How govt plans to plug highway toll collection loopholes after UP scam exposure

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5. How govt plans to plug highway toll collection loopholes after UP scam exposure

Business News

How govt plans to plug highway toll collection loopholes after UP scam exposure
===============================================================================

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By [Upstox News Desk](https://upstox.com/news/authors/upstox-news-desk/)

2 min read | Updated on March 21, 2025, 14:20 IST

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SUMMARY

The National Highways Authority of India (NHAI) has debarred 14 toll collection agencies for two years after detecting fraudulent cash transactions at toll plazas.

![nhai toll plaza fastag.webp](https://assets.upstox.com/content/assets/images/news/nhai-toll-plaza-fastag.webp)

Gadkari clarified that there has been no breach in the Electronic Toll Collection (ETC) system, which accounts for more than 98% of the user fee collection.

The National Highways Authority of India (NHAI) has debarred 14 user fee collection agencies for irregularities detected at toll plazas. The action follows a raid by the Uttar Pradesh Special Task Force (STF) at the Atraila Shiv Ghulam Toll Plaza in Mirzapur district, which unearthed fraudulent practices in cash collection.

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Based on the FIR, NHAI issued show-cause notices to the erring agencies, and found their responses unsatisfactory.

“The agencies have been debarred for a period of two years for violation of the provisions of the contract agreement. ‘Performance Securities’ worth over Rs. 100 crores of the defaulting agencies have been forfeited and are being encashed for breach of the contract,” the ministry of road transport & highways said in a statement.

### How the scam surfaced

Investigations revealed that toll operators were manipulating cash transactions involving non-FASTag or blacklisted FASTag vehicles. Instead of routing payments through the mandatory Toll Management System (TMS), operators used separate handheld devices, including illegitimate Point-of-Sale (PoS) machines, to pocket funds.

Vehicles without valid FASTags are charged double the standard fee and switched to cash mode when boom barriers fail to lift. Operators allegedly logged these transactions as “exempted” or “violation” categories, issuing fake receipts and bypassing the TMS.

“There may also be possibility of charging cash payment from the overloaded vehicles over and above the admissible fee which might not be accounted in the ETC/TMS system,” Union minister Nitin Gadkari said in a written reply to Lok Sabha.

The minister clarified that there has been no breach in the Electronic Toll Collection (ETC) system, which accounts for more than 98% of the user fee collection.

### How govt plans to plug the loopholes

NHAI plans to install audit cameras to independently monitor the accurate count and classify vehicles using Artificial Intelligence (AI).

NHAI has also invited bids for a pilot project introducing a FASTag and Automatic Number Plate Recognition (ANPR)-based barrier-free tolling system at five locations: Gharaunda, Choryasi, Nemili, Urban Extension Road-II, and Dwarka Expressway.

This system enables user fee collection exclusively through FASTag, eliminating the need for cash collection from the toll collection process.

About The Author

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[Upstox News Desk](https://upstox.com/news/authors/upstox-news-desk/)  is a team of journalists who passionately cover stock markets, economy, commodities, latest business trends, and personal finance.

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