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SC Modifies Bombay HC Order, MMRCL Spared ₹250-Crore Upfront Payment

Published: December 01, 2025 | Category: Real Estate Mumbai
SC Modifies Bombay HC Order, MMRCL Spared ₹250-Crore Upfront Payment

The Supreme Court has made a significant ruling in a long-standing legal battle between the Mumbai Metro Rail Corporation Ltd (MMRCL) and the L&T–STEC Joint Venture (JV) Mumbai. The apex court modified a Bombay High Court order that had refused to grant an unconditional stay on the execution of a ₹250.82-crore arbitral award issued in favor of L&T–STEC JV.

A bench led by Chief Justice Surya Kant held that the High Court’s earlier directive, requiring MMRCL to deposit the entire decretal amount as a precondition for stay, was not legally necessary. This decision came as a relief to MMRCL, which had been facing a significant financial burden.

The Supreme Court, in its revised directions, has eased the conditions for MMRCL:

- MMRCL will not be required to deposit the entire decretal amount or furnish a bank guarantee for it. - Instead, the corporation must file an undertaking detailing its properties in Mumbai, along with a commitment to pay the full decretal amount within eight weeks if L&T ultimately succeeds. - There should be a charge on the property, the description of which should be given in the undertaking.

The dispute dates back to a contract for the design and construction of several Metro stations and tunnels in Mumbai. The Bombay High Court had previously directed MMRCL to deposit the arbitral award, around ₹250 crore plus interest, into the HC registry within eight weeks to secure a stay on its execution. This order was issued on October 25, following MMRCL’s challenge to the arbitral tribunal’s June 16, 2025 award. MMRCL had sought a stay to prevent L&T–STEC JV from initiating recovery proceedings.

The Supreme Court’s decision is a significant development in the ongoing legal saga, providing a more balanced approach to the financial obligations of MMRCL while ensuring that the rights of the L&T–STEC JV are protected. This move is expected to ease the financial strain on MMRCL, allowing it to focus on the critical infrastructure projects it is tasked with in Mumbai.

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Frequently Asked Questions

1. What was the original Bombay High Court order?
The Bombay High Court had ordered MMRCL to deposit the entire decretal amount of ₹250.82 crore plus interest into the HC registry within eight weeks to secure a stay on the execution of the arbitral award.
2. What did the Supreme Court modify in the Bombay High Court order?
The Supreme Court modified the order by sparing MMRCL from the immediate ₹250.82 crore upfront payment. Instead, MMRCL must file an undertaking detailing its properties in Mumbai and commit to paying the full decretal amount within eight weeks if L&T ultimately succeeds.
3. What is the nature of the dispute between MMRCL and L&T–STEC JV?
The dispute is over a contract for the design and construction of several Metro stations and tunnels in Mumbai, which led to an arbitral award in favor of L&T–STEC JV.
4. What are the new conditions set by the Supreme Court for MMRCL?
The new conditions include filing an undertaking detailing MMRCL’s properties in Mumbai and a commitment to pay the full decretal amount within eight weeks if L&T ultimately succeeds, along with a charge on the property.
5. Why was the Supreme Court’s decision significant for MMRCL?
The decision is significant because it eases the financial burden on MMRCL, allowing it to focus on its infrastructure projects in Mumbai without the immediate pressure of a large upfront payment.