Maharashtra govt told to pay ₹691 cr to IDRCL in tollway case

India Debt Resolution Co Ltd (IDRCL), the managing arm of National Asset Reconstruction Co Ltd (NARCL), secured a Rs 691 crore arbitration award from the Bombay High Court appointed arbitrator Justice J P Devadhar. The ruling is nearly six times the Rs 117 crore it had paid to take over the debt of Sion Panvel Tollways Pvt Ltd (SPTPL) in 2024.

This is among the first recoveries for the government-backed bad bank since it started operations in 2022. The arbitrator has directed the Government of Maharashtra (GoM) to immediately transfer the amount to a nationalised bank account, according to the order, a copy of which was seen by ET.

“The award is a result of the arbitration proceedings which started in January 2025,” said a person familiar with the details. “IDRCL had pleaded that it be immediately compensated for the debt portion of the concession agreement which was terminated in 2017 by GoM which according to calculations made then came to Rs 691 crore. The arbitrator in hearings completed in December has agreed with the calculations based on the facts at hand.”


IDRCL did not reply to an email seeking comment.

SPTPL was awarded the project to widen and strengthen the Sion-Panvel road to five lanes from three on a build-operate-transfer basis for an overall concession period of 17.5 years between May 2011 and October 2028.

Disputes arose between the state government and the company in 2014 regarding the extent of completion of the project and eventually the agreement was terminated and toll collections taken over by the government’s public works department.

SPTPL was declared as NPA in 2015-16.

In his 26-page order, Justice Devadhar said despite taking over the toll collections in November 2017, the state government declined to share the amount collected as toll to service debt due to the lenders and claimants.

“In fact, appropriating the toll amount collected by GoM with servicing the debt due would amount to unjust enrichment which is wholly impermissible in law,” the order said.

Devadhar further said GoM failed to take steps underlined in the agreement for making termination payment and in spite of collecting toll for nearly eight years. The court directed immediate transfer of the money in an escrow account even as arbitration proceedings in this case will continue.

The state government is likely to challenge the ruling in the Bombay High Court.

IDRCL's parent NARCL had taken over the Rs 2,500 crore debt of SPTPL in March 2024 from more than 80% of the company’s creditors. The NARCL offer includes 85% security receipts backed by the government’s five-year guarantee, which insures banks in the case of lower realisation than that envisaged in the initial deal.

NARCL had rejected three bids in June 2024 as they were of low value, ET reported at the time.

The latest arbitration amount exceeds that value, the person cited above said.