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Reliance Infrastructure has backed off from a contract to build the second line of Mumbai Metro at an investment of ₹12,000 crore, citing “non-fulfilment of various critical obligations” by the Maharashtra Government.
The concession agreement to build the Charkop-Bandra-Mankhurd line was terminated at ‘no cost and no claims’ to either party, the Anil Ambani-led company said. The State Government will return the bank guarantee of ₹160 crore vested with it.
A consortium led by R-Infra had secured the project through an international competitive bidding in 2009. The concession agreement was inked on January 21, 2010. Sources said the primary issue was 100 per cent right for construction of the project and allied infrastructure.
Depot land was another major issue, which required the Environment and Forests Ministry’s clearance.
Given the close proximity to the Juhu Airport, the Airports Authority’s approval, too, was required for the alignment and it was not forthcoming.
The issues had been repeatedly represented to the Mumbai Metropolitan Region Development Authority (MMRDA) and there was absolutely no progress over the last four years, the sources said.
“Due to non-fulfilment of various critical obligations, by State Government / MMRDA, the project could not take off,” R-Infra said.
Out of Delhi Metro The Delhi Airport Metro Express Pvt Ltd (DAMEPL), a special purpose vehicle of R-Infra, had terminated the concession agreement with Delhi Metro Rail Corporation (DMRC) for the Delhi Airport Metro Line, citing ‘material breach and event of default’. DMRC took over the operations from the company on July 1, 2013.
R-Infra claims that DMRC is liable to pay DAMEPL a termination payment, which, it said, is estimated at ₹2,823 crore, as the termination was due to DMRC’s event of default. The matter is now under arbitration.
In its results statement on Wednesday, R-Infra said the parent company continued to fund the statutory and other obligations of DAMEPL post the takeover by DMRC and has funded ₹122.67 crore for the half year ended September 30, 2014.
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