Cannot sanction attachment of DMRC properties: Centre to HC

During the hearing, the court took a dim view of the submission by the Centre and the Delhi government

The Union government on Thursday told the Delhi High Court that it cannot allow the attachment of properties of Delhi Metro Rail Corporation (DMRC) to pay the dues of a 2017 arbitral award to Reliance Infrastructure-promoted Delhi Airport Metro Express Private Limited (DAMEPL), as this will cause the Metro to shut down and bring the Capital to a halt.

The High Court was hearing the execution petition filed by Delhi Airport Metro Express Private Limited against Delhi Metro Rail Corporation. (HT Archive)

The HC was hearing the execution petition filed by DAMEPL against DMRC.

In an affidavit filed by the joint secretary of the Ministry of Housing and Urban Affairs, Justice Yashwant Varma was told that allowing the attachment of DMRC’s assets will cause significant inconvenience to the public and impact law and order in Delhi.

“It is submitted that sanction for attachment of the properties of DMRC cannot be accorded by the answering respondent (DMRC) since that would result in closure of DMRC. Such a situation will cause significant inconvenience to the public and impact law and order in the city,” the affidavit read.

The submission comes after the court directed the Centre last week to take a decision whether it proposes to accord sanction under Section 89 of Delhi Metro Railway (Operation and Maintenance) Act, 2002, for attachment of movable and immovable assets of DMRC.

During the hearing, the court took a dim view of the submission by the Centre and the Delhi government.“It is amazing that there are two elected governments who have formed this corporation and this corporation has no money. Imagine what message you are conveying to the outside world; a government corporation refusing to deal with an award,” the judge said.

The court directed DMRC to attend the next hearing so that a “holistic view” can be taken with respect to the funds available and posted the matter for hearing on Friday.

Earlier this month, the court had noted the total amount of the award with interest till February 14, 2022 as ₹8009.38 crore. Out of this, ₹1678.42 crore has already been paid by DMRC and ₹6330.96 crore is pending.

On February 17, the HC had issued notices to the Union Ministry of Housing and Urban Affairs and the Delhi government, the two essential stakeholders of DMRC, to apprise it of how the pending amount will be paid. The two governments were impleaded as parties in the execution proceedings.

Earlier, the HC had asked the Centre and the AAP government to resolve the matter at the earliest, saying there was a need to protect the Delhi Metro which constitutes the lifeline for the residents of the Capital.

DMRC had informed the HC that despite making requisite efforts, the two stakeholders have been unable to arrive at a consensus.

In January, DMRC had told the court it had requested the Centre and the city government to pay over ₹3,500 crore each as interest free subordinate debt for repayment of the unpaid arbitral award. It had said that though this adds to the financial burden of the Delhi Metro, the option of equity shares, explored earlier, had failed to materialise.

Senior advocate Kapil Sibal, appearing for DAMEPL, had said the court would be justified in lifting the corporate veil of the corporation and proceeding against the stakeholders for the purposes of execution of the award which undisputedly has attained finality.