DMRC will pay Rs 600 crore in 72 hours and urged the court to grant some time to it to approach banks for taking the loan for paying the arbitral award amount.
The Delhi Metro Rail Corporation Monday assured the Delhi High Court that it will deposit Rs 600 crore within two days in an escrow account for Delhi Airport Metro Express Private Limited (DAMEPL), which had initiated execution proceedings against DMRC concerning an arbitral award of over Rs 4,600 crore in its favour.
Justice Suresh Kumar Kait took on record the statement made by DMRC’s counsel and reserved the order on the execution petition.
Senior advocate Parag Tripathi, representing DMRC, initially submitted that the corporation will pay Rs 600 crore in 72 hours and urged the court to grant some time to it to approach banks for taking the loan for paying the arbitral award amount.
He said the money received by it from governmental agencies is for the completion of metro projects and the amount cannot be used by DMRC for paying the arbitral award amount.
"I have money in my account but it is earmarked for a project and it is not my money. I do not have to power to dispose of this money,” Tripathi submitted on behalf of DMRC.
The court, however, asked the DMRC to deposit Rs 600 crore within two days, and the counsel appearing for it agreed
Meanwhile, senior advocate Ramji Srinivasan, appearing for certain banks, said they are lenders to the project and they need their money, irrespective of the fact that it is paid by DMRC or DAMEPL. He urged the court to ensure that the money received shall not be disbursed outside and be given to the lenders.
He said the outstanding amount to the lenders was more than Rs 9,000 crores when the amount which has to come from the present proceedings is about Rs 6,000 crore.
DAMEPL, which is a subsidiary of Reliance Infrastructure, was represented by senior advocate Rakesh Kumar Khanna.
In an earlier affidavit, DMRC has stated that as of February 14, it has a total of Rs 5,694.25 crore as funds which include Rs 1,452.10 crore as DMRC funds and Rs 2,681.29 as project funds.
The court had earlier directed DMRC to give details of its funds and balance sheet.
On January 24, the Supreme Court had asked DMRC and DAMEPL to request the high court to hear the dispute relating to the execution of the arbitral award, saying that any further delay is detrimental to the interest of both the parties.
Last year, DMRC had told the court that since the corporation was facing a “financial crunch”, undertaking a “sudden liability” would impact public interest and authorities were therefore working out a solution.
It had said that it would deposit Rs 1,000 crore in favour of DAMEPL in an escrow account and suggested taking over the debt of the Reliance Infrastructure subsidiary to the extent of the award money, saying that it would be a better position to negotiate with the lender banks.
The offer, however, was turned down by DAMEPL and the court had observed that if the decree-holder did not want to accept the proposal, it could not be forced to do so.
The high court had earlier pulled up DAMEPL for playing hide and seek with the court and holding out-of-court communications with DMRC to settle the dispute relating to the execution of the over Rs 4,600 crore arbitral award passed against the PSU.
An arbitral tribunal in its May 2017 award had ruled in favour of DAMEPL, which had pulled out from running the Airport Express metro line over safety issues, and accepted its claim that the running of operations on the line was not viable due to structural defects in the viaduct through which the train would run.
The arbitral award pertained to a concession agreement between the two entities, which was signed on August 25, 2008. Under the agreement, DMRC was to carry out the civil works, excluding at the depot, and the balance, including the project system works, were to be executed by DAMEPL, a joint venture of Rinfra and a Spanish construction company -- Construcciones Y Auxiliar De Ferrocarriles -- with a shareholding of 95 and five per cent respectively.
DAMEPL had borrowed from 11 banks -- Axis Bank, UCO Bank, Punjab, and Sind Bank, Andhra Bank, Central Bank of India, Dena Bank, Allahabad Bank, Canara Bank, Bank of India, IIFC UK, and Canara Bank London -- to carry out operations on the line.
The Airport Express line was commissioned on February 23, 2011, after an investment of over Rs 2,885 crore, funded by the DAMEPL's promoters' fund, banks, and financial institutions.