Wednesday, December 02, 2020

Delhi HC stopped AAI to collect 39 percent revenue from Mumbai Airport

New Delhi: Airport Authority of India is stopped by the Delhi High Court from collecting the 38.7 percent revenue from Mumbai airport. Mumbai airport had invoked the force majeure clause to challenge the transfer of Rs 29 crore from its escrow account to the AAI in July.

 Lately, on Friday, the High Court gave interim relief to (Mumbai International Airport Limited) MIAL and stop the AAI from transferring funds from the escrow account to itself. This relief will be in order till an arbitral tribunal decides further on this matter.

"The judgment has appreciated the effects of Covid-19 on the aviation sector and, in particular, the airport operator and has as such restrained AAI from transferring any amounts to it under the operations, management and development agreement. In fact, the court has also recognised the fact that at present only limited operations are being carried out by the airport and that as such prima facie the annual fees to AAI cannot be said to be payable till the level of activity existing prior to the pandemic,” said advocate Kartik Nayar, who appeared for Mumbai airport. 

 “In doing so, the court has also appreciated the fact that apart from reduced airport operations, even collection of revenue has been affected owing to the pandemic and, therefore, has held that payments cannot be said to be due to AAI on an accrual basis as was being done under the agreement,” Nayar said.

01/12/20 PSU Connect

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