The Delhi High Court today asked the Centre to explain why it was not releasing the bank guarantee of Reliance Power after it exited the Tilaiya Ultra Mega Power Project (UMPP), saying it was easy to delay a decision when it is someone else's money.
"It is very easy to sit on a decision when it is not your money," Justice Vibhu Bakhru told the Centre while giving it three weeks to file an affidavit indicating its stand on Reliance Power Ltd's (RPL) plea for release of its bank guarantee worth about Rs 208 crore.
The court made it clear that the Centre has to file one affidavit, saying piecemeal affidavits would not be accepted.
RPL was asked to extend the bank guarantee for two more months and the matter was listed for hearing on September 13.
During the hearing, the government said it was not releasing the bank guarantee as it wanted to know whose fault it was that the captive coal block, attached to the power plant in Jharkhand, was not developed.
The government was also concerned over the settlement between Reliance and Jharkhand Urja Vikas Nigam Ltd (JUVNL) under which RPL had transferred its shares in Jharkhand Integrated Power Ltd (JIPL), set up to develop Tilaiya UMPP, to JUVNL.
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The government said it needed three months to take a decision on releasing the bank guarantee.
RPL exited the project by divesting its entire shareholding in JIPL to JUVNL for Rs 112.64 crore. The company had announced the termination of Power Purchase Agreement (PPA) of its 3,960 MW Tilaiya UMPP in District Hazaribagh, in Jharkhand in April 2015.
Based on tariff-based bidding managed by Power Finance Corporation (PFC), Reliance Power was awarded the Tilaiya UMPP in February 2009, the company had said in its plea.
JIPL, which was handed over to Reliance Power by the PFC in August 2009, had signed Power Purchase Agreements with 18 power takers in 10 states for 25 years. To fuel the plant, it was allocated the Kerendari BC captive coal mine block.