Delhi Airport Metro Express: Justice on a slow track

The Supreme Court had, in an order passed last year, directed DMRC to pay DAMEPL an arbitral award of about  ₹7,200 crore.
The Supreme Court had, in an order passed last year, directed DMRC to pay DAMEPL an arbitral award of about 7,200 crore.

Summary

  • In a 12-year-old case, the Supreme Court overturned its own 2021 order okaying an arbitral award to Reliance Infrastructure. Uncertainty on judicial outcomes in India puts investors off, but is anybody listening?

Long-winded and often-unedifying judicial processes are said to be among the reasons foreign investors resist dispute resolution in India. New Delhi’s demand that Indian options be exhausted before overseas arbitration is sought gets in the way of bilateral investment treaties too. 

The Supreme Court’s (SC) overturning of its own 2021 order okaying an arbitral award to Reliance Infrastructure in the Delhi Airport Metro Express case, in response to a curative plea meant for bad miscarriages of justice, is unlikely to help fix this reputation. The case goes back 12 years, when the airport-line service’s private operator backed out, alleging that Delhi Metro had built such a shoddy railway line that it thwarted the business viability of a speedy link from the city’s centre to its airport. 

A tribunal awarded Reliance Infra damages in 2017, but the Delhi high court nixed that arbitral award in 2019. The SC restored it two years later, before flipping its verdict this week. The top court has held the award illegal, saying it had saddled a public utility with an exorbitant liability. Whatever the merits of the arguments made, uncertainty over judicial outcomes in a country generally tends to deter investors.

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