The Delhi High Court on Monday directed Delhi Metro Rail Corporation (DMRC) to give details of funds in its bank account and fixed deposits as of a date in connection with a Reliance Infrastructure subsidiary's plea for the execution of an arbitral award of over Rs 4,600 crore against it.
Justice Suresh Kumar Kait, who was hearing the execution petition by Delhi Airport Metro Express Private Limited (DAMEPL), also directed the corporation to share its balance sheet concerning the year 2021 as well.
The court also asked the parties to file their written submissions and listed the matter for further hearing on February 17.
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.
Senior advocate Parag P Tripathi, appearing for DMRC, said that there was a genuine dispute with respect to the payable amount as according to them, after the earlier payment of Rs 1,000 crore, only Rs 3305 crore was remaining as opposed to DAMEPL's claim of Rs 6305 crore.
The senior lawyer said that the amount lying in DMRC's account was earmarked for several projects and other purposes and was not its own money which can be given away under the law. In its affidavit filed earlier this month, DMRC said that it has around Rs 1,478 crore as “DMRC funds” and around Rs 2668 crore and Rs 1561 crore as “project funds” and “other funds”, respectively.
“This Rs 2670 crore which is for development of Phase III and Phase IV and Rs 1561 crore which is for development of metro in Patna, Maharashtra, etc are not monies which belong to me or over which I have disposing power,” the senior lawyer said.
Tripathi emphasized that DMRC has 14,000 employees and it was running on a monthly net loss of around Rs 100 crore.
He also stated that metro assets cannot be attached under Section 89 of The Metro Railways (Operation and Maintenance) Act, 2002.
Senior advocate Rakesh Kumar Khanna, appearing for DAMEPL, claimed that the corporation was hiding its correct financial position from the court and that thousands of crores of rupees were lying in its fixed deposits, term deposits, and as equity in the share market, etc.
“They have the money. The centre is 50 per cent shareholder and a company can't pay liability of Rs 6300 crore?” he questioned.
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 was however 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 also 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.
The 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.