- Bookmark
- Share
- CaseIQ
Power Grid Corporation Of India Limited v. Essar Power Gujarat Limited
Summary of Opinion
Factual and Procedural Background
Power Grid Corporation of India Limited (PGCIL) filed Interlocutory Application (I.A. No. 22/2018) seeking suspension of the direction in Para 45 of the order dated 11.10.2017 that directed PGCIL to adjust Rs. 112 crore towards capital cost. PGCIL has also filed a Review Petition in Petition No. 187/MP/2015 seeking modification of Para 45 to treat the Rs. 112 crore (encashment of bank guarantee) as adjustment towards transmission charges instead of capital cost. The IA seeks a stay of the Para 45 direction pending the review.
Legal Issues Presented
- Whether the direction in Para 45 of the order dated 11.10.2017 (adjusting Rs. 112 crore towards capital cost) should be suspended pending the decision on the Review Petition in Petition No. 187/MP/2015.
- Whether the Rs. 112 crore received on account of encashment of bank guarantee should be adjusted towards transmission charges instead of capital cost (as framed by the Review Petition).
Arguments of the Parties
Power Grid Corporation of India Limited (Applicant)
- PGCIL has filed a Review Petition in Petition No. 187/MP/2015 seeking modification of the directions in Para 45 of the order dated 11.10.2017 to adjust Rs. 112 crore (encashment of bank guarantee) towards transmission charges instead of capital cost.
- PGCIL requested suspension of the Para 45 direction pending the hearing and decision on the Review Petition, submitting it has a prima facie case and seeking a limited stay to the extent of adjustment of the bank guarantee against capital cost.
Essar Power (Respondent / Interested Party)
- Essar Power's counsel requested the Commission to accommodate the request of the Review Petitioner until the next date of hearing, without prejudice to the rights and obligations of the parties.
Table of Precedents Cited
No precedents were cited in the provided opinion.
Court's Reasoning and Analysis
The Commission considered the submissions of counsel for PGCIL and Essar Power. After consideration, the Commission directed that Para 45 of the order dated 11.10.2017, to the extent that it requires adjustment of the encashed bank guarantee against capital cost, shall not be given effect until further order in the Review Petition. The direction was made expressly without prejudice to the rights and obligations of the parties. The Commission then disposed of I.A. No. 22/2018 in terms of that direction and issued procedural directions for the Review Petition: respondent to file reply on maintainability and merits by 4.5.2018, the Review Petitioner to file rejoinder by 9.5.2018, and the Review Petition listed for hearing on 11.5.2018.
Holding and Implications
Core Ruling: Para 45 of the order dated 11.10.2017 (to the extent of adjustment of the encashed bank guarantee of Rs. 112 crore against capital cost) shall not be given effect until further order in the Review Petition; I.A. No. 22/2018 is disposed of accordingly.
Direct effects: the adjustment directed by Para 45 is stayed only to the stated extent pending the Review Petition; procedural deadlines and a hearing date were fixed for resolution of the Review Petition. No broader precedent or additional implications are stated in the opinion.
1. The Applicant, Power Grid Corporation of India Limited, has made the present Interlocutory Application (IA) for seeking suspension of the direction given in Para 45 of the order dated 11.10.2017 directing PGCIL to adjust Rs. 112 crore towards capital cost incurred by PGCIL till the decision in the Review Petition filed by it.
2. In the IA, PGCIL has submitted that PGCIL has filed Review Petition in Petition No. 187/MP/2015 seeking modification of the directions in Para 45 of the order dated 11.10.2017 to adjust Rs. 112 crore received on account of encashment of bank guarantee towards the transmission charges instead of capital cost. PGCIL has sought suspension of the direction given in order dated 11.10.2017 pending the hearing and decision in the Review Petition.
3. Learned counsel for PGCIL mentioned the matter and submitted that PGCIL has a prima facie case in its favour and requested the Commission to stay the order to the limited extent of adjustment of the bank guarantee against the capital cost till the issuance of order in the Review Petition. Learned counsel for Essar Power submitted that the Commission may consider to accommodate the request of the Review Petitioner till the next date of hearing without prejudice to the rights and obligations of the parties.
4. After considering the submissions of the learned counsels for PGCIL and Essar Power, we direct that para 45 of the order dated 11.10.2017 in Petition No. 187/MP/2015 to the extent of adjustment of encashed bank guarantee against the capital cost shall not be given effect till further order in the Review Petition, without prejudice to the rights and obligations of the parties.
5. I.A. No. 22/2018 is disposed of in terms of the above.
6. Notice is issued in the Review Petition to the respondent who shall file its reply on maintainability as well as on merits by 4.5.2018. The Review Petitioner shall file its rejoinder on or before 9.5.2018.
7. The Review Petition shall be listed for hearing on 11.5.2018.
Alert