HC cuts arbitral award payable by MMRDA to RInfra JV by half to INR 2.48 bln
This story was originally published at 21:07 IST on 24 February 2026
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NEW DELHI – The Bombay High Court Tuesday cut arbitral award award payable by Mumbai Metropolitan Region Development Authority to Reliance Infrastructure Ltd.'s joint venture Mumbai Metro One Pvt. Ltd. by half to INR 2.48 billion. The high court said that the claims found to be unsustainable were independent of those sustained.
"Therefore, setting aside claims towards additional overheads, additional interests, financial expenses, and opportunity costs on loss of profit would have no impact on sustaining the claims towards Andheri Bridge, Wadala land and increase in cost of system works," the high court said. Hence, the principle of severability can easily be adopted in the present case, it added.
The high court upheld the arbitral award regarding Mumbai Metro One's claims for deductions from viability gap funding, recovery of costs towards the casting yard at Wadala land, and additional costs incurred due to changes in scope for the Andheri bridge and an increase in the cost of system works, totalling INR 2.48 billion. It set aside the arbitral award on claims for additional overhead expenses, additional interest, financing expenses, and opportunity costs for loss of profit, totalling INR 2.48 billion.
The high court also allowed National Asset Reconstruction Co. Ltd.'s plea that any amount received by Mumbai Metro One in relation to the metro project, from any source, was to be deposited in an escrow account of the former. Since the arbitral award is partly sustained, the amount deposited in court by the Mumbai Metropolitan Region can be permitted to be transferred to the escrow account, as prayed for by the National Asset Reconstruction, after eight weeks, the high court said.
Mumbai Metro One had defaulted on loan repayments to various banks, and proceedings were initiated against the company to recover debts. The banks assigned the loans to the National Asset Reconstruction Co.
The disputes between the Mumbai Metropolitan Region Development Authority and Mumbai Metro One arose from a concession agreement executed in 2007 to set up the Mass Rapid Transit System along the Versova-Andheri Ghatkopar Corridor, the first metro line in Mumbai. The disputes were referred to a three-member arbitral tribunal, which allowed claims by Mumbai Metro One and ordered the Mumbai Metropolitan Region to pay INR 4.96 billion, along with interest.
Tuesday, Reliance Infrastructure's shares ended 3.2% lower at INR 95.59 on the National Stock Exchange. End
Reported by Surya Tripathi
Edited by Saji George Titus
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