French firm accuses MMRDA officials of graft; HC quashes termination of contract of its Indian arm

French firm Systra accuses MMRDA officials of corruption, Bombay High Court quashes termination notice, sparking calls for inquiry.

French firm Systra which provides consultancy services to metro projects has accused officials of the Mumbai Metropolitan Region Development Authority (MMRDA) of corruption, even as the Bombay High Court on Tuesday (February 25, 2025) quashed MMRDA's notice terminating the contract of its Indian subsidiary.

On November 12, 2024, the French Embassy wrote a letter to Rupinder Singh, Resident Commissioner of Maharashtra in Delhi, requesting the government to study the issue "in depth" and "resolve the situation", while citing Systra's complaint to the embassy about "severe harassment/challenges being faced while working as a general consultant on projects with MMRDA." While senior officials of MMRDA, the planning and development agency of the state government, were not available for commenting on the issue, Shiv Sena (UBT) leader Aaditya Thackeray demanded that Chief Minister Devendra Fadnavis order an inquiry.

The multinational engineering firm accused MMRDA officials of seeking "undue favours," as well as delaying payments, pressuring the firm to inflate orders to contractors, stalling approvals for key staff, and imposing arbitrary penalties.

On Tuesday, a bench of Chief Justice Alok Aradhe and Justice Arif Doctor of the high court noted that the MMRDA did not give reasons while discontining the services of Systra MVA Consulting (India) Pvt Ltd on January 3, 2025.

As per Systra's complaint that the Embassy sent to the Maharashtra government, "major harassment began in August 2023 after the change of some senior MMRDA officials, who summoned the company and asked for undue favours in the form of monetary benefits on the pretext that MMRDA is demanding it." Systra "politely informed" them that it would not comply, the letter said.

Systra is working as a general consultant for various metro projects executed by MMRDA in Mumbai's metropolitan region including Metro Lines 5, 6, 7A, 9, 10, and 12, in addition to providing detailed design consultancy services for Metro Lines 2A and 7, Mandale Depot, Kasheli Depot, and branding guidelines for all Metro Lines of MMRDA.

The MMRDA issued a notice of suspension of payments in January 2024, alleging various deficiencies related to old issues that had already been resolved concerning general consultancy services for Metro Lines 5, 6, 7A, and 9, the letter said.