A toll plaza contract on a national highway is usually a one-year job to collect user fee on NHAI’s behalf. The agency bids the annual remittance it will pay NHAI, in weekly instalments, and the highest bid wins. It keeps whatever it collects above that figure and pays the shortfall if traffic disappoints. In NHAI’s December 2023 RFP for the Pachira fee plaza, bid security was 1% of the annual potential collection or ₹10 lakh, whichever is higher, and the bidder’s net worth had to exceed 10% of that collection.

Who actually stands in the booth at a highway toll plaza? On a BOT road it is the concessionaire that built the stretch. On the many plazas the government paid for itself, it is a private agency that won a short contract to collect the fee and hand most of it over. That second contract is the one a contractor can bid for without building anything, and it works very differently from a works contract.

What a toll plaza contract actually is

The fee on a national highway is levied by the Central Government under Section 7 of the National Highways Act, 1956, and collected under the National Highways Fee (Determination of Rates and Collection) Rules, 2008. Rule 6(7) of those Rules is the opening for a private agency: on public-funded projects the fee “shall be collected by the Central Government, or the executing authority, as the case may be, through its own officials or through a contractor”.

Rule 16 adds a second source of plazas. When a BOT concession expires, collection passes back to the government or the executing authority, and NHAI then needs someone to run the plaza until the stretch is concessioned again. The Rules call that someone the user fee collecting agency, and NHAI’s tenders call it a user fee collection agency.

The agency does not set the rate. Fee rates are notified and revised every year by a formula linked to the wholesale price index. What the agency controls is its own cost, its cash handling and how accurately it priced the traffic when it bid.

Toll plaza contract vs BOT vs TOT

Arrangement What the private side does Typical length Who keeps the toll
User fee collection contract Runs the plaza and the toilets beside it; builds and maintains nothing else One year, or three months as a stop-gap NHAI, after the agency’s fixed remittance; the agency keeps any surplus
BOT (Toll) Builds the road with its own money, then operates it Set in the concession, often decades The concessionaire, for the concession period
TOT (toll, operate, transfer) Pays NHAI a lump sum upfront for an already-built road, then operates and maintains it 20 years for the bundle NHAI awarded in September 2024 The concessionaire

BOT is covered in our explainer on how a BOT contract works on Indian highways. The point for a bidder is that a collection contract carries no construction risk and no long-term debt, but it does carry all of the traffic risk for its year.

How NHAI awards a toll plaza contract

NHAI runs this in two stages. First, a firm has to be on NHAI’s list of pre-qualified bidders under its Request for Qualification dated 1 January 2021. That pre-qualification has no last date, and the RFP says the list is updated within 14 days. Only firms on the list can bid for a particular plaza.

Second, each plaza is tendered on the NIC e-procurement portal, etenders.gov.in. NHAI’s RFP for the Pachira fee plaza on NH-43 in Chhattisgarh (December 2023) shows the standard terms:

  • The financial bid is the annual remittance, and “the Annual Remittance quoted shall constitute the sole criteria for evaluation of bids”.
  • The remittance is paid weekly, “latest by Tuesday of every week”.
  • The bidder’s net worth must be more than 10% of the plaza’s annual potential collection, with positive net cash accruals in two of the last three financial years.
  • Portal registration is free, but ₹10,000 per financial bid is debited from the fee deposited at pre-qualification.
  • Bids stay valid for 120 days. The letter of award follows within 30 days of the bid due date, performance security within 7 days of the award, the contract within 3 days of that, and takeover of the plaza within 2 days of signing.

The annual potential collection is NHAI’s own estimate of what the plaza can earn in a year. For Pachira it was ₹4.58 crore. For a three-month stop-gap on the Delhi–Amritsar–Katra Expressway in April 2026, a Delhi High Court judgment records it at ₹106.41 crore, with the highest bidder quoting a daily remittance of ₹60,63,914.

The money a bidder has to put down

Here is how the Pachira terms work out. The remittance in the last two rows assumes a bid equal to the annual potential collection, purely to show the scale; your own bid sets the real figure.

Deposit Rule in the Pachira RFP At ₹4.58 crore potential collection
Bid security 1% of annual potential collection or ₹10 lakh, whichever is higher ₹10 lakh (1% is only ₹4.58 lakh)
Minimum net worth More than 10% of annual potential collection More than ₹45.8 lakh
Performance security, part 1 Demand draft or pay order for 15 days’ agreed remittance About ₹18.8 lakh (illustrative)
Performance security, part 2 Bank guarantee for 15 days’ agreed remittance, valid 14 months from the award About ₹18.8 lakh (illustrative)

Older contracts asked for more. A Banajodi fee plaza contract signed in October 2020, quoted by the Delhi High Court in February 2023, took a bank guarantee equal to one month’s remittance. The bank guarantee draws on the same non-fund limits you use for EMD and performance guarantees on works contracts, so plan for it before you bid. Our guides to EMD in a tender and to what happens when a bank guarantee is invoked cover both.

