The Supreme Court on August 14 stayed the execution proceedings initiated by Reliance Infrastructure-owned Delhi Airport Metro Express Private Limited against Delhi Metro Rail Corporation (DMRC) to recover Rs 4,800 crore from the latter after it won an arbitration.
A stay was granted on execution as DMRC has moved a curative petition asking the apex court to reconsider its 2021 order upholding the arbitral award in Reliance Infra's favour. The stay is valid till the Supreme Court hears the curative petition next. The court has also issued a notice in the bunch of pleas.
The above transpired in petitions filed by the Union government and the Delhi government challenging the Delhi High Court's March 2023 order directing them to take cognisance of the DMRC request for extending sovereign guarantees or subordinate debt to help it clear the dues of an arbitral award passed in favour of Reliance Infrastructure-owned Delhi Airport Metro Express Private Limited. The HC order came on an execution petition filed by DAMEPL against DMRC over the payment of dues of an arbitral award passed in its favour.
DMRC had said that it has no funds and despite efforts, the two stakeholders — the Centre and the Delhi government — have been unable to arrive at a consensus on the ways and means by which the amount payable under the award may be liquidated.
The HC said that the Union government and Delhi government must decide on DMRC's request for a sovereign guarantee to pay Rs 4,800 crore arbitral dues within two weeks. If permission is granted, DMRC shall pay the entire amount to Reliance Infra within one month. If it is refused, the Centre shall repatriate all the funds received by it from DMRC post-March 10, 2022.
The case pertains to a 2008 agreement between Reliance Infrastructure and DMRC for Delhi Airport Express on a build–operate–transfer (BOT) basis. However, Reliance Infrastructure terminated the agreement in 2012.
DMRC invoked an arbitration clause seeking to initiate arbitration. In 2017, the arbitral tribunal awarded damages to the Reliance Infrastructure arm and directed DMRC to pay Rs 2,800 crore plus interest.
In 2018, a single-judge bench of the Delhi High Court upheld the award and directed DMRC to pay damages.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
