Noida Toll Bridge retrenched 80, laid off 143 after SC order

Assessing the financial loss to the company post the Supreme Court order, Noida Toll Bridge Company Chairman Raj Bhargava said they had to retrench 80 employees and have laid-off 143 employees.Last month the Supreme Court had refused to stay the Allahabad High Court verdict restraining the toll company from collecting toll at the Delh-Noida-Delhi (DND) flyway that connects Delhi and Noida.

Even contractual employees had to be reduced, he said in an interview to CNBC-TV18.

He said the company spends around Rs 95 lakh per month on road maintenance and employed around 450 people but now they are not able to maintain the full strength of employment post the order.

The company spends a lot of money on electricity and maintenance which came from the cash collection at tolls, said Bhargava.Below is the verbatim transcript of Raj Bhargava’s interview to Anuj Singhal, Latha Venkatesh & Sonia Shenoy on CNBC-TV18.Sonia: Things have really turned for the worst for your company ever since that Allahabad High Court order came in. Can you just give us an update on what the status of the litigation is now and how many employees have you asked or have you let go off?A: At the moment, we have got the order from the honourable Supreme Court which said that we should continue not to charge any toll but maintain the road and in the mean time we had to have a look at the financials that we have.Normally, we spend about Rs 90-95 lakhs per month in the maintenance of the road and for the employees that we have. We have about 450 employees. We examined the issue and we found that it was not possible for us to sustain so many employees and maintain their expenditure that will require for maintenance without undertaking certain extreme steps with regards to the employees.As a consequence, we had to retrench about 80 odd employees and we had to lay off about 143 employees. However, we told them that as and when the company gets back to normal, we would be very happy to employ them back. This has resulted in a huge disappointment for the staff but we had no choice. Even the contractual employees had to be reduced and something like 35 employees have been maintained, have been kept to keep the maintenance going.This has a problem with us because the cash flows that we have is based on whatever toll we collect every day. We have to spend lot of money on the electricity, maintenance of the place, looking after the people who drop in for getting back their money from us and so on and so forth.Latha: What happens if you don’t win the appeal against the High Court, the company can’t sustain?A: What we are given to understand from the honourable Supreme Court is that after the Comptroller and Auditor General (CAG) looks into the profitability of the company and comes to the conclusion that we still need to get all the money that we require for the 20 percent that we must get out of our investments and if that money is still not fulfilled by the present situation then they will allow us to go back on the toll. Till such time as we can retrieve the entire money and pay not only our employees but also our shareholders. We have about 80,000 shareholders who have received nothing for almost 10 years.Anuj: If the final Supreme Court order also goes against the company, in that case what are the options left because the toll has to operate but as you are saying that is the only source of income, so do you have land bank that you would sell, how do things move from here just want to understand that?A: We have no control over the land bank; let us put it very clearly. We have only control on the concession agreement, which lays down that in the event of any such thing change of law taking place then we got to be reimbursed by the government of Uttar Pradesh and Noida Authorities to the extent that the independent auditors can calculate the amount that is due with the company and that is the only source that we will have.After that obviously, the company will have to go into liquidation because we have no further income coming in. However, we hope that the money which we can get from the Noida Authorities and the government of Uttar Pradesh it will be possible for us to pay back certain amounts of money to our shareholders and also to employees as part of retrenchment dues, their PF funds, their ESI funds and all those funds which are required to be paid to the employees at the time of retrenchment.Latha: Basically, you await the CAG now?A: The CAG is on the work, they came in two days ago and they are having a look at all the accounts and they are checking. We are waiting for their results.