In a big victory for the Delhi Metro Rail Corporation (DMRC), the Supreme Court of India has reversed its previous ruling. The top court had earlier asked DMRC to pay an arbitration award of a massive ₹8,000 crore to Anil Ambani’s company.
On Wednesday, a special bench headed by Chief Justice D.Y. Chandrachud decided that the Supreme Court made a mistake in setting aside the Delhi High Court’s earlier verdict on the matter.
The apex court ruled that DMRC does not have to pay over ₹8,000 crore to the Delhi Airport Metro Express Private Limited (DAMEPL), a subsidiary of Anil Ambani’s Reliance Infrastructure firm.
The Supreme Court called the earlier arbitration award a “huge miscarriage of justice” and directed that execution proceedings in the Delhi High Court related to recovering the amount will be discontinued.
The legal battle began after DAMEPL terminated its agreement with DMRC in 2012, claiming that DMRC failed to fix certain structural defects identified by DAMEPL.
In 2017, an arbitration tribunal ruled that DAMEPL’s termination of the contract was valid and awarded the company ₹2,950 crore plus interest.
As the case dragged on for years in courts, the total arbitration amount including interest ballooned to ₹8,009.38 crore as of February 14, 2022. DMRC had paid ₹1,678.42 crore of this, leaving ₹6,330.96 crore still due.
With the Supreme Court’s latest order, DMRC is relieved of having to pay this huge remaining amount to Reliance Infrastructure’s subsidiary.
The verdict is a major setback for Anil Ambani’s company. Shares of Reliance Infrastructure plummeted, hitting the 20% lower circuit of ₹227.60 per share today after the Supreme Court decision.
Keywords: Delhi Metro, DMRC, Reliance Infrastructure, Anil Ambani, arbitration award, Supreme Court order, structural defects, agreement termination