Reliance Infrastructure Discoms Are 'Inefficient': Delhi Government To Supreme Court

NEW DELHI: The Delhi government told the Supreme Court that BSES companies of Reliance Infrastructure were “inefficient” as they had defaulted on their dues to NTPC and other electricity suppliers, unlike the Tata group’s distribution arm that had promptly paid.

“These two companies owe Rs 4,500 crore. My concern is outages. You cannot take electricity and not pay for it. At the end of the day the Tatas are paying, why can’t (BSES) Rajdhani? Both are working in the same regulatory regime,” Additional Solicitor General Siddharth Luthra told a two-judge bench hearing the case. The two Reliance companies have been locked in a bitter stand-off with the generating companies over arrears. They claim that the Delhi Electricity Regulatory Commission (DERC) has failed to provide adequate tariffs that can cover costs and give reasonable returns.

BSES lawyer Mukul Rohatgi claimed on Wednesday that the dues outstanding to the two companies are around .`15,000 cr. The company has cited this outstanding amount as the reason why it could not pay generating companies any more money till it recovered some part of the dues. Power major NTPC has earlier threatened to cut off powers to BSES if the stalemate continued.

At the last hearing, the bench asked NTPC to desist from doing any such thing in “consumer” interest and asked BSES to pay a sum of.`700 crore due from the beginning of the 2014.

On Wednesday, when the bench reconvened, BSES and the power generating companies again traded charges over non-payment of dues. While NTPC insisted that no dues have been paid since the last court hearing and suggested “power regulation” to deal with the problem, a euphemism for power cuts, BSES claimed it had paid.`601 crore so far. Senior advocate KK Venugopal claimed that NTPC had in turn to pay Coal India and non-payment by BSES was having a “cascading effect” all around.

“He is the biggest industrialist in the country,” Venugopal stated. Rohatgi countered this. “I am owed Rs15,000 crore, and I am termed inefficient!” The bench then adjourned the case till Tue dayto allow both sides to sort out the issue of payment of current dues, but not before the DERC, through senior advocate Meet Malhotra, had similarly accused BSES of being “inefficient” and “financially indisciplined”.

Malhotra claimed that there were major variations in figures in audited statements made earlier and now, adding a CAG audit would help uncover the facts. The previous arrears may accordingly have to be downgraded, he said.

The DERC has in a roadmap for recovery of dues suggested an 8per cent surcharge to recover these over a period. Any adjustments will bring down the recovery period. He also accused BSES of not infusing enough equity to instill enough confidence in banks to loan them amounts necessary to pay back power generating companies.

“It is evident that the current financial position could have been avoided by infusion of requisite equity from time to time by BYPL,” he told Justices SS Nijjar and AK Sikri who are hearing the case. The discoms accuse the state and the central governments of failing to bail them out by subsidising their costs as done in other states.