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Tata shouldn't take coercive steps against Rel: SC
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June 02, 2008 18:35 IST

The Supreme Court on Monday directed Tata Power Company [Get Quote] not to take coercive steps for recovery of energy charges to the tune of Rs 56 crore (Rs 560 million) from Anil Ambani-owned Reliance [Get Quote] Infrastructure.

Reliance is supposed to pay Rs 56 crore (Rs 560 million), including interest to Tatas by June 9.

A bench headed by Justice C K Thakker while seeking reply from Tata Power and Maharashtra Electricity Regulatory Commission asked Tata Power Company not to take coercive measures against Reliance till the next date of hearing in July.

Reliance has challenged the Appellate Tribunal for Electricity's order dated May 12, 2008 which ruled that TPC was entitled to recover charges for energy supplied to REL at the rate of Rs 2.09 per unit.

The balance outstanding dues on account of differences in energy rates between Rs 2.09 per kwh and Rs 1.77 per kwh and shortfall in minimum off-take of energy should be released to

TPC within four weeks alongwith delayed payment charges at the prevailing SBI [Get Quote] Prime lending Rate for short borrowing and not at the rate of 24 per cent per annum as directed by MERC, the tribunal had held.

ATE had also said that the issue relating to 'take or pay' should be examined after the apex court's decision in another appeal relating to the issues, as to whether or not TPC was a distribution licensee and whether or not Reliance's offer of rebate to its consumers to prevent them from moving away from it was tenable in law.

It may be noted that the Supreme Court allegedly in a similar petition in January last year had directed TPC to refund 50 percent of the Rs 451.35-crore (Rs 4.51 billion) to Reliance paid as standby charges for electricity supply in Maharashtra and pay the rest as bank guarantee.

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