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10. The Arbitral Tribunal formulated the following primary issues for consideration in relation to the termination notice dated 08.10.2012: -

“i) Were there any defects in the civil structure of the airport metro line?

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 (ii) If there were defects, did such defects have a material adverse effect on the performance of the obligation of DAMEPL under CA?

(iii) If there were defects in the civil structure, which had a material adverse effect on the performance of the obligations under the CA by DAMEPL, have such defects been cured by DMRC and / or have any effective steps been taken within a period of 90 days from the date of notice by DAMEPL to cure the defects by DMRC and thus were DMRC in breach of the CA as per 29.5.1 (i)?”

11. In assessing whether the defects pointed out by DAMEPL were cured and/or effective steps to cure them were taken by DMRC within the time stipulated in the notice dated 09.07.2012, the Arbitral Tribunal undertook an in-depth analysis of the defects in the civil structure and steps taken for their repair/rectification. Insofar as the existence of defects is concerned, the Arbitral Tribunal concluded that there were as many as 1551 cracks in 367 girders, i.e., 72 % of the girders were affected by such cracks. Reports of inspections conducted at the behest of DMRC, giving mapping data of the cracks, were relied upon by the Tribunal to hold that such cracks were spread in a large number of 8 | Page girders. The Tribunal referred to the meeting dated 02.07.2012 conducted by the Ministry of Urban Development during which the Managing Director, DMRC expressed his views that the cracks occurred during “lowering” and not during operations. The evidence of Mr. Muls of Systra was considered by the Arbitral Tribunal to hold that they were not sure of the cause of the cracks. On account of such large numbers of cracks in the base slab of the pre-stressed concrete girders in about a year of train operation, coupled with unreliable measurement of crack depth and non-serious inspection of the repairs by an agency appointed by DMRC, the Arbitral Tribunal was of the opinion that these defects adversely impacted the integrity of the structure. As effective steps were not taken within the cure period of 90 days, the Tribunal held that DMRC was in breach of the Concession Agreement, resulting in Material Adverse Effect on the Concessionaire.

17. The Division Bench of the High Court held that the award of the Arbitral Tribunal had recorded two different termination dates. As the Tribunal had based its reasoning on the validity of the termination notice on two different dates leading to confusion and ambivalence as to the termination notice and the date of termination, the award was found to be suffering from the vices of perversity, irrationality and patent illegality. The High Court observed that in deciding the question on defects in the civil structure and whether effective steps were taken to cure the defects, the Arbitral Tribunal had committed serious error by holding, without ‘reason’, that the vital evidence of the sanction granted by the CMRS for resumption of commercial operations of the AMEL and the fact that DMRC had successfully operated the AMEL from 30.06.2013 till the date of the award without any adverse incident were inconsequential. The High Court found 14 | P a g e fault with the Arbitral Tribunal in virtually negating the certificate issued by the CMRS under the Delhi Metro Railway (Operation and Maintenance) Act, 2002 (hereinafter, ‘the Delhi Metro Act’) and held that the cumulative effect of the findings of the award on this issue ‘shocked the conscience of the court’.

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33. The Arbitral Tribunal was called upon by the parties to decide whether there was a breach of the Concession Agreement due to the fault of DMRC and whether the defects pointed out by DAMEPL were cured within the period specified in the notice dated 09.07.2012. Safety of the AMEL was not an issue that fell for determination by the Arbitral Tribunal, though DAMEPL had insisted on not continuing operations of the Line citing safety concerns arising from the defects in its structural integrity. It is no doubt true that the Commissioner is the competent authority to determine the safety of the AMEL. It is also beyond cavil that the Commissioner would not have granted permission to restart the AMEL unless it was of the opinion that restarting of commercial operations would not pose a danger to the public. However, the certificate by itself cannot come to the rescue of DMRC to show that the defects pointed out by DAMEPL were cured within the expiry of 90 days from 09.07.2012. The finding of the Arbitral Tribunal that the defects were not cured is one of fact which cannot be interfered with by the court.