Source: The post Supreme Court’s decision on the dispute between Delhi Metro (DMRC) and Delhi Airport Metro Express (DAMEPL) has been created, based on the article “Supreme Court has just put the Delhi metro on track – and given a roadmap” published in “Indian express” on 18th April 2024.
UPSC Syllabus Topic: GS Paper 2- Polity-dispute redressal mechanisms
News: The article discusses a legal case between Delhi Metro (DMRC) and Delhi Airport Metro Express (DAMEPL) about a partnership gone wrong. The Supreme Court decided that earlier decisions were incorrect and ruled in favor of DMRC, emphasizing proper legal review in arbitration cases.
What was the legal dispute between DMRC and DAMEPL?
The legal dispute between DMRC and DAMEPL centered on the operation of the Airport Metro Express Line.
DAMEPL terminated the contract in 2012, citing defects in the infrastructure provided by DMRC which they claimed were not fixed within the agreed 90 days.
DMRC and DAMEPL even approached the commissioner for metro rail safety to inspect and reopen the line, which happened in 2013.
How did the courts respond?
Initially, the arbitration tribunal ruled in favor of DAMEPL, granting them a termination payment of Rs 2,782 crore plus interest, citing a valid termination notice by DAMEPL.
The Delhi High Court upheld this award in 2018, emphasizing that the award was reasonable and plausible, requiring no further interference.
A Division Bench of the Delhi High Court later reversed this decision, citing overlooked safety inspections and other procedural issues, setting aside the arbitration award.
What was the Supreme Court’s decision?
Special Leave Petitions were filed in the Supreme Court, which, in September 2021, set aside the High Court’s order that had previously nullified the arbitral award and restored the original arbitration decision favoring DAMEPL.
DMRC’s subsequent review petition against this decision of the Supreme Court was dismissed, maintaining the restored arbitral award.
As a final measure, DMRC filed a curative petition, which the Supreme Court agreed to hear, exercising its inherent powers under Article 142 of the Constitution.
This led to the Supreme Court’s final decision to overturn its previous ruling, acknowledging a grave miscarriage of justice and restoring the order of the Delhi High Court’s Division Bench.
What are the implications of this judgment?
The judgment sets a precedent for the careful review of arbitral awards by courts, particularly in infrastructure and public service contracts.
It emphasizes the importance of courts not interfering unduly in arbitration decisions unless there is a clear miscarriage of justice.
The ruling highlights the role of arbitration in resolving disputes while underscoring the necessity of ensuring that arbitration tribunals do not overlook vital evidence or legal principles.
This case demonstrates the potential for curative petitions as a last recourse in correcting legal errors, particularly under Article 142 of the Constitution, ensuring justice in complex contractual disputes.
Question for practice:
Evaluate the significance of the Supreme Court’s decision in the legal dispute between Delhi Metro (DMRC) and Delhi Airport Metro Express (DAMEPL).
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