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Ramakanta Biswas

The Odisha Electricity Regulatory Commission (OERC) has directed the Reliance Infra Limited (RIL) to pay nearly Rs 4,235 crore as compensation to Gridco for allegedly violating the terms of agreement.

“The Commission heard the arguments of RIL and Discoms managed by it (NESCO, WESCO & SOUTHCO) and ruled that RIL is liable to pay Rs 42,34,08,91,661 to Gridco,” informed Gridco counsel Pradipta Mohanty. 

Gridco, a state designated agency authorised to procure power from generating companies and supply to the Discoms, had filed the petition with OERC alleging violation of licence conditions, shareholder agreements, Electricity Act and Regulations there under by RIL.

Reliance Infra Limited (RIL) had taken over 51% shares of Discoms- NESCO, WESCO & SOUTHCO at a sum of Rs 117 Crore. Having obtained controlling interest at Rs 117 crore, it was expected to invest sufficient funds to improve performance of the Discoms. Instead of doing that, RIL gradually diluted its shareholding from 51% to 0.002%. 

“The shares were transferred to companies having no relevant experience in the power sector. This was in gross violation of disinvestment scheme, the provision of shareholder agreement, Section 17 of the Electricity Act and Section 21 of Orissa Electricity Reform Act,” the Gridco claimed in the petition.

Gridco had prayed that an amount of Rs 42,34,08,91,661 stands recoverable from RIL and the RIL managed Discoms (NESCO, WESCO and SOUTHCO) out of which Rs 14,93,00,32,249 relate to arrear Billing and Settlement Plan (BSP) dues. Therefore these respondents may be directed to pay the above amount to the petitioner Gridco. 

During the hearing, RIL contended that the petition is not maintainable and the Commission has no jurisdiction to entertain, try and dispose of the same on the following grounds.

However, the OERC stated that Section 86 (1) (f) of Odisha Electricity Act authorises it to adjudicate upon the disputes between the licensees, and generating companies and to refer any dispute for arbitration.

While deposing of the case the Commission said, “We accept the claim of Rs 42,34,08,91,661 made by Gridco. We also hold that besides the three RIL managed Discoms, RIL itself is squarely liable for settling the above claim of the petitioner.”

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