DELHI INTERNATIONAL AIRPORT LIMITED Vs AIRPORT AUTHORITY OF INDIA & ANR.
O.M.P.(I) (COMM.) 409/2020 Page 1 of 26
$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 23rd December, 2020
Pronounced on: 5th January, 2021
+ O.M.P . (I) (COMM.) 409/2020 & I.A. 11600/2020, I.A.
11601/2020, I.A. 12643/2020
DELHI INTERNATIONAL AIRPORT LIMITED…. Petitioner
Through: Dr.A.M.Singhvi with
Mr.Manoj K. Singh, Mr.Vijay K
Singh, Mr. Ssahel Sood, Mr.Raghav
Shelchar, Mr.Rahul Chopra, Advs.
versus
AIRPORT AUTHORITY OF INDIA & ANR. ….. Respondent s
Through: Mr.Tushar Mehta,
Solicitor General with Mr. Raghav
Shankar, Mr. Karan Lahiri,
Ms.Arshiya Sharda, Mr.Prateek Arora,
Mr.Sailender Reddy, Advs.
CORAM:
HON’BLE MR. JUSTICE C. HARI SHANKAR
O R D E R
% 5th
1. Though I had mooted a suggestion that the present petition ,
having been heard in extenso through eminent learned Senior Counsel,
including the learned Solicitor General of India, could be finally
disposed of, there was no consensus ad idem between the parties on
my suggestion. Accordingly, this order is restricted to the issue of
grant of ad interim relief. January, 2021
(Video-Conferencing)
2021:DHC:18
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2. This order , accordingly, adjudicates prayer (vii) in the present
petition, which seeks issuance of ad interim orders in terms of prayer s
(i) to (vi). Notice is, accordingly, separately being issued in the OMP.
3. Dr. Singhvi, learned Senior Counsel for the petitioner -Delhi
International Airport Limited (hereinafter referred to as “DIAL”),
submits that the issue in controversy is squarely covered by my earlier
judgment in Mumbai International Airport Limited v. Airport Authority of India
1
(hereinafter referred to as “ MIAL ”) and that,
therefore, the petitioner is clearly entitled to interim relief.
4. Mr. Tushar Mehta, learned Solicitor General appearing for the
Airport Authority of India (hereinafter referred to as “AAI”), submits,
per contra , that there are clear factors which distinguish the present
case from MIAL1
.
5. A brief recital of facts would suffice, as I am concerned with the
aspect of ad interim relief.
6. On 4th
April, 2006, DIAL and AAI entered into an Oper ation
Management and Development Agreement (hereinafter referred to as
“OMDA”) for development and management of the Indira Gandhi
International Airport, Delhi (hereinafter referred to as “IGI Airport”),
of which the following features may be noted:
1 MANU/DE/2148/2020
2021:DHC:18
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(i) Chapter III of the OMDA set out the conditions
precedent, to be fulfilled by DIAL and AAI.
(ii) Clause (iii) of Article 3.1.1 and 3.1.2 of the OMDA
required the AAI and DIAL to execute an Escrow Agreement,
with one of the banks named in Schedule 13 to the OMDA.
(iii) Chapter XI of the OMDA, required DIAL to pay, to AAI,
an Annual Fee (hereinafter referred to as “AF”), during the
currency of the OMDA, and set out the quantum thereof. Clause
11.1.2.2, thereunder, read thus:
“11.1.2.2 The AF shall be payable in twelve equal
monthly instalments, each instalment (hereinafter
referred to as “Monthly AF” or “MAF”) to be paid on
the first day of each calendar month. The JVC shall
from time to time cause the Escrow Bank to make
payment of the MAF to AAI in advance on or prior to
the 7th day of each month by cheque drawn in favour of
AAI. If AAI does not receive the payment of MAF due
hereunder by the due date provided herein, the amount
owed shall bear interest for the period starting on and
including the due date for payment and ending on but
excluding the date when payment is made calculated at
State Bank of India Prime Lending Rate + 10% p.a.
Notwithstanding anything contained herein, the JVC
shall at all times be liable to pay the MAF in advance
on or prior to the 7th
“ “Revenue” means all pre-tax gross revenue of JVC,
excluding the following: (a) payments made by JVC,
if any, for the activities undertaken by Relevant
Authorities or payments received by JVC for
provision of electricity, water, sewerage, or analogous day of each month”
(iv) “Revenue” was defined, in the OMDA, thus:
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utilities to the extent of amounts paid for such utilities
to third party service providers; (b) insurance proceeds
except insurance indemnification for loss of revenue;
(c) any amount that accrues to JVC from sale of any
capital assets or items; (d) payments and/or moneys
collected by JVC for and on behalf of of any
governmental authorities under Applicable Law (e) any
bad debts written off provided these pertain to past
revenues on which annual fee has been paid to AAI. It
is clarified that annual fee payable to AAI pursuant to
Article 11 and Operational Support Cost payable to
AAI shall not be deducted from Revenue.”
