Departments has been functioning for a period of about 40 years, difficulties have been experienced from time to time, 3. Since the Central Government have no direct administrative control over the executing agency, there have been instances when the Central Government had to remain helpless in case a State Government overlooked the acts of omission or commission on the part of its staff engaged in the construction and maintenance of national highways. This has resulted in anomalous situations where the Central Government, being constitutionally responsible for the development and maintenance of national highways had to defend actions of State Governments in various forums, including Parliament. Similarly the Centre generally ha¯no role in fixation and operation of even major contracts arbitration cases, payment of compensation to contractors, etc, over and above the original contract amounts and other items resulting in direct financial commitment of Central funds. 4. Under the circumstances, the only, alternative is for the Centre to take over development and maintenance of the national highway system through the creation of an autonomous National Highways Authority. It is proposed that this Authority should take over, in a phased manner the functions presently being performed by the State Public Works Departments. 5. The main functions of the Authority would be to develop and maintain national highways whose management and operation is vested in the Central Government. Some of the salient features of the Bill are :- (a) the Authority, which will be a functional body, will consist Of a Chairman and not more than five full time members to be appointed by the Central Government. The Central Government may also appoint not more than four part- time members; (b) the Central Government is being empowered to vest in, or entrust to, the Authority such national highways or any stretch thereof, as are vested at present in that Government under section 4 of the National Highways Act, 1956; (c) any land required by the Authority for discharging its functions will be deemed to be land needed for a public purpose and such land may be acquired for the Authority under the provisions of theLand Acquisition Act, 1894or any corresponding law for the time being in force; (d) the authority will have powers to enter into and perform any contract up to a certain value which will be prescribed by the Central Government. (e) the Central Government will provide funds to the Authority for the discharge of its functions; (f) the Authority will be responsible for the development, maintenance and management of the national highways which are vested in it by the Central Government; (g) the Authority will construct offices, workshops and residential buildings for its employees and construct way- side amenities near the national highways vested in it; (h) the Authority will, on behalf of the Government, be empowered lo collect fees for services or benefits rendered by it undersection 7 of the National Highways Act, 1956; (i) for the proper management of highways, the Authority will regulate and control the plying of vehicles on the highways vested in it; (j) with the approval of the Central Government, the Authority will raise funds through the floating of bonds, issue of debentures, etc. 6. The Bill seeks lo achieve the above objects. -Gaz.of Ind.,4- 1l-88, Pt. II, S.2, Ext. P. 13 (No. 52)[]
An Act to provide for the constitution of an Authority for the development, maintenance and management of national highways and for matters connected therewith or incidental thereto. BE it enacted by Parliament in the Thirty-ninth Year of the Republic of India as follows:-
SECTION 01: SHORT TITLE, EXTENT AND COMMENCEMENT
(1) This Act may be called the National Highways Authority of India Act, 1988.
(2) It extends to the whole- of India.
(3) It shall come into force on such date" as the Central Government may, by notification in the Official Gazette, appoint.
SECTION 02: DEFINITIONS
- In this Act, unless the context otherwise requires, -
(a) "Authority" means the National Highways Authority of India constituted underS.3-;
(b) "Chairman" means the Chairman of the Authority:
(c) "employee" means a person in the full time service of the Authority;
(d) "member" means a member of the Authority appointed underS.3-and includes the Chairman:
(e) "national highway" means any highway for the time being declared as a national highway undersection 2 of the National Highways Act, 1956-;
(f) "prescribed" means prescribed by rules made under this Act;
(g) "regulations" means regulations made by the Authority under this Act;
(h) words and expressions used herein and not defined but defined in the National Highways Act, 1956 shall have the meanings assigned to them in that Act.
SECTION 03: CONSTITUTION OF THE AUTHORITY
( 1 ) With effect from such date as the Central Government may, by notification in the Official Gazette, appoint in this behalf, there shall be constituted for the purposes of this Act an Authority to be called the National Highways Authority of India.
