The Supreme Court on Thursday upheld an Arbitral Tribunal award directing the Delhi Metro Rail Corporation (DMRC) to pay a sum of over ₹2,800 crore with interest to the consortium headed by Reliance Infrastructure Limited, which operated the Delhi Airport Express .
The consortium of Reliance Energy Limited (renamed as Reliance Infrastructure Limited) and M/s Construcciones y Auxiliar de Ferrocarriles, S.A terminated the Concession Agreement in October 2012 citing failure of DMRC to cure defects in the structure supporting the Airport Metro Express Line. DMRC invoked the arbitration clause of its contract with the consortium. In 2017, the Arbitral Tribunal awarded damages to Reliance Infra, an award upheld by a single-judge bench of the Delhi high court in 2018. A division bench of the same court set aside the award in 2019 after which Reliance Infra approached the top court.
A bench of Justices L Nageswara Rao and S Ravindra Bhat upheld the award and the order of the single judge of the High Court said, “It cannot be said that the view of the Tribunal is perverse. Therefore, we do not concur with the high court’s opinion that the award of the Tribunal on the legality of the termination notice is vitiated due to the vice of perversity.”
The Court also took objection to the manner in which the Division Bench scrutinized the award: “The members of the Arbitral Tribunal, nominated in accordance with the agreed procedure between the parties, are engineers and their award is not meant to be scrutinized in the same manner as one prepared by legally trained minds.”
Setting aside the Division Bench’s January 15, 2019 order, the top court said, “As the arbitrator is the sole judge of the quality as well as the quantity of the evidence, the task of being a judge on the evidence before the Tribunal does not fall upon the court in exercise of its jurisdiction under Section 34 of the Arbitration and Conciliation Act 1996.”
Following the judgment, DMRC’s Corporate Communications Executive Director Anuj Dayal said in a statement: “The Supreme Court has pronounced judgment in the Airport Metro Express line matter today and the appeal of DAMEPL (Delhi Airport Metro Express Private Ltd) has been allowed. The judgment is being currently analyzed for future course of action.”
A person familiar with the matter in DAMEPL said: “The amount payable by DMRC is being worked out. In any event, the amount will exceed over ₹5,000 crore.”
A spokesperson of the Reliance Anil Dhirubhai Ambani Group did not respond to requests for a comment.
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