(v) Chapter XVI of the OMDA provided for “ force majeure ”.
Articles 16.1.1 and 16.1.2, thereunder, read thus:
“16.1 Force Majeure
16.1.1 The JVC, or AAI, as the case may be, shall be
entitled to suspend or excuse performance of its
respective obligations under this Agreement to the
extent that AAI or JVC, as the case may be, is unable
to render such performance by an event of Force
Majeure (a “ Force Majeure ”).
16.1.2 In this Agreement, “Force Majeure” means any
event or circumstance or a combination of events and
circumstances, which satisfies all the following
conditions: (a) materially and adversely affects the
performance of an obligation; (b) are beyond the reasonable control of the affected Party; (c) such Party
could not have prevented or reasonably overcome with
the exercise of Good Industry Practice or reasonable
skill and care; (d) do not result from the negligence or
misconduct of such Party or the failure of such Party to
perform its obligations hereunder; and (e) (or any
consequence of which), have an effect described in
Article 16.1.1.”
As has been observed by me in MIAL1, the present COVID –
2019 pandemic clearly constitutes “ force majeure ” within the
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meaning of Chapter (xvi) of the OMDA. Though, as noted in
case of MIAL, the learned Solicitor General has not disputed this fact, he contends that, unlike the situation which obtained in
MIAL, the COVID- 2019 pandemic cannot be said to have made
it unable for DIAL to discharge its obligations under the OMDA. Schedule 13 to the OMDA sets out the draft of the
Escrow Agreement, to be executed between AAI and DIAL.
7. As required by the OMDA, an Escrow Agreement, dated 28
th
(i) Clause 2.1 of the Escrow Agreement read thus:
April, 2006, was executed between DIAL, AAI and the ICICI Bank
Limited (as the Escrow Bank). The salient features thereof may be
enumerated as under:
“2.1 Establishment of the Accounts
The Company and the Escrow Bank confirm that the
Escrow Bank has established, in the name of the
Company at the Escrow Bank’s New Delhi branch, an
account titled the “Escrow Account” . The Escrow
Account shall have the f ollowing sub accounts,
maintained, controlled and operated by the Escrow Bank for the purposes of this Agreement, namely:
(a) a sub account maintained, controlled and
operated by the Escrow Bank, titled the “Receivables Account”;
(b) a sub account maintained, controlled and
operated by the Escrow Bank, titled the
“Proceeds Account” which shall have the
following sub accounts:
(i) a sub-account maintained,
controlled and operated by the Escrow
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Bank, titled the “Statutory Dues
Account ;
(ii) a sub-account maintained,
controlled and operated by the Escrow
Bank, titled the “AAI Fee Account; and
(iii) a sub-account maintained,
controlled and operated by the Escrow
Bank, titled the “Surplus Account”.
(ii) Article 3 of the Escrow Agreement se ts outs the manner
in which the Escrow Account was to be operated. According to
the covenants thereof,
(a) all receivables were to be deposited, by DIAL, into
the Receivables Account, immediately, on receipt thereof,
(b) immediately on deposit of monies in the
Receivables Account, the Escrow Bank was to transfer
the monies from the Receivables Account to the Proceeds
Account,
(c) in operating the Proceeds Account, the Escrow
Bank would act thus, in the following manner and priority:
(i) transfer, to the Stat utory Dues Account, by
the last day of any month, statutory dues payable for the succeeding month, (ii) transfer to the AAI Fee Account, by the last
day of every month, the monthly AAI Fee payable for the succeeding month, (iii) remit, to AAI, any amount other than AAI
Fee, payable by DAIL to AAI under the OMDA,
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and notified in writing by AAI to the Escrow Bank,
and
(iv) transfer any or all balance amount into the
Surplus Account.
(iii) Articles 3.3 and 3.4 of the OMDA required the Escrow
Bank to withdraw, from the Statutory Dues Account and the
AAI Fee Account, the amounts required to be paid by the DIAL
towards statutory dues as per applicable law and the amounts
required by the AAI.
(iv) Article 3.5 required the Escrow Bank to pay, from time to
time, to DIAL, within three days of receipt of directions from
DIAL to the said effect, the said amounts, from the Surplus Account, as DIAL may direct.
8. A reading of the opening paragraph of my judgment in MIAL
1,
which sets out the covenants of the OMDA and the Escrow Agreement between MIAL and AAI, juxtaposed with the OMDA
executed between DIAL and AAI, and the Escrow Agreement
executed among DIAL, AAI and the ICIC I Bank Limited, would
reveal that the covenants of the OMDA and Escrow Agreement in
MIAL
1 were identical to the OMDA and the Escrow Agreement in the
present case. The contractual dispensation governing the relationship
between DIAL and AAI was, therefore, the same as the contractual
dispensation between MIAL and AAI.
