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MMRDA deposits Rs 560 cr in Metro arbitration case with Reliance Infra
In June, the Bombay High Court had directed MMRDA to pay the arbitration award of Rs 1,169 crore to MMOPL and deposit the amount with the registry before 15 July 2025.
However, MMRDA filed a special leave petition before the Supreme Court challenging the order. The apex court then directed MMRDA to deposit 50 per cent of the award amount. MMOPL had stated that the money would be used to reduce its debt.
The matter dates back to August 2023, when MMOPL won an arbitration award of Rs 992 crore passed by a three-member arbitral tribunal in the arbitration between MMOPL and MMRDA for various disputes, including the cost of the project.
The initial estimated cost of the project was Rs 2,356 crore, according to data from MMRDA's website. The cost later escalated to Rs 4,321 crore.
MMRDA had challenged the award, initiating proceedings under Section 34 of the Arbitration and Conciliation Act, 1996, which the high court has now upheld in favour of MMOPL.
MMOPL is a joint venture of R-Infra and MMRDA, with R-Infra holding a 74 per cent stake and the remainder with MMRDA. MMOPL operates Mumbai's first metro line between the Versova–Andheri–Ghatkopar corridor.
The mass rapid transit system project was awarded by MMRDA through global competitive bidding on a public-private partnership (PPP) framework to a Reliance Infrastructure-led consortium in 2007. MMOPL, a special-purpose vehicle, was incorporated for the project's implementation. MMRDA is an apex body for planning and coordinating development in the Mumbai Metropolitan Region.
This was the first metro project in India awarded on a PPP basis and involved the design, financing, construction, operation and maintenance of about 12 km of elevated metro with 12 stations en route.
The project was financed by a consortium of banks led by Canara Bank. In November 2024, the consortium was looking to sell Rs 1,226 crore of loans through a bidding process. In the same month, state-owned National Asset Reconstruction Company Ltd (NARCL) gave an anchor bid of Rs 1,063 crore to acquire the stressed loans from the MMOPL consortium.
Separately, State Bank of India (SBI) and IDBI Bank initiated insolvency proceedings against MMOPL amid non-payment of loans of Rs 416.08 crore and Rs 133 crore, respectively, in 2023.
In April 2024, the Mumbai bench of the National Company Law Tribunal (NCLT) dismissed the banks' petitions after the concerned parties agreed to a one-time debt settlement.
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