The Delhi High Court today sought response of Delhi Metro on a plea by a former concessionaire of the airport express line for early payment of 75 per cent of the arbitral award of Rs 4,670 crore in its favour.
Justice Vibhu Bakhru issued notice to the Delhi Metro Rail Corporation (DMRC) and sought its reply by May 29 on the plea of concessionaire Delhi Airport Metro Express Private Limited (DAMEPL), which is seeking early payment of Rs 3,502 crore which is 75 per cent of the total award amount.
DAMEPL, a subsidiary of the Reliance Infrastructure (Rinfra), has sought early payment of the award claiming it was paying Rs 65 lakh per day to its lenders, comprising public and other banks, since the termination of its agreement with DMRC to run the Airport Metro line.
The concessionaire, represented by senior advocate P Chidambaram, contended in court that it has been paying Rs 18 -20 crore a month since July 2013 for servicing the debt and has already shelled out over Rs 1070 crore towards payment of interest with the initial capital still remaining as outstanding.
The DMRC, on the other hand, has opposed maintainability of the plea for enforcement of the award which was granted in favour of the concessionaire by a unanimous decision of a three-member arbitration tribunal on May 11.
The DAMEPL, in its plea, has claimed that under the guidelines issued by Niti Aayog on September 5, 2016, public sector undertakings are to pay 75 per cent of the award amount even if they propose to challenge the arbitral award.
According to DAMEPL's plea, the concession agreement was entered into between the two on August 25, 2008. Under the agreement the 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, the plea has said.
The Airport Express line was commissioned on February 23, 2011 after an investment of Rs 2,885 crore funded by DAMEPL's promoters' fund, banks and financial institutions.
DAMEPL has said it had terminated the concession agreement as the DMRC had not cured some defects in the express line within 90 days of the notice issued by it.
According to the petition, the agreement was with effect from January 1, 2013 and the project was handed over to the DMRC on June 30, 2013. Till handing over of the project, the DAMEPL had operated the line as a deemed agent of DMRC, it said.
Arbitration was entered into in August 2013 after efforts to amicably resolve the issues did not yield results.
DAMEPL is 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.
The concessionaire, in its plea, has claimed that "the payment of the interest to the lenders by it over the last four years in addition to the capital invested has enormously benefited DMRC and caused a financial crunch to DAMEPL".
"In view of the award having been passed in petitioner's (DAMEPL) favour, it is now necessary and equitable that the petitioner be not saddled with any further hardship and financial burden and that DMRC be directed to deposit at least 75 per cent of the arbitral award to the tune of Rs 3502.62 crore in the court to ensure payment to the lenders..,"the petition has said.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)