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9. Till beginning of 2020, the OMDA and the Escrow Agreement
were operated, without any hiccups, in the manner stipulated and
contemplated therein.
10. A radical change in the situation, however, occurred as a result
of the COVID-2019 pandemic, which has been a global scourge starting February 2020. As a matter of common knowledge, various
travel advisories were issued by the Central Government and State
governments, initially restraining and, thereafter, completely prohibiting airline operations at airports. Specific reference has been
made by DIA L – as was made by MIAL in the earlier case – to the
travel and other advisories issued by the Central Government and by the Ministry of Health and Family Welfare on 5
th February, 2020, 19th
February, 2020, 26th February, 2020, 2nd March, 2020, 5th March,
2020, 18th March, 2020, 19th March, 2020 and 23rd March, 2020, the
invocation of the Epidemic Diseases Act, 1897 and the notification, by
the Government of NCT of Delhi, of the Delhi Epidemic Diseases
(COVID -2019) Regulations on 12th March, 2020 and the im position of
janta curfew on 22nd March, 2020, f ollowed by a nationwide
lockdown on 24th
11. DIAL, in the circumstances, addressed communications to the
AAI, on 19 March, 2020, which was, much after it was imposed,
relaxed only in phases. As a result, operations at the IGI Airport were
seriously and adversely affected and, over a time, practically came to a
halt.
th March, 2020, 27th March, 2020 and 31st March, 2020,
invoking the force majeure clause as contained in the OMDA and
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requesting for exemption fr om having to pay M onthly Annual Fee
(hereinafter referred to as “MAF ”), thereunder, during the currency of
the force majeure situation.
12. Similar communications were made by MIAL to AAI, to which
detailed allusion is to be found in MIAL1.
13. At this ad interim stage, I do not deem it necessary to make
exhaustive reference to all these communications. However, it is
necessary to refer to the response, dated 4th
9. Reference in this regard may be had to Clause
16.1.5(c), which stipulates that “the time for performance by April, 2020, from AAI, to
the represe sntation of DIAL. In the said letter, AAI, after spec ifically
referring to Article 11.1.2, 16.1.1 and 16.1.5(d) of the OMDA, went on to observe, in paras 8, 9, 11, 12 and 13, as under:
“8. AAI is cognizant of the extraordinary nature of the
events that have transpired in the past weeks. Keeping these in
view, AAI is willing to grant consideration to deferral, as
requested, for a period of three (3) months of DIAL’s obligation under Article 11.1.2.2 to make Monthly Annual
Fee payments against its Annual Fee obligation. In short, AAI
accepts DIAL’s proposal for deferral of its obligation to pay
MAF, on the stated ground that it “would not be in a situation
to discharge its obligation to pay Monthly Annual Fee to AAI
during the next three months upto June, 2020″. AAI is doing
so in these extraordinary circumstances on a without prejudice basis and notwithstanding DIAL’s failure to produce any
supporting documentation on its available cash flows, debt
obligations or evidence of DIAL’s temporary inability to pay
MAF. However, as stated below, AAI’s acceptance is
conditional upon the Board of DIAL passing a Resolution on
this matter, and such Resolution being duly communicated to
AAI.
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the affected Party of any obligation or compliance by the
affected Party with any time limit affected by Force Majeure,
and for the exercise of any right affected thereby, shall be
extended by the period during which such Force Majeure
continues and by such additional period thereafter as is necessary to enable the affected party to achieve the level of
activity prevailing before the event of Force Majeure”. AAI is
willing to have recourse to Clause 16.1.5(c) to extend the time for payment of MAF for the months of April, May and June
2020 till 15.07.2020. Such extension of time in respect of MAF payment is of course without prejudice to AAI’s rights
under the OMDA and cannot be construed as a waiver,
modification or alteration of any of the said rights, including
AAI’s right to be paid Annual Fee computed at 45.99% of pre-
tax Gross Revenue under the OMDA. It is also clarified that
such extension of time is in the nature of a dispensation
limited to the present facts and circumstances and cannot be
construed as creating any precedent in this regard inter se the
parties to the OMDA.
*****
11. In view of the above, till such time DIAL submits the
Board resolution, AAI shall issue instructions to the Escrow Bank to transfer funds equivalent to 45.99% of the Gross
revenue projected by DIAL in the spreadsheet included as an
attachment to DIAL’s email dated 03.04.2020 for the three
months (i.e. April, May and June 2020) from the Proceeds
Account to the AAI Fee account and thereafter to AAI’s bank
account by the 7
th
12. In the event that DIAL is able to submit the Board
Resolution within the three months (i.e. April, May and June 2020, and prior to 06.06.2020), then AAI would instruct the
Escrow bank to not transfer funds from the Proceeds Account
to the AAI Fee Account, for the remaining time within the
said three month period and, instead, transfer such amounts
directly to the Surplus account up to 06.06.2020. After
06.06.2020, the normal procedure would be followed in of the month. This would, as you are aware,
be considerably less than monthly payment of Rs.148.33 Cr.
