CG Tollway, a BOT concessionaire operating a national highway stretch, contested a GST demand exceeding Rs. 16.36 crore on the ground that its right to collect toll from road users was not 'consideration' for the construction services it rendered to NHAI.
A Division Bench of the Rajasthan High Court held that the concessionaire had received commercially valuable rights — the toll-collection right — in place of direct monetary payment, that the arrangement bore the characteristics of a barter transaction, and upheld the GST demand with interest and penalty as taxable consideration for works-contract services. CG Tollway has appealed to the Supreme Court, which issued notice and an interim stay application on 3 September 2026 without expressing any view on the merits.
BOT and HAM concessionaires and their lenders across the highway, airport, port and mining PPP sectors face a live risk that toll or other collection rights granted under a concession agreement could be treated as taxable GST consideration for the underlying construction — a Supreme Court ruling either way will directly affect how such projects are bid, financed and priced.