RInfra wins Rs 2,950-crore arbitration award against DMRC
Reliance Infrastructure (RInfra) on Thursday said it has been awarded a compensation worth Rs 2,950 crore by an arbitral tribunal against Delhi Metro Rail Corporation.
Mumbai: Reliance Infrastructure (RInfra) on Thursday said it has been awarded a compensation worth Rs 2,950 crore by an arbitral tribunal against Delhi Metro Rail Corporation.
According to the company, the compensation was awarded to its subsidiary Delhi Airport Metro Express (DAMEPL) through a unanimous decision of the three-member tribunal which was constituted from a panel nominated by the DMRC.
"The award to RInfra has been granted on the basis of termination provisions of the concession agreement where the arbitration tribunal has held termination by DAMEPL as valid," the company said in a statement.
"The compensation covers damage as a result of breach by DMRC of its obligations under the concession agreement and material adverse effect on the ability of DAMEPL to perform its obligations under the concession agreement."
Welcoming the award, a spokesperson for RInfra said in a statement, "Reliance Infrastructure participated in PPP (public private partnership) model in the Metro sector to lead the Metro movement in the country through PPP but unfortunately had to terminate the agreement."
"We welcome the award and hope it will encourage private sector to participate in the nation-building process."
The statement said that the three-member tribunal, formed out of a DMRC-nominated panel as per the concession agreement in September 2013 gave its award in May 2017 after hearing the case for about three and a half years.
"The tribunal heard the submission made by both the parties and after detailed proceedings in 68 hearings; the tribunal has issued its final order whereby it has awarded the compensation to DAMEPL," the statement said.
Under the guidelines approved by the Cabinet Committee on Economic Affairs and issued by Niti Aayog vide its office memorandum of September 5, 2016, public sector undertakings are expected to pay 75 per cent of the award amount against bank guarantee even if they propose to challenge the arbitral award.
"Therefore, RInfra is expected to get Rs 2,210 crore as per above guidelines against bank guarantee in case DMRC proposes to challenge the award," the statement added.