How long the contract runs

The Pachira RFP sets the period at “1 (One) year or until the fee plaza is handed over to other user fee collection agency (OMT Concessionaire/BOT Concessionaire, etc.)”, whichever is earlier. NHAI also reserves the right to cut the period short, without compensation, if the stretch is going to a BOT, OMT or TOT concessionaire. Price that in: a plaza on a stretch already lined up for monetisation may not give you the full year.

Three-month contracts exist as a stop-gap between regular agencies. In its October 2025 statement on the cost of toll collection, the government said NHAI had deleted the provision for a deemed three-month extension and now ensures that “the maximum contracts for one-year duration are awarded and Short-term contracts of three months are minimized”.

What the agency keeps, and what it carries

The same statement gives the only official figure for the agencies’ share. It calls the difference between the toll the agencies collect and what they remit the “cost of toll collection”:

Public-funded plazas FY 2023-24 FY 2024-25
Toll collected by the agencies ₹27,417 crore about ₹28,823 crore
Remitted to NHAI about ₹22,681 crore around ₹26,149 crore
Cost of toll collection 17.27% 9.27%

Read that as an average across every plaza and every agency, before staff, systems, cash handling and toilet upkeep. It is not a margin you can expect on a given plaza, and it shrank sharply in one year as NHAI tightened its contracts. The same release adds a windfall clause: a contract “can be terminated if the moving average of toll collection in last 15 days is more than 40 percent of the remittance paid to NHAI”.

The risks sit with you:

  • “The Authority does not guarantee extent of User Fee Revenue during the contract period,” says the RFP, and the bidder has to accept that some traffic enters the stretch without passing the booth.
  • In NHAI v Sangam (India) Ltd (14 September 2026), the Delhi High Court noted that the weekly remittance “was contractually fixed and was not made contingent upon actual toll collections”.
  • Late remittance attracts a penalty of 0.2% per day under the Borgaon contract NHAI published in 2022, and the project director can route the plaza’s electronic toll collection straight to NHAI until the dues are cleared.
  • Vehicles without a valid FASTag pay twice the fee in cash, and under the Borgaon contract the agency remits half of that double fee to NHAI. Since 15 November 2025, a vehicle without a valid FASTag that pays by UPI is charged 1.25 times the fee.
  • When the fee rates are revised each year, the remittance is revised with them, and the contract bars claims over changes in rate or vehicle classification.
  • A contract reproduced by the Delhi High Court in July 2026 routes every transaction through the plaza’s electronic toll system and bans handheld ticketing machines, with debarment of up to one year for a breach.

Before you bid for a toll plaza contract

  • Count the traffic yourself, by class and by hour, for at least a week. NHAI’s estimate is a starting point, not a promise.
  • Map the lateral entries: village roads, service lanes and anything that lets vehicles reach the stretch without crossing your booth.
  • Work your bid back from the weekly cash you can be sure of, not from the annual potential collection.
  • Check the bank guarantee limit and the cash for the demand draft before you bid, not after the award.
  • Ask whether the stretch is lined up for TOT or another concession. That can end your year early.
  • Do not bid for the plaza at any price. In RnR Cab Solutions v NHAI (May 2025), the Delhi High Court reduced the debarment NHAI had imposed on a highest bidder whose quote it judged abnormally high, but the firm still faced a penalty equal to its ₹10 lakh bid security.

State highways run on the same idea under each state’s own rules. Toll plazas on state roads are let by the state road or public works department, and the terms can differ a good deal from NHAI’s.

The bottom line

A toll plaza contract is a cash-flow business, not a construction one. You promise NHAI a fixed weekly payment for a year, you lock up about a month of that payment in security, and your earnings are whatever the traffic brings in above it. The bids are public and the rules are strict, so the firms that do well are the ones that counted the traffic themselves and priced the plaza from what they saw.

If you also take highway works, browse live highway tenders and project opportunities, and line up equipment finance and working capital that leaves room for your guarantee limits. Machines on toll roads pay their own way too, as our note on whether a JCB pays toll on the highway explains.

Tender terms, deposits, remittance rules and fee rates change with each RFP and with amendments to the National Highways Fee Rules. The figures here are from the NHAI documents, government statements and court records named. Confirm the terms of the specific tender with NHAI or the state road department before you bid, and confirm guarantee limits with your bank.