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SC says, DMRC not needed to pay 8,000 crore rupees to Reliance

  • Posted on April 11, 2024
  • News

The Supreme Court (SC) overturned its own ruling from three years ago on Wednesday, sparing the Delhi Metro Rail Corporation (DMRC) from having to pay an arbitration award of almost Rs 8,000 crore to a Reliance Infrastructure business under Anil Ambani's control. 

SC says, DMRC not needed to pay 8,000 crore rupees to Reliance Image Source

With a curative petition, the DMRC contested a ruling by a two-judge panel of the Supreme court in 2021. The division bench upheld the arbitral tribunal's ruling in favour of DAMEPL, a Reliance Infrastructure subsidiary.

The nation's highest court mentioned its 2021 decision on Wednesday and stated that by rejecting a Delhi High Court Division Bench verdict, it had seriously wronged the people.

Chief Justice DY Chandrachud of India led a three-judge bench that declared the ruling to be "perverse and patently illegal". He was reading out the verdict that was reserved on February 20.

The bench consisting of Chief Justice Dr. DY Chandrachud, Justice BR Gavai and Surya Kant, directed the DMRC to reimburse the amount it had been given.

It further stated that the award's implementation procedures must be stopped and that DMRC must receive a reimbursement for any money it paid under duress.

This is a tremendous relief because DMRC had asked to the central government for money to cover the arbitration award. Following the arbitration litigation, Reliance Infra withdrew from the project, and DMRC assumed control of the contested Airport metro line.

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Reliance Infrastructure refuted any accountability for the court's decisions on Wednesday. Even though DAMEPL is a subsidiary of Reliance Infrastructure, DAMEPL bears liability, not the latter.

When DMRC Cancelled running the Delhi Metro Airport Line due to structural issues raising safety concerns, the disagreement between them and DAMEPL started. DMRC was mandated by an arbitral court to reimburse the Reliance Infra Company for the money they were granted in 2017.

Reliance Infra petitioned the Supreme Court on December 2, 2022, demanding that DMRC pay DAMEPL 4,500 crore rupees, which represented a portion of the arbitral award in its entirety.

On December 14, 2022, the Supreme Court gave DMRC three months to pay off its obligations after remanding the issue to the Delhi High Court for additional consideration.

At present, the outstanding balance surpasses Rs 8,000 crores, encompassing interest and additional penalties.

Disagreement between DAMEPL and DMRC regarding the concession agreement for the Delhi Airport Express Line gave rise to this problem.



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