CNX Today | Indian Government Proposes Amendment to Protect Delhi Metro Rail Assets from Attachment

Apr 13,2023

The central government has proposed an amendment to the Metro Rail (Operation and Maintenance) Act, seeking to prevent any metro rail administration’s assets, properties, or bank accounts from being attached in the case of a court order.

There has been a long legal dispute between a Reliance Infrastructure (RInfra) subsidiary owned by Anil Ambani and the Delhi Metro Rail Corporation (DMRC). Following a judiciary warning, the Ministry of Housing and Urban Affairs has taken steps to modify the Metro Railways Act with the intention of safeguarding the assets of DMRC from being attached.

The proposed change in the law would provide significant relief to Metro Rail entities across India, as it ensures that no properties or bank accounts of such entities can be attached ever. To prevent any properties or bank accounts of such entities from being seized, Union minister Hardeep Singh Puri instructed officials to review the attachment provision in the Metro Rail Act and make necessary changes. According to sources, the Ministry has shared the suggested revisions to Section-89 of the Act with various other ministries and has requested their input within a two-week period.

As per the suggested modification, none of the stock, machinery, plant, fittings, materials, or effects used or supplied by the metro railway administration for the purpose of traffic on its railway, stations, workshops, earnings, offices, or any parcel of land held by the Metro Rail Administration would be taken in execution under any decree or order issued by a court, local authority, or person with the legal authority to confiscate or impound property.
Currently, the attachment of any Metro Rail property requires the sanction of the central government. However, the suggested modification in the Act will guarantee that no confiscation of Metro Rail assets, including financial assets, will take place in response to execution procedures initiated by any court in the country. Moreover, the addition of “earnings or any parcel of land” to the Act, which is not presently included, will provide greater safeguarding for Metro Rail establishments that are currently struggling to generate sufficient revenue to operate their services.

The government intends to eliminate Section 89(2) from the current Act, which permits courts to seize the earnings of Metro Rail entities in execution. The Ministry refused to authorize the attachment of DMRC properties to settle a dispute with a company that abandoned its contract for the airport metro line. The Ministry highlighted to the High Court that such an action would result in the closure of DMRC, which would cause significant public inconvenience and pose a risk to law and order in the city. The central government, as a guardian of public welfare, cannot permit such a dangerous situation to occur.