(2) The Authority shall be a body corporate by the name aforesaid having perpetual succession and a common seal, with power, subject to the provisions of this Act, to acquire, hold and dispose of property, both movable and immovable, and to contract and shall by the said name sue and be sued.
(3) The Authority shall consist of -
(i) a Chairman;
(ii) not more than five full-time members; and
(iii) not more than four part-time members, to be appointed by the Central Government by notification in the Official Gazette.
SECTION 04: TERM OF OFFICE AND CONDITIONS OF SERVICE OF MEMBERS
The term of office and other conditions of service of the members shall be such as may be prescribed.
SECTION 05: DISQUALIFIED FOR APPOINTMENT AS MEMBER
- A person shall be disqualified for being appointed as a member if he -
(a) has been convicted and sentenced to imprisonment for an offence which, in the opinion of the Central Government, involves moral turpitude; or
(b) is an undischarged insolvent; or
(c) is of unsound mind and stands so declared by a competent Court; or
(d) has been removed or dismissed from the service of the Government or a Corporation owned or controlled by the Government; or
(e) has, in the opinion of the Central Government, such financial or other interest in the Authority as is likely to affect prejudicially the discharge by him of his functions as a member.
SECTION 06: ELIGIBILITY OF MEMBER FOR REAPPOINTMENT
Subject to the other terms and conditions of service as may be prescribed, any person ceasing to be a member shall be eligible for reappointment as such member.
SECTION 07: MEETINGS
(1) The Authority shall meet at such times and places and shall observe such rules of procedure in regard to the transaction of business at its meetings, including the quorum thereat, as may be provided by regulations.
(2) If for any reason the Chairman is unable to attend any meeting of the Authority any other member chosen by the members present at the meeting shall preside at the meeting.
(3) All questions which come up before any meeting of the Authority shall be decided by a majority of votes of the members present and voting and in the event of an equality of votes, the Chairman, or in his absence the person presiding, shall have and exercise a second or casting vote.
SECTION 08: VACANCY IN THE AUTHORITY NOT TO INVALIDATE PROCEEDINGS
- No act or proceeding of the Authority shall be invalidated merely by reason of -
(a) any vacancy in, or any defect in the constitution of, the Authority; or
(b) any defect in the appointment of a person acting as a member of the Authority: or
(c) any irregularity in the procedure adopted by the Authority not affecting the merits of the case.
SECTION 09: APPOINTMENT OF OFFICERS, CONSULTANTS AND OTHER EMPLOYEES OF THE AUTHORITY
(1) For the purpose of discharging its functions, the Authority shall appoint such number of officers and other employees as it may consider necessary on such terms and conditions as may be laid down by the regulations.
(2) The Authority may appoint, from time to time, any person as adviser or consultant as it may consider necessary, on such terms and conditions as may be laid down by the regulations.
SECTION 10: AUTHORITY TO ACT ON BUSINESS PRINCIPLES
In the discharge of its functions under this Act, the Authority shall act, so far as may be, on business principles.
SECTION 11: POWER OF THE CENTRAL GOVERNMENT TO VEST OR ENTRUST ANY NATIONAL HIGHWAY IN THE AUTHORITY
The Central Government may, from time to time, by notification in the Official Gazette, vest in, or entrust to, the Authority, such national highway or any stretch thereof as may be specified in such notification.
