Delhi HC disposes pleas for SIT on alleged over-invoicing by Adani's, Essar's & others' power cos [Read Judgment]

NEW DELHI: The Delhi High Court has disposed of pleas seeking setting up of a Special Investigating Team (SIT) against alleged over-invoicing by power companies belonging to the Adani Group, Essar Group and others without issuing any directions for the same.

The Court noted that since the filing of the petitions in 2017, multiple proceedings have already been initiated and are pending before relevant forums in this regard.

Stating that investigation is already in process in some cases, the Court said it “finds it appropriate to direct the respondents to meticulously and expeditiously look into the allegations of the petitioners to unearth actual factual position and take appropriate actions against the erring companies, if any, as per law.”

It thus ordered the Directorate of Revenue Intelligence (DRI) and the Central Bureau of Investigation (CBI) to “meticulously and expeditiously” probe the allegations, without issuing any directions for an SIT.

The pleas which were filed in 2017, were decided by a Division Bench of Justices Suresh Kumar Kait and Neena Bansal Krishna by Adv. Prashant Bhushan's NGO one Centre for Public Interest Litigation and activist Harsh Mander.

The petitioners made several allegations including over-invoicing with exaggerated rates, and inflated rates of tariff of electricity while seeking an SIT-monitored probe headed by a retired Supreme Court judge.

However, the Court noted that with respect to alleged exaggerated rates, Show Cause Notices had already been issued to (i) Adani Power Maharashtra Lrd. (ii) Adani Power Rajasthan Ltd. (iii) Maharashtra Eastern Grid Power Transmission Co. Pvt. Ltd. and (iv) PMC Projects (India) Pvt. Ltd. by DRI.

Further, Show Cause Notices dated 31.08.2016 were also issued to (i) Adani Enterprises Ltd. (ii) Adani Renewable Energy (iii) Adani Hazaria Port Private Ltd. (iv) Adani International Container Terminal (P) Ltd. & Adani Ports and Special Economic Zone Ltd. and (v) Adani Vizag Coal Terminal Pvt. Ltd.

Certain documents to show the present status of complaints/cases not only pending against various companies under Adani and Essar Group, but certain other companies as well, were also put on record by DRI.

Noting that Letters Rogatory had also already been issued against other companies i.e. Tamil Nadu Electricity Board, Gujrat State Electricity Corporation Ltd., Jhajar Power Ltd., Haryana Power Generation Corporation Ltd. where Adani Group is the supplier, the Court said that this meant that “…the respondents have already initiated process of law under the appropriate provisions before the competent forum.”

On the issue of alleged inflated rates of tariff of electricity the Court held that the provisions of the Electricity Act, 2003 “make it clear that under Section 61 of the Act, it is the Tariff Regulatory, which govern(s) the tariff based upon service for generation, transmission and distribution as well as cost of project, which is determined through transparent process of bidding under the guidelines of the Central Government. Hence, on this count no interference is required.”

The petitioners had relied on the show cause notices dated May 15, 2014 and March 31, 2016 issued by DRI stating that the intelligence had indicated that various entities of Adani group and Essar Group were indulging in gross over-valuation of imported goods (zero or low duty rated) to siphon off money abroad from public listed companies.

The CBI on its part said that it has registered two cases and investigation in them is still ongoing.

Thus, after considering the case, the Court disposed of the plea.

Cause Title: Centre for Public Interest Litigation & Anr. v Union of India & Ors.

[Read Judgment]