Delhi airport has invoked the force majeure clause to temporarily cease its revenue-sharing accord with the Airports Authority of India (AAI).
Delhi International Airport (DIAL), which manages and operates the Indira Gandhi International Airport, took the decision in the wake of low traffic flow and revenue impacted by the coronavirus pandemic, according to a report by Business Standard.
As per the agreement inked between DIAL and AAI in 2006, DIAL paid 45.99 per cent of its annual revenue as concession fee to AAI. DIAL deposits the (annual procession) fee on a quarterly basis in an escrow account, which AAI then transfers the money into its own account.
"A resolution to invoke the force majeure clause was passed by the DIAL board in November. Accordingly, we had approached AAI for a cease on revenue share till traffic was back to normal levels," a source told the publication, adding that DIAL planned to use the money in the escrow account to carry out airport maintenance.
DIAL, earlier this year, also moved the Delhi High Court (HC) to retrieve dues worth Rs 399.2 crore paid to AAI since April (2020) under a revenue-sharing agreement.
Air operations were inoperative from March 24 for a span of two months as the government had imposed a nationwide lockdown to stem the spread of COVID-19.
Delhi HC had in September (2020) asked AAI to furnish a note declaring the treatment of Rs 399.2 crore transferred by DIAL in the escrow account.
Meanwhile, Mumbai International Airport (MIAL), too, earlier this year invoked the force majeure clause to suspend payment to AAI for the April-June period.
Earlier this month, Delhi HC restricted AAI from collecting 38.7 per cent of MIAL's revenue as annual fee in the wake of adverse financial impact of the coronavirus pandemic. The court also restricted AAI from moving funds from the escrow account to itself, until an arbitral tribunal took a decision on the matter.