SECTION 12: TRANSFER OF ASSETS AND LIABILITIES OF THE CENTRAL GOVERNMENT TO THE AUTHORITY
( 1 ) On and from the date of publication of the notification underS.11-.-
(a) all debts, obligations and liabilities incurred, all contracts entered into and all matters and things engaged to be done by, with, or for, the Central Government, immediately before such date for or in connection with the purposes of any national highway or any stretch thereof vested in, or entrusted
to, the Authority under that section, shall be deemed to have been incurred, entered into and engaged to be done by, with, or for, the Authority;
(b) all non-recurring expenditure incurred by or for the Central Government for or in connection with the purposes of any national highway or any stretch thereof, so vested in, or entrusted to, the Authority, up to such date and declared to be capital expenditure by the Central Government shall, subject to
such terms and conditions as may be prescribed, be treated as capital provided by the Central Government to the Authority;
(c) all sums of money due to the Central Government in relation to any national highway or any stretch thereof, so vested in, or entrusted to, the Authority immediately before such date shall be deemed to be due to the Authority:
(d) all suits and other legal proceedings instituted or which could have been instituted by or against the Central Government immediately before such date for any matter in relation to such national highway or any stretch thereof may be continued or instituted by or against the Authority.
(2) If any dispute arises as to which of the assets, rights or liabilities of the Central Government have been transferred to the Authority, such dispute shall be decided by the Central Government.
SECTION 13: COMPULSORY ACQUISITION OFLAND FOR THE AUTHORITY
3-Any land required by the Authority for discharging its functions under this Act shall be deemed to be land needed for a public purpose and such land may be acquired for the Authority under the provisions of the National Highways Act, 1956 (48 of 1956).
SECTION 14: CONTRACTS BY THE AUTHORITY
Subject to the provisions ofS.15-, the Authority shall be competent to enter into and perform any contract necessary for the discharge of its functions under this Act.
SECTION 15: MODE OF EXECUTING CONTRACTS ON BEHALF OF THE AUTHORITY
( 1 ) Every contract shall, on behalf of the Authority, be made by the Chairman or such other member or such officer of the Authority as may be generally or specially empowered in this behalf by the Authority and such contracts or classes of contracts as may be specified in the regulations shall be sealed with the common seal of the Authority : Provided that no contract exceeding such value or amount as the Central Government may prescribe in this behalf shall be made unless it has been previously approved by that Government : Provided further that no contract for the acquisition or sale of immovable property or for the lease of any such property for a term exceeding thirty years and no other contract exceeding such value or amount as the Central Government may prescribe in this behalf shall be made unless it has been previously approved by that Government.
(2) Subject to the provisions of sub-section (1), the form and manner in which any, contract shall be made under this Act shall be such as may be provided by regulations.
(3) No contract which is not in accordance with the provisions of this Act and the regulations shall be binding on the Authority.
SECTION 16: FUNCTIONS OF THE AUTHORITY
(1) Subject to the rules made by the Central Government in this behalf, it shall be the function of the Authority to develop, maintain and manage the national highways and any other highways vested in, or entrusted to, it by the Government.
(2) Without prejudice to the generality of the provisions contained in subsection (1), the Authority may, for the discharge of its functions -
(a) survey, develop, maintain and manage highways vested in, or entrusted to, it;
(b) construct offices or workshops and establish and maintain hotels, motels, restaurants and rest-rooms at or near the highways vested in, or entrusted to, it:
(c) construct residential buildings and township for its employees;
(d) regulate and control the plying of vehicles on the highways vested in, or entrusted to, it for the proper management thereof;
(e) develop and provide consultancy and construction services in India and abroad and carry on research activities in relation to the development, maintenance and management of highways or any facilities thereat;
(f) provide such facilities and amenities for the users of the highways vested in, or entrusted to, it as are, in the opinion of the Authority, necessary for the smooth flow of traffic on such highways;
(g) form one or more companies under the Companies Act, 1956 -to further the efficient discharge of the functions imposed on it by this Act;
4(h) engage, or entrust any of its functions to, any person on such terms and conditions as may be prescribed;
(i) advise the Central Government on matters relating to highways;
(j) assist, on such terms and conditions as may be mutually agreed upon, any State Government in the formulation and implementation of schemes for highway development.