MAF as per the last Business Plan, which would (as per past
practice) have determined the MAF payable until the new
Business Plan for FY 2020-21 is approved by DIAL’s Board
of Directors.
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respect of transfer of funds from the Proceeds Account to AAI
Fee Account as per Business Plan to be submitted by DIAL.
13. At the end of this three-month period, the cumulative
Annual Fee amount for the months of April, May and June, 2020, (computed on actuals) shall be paid to AAI by
15.07.2020. No interest under Article 11.1.2.2 would be levied for this three- month period (i.e. 1
st Quarter FY 2020-
21).”
14. The communication, dated 30th March, 2020, from AAI to
MIAL, which constituted the main plank of MIAL’s case before this Court, in MIAL
1, was, to all intents and purposes, identical to the
aforesaid communication dated 4th April, 2020, from AAI to DIAL.
As in the case of the communication dated 30th March, 2020 from AAI
to MIAL, the communication dated 4th April, 2020 from AAI to DIAL
also specifically (i) notes (in para 4) the invocation, by DIAL, of the force majeure provisions contained in Chapter XVI of the OMDA,
and (ii) given the circumstances consequent to the COVID -2019
pandemic and the restrictions imposed as a consequence thereof,
expresses (in para 6), unequivocally , the willingness of AAI to defer
the obligations of DIAL to pay MAF up till 30
th
15. There is, therefore, effectively no distinction, whatsoever,
between the present case and MIAL, insofar as acknowledgement, by
AAI, of (i) the existence of force majeure , (ii) the fact that the ability
of DIAL, to perform its obligations under the OMDA had been
prejudicially affected by the force majeure , and (iii) the consequent
decision, of AAI, to grant deferral, to DIAL, of the requirement of
paying MAF, in accordance with the OMDA, were concerned. As in the case of MIAL June, 2020.
1, the AAI granted deferral, to DIAL, of its
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obligations under the OMDA, for the months of April, May and June,
2020, and not thereafter .
16. It is important to note this fact, at least at this ad interim stage,
as it answers the factual distinction which the learned Solicitor General had sought to draw, between the present case and MIAL
1.
17. The learned Solicitor General had also sou ght to submit that,
unlike the position that obtained in the case of MIAL1, the force
majeure situation that had emerged consequent to the COVID -2019
pandemic had not rendered DIAL unable to perform its obligations
under the OMDA. In this context, the lea rned Solicitor General
asserted that the financial position of DIAL was far superior to that of
MIAL. He also invited my attention, in this context, to the balance –
sheet of DIAL, which contained, according to the learned Solicitor
General, huge reserves (in the region of ₹ 1800 crores), which could be
exploited by DIAL for payment of MAF and compliance with other obligations under the OMDA.
18. The learned Solicitor General emphasised that Article 16.1.1 of
the OMDA did not excuse or suspend the obligation of the JV –
whether MIAL or DIAL – merely because a situation of force majeure
existed. He pointed out that it was also necessary for the JV to
establish that, as a consequence of such force majeure, it had been
rendered unable to perform its obligations under OMDA. MI AL, he
submits, had been able to make out such a case, whereas DIAL had
not.
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19. To this, Dr. Singhvi had sought to respond that a mere reading
of the balance -sheet of DIAL was not accurately reflective of its
financial wherewithal to perform its obligations under the OMDA. He
sought to submit that the “huge reserves” reflected in the balance –
sheet were specifically required to be used for the new terminal of the
IGI Airport, which was being developed and were not available,
therefore, to DIAL, for its ut ilisation towards payment of MAF under
the OMDA. Dr. Singhvi submitted that the financial position of DIAL,
as reflected by the averments contained in the petition, w as true,
correct and accurate, and that the submissions of learned Solicitor
General, to t he contrary, were not correct on facts.
20. The learned Solicitor General objected to this line of argument,
stating that these were facts which were required to be pl eaded on
affidavit, and did not form any part of the pleadings in the present
case.
21. To my mind, at least at this ad interim stage, it is not necessary
to enter into the fin e niceties of the financial position of DIAL, vis-a-
vis that of MIAL, or to hyper -distinguish one from the other.
22. That the intervention of the COVID-2019 pand emic, and the
restrictions imposed as a consequence thereof, had, even in the case of
DIAL, made out a case for deferral of its obligations under the
OMDA, stands specifically acknowledged by AAI in its communication dated 4
th April, 2020 to DIAL, just as had been
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acknowledged by the AAI in its communication dated 30th March,
2020 to MIAL. Moreover, the d eferral from performance of its
obligations under the OMDA, as extended by AAI to DIAL, is exactly
the same as that extended by AAI to MIAL, i.e., deferra l till 30th June,
2020, and no further.
