Metro deliberately delaying arbitral award, Delhi HC told

In an application, DAMEPL, a subsidiary of the Reliance Infrastructure’s subsidiary (DAMEPL), has told the court said that DMRC is trying to defeat the process by making a limited disclosure of bank account details only with respect to ₹1,642.69 crore despite the court’s previous order directing it to disclose bank account details

The Delhi Airport Metro Express Private Limited (DAMEPL) has told the Delhi high court that Delhi Metro Rail Corporation (DMRC) is deliberately trying to delay the execution of over ₹4,600 crore arbitral award against it by not disclosing all its bank account details.

On December 22, Justice Suresh Kait of the Delhi HC directed DMRC to file an affidavit furnishing the details of its bank accounts along with the balance amount. (HT Photo)

In an application, DAMEPL, a subsidiary of the Reliance Infrastructure’s subsidiary (DAMEPL), has told the court said that DMRC is trying to defeat the process by making a limited disclosure of bank account details only with respect to ₹1,642.69 crore despite the court’s previous order directing it to disclose bank account details.

“The delay in the payment of the Arbitral Award by DMRC is costing the taxpayer an additional interest burden of almost ₹1.75 crore per day,” the application said.

The application by DAMEPL was filed in response to an affidavit filed by DMRC’s on January 5, in which it has made a partial/ limited disclosure of its bank accounts only with respect to Rs. 1642.69 crore out of the total funds of ₹5,800.93 crore that it had disclosed in the court through its last affidavit filed on December 21, 2021.

On December 22, Justice Suresh Kait directed DMRC to file an affidavit furnishing the details of its bank accounts along with the balance amount.

The judge observed that while the attachment of DMRC’s properties was not permitted under Section 89 of The Metro Railways (Operation and Maintenance) Act, 2002, there was no such embargo with respect to its bank accounts.

Saying that DMRC is in contempt of the court’s order, DAMEPL has said that DMRC has intentionally not provided details of its remaining funds and bank accounts, which is clearly disregard and contempt of the

It said that this conduct of the DMRC clearly exhibits that it is deliberately trying to defeat and delay the execution process of the Arbitral Award, and also ensure that the next hearing scheduled on January 11 becomes ineffective.

According to DAMEPL, DMRC in its last affidavit on December 21 in the high court, had informed that it had total worth ₹5800.93 crore, as of December 17, 2021. Out of this, Rs. 1642.69 crores were as DMRC funds, Rs. 2412.12 crores as other than DMRC.

DAMEPL, its application, has requested the high court to direct DMRC to comply with the court’s previous order in letter and spirit by furnishing complete details of all its bank accounts the funds lying in those accounts along with the respective bank statements, or before the next date of hearing i.e. January 11

The application was filed in DAMEPL’s execution plea for the arbitral award won against the corporation.

The consortium of Reliance Energy Limited (renamed as Reliance Infrastructure Limited) and M/s Construcciones y Auxiliar de Ferrocarriles, SA terminated the Concession Agreement in October 2012 citing failure of DMRC to cure defects in the structure supporting the Airport Metro Express Line. DMRC invoked the arbitration clause of its contract with the consortium.

The concession agreement between the two was signed on August 25, 2008. Under the agreement, DMRC was to carry out the civil works, excluding at the depot, and the balance, including the project system works, were to be executed by DAMEPL, a joint venture of Rinfra and a Spanish construction company -- Construcciones Y Auxiliar De Ferrocarriles -- with a shareholding of 95 and five per cent respectively.

In 2017, the Arbitral Tribunal awarded damages to Reliance Infra, an award upheld by a single-judge bench of the Delhi high court in 2018. A division bench of the same court set aside the award in 2019 after which Reliance Infra approached the top court.

In September this year, the apex court set aside the division bench’s judgment of January 15, 2019 order and upheld the arbitral award in favour of DMRC, saying that there was a disturbing tendency of courts setting aside arbitral awards.

In November, the Supreme Court had dismissed DMRC’s plea seeking a review of its judgment which upheld the 2017 arbitration award in favour of DAMEPL, enforceable against it. The apex court on September 9 had upheld the arbitration award enforceable against DMRC.

The DMRC had stated that since the corporation was facing a “financial crunch”, undertaking a “sudden liability” would impact public interest and authorities were, therefore, working out a solution. It had also claimed that the amount liable to be paid was approximately ₹5,000 crore which was lesser than DAMEPL’s claim.