New Delhi: In a landmark judgment, the Supreme Court of India has overturned a previous arbitration tribunal’s decision that had awarded Delhi Airport Metro Express Pvt. Ltd. (DAMEPL), a subsidiary of Anil Ambani’s Reliance Infrastructure, a sum of Rs 8,000 crore. The apex court’s ruling came as a resolution to the long-standing dispute stemming from the concession agreement signed in 2008 between DAMEPL and the Delhi Metro Rail Corporation (DMRC).
Background of the Dispute
The contention began when DAMEPL, which was responsible for the operation of the Delhi Airport Metro line, terminated the agreement in 2012, citing unresolved structural defects. DMRC contested the termination, leading to an arbitration process. In 2017, the tribunal ruled in favor of DAMEPL, directing DMRC to pay Rs 2,800 crore plus interest. This decision was upheld by a single-judge bench of the Delhi High Court but was later overturned by a Division Bench.
Supreme Court’s Decision
On April 10, 2024, the Supreme Court set aside the arbitral award and directed DAMEPL to refund the Rs 3,300 crore already paid by DMRC. The court’s decision highlighted that the previous judgment had resulted in a “grave miscarriage of justice” by interfering with the Division Bench decision of the Delhi High Court.
Financial Implications for Reliance Infrastructure
Reliance Infrastructure has clarified that the Supreme Court’s order does not impose any financial liability on the company. They stated that no funds from the arbitration award have been received by them from DMRC or DAMEPL. As DAMEPL operates as a separate legal entity, the responsibility for the refund falls solely on it.
Market Reaction
Following the Supreme Court’s ruling, shares of Reliance Infrastructure witnessed a significant drop, reflecting the market’s response to the financial developments.
This verdict marks a significant turn in the legal battle between DMRC and DAMEPL, potentially setting a precedent for future public-private partnership disputes in India.