23. At this ad interim stage, therefore, it would neither be possible,
or, even appropriate, for me, to distinguish the facts of the present
case, from those which obtained in MIAL1. Consistency is one of the
foremost traits of a robust justice dispensation system.
24. In the case of MIAL, the concluding paragraph of my judgment,
dated 27th
(iii) MIAL would be entitled to utilise the amounts lying in
the Proceeds Account, for meeting its expenses in connection
with its obligations under the OMDA, pertaining to the
running and maintaining of the CSI Airport and other
obligations linked thereto. I do not deem it necessary,
therefore, to transfer the amounts lying in the Proceeds
Account to the Surplus Account. The utilisation, by MIAL, of
the amounts lying in the Proceeds Account, towards
maintaining the CSI Airport and fulfilling other obligations November, 2020, had directed as under:
“(i) 38.7% of the actual payments, received by MIAL, from
the activities connected with the OMDA and the functioning
of the CSI Airport, shall be deposited in the Proceeds Account
in the Escrow Account maintained by SBI. Subject to the directions that follow, this direction shall operate
prospectively from the date of the pronouncement of this
judgement.
(ii) AAI is restrained from transferring the said amounts,
lying in, or to be deposited in, the Proceeds Account to the AAI Fee Account.
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under the OMDA – save and except such obligations, the
fulfilment of which are impeded by the COVID -2019
pandemic and the restrictions imposed consequent thereupon
– would be strictly accounted, and monthly account
statements, in that regard, shall be provided to AAI as well as the SBI.
(iv) MIAL and AAI are both directed to appoint one arbitrato r
each, of their choice, within a period of ten days from the
communication, by the Registry of this Court, of a copy of
this order, by e- mail to learned Counsel who appeared on their
behalf, or from the date of uploading of this order on the
website of this Court, whichever is earlier, and to
communicate the choice of arbitrator to each other. The two
arbitrators, so appointed, shall appoint the Presiding
Arbitrator, on or before 31
st
(viii) In case such an application is moved by MIAL or AAI,
the learned Arbitral Tribunal is requested to consider and
dispose of the application as expeditiously as possible, December, 2020. The learned
Arbitral Tribunal would enter on the reference within two
weeks of its being so constituted.
(v) The fees of the learned arbitrators would be in
accordance with the Fourth Schedule of the Arbitration and
Conciliation Act, 1996, subject to any other fees being fixed
by the learned arbitrators after discussion with the parties.
(vi) MIAL is permitted, if it so chooses, to prefer, before the
Arbitral Tribunal thus constituted, an application, under
Section 17 of the Arbitration and Conciliation Act, 1996, for
the continuance of the operation of this order, within two
weeks of the Arbitral Tribunal entering on the reference.
Default, on the part of MIAL, in doing so, would result in this
order ceasing to operate on the expiry of the said period.
(vii) AAI is also permitted to move an application, under
Section 17 of the Arbitration and Conciliation Act, 1996, before the learned Arbitral Tribunal, for alteration or variation
of the present order, or for a direction, to MIAL, to deposit
any differential amount, remaining to be paid in accordance
with the OMDA, in the Proceeds Account or the AAI Fee
Account, or for any connected or cognate reliefs. Any such
application, if moved, would be decided on its own merits.
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needless to say after affording due opportunity to the opposite
party to contest the prayers. The present order would,
therefore, continue to remain in operation, pending and
subject to the decision of the learned Arbitral Tribunal in this
regard.
(ix) The interim protection, under (i) to (iii) supra, would
continue till, and remain subject to, the decision, of the
learned Arbitral Tribunal, on the application to be preferred,
before it, by MIAL under Section 17 of the Arbitration and
Conciliation Act, 1996, if it so chooses to prefer any such
application. Else, as already noted hereinabove, this order
would cease to operate two weeks after the Arbitral Tribunal
enters on the reference.”
25. Prima facie , I am of the view that the facts in the present case
are identical to those in MIAL1
26. The learned Solicitor General also sought to take exception to
the fact that, unlike MIAL, which had approached this Court at the
appropriate stage, DIAL merely sought to capitalise on the judgment
rendered in the case of MIAL, and had invoked Section 9 of the
Arbitration & Conciliation Act, 1996 in a much belated fa shion. Dr.
