DMRC goes to Centre, Delhi govt for arbitration amount

DMRC told justice V. Kameswar Rao that it has to seek additional funds from the Centre and the state governments; and that the interest of its 4.8 million commuters will be jeopardized as it cannot raise the money on its own due to a financial crunch.

Hearing the submissions of the DMRC, represented by attorney general R. Venkatramani, the court granted two weeks to DMRC to work out the modalities for the payment of over ₹7,000 crore arbitral award to Delhi Airport Metro Express, out of which ₹2,599.17 crore has been paid. According to DMRC, it owes ₹7,010.08 crore to the company as on 6 September along with the interest.

Urging the court not to pass any adverse order since both the equity partners are applying their minds to the issue, DMRC said that its safety is likely to be jeopardized as its funds for regular refurbishment activities of the assets including replacement of signalling old assets, telecommunication assets, worn out rails and turnouts, has been depleted due to the payment of ₹2,599.17 crore to Delhi Airport Metro Express.

“Having regard to the gravity of the situation, namely that anything that is done regarding the activities and operations of the Delhi Metro will have serious consequences for its current operations. Millions of commuters will simply be told you cannot use Delhi Metro if any adverse order is passed against Delhi Metro at this point in time,” the attorney general submitted.

In a short affidavit, DMRC also told the court that a meeting of its board was held on 21 September, where it was decided that the company would not take any further loans from the banks as it was already “reeling under financial crisis and if it pursues raising of any loan, it will not be able to serve the interest & loan repayment and may fall in “financial or debt trap”.

The AG told the court that the board, after deliberations, decided that the fit course of action would be to request both the stakeholders of the company to infuse funds in equal proportion so that it continues to provide its current world-class services to its commuters.

Venkatramani told the court that in terms of such a resolution, the DMRC, on 22 September, wrote to the Union and the Delhi government for an infusion of funds to pay over ₹7,000 crore and is expecting a reply from their side.

Taking note of the submissions, the court granted time to DMRC and posted the matter for hearing on 31 October.

On 10 March, the high court directed the DMRC to pay over ₹4,600 crore of the arbitral award along with interest to the Delhi Airport Metro Express in two equal instalments within two months. The first and second instalments were to be paid on or before 30 April and 31 May, respectively.

The 10 March judgment had come on the Delhi Airport Metro Express’ execution petition filed against the DMRC concerning an arbitral award of over ₹4,600 crore passed in its favour on 11 May 2017.

However, Delhi Airport Metro Express moved the high court stating that the DMRC paid it only ₹166.44 crore on 14 March and sought directions for the balance payment of ₹4,427.41 crore.