DMRC Cannot Be Forced To Revive Concession Agreement Granted To Prime Infrapark, Terminated Before CIRP: NCLAT

The National Company Law Appellate Tribunal (NCLAT) on Friday held that the Delhi Metro Rail Corporation (DMRC) cannot be directed to revive a concession agreement for the development of a multi-level parking and commercial project at the New Delhi Railway Station under the Airport Express Line.

The tribunal noted that the agreement had been terminated in 2017, well before the initiation of the Corporate Insolvency Resolution Process (CIRP) of Prime Infrapark Pvt Ltd, the special purpose vehicle to which the concession was assigned.

However, the tribunal left open the option of conciliation and arbitration under Clause 12 of the concession agreement, allowing the parties to pursue dispute resolution in respect of claims and issues arising from the agreement, including its termination, in accordance with law.

The bench of Chairperson Justice Ashok Bhushan and Technical Member Barun Mitra pronounced the order.

The appeal was filed by DMRC against the order dated September 11, 2025 passed by the National Company Law Tribunal (NCLT), New Delhi, which had disposed of an application filed by the successful resolution applicant (SRA) with certain directions.

DMRC had issued a Letter of Acceptance in 2009 to Pratibha Industries Ltd. for the construction of a multi-level parking and commercial development project at the New Delhi Railway Station under the Airport Express Line. A concession agreement was executed on April 1, 2010 and later assigned to Prime Infrapark Pvt Ltd, a special purpose vehicle.

After issuing a cure-cum-termination notice for non-payment of dues amounting to Rs 36.78 crore, DMRC terminated the concession agreement on September 1, 2017 and took possession of the project facility on September 2, 2017. The corporate debtor admitted the breach, sought revocation of the termination, and raised claims of Rs 340.44 crore.

The corporate debtor also invoked the arbitration clause under the agreement and sought reinstatement of the concession agreement, though no reinstatement was agreed to between the parties.

CIRP against the corporate debtor commenced on August 12, 2022, and the information memorandum recorded the prior termination of the concession agreement as well as invocation of the dispute resolution clause.

A resolution plan submitted by a consortium of Crown Steels and Sunrise Industries was approved on July 30, 2024.

The resolution plan itself envisaged revival of the concession agreement, without placing any additional financial burden on the corporate debtor. Following its approval, the successful resolution applicant (SRA) moved the NCLT through a series of applications, seeking directions against DMRC.

DMRC, however, pushed back firmly. It maintained that the concession agreement had already been terminated long before the commencement of CIRP and, as such, fell outside the scope of the insolvency process. It further argued that the NCLT lacked the jurisdiction to order revival of a contract that had ceased to exist. Emphasising its position, DMRC pointed out that it had not participated in the CIRP and could not be treated as a stakeholder. At the same time, it indicated a willingness to engage in conciliation or arbitration in terms of the agreement.

For its part, the respondent took a narrower stance. It clarified that no direction to revive the concession agreement had been granted by the NCLT. Instead, the request was limited to allowing the SRA to revive conciliation proceedings and to have its proposal considered by DMRC.

The NCLAT noted that there was no dispute regarding the termination of the concession agreement on September 1, 2017 and that the corporate debtor had already invoked Clause 12 of the agreement.

“There can be no quarrel to the proposition that Concession Agreement which was terminated on 01.09.2017 much prior to initiation of CIRP of the Corporate Debtor cannot be subject matter of the CIRP process and no direction could have been issued to the Appellant either in the Resolution Plan or order impugned for revival of the Concession Agreement which stood terminated.,” the tribunal held.

Holding that the adjudicating authority could not have issued any direction for revival of the terminated agreement, the appellate tribunal modified the NCLT's order.

It clarified that while no direction for revival could be issued under the insolvency framework, the parties are free to pursue conciliation or arbitration in respect of disputes arising out of the concession agreement, including claims relating to its termination or any request for reinstatement, in accordance with law, with all rights and contentions left open