MMRDA, Metro operator spar over land lease pact

The agreement also proposes to cover the excess area that the MMRDA has alleged that the MMOPL has built in the Metro car depot and at some stations, a senior official said. According to the authority, it had given permission to build up to 45,200 sq m in the car depot, but the the MMOPL has constructed 30,185 sq m of additional area.

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“Although the concession agreement calls for it, the lease agreement has not been signed until now. We have been discussing the issue and have sent the company a draft. We have given them sufficient time to sign it, but they haven’t, so this issue too is likely to run into arbitration,” said a senior MMRDA official requesting anonymity.

The lease agreement will formalise handing over the land to MMOPL and put it within a framework of certain regulations. The official said the land would be leased to MMOPL till the end of the concession period at a certain cost. He, however, did not give details on the cost and other conditions of the draft agreement.

“The duration and the cost are not the points of disagreement. Their contention is that the provisions of the Metro Act be applied to even the lease agreement. This will effectively give them the right to develop the entire land given to them for the project the way they want,” he added

Under the Metro Act, a Metro Rail Administrator can acquire, hold and dispose off all kinds of properties owned by it, improve develop or alter any property or asset it holds, develop any Metro railway land for commercial use and execute any lease of grant any license for the property.

The MMOPL has developed the 11.4-km Versova-Andheri-Ghatkopar Metro on a public private partnership with a “build, own, operate and transfer” model.

The project was brought under the Union government’s Metro Act midway through implementation, after which the MMOPL became the Metro Rail Administrator.

A spokesperson for MMOPL said, “As per the provisions of the agreement, the lease agreement is to be agreed by parties mutually. We have sent the draft of the lease agreement to MMRDA.”

Not long ago, the MMRDA and MMOPL had a conflict on cost escalation in the project.

The arbitration process, mainly for the surge in cost from Rs 2,356 crore to Rs 4,321 crore, will begin next month when the scope of the arbitration would be decided. Officials said they will ask for the lease to be included in the scope. Meanwhile, before the arbitration begins, the two parties have also filed claims with each other. While the MMRDA has asked MMOPL to pay Rs 1,155 crore citing delay in completion, the operator has in turn filed a claim for about Rs 1,500 crore.

manasi.phadke@expressindia.com