Singhvi sought to respond to this submission by pointing out that , in
its communication dated 23.
rd November, 2020, addressed to DIAL,
AAI, even while accepting the proposal of DIAL for deferral of obligations to pay MAF till June, 2020, denied the submission, of
DIAL, that it was exempted of its obligations from having to pay
MAF as a consequence of force majeure . In view of issuance of this
communication, Dr. Singhvi submitted that it could not be alleged that
DIAL had approached this Court belatedly. Even otherwise, he submits, once this Court had expressed it s view on an identical issue,
the petitioner was well within its right in seeking the same relief, as it
2021:DHC:18
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was identically situated.
27. At this ad interim stage, given the similarity and near identity,
on facts, between MIAL1 and the present case, I do no t intend to enter
into this aspect, leaving it open for consideration when the present
OMP is finally heard, or by the Arbitral Tribunal which may came to
be constituted, as the case may be.
28. There is, however, one important factual distinction betwee n the
present case and that of MIAL.
29. As there was some confusion regarding the exact status of the
monies contained in the Proceeds Account, the AAI Fee Account and
the Surplus Accounts, in the present case, I ha d, vide my order dated
9th
30. In compliance with the aforesaid directions, AAI has filed an
affidavit, along with which the table, appended to this order, has been December, 20 20, issued the following directions to AAI:
“The AAI is, accordingly, directed to place a short note, not
exceeding two pages, under cover of an appropriate index,
setting out this position, in order to clarify to this Court as the
Court desires to know the date when the aforesaid amounts of
₹ 399.20 and ₹ 51 crores were
(i) deposited in the Proceeds Account,
(ii) transferred, from the Proceeds Account, to the AAI
Fee Account,
(iii) further transferred from the AAI Fee Account, if at
all, and
(iv) the account in which these amounts are present
today.”
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annexe d2.
31. The position, as reflected in the tabular statement, filed by AAI
– which is not disp uted by Dr. Singhvi – is that between April, 2020 &
November, 2020, out of ₹ 1426.67 crores, transferred from the
Receivables Account into the Proceeds Account, ₹384.73 crores had
already been transferred into the AAI Fee Account and therefrom to
the AAI Bank Account which was outside the Escrow Account .
Further, by 9th December, 2020, a further amount of ₹ 51.94 crores,
out of a total amount of ₹ 129.97 crores which had been transferred
from the Receivables Account into the Proceeds Account also stood
transferred into the AAI Fee A ccount and therefrom to the AAI Bank
Account . DIAL has sought refund of this amount into the Proceeds
Account , such a prayer cannot be considered at an ad -interim stage.
As such, the aspect of refund of ₹ 384.73 crores & ₹ 51 .94 crores
which had travelled outside the Escrow A/c back into Escrow Account is an aspect which will have to be examined when the present OMP is
finally heard. At an ad-interim stage, it is not possible for this Court to
restore the status quo ante.
32. Dr. Singhvi has taken specific exception to the withdrawal , by
AAI, of ₹ 51.9 4 crores , from the AAI Fee Account immediately on it
being transferred to the said account, prior to 9
th
2 Ref. Annexure to this order. December , 2020,
after the present petition had been filed and was listed before this
Court .
2021:DHC:18
O.M.P.(I) (COMM.) 409/2020 Page 19 of 26
33. A reading of the OMDA read with the Escrow Agreement
makes it clear that the AAI was entitled to transfer, from the Proceeds
account to the AAI Fee Account, 45 .99% of the amounts deposited in
the Proceeds Account every month. No exception could be taken to
the transfer of ₹ 51.94 crores from the Proceeds Account to the AAI
Fee Account, per se.
34. Having said that, in my judgment in MIAL1, I had directed
status quo to be maintained with respect to the AAI Fee Account. In
other words, I had restrained AAI from withdrawing any amount from
the AAI Fee Account.
35. Tested on that anvil, it may be arguable whether AAI is
required to transfer back, into the AAI Fee Account, the aforesaid amount of ₹ 51.94 crores , which was withdrawn by it from the AAI
Fee account, immediately on deposit of the amount therein .
36. This, however, is also not a direction which I can legitimately
issue at an ad interim stage.
37. As such, the issue of whether the amounts withdrawn by AAI,
from the AAI Fee Account, on or before 9
th December, 2020 (as
reflected in the afore-extracted table2
38. Dr. Singhvi, however, submits that, even in December, 2020, filed by AAI itself), is required
to be deposited back in the Escrow Account, is left open for decision
at the stage of final hearing of the present OMP.
2021:DHC:18
O.M.P.(I) (COMM.) 409/2020 Page 20 of 26
apart from the aforesaid amount of ₹ 51.94 crores, an additional
amount of ₹ 77 crores was tra nsferred from the Proceeds Account to
the AAI Fee Account, after 9th December, 2020.
