More Stories

Informist, Tuesday, Nov. 26, 2024

 

--HC stays Solar Energy Corp debarring Reliance Power from future tenders

--HC notice to Solar Energy Corp on Reliance Power's plea vs debarment order

--HC to hear Reliance Power's plea vs Solar Energy Corp on Dec 4

 

NEW DELHI – The Delhi High Court Tuesday stayed Solar Energy Corp. of India Ltd's three-year debarment order against Reliance Power Ltd. from its future tenders, till the next date of hearing on Dec. 4. The court also stayed Solar Energy Corp.'s order to declare Reliance Power as "ineligible for any bid/tender in which they have directly/indirectly participated through any subsidiary" in any bid currently under its evaluation. The court has issued a notice to Solar Energy Corp. on Reliance Power's petition against the debarment order.

 

The case has its genesis from a request for selection by Solar Energy Corp. for setting up 1,000 megawatt/2,000 megawatt-hour standalone battery energy storage systems in India under tariff-based global competitive bidding. To participate in the tender process, Reliance Power's subsidiary Reliance NU BESS Ltd. had to submit a bid along with a bank guarantee towards the earnest money deposit for INR 682 million for bid capacity of 1,000 megawatt/2000 megawatt-hour.

 

As per the tender, a bidder was required to furnish bank guarantees towards the earnest money deposit from any of the scheduled commercial banks as listed on the website of the Reserve Bank of India. Bank guarantees issued by foreign branch of a scheduled commercial bank were to be endorsed by the Indian branch of the same bank or State Bank of India, the tender stated.

 

To assist Reliance NU BESS for participating in the tender, Reliance Power executed a co-operation agreement in July with a third party Biswal Tradelink Pvt. Ltd., which was represented by its directors, Partha Sartha Biswal and Manoj Kumar Biswal. As per the agreement, the third party agreed to arrange a bank guarantee in favour of Solar Energy Corp. for a value of INR 682 million and in consideration thereof, Reliance Power agreed to pay to the third party a commission at the rate of 6.5% per annum of the value of the bank guarantee. 

 

Later, Solar Energy Corp. sought confirmation of bank guarantee issued by FirstRand Bank. However, State Bank of India, responding to Solar Energy Corp.'s enquiry, denied the receipt of any structured financial messaging system for the bank guarantee. The SBI said that the copy of structured financial messaging system authentication provided was not done by their branch and the authentication did not appear to be genuine. 

 

Consequently, Solar Energy Corp., in a showcause notice, asked Reliance NU BESS to clarify why legal action ought not be taken against them in view of submission of fake bank guarantee documents. Reliance Power said that it had not received any such showcause notice.

 

Thereafter, Solar Energy Corp. again issued a showcause notice to Reliance NU BESS and asked why it should not be debarred. Reliance Power said that neither any accusation was made against them nor any showcause was issued by Solar Energy Corp. Reliance Power said they filed a criminal complaint with the Economic Offences Wing as it, along with Reliance NU BESS, were cheated, defrauded and misled by the third party.

 

The result of Solar Energy Corp.'s arbitrary decision to debar the petitioner grossly violates its fundamental right and leads to its "civil death", said Reliance Power. The debarment order is "ex facie erroneous, illegal and an abuse of power". It was neither served with any showcause notice nor given any other opportunity to present its case to Solar Energy Corp., said Reliance Power. 

 

At 1402 IST, shares of Reliance Power Ltd. were up 4.9% at INR 36.27 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Akul Nishant Akhoury

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2024. All rights reserved.