The Bombay High Court refused to grant interim relief to Tata Power Company (TPC) against the state directive that forced it to supply 360 mw electricity to Reliance Infrastructure (R-Infra). The state, meanwhile, made a complete volte-face by informing the High Court that it did not forced the TPC but just "issued an advisory". The division bench of acting Chief Justice JN Patel and Justice SC Dharmadhikari held that since the Maharashtra Electricity regulatory Commission would be looking into the matter of power diversion by the Maharashtra State Load Despatch Centre (MSLDC) to R-Infra there was no requirement to set-aside an advisory.
The state government in its affidavit submitted that TPC had not challenged any action taken by MSLDC before the HC. The MSLDC decisions have been challenged before the MERC and are pending before it. So this issue cannot be dealt with by the High Court as of now.
TPC has challenged the Memorandum and Committee Report, which according to TPC issued directions to it to supply 360 mw of power to R-Infra till June 30. However, the state government contended in its affidavit that "the report was only to assist the state to take an informed decision in the matter... there is absolutely no warrant or justification for challenging a mere advisory report."
The affidavit filed by DK Kharat, deputy secretary to the government, further contends that its advisory requested the MERC to take suitable measures to protect the interest of the consumers. "It is for the MERC to decide what these suitable measures should be," the affidavit states.
It "merely suggests" an interim arrangement between TPC and R-Infra, while the MERC mandates a long term solution to protect the consumer interests. "The state government ‘expects' that the parties (TPC and R-Infra) will abide by it," the government has submitted adding that "this is not a direction."
The government reply also says that the case involves disputed facts and highly technical issues, which are being dealt with by the MERC, which is a specialised body and the hearing has been fixed for June 28.
The state government says that TPC announced withdrawal of 460 mw of power supply to R-Infra at regulated rates from April this year following a Supreme Court judgement in May 2009.
This would have resulted in serious law and order situation as the suburbs of Mumbai would either have had to face heavy load shedding or had to be burdened with higher tariffs by buying power from outside. To avoid this, the government stepped in and "requested" TPC to maintain status quo in the matter of power supply to R-Infra.
The TPC contended that it has the freedom to sell power to any consumer of its choice. Tata's lawyer today stated in the court that since 2003 it has been pressing Reliance to sign a power purchase agreement, but latter has not done so. As per the current arrangement, Tata supplies 360 mw to Reliance, which distributes power in Mumbai suburbs.
Source- Economic Times