The Supreme Court has directed the Madhya Pradesh Electricity Board to pay Rs 55.23 crore with interest to Bhilai Power Supply Company Ltd and Daewoo Power.
The court rejected the plea of the MP power board that after the state reorganisation and the creation of Chhattisgarh, the original board has been succeeded by two two separate boards and the new state should take care of the liabilities.
The MP power board argued that originally there were nine projects. Seven projects related to the reorganised Madhya Pradesh and two to the new state. The two projects have not come into existence, according to Chhatisgarh power board.
It was contended by the MP power board that in terms of the Reorganisation Act 2000, the central government had to quantify the assets and liabilities and take follow-up steps.
This was not been done and, therefore, it would be inappropriate to direct the MP power board to liquidate the liabilities.
The Chattisgarh power board argued that amounts collected as security deposits were kept as fixed deposits in scheduled banks by the MP power board and the latter was responsible to pay back.
Resolving the dispute, the Bench comprising Justice Shivaraj Patil and Justice Arijit Pasayat said the undisputed position was that the Bhilai company and Daewoo were entitled to the refund of the security deposit.
They could not be made to suffer because the two states and the two boardsdid not appear to have reached an agreement regarding sharing of assets and liabilitiesand other connected aspects.
Rerferring to the payment of security deposits to the two power companies, the Bench said what would be the rights available under the Re-organisation Act was really of no consequence so far as the present petitions were concerned.
