The state transport department’s arbitrator would hear the cases of the ring route bus service operator — Eden Transport Private Limited — challenging the Bihar State Road Transport Development Corporation (BSRTC)’s move to hike the royalty and non-payment of subsidy on Thursday.

The firm petitioned the transport department secretary — the sole arbitrator of the state transport department — in June on the royalty issue. Besides, Eden Transport Private Limited claimed that BSTRC had failed to release the subsidy against procurement of buses according to the terms of the public-private partnership agreement.

“According to the agreement for operation of ring route buses in Patna and inter-city buses to Chhapra and Siwan, Eden Transport Private Limited had to pay royalty equal to 11 per cent of total seating capacity multiplied by the maximum fare on the respective route. There is no mention about the number of trips for the purpose of calculation of royalty. But BSTRC of late started computing the royalty by multiplying the above mentioned amount with the number of trips made by a bus in a day. This is a violation of the terms of the agreement,” said a senior executive of Eden Transport Private Limited.

Eden Transport Private Limited entered into an agreement with BSRTC on March 14, 2011 for running 78 buses (70 non-AC and eight AC) on seven routes in the city.

The buses were launched on May 15, 2011. Another agreement was signed between the two in January, 2011 for operating 40 buses under the inter-city express bus service on Patna-Chhapra-Siwan route.

According to the agreement, BSRTC was supposed to pay subsidy amounting to Rs 7.5 lakh per bus to Eden Transport Private Limited under the ring route service in the city. Similarly, subsidy amounting to Rs 5 lakh for each vehicle was to be paid by BSRTC for the inter city bus service. But Eden Transport Private Limited in arbitration petition has sought compensation on account of non-release of subsidy. “The BSRTC has not released a single penny against any of our buses till date,” said the executive of the Eden Transport Private Limited.

The firm has also sought compensation against the loss incurred it on account of non-compliance to the terms of the agreement under which BSRTC was supposed to arrange for bus stops and parking space free of cost.