Reliance Infra Unit to Refund ₹8,000 Crore to DMRC

10 Apr 2024 , 03:42 PM

In a landmark decision, the Supreme Court granted the Delhi Metro Rail Corporation’s (DMRC) curative plea, ordering Reliance Infrastructure to reimburse its subsidiary Delhi Airport Metro Express Private Limited (DAMEPL) for the ₹8,000 Crore that it had previously paid. In order to contest the arbitral ruling that required it to pay the Reliance Infrastructure subsidiary, DMRC filed a curative petition.

The supreme court declared that the division bench order was improperly interfered with, resulting in a serious injustice, and ordered the DMRC to reimburse the money spent.

Shares of Reliance Infrastructure fell 20% shortly after the court’s decision, and the company entered the lower circuit.

DMRC has appealed a two-judge bench ruling of the Supreme Court that had maintained the legality of the arbitral decision in DAMEPL with a curative petition. The award was overturned by a Delhi High Court division bench.

The issue concerns a build-operate-transfer (BOT) arrangement that Reliance Infrastructure and DMRC made in 2008 for the Delhi Airport Express. But in 2012, Reliance Infrastructure ended the contract. In 2017, the arbitral panel ordered damages to the Reliance Infrastructure unit of DMRC, requiring the company to pay ₹2,800 Crore plus interest. DMRC had previously invoked a clause seeking to commence arbitration.

A Delhi High Court single-judge bench confirmed the award in 2018 and ordered DMRC to make good on the damages.

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