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The Mumbai Metro Rail Corporation Limited (MMRCL) has released long-pending payments to contractors working on Metro Line 3, resolving a standstill caused by a property tax dispute with the BMC. The issue revolved around BMC's tax claims on casting yards, which contractors like Dogus Soma JV, CEC-ITD JV, L&T STEC JV, and HCC argued were exempt under Section 184 of the Railways Act, 1989. The Bombay High Court provided interim relief in April 2024, halting any forceful tax recovery. With no new recovery notices issued and undertakings now secured, MMRCL has resumed disbursing funds to maintain construction progress.
The Mumbai Metro Rail Corporation Limited (MMRCL) has recently released payments to its construction contractors involved in Metro Line 3 development. This action follows a period where funds were held back due to a property tax dispute with the Brihanmumbai Municipal Corporation (BMC), a matter now addressed after MMRCL secured undertakings from the contractors. Advertisement
The dispute centered on the BMC's claims for property tax dues on certain casting yards essential for Metro Line 3 construction. Contractors, including major firms such as Dogus Soma JV, CEC-ITD JV, L&T STEC JV, and HCC, had challenged these claims, arguing that casting yards are exempt from property tax under Section 184 of the Railways Act, 1989.
In April 2024, the Bombay High Court granted interim relief, instructing the BMC not to take forceful action to collect the disputed tax. Subsequent legal notices were served by the contractors in April 2025, emphasizing the ongoing payment freeze. Despite BMC's continued insistence that casting yards are indeed taxable and that contractors bear joint and several liability, no fresh legal notices or recovery actions have been initiated by the civic body.
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