Hyderabad: The Central government’s order directing Telangana State Southern Power Distribution Company Limited, Telangana State Northern Power Distribution Company Ltd, and Telangana State Power Coordination Committee to pay APGENCO (Andhra Pradesh Power Generation Corporation Limited) more than Rs 6,700 crore as power dues has been overturned by the Telangana High Court.
The Division Bench, which included Chief Justice Alok Aradhe and Justice NV Sharavan Kumar, issued the ruling after the state government challenged the order.
In accordance with the AP State Reorganisation Act, the Ministry of Power of the Central government issued an order on August 29 for the power supply provided by APGENCO from June 2014 to June 2017.
The order directs payment of Rs 3,441.78 crore towards the principal amount and Rs 3,315.14 crore towards the late payment surcharge to the Government of Andhra Pradesh within a 30-day period.
This is one among the several issues disputes between the two states since the bifurcation in 2014.
The Central government was contacted by the State of Andhra Pradesh to intervene, and a meeting was held on February 8, 2022, to address the difficulties emerging under the Reorganisation Act.
A condition in 31 Power Purchase Agreements (PPAs) between Andhra Pradesh and TS DISCOMS stipulates that disagreements between the parties must be resolved through discussions between the chief executives, according to CS Vaidhyanathan, Senior Counsel for TS DISCOMS.
TS Power Utilities stated that neither the same nor any other chance was taken as promised. It was asserted that the union government was not authorized by the Reorganisation to operate as the adjudicatory body and that it lacked jurisdiction.
The Additional Solicitor General argued on behalf of the union government that the contested order was passed with the secretary of each state present. Moreover, the union stated that a message from Telangana acknowledged the need to pay the Principal amount of Rs 3,441.78 crore.
Andhra Pradesh’s Senior Counsel, CV Mohan Reddy, reaffirmed that the ruling issued by the Center is predicated on Telangana’s acknowledgement of obligation for unpaid dues; as such, the argument that the principles of natural justice were violated is misplaced.
Additionally, he asserted that the High Court is not the proper authority and that only the Supreme Court could resolve this disagreement.
The State of Andhra Pradesh addressed the Central Government directly under Section 92 of the Reorganisation Act, declining to use any of the previously mentioned procedures.
The court noted that it is highly desirable for the matter to be settled peacefully, ideally through mediation, as it concerns the entities that the States of Telangana and Andhra Pradesh possess and manage. The court expressed its hope that both sides would try their hardest to resolve their differences.