(k) collect fees on behalf of the Central Government for services or benefits rendered underS.7 of the National Highways Act, 1956-, as amended from time to time, and such other fees on behalf of the State Governments on such terms and conditions as may be specified by such State Governments; and
(l) take all such steps as may be necessary or convenient for, or may be incidental to, the exercise of any power or the discharge of any function conferred or imposed on it by this Act
(3) Nothing contained in this section shall be construed as -
(a) authorising the disregard by the Authority of any law for the time being in force; or
(b) authorising any person to institute any proceeding in respect of a duty or liability to which the Authority or its officers or other employees would not otherwise be subject under this Act.
SECTION 17: ADDITIONAL CAPITAL AND GRANTS TO THE AUTHORITY BY THE CENTRAL GOVERNMENT
5-The Central Government may, after due appropriation made by Parliament by law in this behalf,-
(a) provide any capital that may be required by the Authority for the discharge of its functions under this Act or for any purpose connected therewith on such terms and conditions as that Government may determine;
(b) pay to the Authority, on such terms and conditions as the Central Government may determine, by way of loans or grants such sums of money as that Government may consider necessary for the efficient discharge by the Authority of its functions under this Act.
SECTION 18: FUND OF THE AUTHORITY
(1) There shall be constituted a Fund to be called the National Highways Authority of India Fund and there shall be credited thereto -
(a) any grant or aid received by the Authority;
(b) any loan taken by the Authority or any borrowings made by it;
(c) any other sums received by the Authority.
(2) The Fund shall be utilised for meeting -
(a) expenses of the Authority in the discharge of its functions having regard to the purposes for which such grants, loans or borrowings are received and for matters connected there with or incidental thereto:
(b) salary, allowances, other remuneration and facilities provided to the members, officers and other employees of the Authority;
(c) expenses on objects and for purposes authorised by this Act.
SECTION 19: BUDGET
The Authority shall prepare, in such form and at such time in each financial year as may be prescribed, its budget for the next financial year, showing the estimated receipts and expenditure of the Authority and forward the same to the Central Government.
SECTION 20: INVESTMENT OF FUNDS
The Authority may invest its funds (including any reserve fund) in the securities of the Central Government or in such other manner as may be prescribed.
SECTION 21: BORROWING POWERS OF THE AUTHORITY
(1) The Authority may, with the consent of the Central Government or in accordance with the terms of any general or special authority given to it by the Central Government, borrow money from any source by the issue of bonds, debentures or such other instruments as it may deem fit for discharging all or any of its functions under this Act.
(2) Subject to such limits as the Central Government may, from time to time, lay down, the Authority may borrow temporarily by way of overdraft or otherwise, such amounts as it may require for discharging its functions under this Act.
(3) The Central Government may guarantee in such manner as it thinks fit the repayment of the principal and the payment of interest thereon with respect to the borrowings made by the Authority under sub-section (1).
SECTION 22: ANNUAL REPORT
The Authority shall prepare, in such form and at such time in each financial year as may be prescribed, its annual report, giving a full account of its activities during the previous financial year, and submit a copy thereof to the Central Government.
SECTION 23: ACCOUNTS AND AUDIT
The accounts of the Authority shall be maintained and audited in such manner as may, in consultation with the Comptroller and Auditor-General of India, be prescribed and the Authority shall furnish to the Central Government, before such date as may be prescribed, its audited copy of accounts together with the auditor's report thereon.
SECTION 24: ANNUAL REPORT AND AUDITOR'S REPORT TO BE LAID BEFORE PARLIAMENT
The Central Government shall cause the annual report and auditor's report to be laid, as soon as may be after they are received, before each House of Parliament.
SECTION 25: DELEGATION OF POWERS
The Authority may, by general or special order in writing, delegate to the Chairman or any other member or to any officer of the Authority, subject to such conditions and limitations, if any. as may be specified in the order, such of its powers and functions under this Act (except its powers underS.35-) as it may deem necessary.
SECTION 26: AUTHENTICATION OF ORDERS AND OTHER INSTRUMENTS OF THE AUTHORITY
All orders, decisions and other instruments of the Authority shall be authenticated by the signature of t
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