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Informist, Monday, Oct. 21, 2024

 

NEW DELHI – The Supreme Court on Monday rejected Delhi Transport Corp.'s plea against the Delhi High Court order asking it to pay Tata Motors Ltd. an 18% per annum interest on the total amount of INR 3.27 billion from the date of arbitral award in 2017 till realisation of the amount. In August, the high court had said that Tata Motors was not only entitled to the principal amount of INR 3.27 billion of the arbitral award, but also an 18% post award interest rate. 

 

"We are not inclined to entertain the Special Leave Petition under Article 136 of the Constitution. The Special Leave Petition is accordingly dismissed. Pending application, if any, stands disposed of," said the top court.

 

Delhi Transport Corp. had said that the high court had disposed of Tata Motor's execution petition by granting the latter interest upon interest on the amount awarded by arbitration award which was contrary to law and the terms of the contract between the parties. The high court has completely ignored the fact that the petitioner had already deposited more than the awarded amount before the court, and which has since also been released to Tata Motors against bank guarantee, said Delhi Transport Corp.

 

After the award was passed, the Delhi Transport Corp had deposited INR 1 billion on Aug. 30, 2018, INR 1.4 billion on Mar. 19, 2019, and INR 1 billion on Mar. 4, 2020. The high court was hearing an enforcement petition by Tata Motors and the issue arose on the balance amount, if any, which Delhi Transport Corp has to pay as per the arbitral award.

 

The case has its genesis from Tata Motors being the successful bidder in the tenders floated by the Delhi Transport Corp for design, manufacture, supply, testing, commissioning and comprehensive maintenance of the low floor CNG Buses along with its comprehensive annual maintenance. Subsequently, a dispute arose between the parties and an arbitral tribunal was constituted for adjudication of the issues. 

 

In 2017, the arbitral tribunal awarded an amount of INR 2.96 billion, with interest of INR 305.3 million under various heads, payable by Delhi Transport Corp. to Tata Motors. The appeal against the award by Delhi Transport Corp. was pending in the high court. Meanwhile, Tata Motors filed a petition in the court for the enforcement of the arbitral award. 

 

On Monday, the shares of Tata Motors Ltd. ended 0.8% lower at INR 903.30 on the National Stock Exchange.  End

 

Reported by Surya Tripathi

Edited by Akul Nishant Akhoury

 

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