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The Supreme Court has ruled in favour of IL&FS by asking Haryana Government to deposit ₹1,925 crore in an escrow amount in a case related to the Gurgaon Metro Project.
As part of the judgment, the Supreme Court has directed Haryana Shehari Vikas Pradhikaran (HSVP) to deposit 80 per cent of total “debt due” (over ₹2,400 crore), amounting to ₹1,925 crore, within three months into the Escrow Accounts
Appropriation of any amount from the said Escrow Account shall be subject to further orders of the NCLAT or any other competent legal authority.
Both parties - IL&FS SPVs and HSVP - have the liberty to refer any disputes relating to other rights, as well as those arising from the Audit Report commissioned by CAG for determining the debt due, to Arbitration
IL&FS had bagged the two-phased Gurgaon Metro Project - that were developed through its subsidiary SPVs - Rapid Metro Rail Gurgaon Limited (RMGL) and Rapid Metro Rail Gurgaon South Limited (RMGSL) - in 2009 and 2013
Due to multiple unmet obligations by the Authority (HSVP) - under the concession agreement, IL&FS SPVs had terminated the concession agreements in September 2019 and demanded certain termination payments due to them under the Concession Agreement
HSVP however refuted the contention of IL&FS SPVs and challenged the matter in High Court of Punjab and Haryana.
The High Court after hearing both the parties, ruled in September 2019 that Operations and Maintenance of the Metro Link be handed over to HSVP; directed CAG to carry out financial audit of total Debt Due; thereafter HSVP to pay 80 per cent of Debt Due (as determined by CAG) in the escrow account within 30 days of submission of CAG report and sought that all other disputes to be settled through arbitration
Project was handed over to HSVP in October 2019, as per Court orders.
Auditors appointed by CAG submitted their report on Debt Due and determined the same at ₹2,407 crore. The report was taken note by Court on September 28, 2020.
IL&FS (SPVs) moved SC in January 2021, as despite CAG submitting the audit report in compliance of the HC order, HSVP refused to meet its obligations and pay the compensation as ordered vide the HC order, while raising several objections to CAG audit reports and not complying with HC order
Supreme Court has now given its ruling in the matter on March 26, 2021.
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