Delhi High Court - Orders
West Haryana Highways Projects Private ... vs National Highways Authority Of India ... on 5 August, 2020
Author: Rekha Palli
Bench: Rekha Palli
Via video conferencing
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ O.M.P.(I) (COMM.) 144/2020
WEST HARYANA HIGHWAYS PROJECTS PRIVATE LIMITED
..... Petitioner
Through Mr.Harish Malhotra, Sr.Adv. with
Mr.Apoorv Agarwal, Mr.Gupreet, Ms.Akanksha
Sharma, Advs.
versus
NATIONAL HIGHWAYS AUTHORITY OF INDIA AND ORS
..... Respondent
Through Ms.Gunjan Sinha with Mr.Mitash
Charan, Advs for NHAI.
Mr.V.K.Sharma, Project Director, PIU Rothak.
Ms.Navneet (Legal) for NHAI.
Mr.Sanjiv Kakra with Mr.Abhishek Batra, Advs
for SBI.
Mr.Apoorv Sarvaria, Adv with Mr.RP.Vats for
PNB.
CORAM:
HON'BLE MS. JUSTICE REKHA PALLI
ORDER
% 05.08.2020 I.A.6365/2020
1. This is an application filed by the petitioner praying for directions to the respondent no.2 to release certain amounts in favour of the petitioner, on a weekly basis, from the escrow account in order to enable it to carry out major maintenance work which forms the subject matter of the two NITs and is in accordance with the directions of respondent no.1
2. Upon notice being issued in the present application on the last date, the respondent no.2/PNB has filed a detailed reply opposing the application primarily on the ground that the terms of the escrow agreement, which envisage release of amount to the petitioner, are subject to the terms of the loan agreement between the petitioner and the respondent no.2. It is pertinent to note that under the loan agreement, the petitioner has already been declared a defaulter.
3. Mr.Apoorv Sarvaria, learned counsel for the respondent no.2 contends that once the petitioner has defaulted under the loan agreement, the respondent no.2 is within its rights to withhold release of any further amounts to the petitioner. He, however, submits that without prejudice to its right to withhold release of any further amount in favour of the petitioner, the respondent no.2 has still been releasing a monthly sum of Rs.71 lakh to the petitioner for minor repair work and, therefore, prays that the application be dismissed.
4. On the other hand, learned senior counsel for the petitioner, while praying for time to file a rejoinder, submits that Clause 4.1.1 of the escrow agreement makes it incumbent upon the respondent no.2, being the lead Bank, to release amounts in favour of the petitioner/concessionaire in order to carry out the work in accordance with the directions of the respondent no.1. He further submits that the escrow agreement mandates that the daily revenue generated from the petitioner's toll collections shall be deposited in the escrow account and its utilisation shall be determined strictly in accordance with the terms thereof. However, the respondent no.2, in contravention of the specific terms of the agreement, has been diverting a great portion of these amounts towards the instalment payable by the petitioner to the respondent no.2 Bank and other lender banks. This action has been carried out without appreciating the fact that the escrow account has been created for a particular purpose and imposes certain conditions for disbursement of the amounts deposited therein, viz., prioritising all expenses arising out of the repair and maintenance work of the project. He submits that in these circumstances, the petitioner has not been able to carry out the necessary repair and maintenance work on account of a shortage of funds, resulting from the actions of the respondent no.2 which are in contravention of the escrow agreement.
5. In the light of the aforesaid submissions made by the parties, I am of the prima facie opinion that pending the disposal of the present application pertaining to the dispute on the proper manner in which the amount in the escrow account should be used, the repair and maintenance work in the national highways should not be allowed to suffer. Therefore, in public interest, I am of the view that the respondent no.2 ought to give priority to the repair and maintenance work of the highway, before transferring the amounts in the escrow account to any lender banks. In case the petitioner is a defaulter, it will always be open for the respondent no.2 to recover its dues from the petitioner as per law, but the same cannot be a ground to defeat the interest of the public at large, that too when the escrow agreement specifically provides release of the amounts for this very purpose.
6. Accordingly, the respondent no.2 is restrained from transferring or releasing any amount from the escrow account to itself or any of the other lender Banks, in discharge of the dues, if any, payable by the petitioner. The respondent no.2 is also directed to release the available amount in the account of the petitioner on a weekly basis who, in turn, will continue to carry out the repair work as per the directions of Mr.V.K.Sharma, Project Director, PIU Rothak. It is made clear that these directions are subject to the final adjudication of this application.
7. As prayed for, the petitioner is granted one week's time to file its rejoinder. At this stage, Ms. Gunjan Sinha submits that the respondent no.2 has made wholly unwarranted allegations against the respondent no.1 in its reply. She, therefore, prays for and is granted one week's time to file the response of respondent no.1 to the reply filed by respondent no.2.
8. List the application for disposal on 04.09.2020. O.M.P.(I) (COMM.) 144/2020 & I.As. 4646/2020, 5915/2020
9. Keeping in view the petitioner's stand that it will forthwith begin the repair work, the respondent no.1 is directed to file an affidavit before this Court setting out instructions for the petitioner to effectively carry out this work as also a detailed report of the work actually being conducted on-site.
10. At request, list on 04.09.2020
11. Interim orders to continue.
REKHA PALLI, J AUGUST 05, 2020/sr