HC asks MMRDA to deposit ₹1,169 cr in Metro 1 case

MUMBAI: Bombay HC orders MMRDA to deposit ₹1,169 crore arbitration award to MMOPL, impacting cash-strapped authority amid ongoing disputes over metro project costs.

MUMBAI: In a setback for the cash-strapped Mumbai Metropolitan Region Development Authority (MMRDA), the Bombay high court on Tuesday directed the government body to deposit an arbitration award of ₹1,169 crore with the court’s registry in the case pertaining to the Reliance Infrastructure-led Mumbai Metro One Private Limited (MMOPL).

Mumbai - Bombay High Court. Photo by Girish Srivastava/HT 08-01-02

MMOPL is a special purpose vehicle in which Anil Ambani’s Reliance Infrastructure has 74% stake and MMRDA has 26%. The entity operates and manages the Versova-Andheri- Ghatkopar metro line on a Public-Private Partnership basis, Maharashtra’s first. On June 8, the transportation system completed 11 years of service.

“On June 10, 2025, the Hon’ble Bombay High Court, after noting that no case was made out for an unconditional stay, passed an order directing MMRDA to deposit the entire awarded amount—approximately ₹1,169 crore (inclusive of accrued interest as of May 31, 2025) with the registry of the Bombay High Court on or before July 15, 2025,” read an exchange filing by Reliance Infrastructure.

The dispute dates back to August 29, 2023, when MMOPL won an arbitration award of ₹992 crore passed by a three-member arbitral tribunal. The arbitration case was fought between MMOPL and MMRDA over various disputes, including the project’s cost.

Back in 2007, when the project was awarded, including the viability gap funding of ₹650 crore, the project’s estimated cost was ₹2,356 crore. The timeline to ready the transportation system was set for December 2010. However, the construction commenced only in February 2008 and the system launched in June 2014. As the project neared completion, MMOPL and MMRDA were at loggerheads over its cost, with the former claiming it to be ₹4,321 crore, an increase of ₹1,965 crore which was challenged by the latter.

The arbitration award in August 2023 was corrected in February 2024 and a sum of ₹992 crore along with interest was granted to MMOPL. MMRDA moved the Bombay high court, seeking a stay on the payment of the amount, which was struck down.

In its statement to HT on Tuesday’s development, MMOPL stated that the proceeds would be used to reduce MMOPL’s debt. In the past, MMOPL has defaulted on loan repayment.

Sanjay Mukherjee, MMRDA’s metropolitan commissioner, did not respond on the subject. An MMRDA official said they would examine the official order and take appropriate action accordingly.

Incidentally, in July 2020, Reliance Infrastructure had communicated to the Maharashtra government that it intended to exit from the loss-making 11.40-km metro project and wanted the government to acquire it. Since then, several rounds of discussions were held between representatives from both sides.

Despite ascertaining the project’s valuation at an enterprise value of ₹5,400 crore or acquiring the 74% stake at ₹4,000 crore by factoring in the capital expenditure required to increase passenger-carrying capacity, the state government backed out in June 2024.