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May 10, 2001
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Money > PTI > Report May 10, 2001 |
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Govt, MSEB refute DPC allegations in arbitration noticesThe Maharashtra government and the Maharashtra State Electricity Board have refuted all charges levelled against them by the Enron-promoted Dabhol Power Company in separate replies to the four international arbitration notices slapped on them by the US energy major last month. The replies, which were dispatched to DPC on May eight by the state and MSEB, categorically deny the allegations mooted by the company, official sources said in Bombay on Thursday. DPC slapped arbitration notices alleging that Maharashtra had failed to keep its commitment of supporting the Power Purchase Agreement and 'without justification acted in an inconsistent manner'. DPC further alleged that the state's actions had adversely and materially impacted the multinational's ability to perform under its contractual agreements. On its part, the loss-making electricity board has stated that it was not liable to pay for the December and January bills amounting to a total of Rs 2.13 billion. "Instead, it is DPC which has to adjust the amount from the Rs 4.01 billion penalty slapped on it by MSEB for its February 28 default," the sources said. The government of Maharashtra, which replied to three notices, including non-compliance of state support agreement and supplemental state support agreement, has said that 'since MSEB had already denied DPC's charges over non-payment, the question of the state paying on its behalf did not arise'. With regard to the supplemental state support agreement, the state has denied any 'breach of agreement' on its part as alleged by DPC and asserted that the energy major was 'misinterpreting the scope of the PPA'. In its notices sent on April 10 and 11, DPC has also alleged the state had breached the PPA by setting up the Godbole review committee for the USD three billion project. "DPC has contended that the very fact of the government constituting the review committee indicated that it does not want to support the PPA," sources said. They said the multinational has also taken exception to various statements and public speeches made by state ministers criticising the PPA at several forums. The company has also complained against state agencies like Pollution Control Board and other authorities, as these were not co-operating in issuing the required clearances and licences for 'smooth functioning' of the project. Sources said the state and MSEB officials have embarked upon a massive exercise to present their case in London where the arbitration proceedings would take place. "As per the international law, it is not even necessary to reply to arbitration notice considering its merits. We will lay our cards only when the actual proceedings commence," a senior state government official said. Singapore-based lawyer Quinten Loh would be the state's arbitrator, assisted by two senior counsel S G Aney and Ashutosh Kumbhkoni, while former Bombay High Court judge M L Pendse would represent MSEB. Former chief judge of New South Wales Supreme Court (commercial) Andrew John Rogers would be DPC's arbitrator.
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