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The Supreme Court on Friday reserved orders on a petition filed by Delhi Airport Metro Express Private Limited (DAMEPL) challenging the Delhi high court’s order rejecting their demand for substantial interest on the 2017 arbitration award. ₹4,600 crore against the Delhi Metro Rail Corporation (DMRC).
A bench of L Nageswara Rao and BR Gavai reserved judgment after hearing senior advocate Harish Salve representing DAMEPL, which is run by Anil Ambani’s Reliance Infrastructure Limited-led consortium, and senior advocate Parag Tripathi for DMRC.
DAMEPL went to the Delhi High Court to enforce the judgment, which resulted in the order being passed on March 10. The High Court directed the DMRC to make the payment of the outstanding amount in terms of the May 11, 2017 arbitration award in two installments by the end of May. However, DAMEPL argued that the order “erroneously” denied the decree holder’s request to add unpaid interest to the principal amount.
DAMEPL in its petition filed by advocate EC Agrawala said, “It (the high court) wrongly rejects the calculation of post-award interest by DAMEPL on ‘awarded amounts’ as it includes pre-award interest.
While the awarded sum (including pre-award interest) came to ₹4,662.59 crore, DAMEPL has calculated that the total amount to be paid by DMRC ₹8,053.21 crores, including post-award interest charged on 10 March 2022 (the date of the High Court judgment).
DMRC has so far paid an amount of ₹2,278.42 million, leaving a deficit of ₹5774.79 crore, the petition filed by DAMEPL said.
DMRC opposed this demand of DAMEPL and said that the sum payable on the date of award cannot include interest component. According to Tripathi, DMRC should pay the repayment within a month and interest will be charged only on account of late payment. He said the addition of interest would further increase the award ₹1,236 crowns.
The dispute between the two companies stems from an agreement signed by DMRC with DAMEPL in August 2008 for the design, installation, commissioning, operation and maintenance of the 22.7 kilometer Airport Metro Express line. As part of the agreement, DMRC was to carry out the design and construction of the project structure. In October 2012, a consortium of Reliance Infrastructure and Construcciones and Aukiliar de Ferrocarriles SA terminated the concession agreement citing DMRC’s failure to repair defects in the structure supporting the airport line.
DMRC referred to arbitration and the award was given in favor of DAMEPL. But since the payment was delayed, DAMEPL claimed that it has to settle the payments with the banks. The consortium claimed to have invested in running the Airport Express line project ₹2,802 million, of which ₹A consortium of banks financed 2,117 million.
The Supreme Court upheld the award in September last year and directed the Delhi High Court to enforce the award.
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