HC orders attachment of Delhi's Himachal Bhawan after H.P. govt fails to clear dues of power firm

The case pertains to the 340 MW Seli Hydropower Electric Project on the Chenab river in Lahaul and Spiti district

The Himachal Pradesh High Court has ordered the attachment of the Himachal Bhawan in Delhi for the recovery of ₹150 crore that the State government owes to a power firm, Seli Hydropower Electrical Company.

Passing the order on Monday (November 18, 2024), a single-judge bench of Justice Ajay Mohan Goel said the company may take appropriate steps for the auction of Himachal Bhawan located in central Delhi's Mandi House area thereof.

The case pertains to the 340 MW Seli Hydropower Electric Project on the Chenab river in Lahaul and Spiti district.

The State government awarded the project to Seli Hydro Electric Power Company Limited/Moser Baer and issued the Letter of Allotment (LOA) on February 28, 2009, following which the firm deposited the upfront premium of ₹64 crore.

However, the project did not materialise. The State government cancelled the LOA and ordered forfeiture of the upfront premium.

The company challenged the decision before an arbitrator which ruled in its favour and asked the government to deposit the upfront premium with interest.

After the State government did not comply with the order, the company filed a petition before the high court under Article 226.

The court found merit in the petitioner's contention that the project had become technically and financially unviable and its prayer for withdrawing from it deserved to be allowed.

The High Court also upheld the decision of the arbitrator on January 13, 2023, and directed the government to deposit the upfront premium with interest with the Registry.

Due to the delay in payment, the amount has increased to ₹150 crore with the accumulation of 7% interest from the date of filing of the petition.

In an embarrassment for the government, the court ordered the attachment of Himachal Bhawan in Delhi.

It also directed the principal secretary (Power) to order a fact-finding inquiry to identify the officers responsible for the lapse and sought its report within 15 days before the next hearing on December 6.

Advocate General Anup Rattan said the Himachal Pradesh government has already filed an appeal against the initial HC order and it is likely to come up for hearing this month.

Published - November 19, 2024 03:11 pm IST