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MSEB seeks rejection of DPC petition

The Maharashtra State Electricity Board on Saturday filed an affidavit in Bombay high court seeking rejection of US energy major Enron promoted Dabhol Power Company's June 6 petition.

"In our affidavit we have prayed that DPC's petition, challenging the jurisdiction of the Maharashtra Electricity Regulatory Commission should not be admitted and also denied all allegation made against the board," MSEB sources said in Bombay.

MSEB has contended that DPC had acted "in haste" and it should have waited for MERC to pass an order or at least take a decision over jurisdiction on the June 14 hearing, they said.

In its affidavit, MSEB has sought orders from the court directing DPC back to MERC saying that the high court could do so as the regulator was yet to pass an order in this case.

"DPC has jumped the gun. MSEB's prayer is that it's too premature for the court to intervene in the matter, orders for which have not yet been passed by the other concerned quasi-judicial authority," MSEB sources said.

First of all, the MSEB affidavit says, the court should take into account MERC's stand on this imbroglio and refer the case back to the regulator.

On June 6, DPC had moved the court urging it to either stay or quash MERC's order, which restrained it from activating the escrow account and initiating international arbitration proceedings. The case is listed for hearing on for June 11.

MSEB's affidavit has refuted DPC's claim that MERC did not have jurisdiction over resolving the matter as the power purchase agreement signed between the two power utilities clearly provided for international arbitration in case of any dispute between the parties.

The board has made it clear that as per the Electricity Regulatory Commission Act, 1998, MERC was a specialised forum, which could alone adjudicate upon disputes arising between two power utilities.

"MERC has been empowered under the law to adjudicate upon such disputes, and, if it deemed fit, refer such disputes for arbitration," sources said.

In its petition, DPC said MSEB had entered into PPA after seeking state government's approval. Both parties were fully aware that PPA contained a dispute resolution mechanism, which provided for an arbitration of disputes and differences, in accordance with arbitration agreement set out in clause 20.3.

Therefore, DPC said, it possessed a contractual right under PPA to refer any dispute or difference, which may arise to arbitrators. MSEB had a similar right to invoke the arbitration clause, DPC has argued in the petition.

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