Delhi High Court Directs DMRC To Pay Decretal Amount Of Over Rs 6K Crores To DAMEPL In 2 Instalments By May 31, 2022

The Delhi High Court on Thursday directed the Delhi Metro Rail Corporation (DMRC) to pay the decreetal amount to Reliance Infrastructure-promoted Delhi Airport Metro Express Pvt Ltd (DAMEPL) in latter's plea seeking enforcement of the arbitration award dated May 11, 2017 in two installments by May 31, 2022.

The Court directed that part-payment must be paid within two weeks.

DAMEPL submitted that the the gross decreetal sum along with interest up to 14.02.2022 computed in accordance with the arbitral award is Rs. 8009.38 crores. Out of the said amount, only a sum of Rs. 1678.42 crores has been paid so far by DMRC. Thereby, as on 14.02.2022, the remaining decreetal amount payable with interest is Rs.6330.96 crores [Rs.8009.38 crores - Rs. 1,678.42 crores].

According to the affidavit submitted by the DMRC, the funds available it under the head Total DMRC Funds is Rs.1,452.10 cores; under the head Total Project Funds is Rs.2681.29 and under the head Total Other Funds is Rs.1,560/-. A sum of Rs.514 crores is committed to the salary, medical and post retiral benefits of employees and Rs.114 crores is the portion of security deposit on smart cards, which is refundable to the commuters.

"In the considered opinion of this Court, the said amount i.e. Rs.514+ Rs.114 crores has to be kept aside for the aforesaid purpose, however, from the remaining amount available in different bank accounts of judgment debtor as well as under other heads, the payments towards decreetal amount has to be made".

Justice Suresh Kumar Kait ordered thus:

"Accordingly, out of the funds available under the head "Total DMRC Funds of Rs.1,452.10 cores", judgment debtor is directed to keep aside amount of Rs.628 crores (Rs.514+ Rs.114 crores) towards statutory expenses as mentioned herein above and from the remaining amount, part payment of decretal amount be made within two weeks."

For the remaining outstanding amount, the Court directed DMRC to make the payments in two equal instalments within two months.

While the first instalment is directed to be paid on or before April 30, 2020, the second instalment shall be made on or before May 31, 2022.

"The award dated 11.05.2017 has attained finality and cannot be allowed to remain as a paper award, therefore, the judgment debtor is duty bound to either divert its finds shown to be available. According to the aforesaid affidavit, as on 14.02.2022, the total funds in different heads mentioned in the affidavit of 14.02.2022 after seeking permission of the Central Government, if necessary, or raise loans to satisfy the award", the bench observed.

The Court was of the view that as the award dated 11.05.2017 had attained finality and cannot be allowed to remain as a paper award, therefore, DMRC was duty bound to either divert its finds shown to be available in different heads mentioned in it's affidavit dated February 14, 2022 after seeking permission of the Central Government, if necessary, or by raising loans to satisfy the award.

The Judgment Debtor, DMRC, had preferred a challenge under Section 34 of the Arbitration and Conciliation Act, 1996 to the Award which was dismissed by a Single Judge of the High Court vide judgment dated March 6, 2018.

Thereafter, the said judgment was challenged before a division bench under Section 37 of the Act which was partly allowed and the Award was set aside vide judgement dated January 15, 2019.

DAMEPL, the Decree Holder, had then preferred a Special Leave Petition before the Supreme Court of India against the judgement of 2019 which was allowed in it's favour vide judgement dated September 9, 2021.

Accordingly, since the Award of 2017 could be executed as a decree in terms of Section 36 of the Act, the present petition was being filed by DAMEPL for execution of the Award passed by the Arbitral Tribunal.

Earlier, DMRC had disclosed before the Court that is has a total of Rs. 6,208.03 Crores funds lying in various banks.

DMRC had also assured the Court that it shall deposit an amount of Rs. 600 Crores in the escrow account of DAMEPL.

Case Title: Delhi Airport Metro Express Private Limited v. Delhi Metro Rail Corporation Ltd. 

Citation: 2022 LiveLaw (Del) 190

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