Reliance Infra wins case against Delhi Metro; 4,500 crore will be received as damages

  • | Thursday | 9th September, 2021

On this, DMRC started the arbitration process, after which the matter kept circulating in the courts. The Supreme Court today upheld the company`s claim and ordered DMRC to refund the amount along with interest and damages.

Anil Ambani`s company Reliance Infrastructure will get a total of Rs 4,500 crore from Delhi Metro (DMRC). The company had demanded a termination fee of Rs 2,800 crore from the Delhi Metro alleging that it had broken the contract.

On this, DMRC started the arbitration process, after which the matter kept circulating in the courts. The Supreme Court today upheld the company`s claim and ordered DMRC to refund the amount along with interest and damages.

The matter pertains to an agreement signed between Reliance Infrastructure and DMRC in 2008. A deal was signed between the two to build Delhi Airport Express on Build Operate Transfer (BOT) basis.

Reliance Infra accused Delhi Metro of breaking the agreement and rejected it and demanded termination fee. On this DMRC resorted to the clause attached to it to initiate arbitration in the matter.

The Arbitration Tribunal issued an order against DMRC in 2017 in the matter. The tribunal asked him to pay interest and damages on that amount along with an arbitration award of Rs 2,800 crore. The order of the tribunal was also upheld by a single judge bench of the Delhi High Court in 2018 and asked DMRC to pay compensation.

In 2019, the Division Bench of the Delhi High Court set aside the arbitration award, giving relief to the DMRC. This order of the Delhi High Court was challenged by Reliance Infra in the Supreme Court. The order of the Supreme Court has brought a big relief to the company, as it will be able to repay the loan with the amount received from DMRC.

During the hearing of the case, the lawyers of the company had told this to the court. On this, the Supreme Court had restrained the banks from making the company`s loan as NPA. After the order of the Supreme Court, the ban on the lenders of the company has been lifted.

The Supreme Court order is important for Anil Ambani as his telecom companies are on the verge of being declared bankrupt. He himself is fighting a personal insolvency case against the country`s largest bank SBI.

In case of dispute over an agreement, the aggrieved party instead of going to court, resorts to the arbitration system i.e. Alternative Dispute Resolution (ADR). In this, both the parties argue before the arbitrator, who is a neutral third party and his order can be enforced through the court.


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