39. Inasmuch as the right of the AAI to transfer , to the AAI Fee
Accou nt, 45 .99% of the amount deposited in the Proceeds Account,
stood exhausted with the transfer of ₹ 51.94 crores till 9th December,
2020, Dr. Singhvi submits, with emphasis, that the further transfer of ₹
77 crores from the Proceeds Account to the AAI Fee Accounts, which
had taken place after 9th
41. Though Dr. Singhvi acknowledges that this averment does not
find reflection in the pleadings thus far, he submits that, as this
allegedly clandestine transfer of ₹ 77 crores had taken place without
the knowledge of DIAL and in violation of the OMDA and the Escrow Agreement, after 9 December, 2020, is completely without
authority of law and is contrary to the provisions contained in the
OMDA and the Escrow Agreement. He submits that this amounts to
an “advance appropriati on”, by AAI, of the amounts transferable
probably for the month of January, 2021, which, according to him, is
not permissible either under the OMDA or under the Escrow Agreement.
40. As such, this amount of ₹ 77 crores, according to Dr. Singhvi, is
required to be immediately transferred back to the Proceeds Account, without a day’s delay.
th December, 2020, he had no opportunity to place it
on record. He, however, confirms, on instructions, that such transfer
2021:DHC:18
O.M.P.(I) (COMM.) 409/2020 Page 21 of 26
has, in fact, taken place.
42. The learned Solicitor General objected to this line of argument,
submitting that these were aspects which would have to be ascertained, from AAI, on instructions. He, therefore, exhorted the court not to take any notice of such submissions, till they were placed on affidavit by DIAL.
43. Though it is a fact that the submission, of Dr. Singhvi, that ₹ 77
crores had been illegally transferred from the Proceeds Account to the
AAI Fee Account after 9
th
45. Secondly, there can, prima facie , be no gainsaying the posit ion,
emanating from the OMDA a s well as the Escrow Agreement, that
AAI is entitled to transfer, in any month, only 45.99 % of the amount
transferred to the Proceeds Account from the Receivables Account in December, 2020, does not find reflection in
the pleadings thus far, there are three reasons why it is not possible for me to ignore this submission, as the learned Solicitor General would request.
44. Firstly, a bare glance at the chart filed by AAI, regarding the
position of the various amounts of the Escrow Account, as extracted hereinabove, would reveal that monies deposited in the AAI Fee Account were being immediately transferred from the AAI Fee
Account to the account of the AAI outside the Escrow Agreement and,
therefore, as AAI would submit, outside the Section 9 reach of this
Court.
2021:DHC:18
O.M.P.(I) (COMM.) 409/2020 Page 22 of 26
that month, and not more. The chart filed by the AAI indicates that,
with the transfer of ₹ 51.94 crores into the AAI Fee Account, till 9th
December, 2020, this permitted 45.99 % entitlement of AAI, for the
said month, stood exhausted. Prima facie , therefore, Dr. Singhvi is
correct in his submission that, no amount, in excess of the aforesaid
amount of ₹ 51.94 crores could have been transferred into the AAI Fee
Account after 9th December, 2020.
46. Thirdly, the actual amount transferred after 9th December, 2020
hardly matters. Neither, in view of the directions that I propose to
issue in that regard, does the question of whether any amount, in
excess of ₹ 51.94 crores was, or was not, transferred from the
Proceeds Account to the AAI Fee Account after 9th December, 2020,
matter. If no such transfer has taken place, the direction wo uld not
affect AAI, as it would not apply. If any such transfer has taken place,
however, I am of the clear prima facie view that AAI was not entitled
to transfer any amount from the Proceeds Account to the AAI Fee
Account in December 2020, beyond ₹ 51.94 crores which stood
transferred by 9th December, 2020 . Any transfer from the Proceeds
Account to the AAI Fee account, which ha s taken place after 9th
47. I am, therefore, in agreement with Dr. Singhvi that any amount
that has been transferred from the Proceeds Account to the AAI Fee
Account, after 9
December, 2020, is, therefore, prima facie , contrary to the OMDA as
well as to the Escrow Agreement.
th December, 2020, would be required to be
transferred back into the Proceeds Account. This position would
2021:DHC:18
O.M.P.(I) (COMM.) 409/2020 Page 23 of 26
obtain even if the said amount has been transferred out of the AAI Fee
Account to the bank account of AAI.
48. At the same time, I reiterate my view that, at least at this ad
interim stage , no direction could be issued to AAI with respect to the
amount of ₹ 51.94 crores, which has travelled outside the Escrow
Account, into the individual bank account of the AAI in December
2020, or with respect to the amount of ₹ 384.73 crores, out of the
amount of ₹ 1426.67 crores deposited in the Proceeds Account, which
travelled outside the Escrow Account into the AAI Bank Account between April 2020 and November 2020. The prayer, of DIAL, for
return of this amount into the Escrow Account, would amount to
restoration of the status quo ante , and would have to be consider ed
when the present OMP is finally heard.
