SC stays order to MMRDA to deposit full arbitral award in RInfra JV case
This story was originally published at 19:32 IST on 22 July 2025
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NEW DELHI – The Supreme Court has put on hold a Bombay High Court order that had refused an unconditional stay on the execution of an arbitral award favouring Reliance Infrastructure Ltd.'s joint venture Mumbai Metro One Pvt. Ltd., to be paid by Mumbai Metropolitan Region Development Authority. Issuing notice to Mumbai Metro One, the top court asked MMRDA to deposit 50% of the arbitral award amount with the high court's registry.
On Jun. 10, the Bombay High Court had ruled that it will stay the execution of an arbitral award favouring Mumbai Metro One if MMRDA deposits the entire award amount of INR 11.69 billion with the registry of court on or before Jul. 15. The high court had rejected MMRDA's prayer for unconditional stay of the award.
"It is further clarified that the pendency of the proceedings shall not preclude the High Court from proceeding further with the hearing of the application filed (by Mumbai Metropolitan) under Section 34 of the Arbitration and Conciliation Act, 1996 and if, in the meantime, the High Court finally decides the application under Section 34, one way or the other, this interim order shall abide the order passed by the High Court," said the top court.
The high court had rejected MMRDA's prayer for unconditional stay of the award. In essence, the arbitral award money was to be kept deposited with the high court's registry till the time it hears the challenge by MMRDRA against Mumbai Metro One. Subsequently, Mumbai Metro One would not have been able to proceed with the execution of its arbitration award against MMRDA. If MMRDA succeeds in its petition, the deposited money will be returned, else the amount will be given to Mumbai Metro One.
The high court had said routinely granting a stay and that too without any deposit would run counter to the explicit legislative intervention that was made by Parliament to give teeth and relevance to arbitral awards. "In these circumstances, I am not inclined to accept the request made on behalf of MMRDA to stay the impugned award without any deposit being ordered," Justice Somasekhar Sundaresan of the high court had said.
The case has its genesis in the arbitral award passed by a three-member arbitral tribunal in favour of Mumbai Metro One, a joint venture between Reliance Infrastructure that holds 74% stake and MMRDA 26% stake. The award was passed by the tribunal in 2023 and was corrected in 2024.
The dispute between the parties stemmed from issues related to the development, design, financing, construction, and operation of a mass rapid transit system. The MMRDA challenged the arbitral award in the high court and sought a stay on its execution. The MMRDA argued against any deposit requirement for the stay while Mumbai Metro One contended that the conventional approach of a full deposit must follow, if there is any stay on execution.
On Tuesday, shares of Reliance Infrastructure ended 2.1% lower at INR 376.05 on the National Stock Exchange. End
Reported by Surya Tripathi
Edited by Subhojit Sarkar
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