GVK-led Mumbai International Airport (MIAL) argued in the Bombay High Court on Tuesday that Housing Development and Infrastructure Limited (HDIL) is liable to pay the airport developer Rs 276 crore as “liquidated damages” in the ongoing dispute over the Mumbai airport slum rehabilitation project.
These liquidated damages MIAL’s legal counsels said are financial claims for the breach of timelines of construction. The total amount could go up further, said MIAL’s counsels as they alleged that the airport operator can claim further damages from HDIL without quantifying the same.
The legal battle between the Mumbai-based real estate developer and the airport operator went a step further on Tuesday as MIAL’s counsel claimed that HDIL has “repudiated the contract” for the slum rehabilitation project.
MIAL’s counsel argued that according to the agreement, if there was a delay on part of HDIL in handing over the freed up land from slum encroachments, then it was HDIL who is liable to pay for such a delay.
Earlier this month, HDIL had moved the Bombay HC against MIAL, Slum Rehabilitation Authority and Mumbai Metropolitan Regional Development Authority (MMRDA), challenging MIAL’s termination of the airport slum rehabilitation contract awarded to it in 2006. MIAL terminated the contract in February 2013 saying HDIL had failed to complete the rehabilitation by 2011.
In an interim relief to HDIL, the high court, on July 1 had barred SRA from initiating proceedings for repossession of tenements built by the realty company for the slum rehabilitation project.
In the arguments that followed the interim relief, HDIL had argued that it could not meet deadlines on the project due to insufficient cooperation from the government agencies. However, MIAL’s response to this is that getting all necessary clearances, vacating the encroached land, rehabilitating the slum dwellers and coordinating with government agencies was the “sole responsibility” of HDIL. MIAL is further arguing that HDIL signed the contract agreeing to these terms.
“There is nothing in the contract, which entitles them to lay the blame on our door,” MIAL counsel told the high court on Tuesday. He also argued that the issues related with SRA and MMRDA were not part of the agreement signed between MIAL and HDIL. “If they were not sure of how government agencies will react, they should have included that in the agreement, or not bid for the project,” he said.
As for HDIL’s arguments on their rights over 65 acres of cleared land, MIAL is arguing that it was subject to 28,000 tenements getting constructed under Phase I and the slums dwellers getting rehabilitated. MIAL says since the conditions have not been satisfied, HDIL should not be granted any relief on its alleged land rights. MIAL also denied in Court that HDIL provided it with Rs 300 crore of bank guarantees as performance security. The hearing will continue on Wednesday with SRA and MMRDA expected to respond to HDIL’s claims.