49. In view of the aforesaid, at this ad interim stage, the following
directions are issued:
(i) The ICICI Bank is directed to transfer back, into the
Proceeds Account, any amount which may have been
transferred from the Proceeds Account to the AAI Fee Account,
after 9
th
December, 2020.
(ii) In case any part of the said amount has been transferred
out of the Escrow Account, into the Bank account of AAI, after
9th December, 2020, AAI is directed to pay back, into the
Proceeds Account, the said amount, within two week s of the
2021:DHC:18
O.M.P.(I) (COMM.) 409/2020 Page 24 of 26
passing of the this order.
(iii) DIAL would continue to make payment into the
Receivables Account, of all receivables earned by it from the activities of the airport, in accordance with the OMDA, every
month. From the said receivables amount, the Escrow Bank would effect transfer, into the Proceeds Account, in accordance
with the OMDA.
(iv) Transfer of moneys from the Proceeds Account to the
AAI Fee Account, pending further orders, shall stand stayed.
(v) DIAL wou ld be entitled to use the amounts contained in
the Proceeds Account for running of the IGI airport and all
activities connected therewith.
(vi) All receivables as a consequence of such activities,
would, however, abide by the directions already issued
hereinab ove.
50. These ad interim directions would continue to remain and
operate subject to the final outcome of the present OMP.
51. As there was considerable debate, regarding the financial
position of DIAL, and as to whether it had been rendered unable to
perform its obligations under the OMDA, as a consequence of force
majeure , AAI is directed to file an affidavit, specifically setting out its
submissions in this regard within a period of two weeks from the date
2021:DHC:18
O.M.P.(I) (COMM.) 409/2020 Page 25 of 26
of pronouncement of this order. DIAL is dire cted to file its response
thereto with in a period of two weeks therefrom and AAI would be
entitled to file its rejoinder to the response of DIAL within one week
from the filing of such response. This aspect would be examined in
detail when the O.M.P. is f inally heard.
52. Prayer (vii) in the petition, for grant of ad interim relief stands
disposed of, in the aforesaid directions.
OMP(I)(COMM) 409/2020
1. Issue notice, returnable on 18th February, 2021. Mr. Raghav
Shankar accepts notice on behalf of the respondents.
2. Counter affidavit, if any, be filed within a period of four weeks
from today with advance copy to learned Counsel for the petitioner
who may file rejoinder thereto, if any, before the next date of hearing.
3. Renotify for hearing on 18th
February, 2021.
C. HARI SHANKAR, J .
JANUARY 05, 2021
dsn/kr
2021:DHC:18
O.M.P.(I) (COMM.) 409/2020 Page 26 of 26
1 ANNEXURE
2 3 4 5 6 7 8 9 10
MONTH Amount
transferr
ed from
Receivab
les A/c to
Proceeds
a/c
during
month Bill
Amount
in
respect
of MAF Amount (in crores) Date of Transfer
from Receivables a/c
no. 6505002690 to
Proceeds Account a/c
no. 6505002691 Date of transfer from
Proceeds account to AAI
Fee Account a/c
no.6505002693 Date of transfer from AAI
Fee account to AAI Bank
a/c no.705041566
INR – in
crores AAI
FEE
(Net
after
TDS) GST TOTAL credit in Bank a/c 6505002691
(Proceeds a/c) 6505002693 (AAI Fee a/c) 705041566 (AAI Bank a/c)
Apr-20 89.4 20.74 18.67 3.73 22.4
All funds received in
Receivables account
are transferred to
Proceeds account on a
daily basis 07.04.2020 07.04.2020
May- 20 78.91 27.80 25.02 5 30.02 06.05.2020 06.05.2020 Note -1
Jun-20 130.63 36.95 33.25 6.65 39.9 05.06.2020 05.06.2020
Jul-20 189.95 47.32 42.58 8.52 51.1 07.07.2020 07.07.2020
Aug-20 172.8 46.71 43.2 8.4 51.6 07.08.2020 07.08.2020
Sep- 20 225.1 47.01 30.08 8.46 39.26 07.09.2020 07.09.2020
Oct-20 269.48 47.01 43.48 8.46 51.94 07.10.2020 07.10.2020
Nov-20 270.4 47.01 43.48 8.46 51.94 07.11.2020 07.11.2020
S.Fall -Q1 0 46.25 2.63 8.32 10.95 Note -2
S.Fall -Q2 0 32.23 29.82 5.8 35.62 15.10.2020 15.10.2020
TOTAL 1426.67 399.03 312.93 71.8 384.73
Dec. -20 129.97 47.01 43.48 8.46 51.94 09.12.2020 09.12.2020
Note -1 – In May 2020 Rs.15.60 crores transferred to AAI Bank account from Escrow Proceed account whereas Rs.14.42 crores from DIAL’s a nother account
Note -2 – Bill Amount adjusted against credit note issued to DIAL.”
2021:DHC:18