Refund Rs 280 cr to Adani Power paid for Kinnaur project: HC

Our Correspondent

Shimla, April 21

The HP High Court has directed the state government to refund within two months the amount of upfront premium of Rs 280.06 crore to Adani Power Ltd for the Jangi-Thopan-Powari power project in Kinnaur district.

Justice Sandeep Sharma passed the order last week on a petition filed by Adani Power Ltd, challenging the communication of the Special Secretary (Power) on December 7, 2017, whereby it was conveyed that due to various legal intricacies and contractual complications involved in the matter, the Council of Ministers had reconsidered and reviewed the decision taken at its meeting held on September 4, 2015, to refund the amount of upfront premium deposited by the petitioner for the Jangi-Thopan-Powari power project.

While quashing the communication dated December 7, 2017, Justice Sharma observed, “Once the Council of Ministers on September 4, 2015, after having taken notice of the detailed Cabinet note prepared by the Administrative Department, had decided to refund Rs 280.06 crore to the petitioner, it is not understood that on what basis it reviewed its decision. Though it has been stated that due to legal intricacies and contractual complications involved in the matter, the Council of Ministers has decided to review its decision taken in its meeting of September 4, 2015, but what are those legal intricacies and contractual complications have not been spelt out in the aforesaid communication”.

In October 2005, the state floated a global tender for the Jangi-Thopan-Powari power project of 980 MW. Brakel Corporation was found to be the highest bidder for the project. Brakel Corp deposited Rs 280.06 crore as the upfront premium with the state.

However, later the state government decided to go for re-bidding of the project. Thereafter, Brakel Corp requested the state through a communication dated August 24, 2013, to refund Rs 280.06 crore to Adani Power Ltd, which is its consortium partner.

Brakel Corp categorically stated that “the petitioner is a bona fide investor and was not involved at the evaluation and award stage. As such, it has no objection, if the money is paid to Adani Power Ltd and it shall have no right or claim on the same in future”.

The court observed, “No party, other than Brakel Corp, can have a grouse, if any, for the release of the upfront premium in favour of Adani Power Ltd. But since Brakel Corp has already written to the state to release the money in favour of Adani Power Ltd, it is not understood what are the legal intricacies and contractual complications that the state may encounter, in the event of releasing the amount to Adani Power”.