SC issues contempt notice to Axis Bank, Reliance Infra unit over DMRC refund dispute

The Supreme Court of India has issued a contempt notice to Axis Bank, its Managing Director Amitabh Choudhary, and a subsidiary of Reliance Infrastructure in connection with a long-running dispute over the former parties not paying the refund of a ₹4,500 crore escrow deposit.

The court directed the parties to show cause why contempt proceedings should not be initiated for allegedly defying a previous order. The case stems from a contempt plea filed by the Delhi Metro Rail Corporation (DMRC), which claims that Delhi Airport Metro Express Private (DAMEPL)- a unit of Reliance Infrastructure, Axis Bank, and its senior officials have failed to comply with a ruling issued in April 2024.

In that judgment, the Supreme Court had set aside its previous decision that mandated the PSU to pay an arbitration award of an ₹8,000 crore in favour of DAMEPL. The Court had also directed the refund of a ₹4,500 crore deposit, which includes ₹2,800 crore principal and interest, held by Axis Bank on behalf of DMRC.

On Wednesday, DMRC, the operator of Delhi’s metro system, accused the parties of "wilfully" defying the court's ruling, asserting that they have not taken steps to return the escrowed funds as instructed by the Supreme Court.

During Monday’s hearing, the bench granted an exemption to Axis Bank's MD and the MD of R.Infra's subsidiary from personally appearing before the court at the next hearing.

The dispute has drawn significant attention, highlighting the ongoing challenges faced by the infrastructure and financial sectors in complying with judicial orders in high-stakes commercial cases.

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