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Karnataka High Court

Global Energy Private Limited vs Bangalore Electricity Supply Company ... on 27 March, 2026

Author: M.Nagaprasanna

Bench: M.Nagaprasanna

Reserved on : 21.02.2026
Pronounced on : 27.03.2026

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 27TH DAY OF MARCH, 2026

BEFORE

THE HON'BLE MR. JUSTICE M. NAGAPRASANNA

WRIT PETITION No.9206 OF 2025 (GM - KEB)

BETWEEN:

GLOBAL ENERGY PRIVATE LIMITED
A COMPANY AS PER THE PROVISIONS
OF COMPANIES ACT, 2013, AND
THROUGH MR. HARRY DHAUL,
ITS SUCCESSFUL RESOLUTION APPLICANT,
HAVING HIS RESIDENCE AT FLAT NO.4A,
AMAYAND RESIDENCY, NO.9,
RACE COURSE ROAD,
BENAGLURU - 560 001.
... PETITIONER

(BY SRI SAJAN POOVAYYA, SR.ADVOCATE FOR
SRI M.H.HIDAYATHULLA, ADVOCATE)

AND:

1. BANGALORE ELECTRICITY
SUPPLY COMPANY LIMITED
A COMPANY AS PER THE
PROVISIONS OF THE COMPANIES ACT, 2013,
THROUGH ITS MANAGING DIRECTOR,
2

HAVING ITS REGISTERED AT
CORPORATE OFFICE, BESCOM
K. R. CIRCLE, BENGALURU - 560 001.

2. POWER COMPANY OF KARNATAKA LIMITED
A COMPANY AS PER THE PROVISIONS
OF THE COMPANIES ACT, 2013
THROUGH ITS MANAGING DIRECTOR,
HAVING ITS REGISTERED OFFICE AT
5TH FLOOR, KPTCL BUILDING,
KAVERI BHAVAN,
BENGALURU - 560 009.

3. GOVERNMENT OF KARNATAKA
THROUGH THE ADDITIONAL CHIEF SECRETARY,
ENERGY DEPARTMENT, ROOM NO. 236,
2ND FLOOR, VIKASA SOUDHA,
DR. B.R AMBEDKAR STREET,
BENGALURU - 560 001.
... RESPONDENTS

(BY SRI SHAHBAAZ HUSAIN, ADVOCATE FOR R-1 AND R-2;
SRI M.RAJAKUMAR, AGA FOR R-3)

THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE
CONSTITUTION OF INDIA PRAYING TO A. DIRECT BANGALORE
ELECTRICITY SUPPLY COMPANY LIMITED (RESPONDENT NO. 1)
AND/OR POWER COMPANY OF KARNATAKA LIMITED (RESPONDENT
NO.2) HONOUR ITS ADMITTED PAYMENT OBLIGATIONS, AND
REIMBURSE GLOBAL ENERGY PRIVATE LIMITED FOR THE
OVERDRAWAL CHARGES PAID BY GLOBAL ENERGY PRIVATE
LIMITED (PETITIONER) TO MAHARASHTRA STATE ELECTRICITY
DISTRIBUTION COMPANY LIMITED ON BEHALF OF BANGALORE
ELECTRICITY SUPPLY COMPANY LIMITED (RESPONDENT NO.1); B.
DIRECT BANGALORE ELECTRICITY SUPPLY COMPANY LIMITED
(RESPONDENT NO.1) AND/OR POWER COMPANY OF KARNATAKA
LIMITED (RESPONDENT NO.2) TO CLEAR THE INVOICES DATED
09.03.2017 (ANNEXURE-AZ)/17.04.2017 (ANNEXURE-BC) FOR THE
3

OVERDRAWAL CHARGES BETWEEN 11.07.2014 AND 31.08.2016,
AT LEAST AT THE ADMITTED RATE OF INR.4.85/UNIT; C. DIRECT
BANGALORE ELECTRICITY SUPPLY COMPANY LIMITED
(RESPONDENT NO.1) AND/OR POWER COMPANY OF KARNATAKA
LIMITED (RESPONDENT NO. 2) TO PAY LATE PAYMENT SURCHARGE
(AT 15 PERCENT P.A.) FROM THE DATE WHEN PAYMENTS IN
RESPECT OF OVERDRAWAL BECAME DUE AND PAYABLE AND TILL
ACTUAL PAYMENT.

THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED
FOR ORDERS ON 21.02.2026, COMING ON FOR PRONOUNCEMENT
THIS DAY, THE COURT MADE THE FOLLOWING:-

CORAM: THE HON'BLE MR JUSTICE M.NAGAPRASANNA

CAV ORDER

The petitioner is before the Court seeking the following

prayer:

"a. Pass an appropriate writ, order and/or direction, in the
nature of mandamus, or such other writ, order and/or
direction that this Hon'ble Court may deem fit, and direct
Bangalore Electricity Supply Company Limited
(Respondent No.1) and/or Power Company of Karnataka
Limited (Respondent No.2) to honour its admitted
payment obligations, and reimburse Global Energy Private
Limited for the overdrawal charges paid by Global Energy
Private Limited (Petitioner) to Maharashtra State
Electricity Distribution Company Limited on behalf of
Bangalore Electricity Supply Company Limited
(Respondent No.1).

b. Pass an appropriate writ, order and/or direction, in the
nature of mandamus, or such other writ, order and/or
direction that this Hon'ble Court may deem fit, and direct
4

Bangalore Electricity Supply Company Limited
(Respondent No.1) and/or Power Company of Karnataka
Limited (Respondent No.2) to clear the invoices dated
09-03-2017 (Annexure-AZ)/17-04-2017 (Annexure-BC)
for the overdrawal charges between 11-07-2014 and
31-08-2016, at least at the admitted rate of INR
4.85/unit.

c. Pass an appropriate writ, order and/or direction, in the
nature of mandamus, or such other writ, order and/or
direction that this Hon'ble Court may deem fit, and direct
Bangalore Electricity Supply Company Limited
(Respondent No.1) and/or Power Company of Karnataka
Limited (Respondent No.2) to pay late payment surcharge
(@ 15% p.a.) from the date when payments in respect of
overdrawal became due and payable and till actual
payment.

d. Grant such other relief as this Hon'ble Court may deem fit
in the facts and circumstances of the present case."

2. Heard Sri Sajan Poovayya, learned senior counsel

appearing for the petitioner, Sri Shahbaaz Husain, learned counsel

appearing for respondents 1 and 2 and Sri M. Rajakumar, learned

Additional Government Advocate appearing for respondent No.3.

3. Facts, in brief, germane are as follows: -

3.1. The petitioner is a Company registered under the

Companies Act, 2013 involving in the business of power

transmission and distribution. The 1 st respondent/Bangalore
5

Electricity Supply Company Limited ('BESCOM'), a Government of

Karnataka Company and electricity distribution licensee under the

Electricity Act. These are the two protagonists in the case at hand.

The State of Karnataka was, at the relevant point in time,

undergoing severe power deficit and was seeking power at the rates

of ₹7 to 10 per unit. The situation was compounded by constrained

transmission connectivity with other States and regions. All

existing transmission corridors were exhausted owing to long term

and medium term power delivery, which led a proposal to bring

supply of power through untapped Chikkodi-Talangade and

Chikkodi-Mudasangi transmission lines (hereinafter referred to as

'the transmission lines') connected to States of Maharashtra and

Karnataka in a radial mode, where power flows in one direction

from the source to the loads with no alternate supply path. This

mode ensured guaranteed supply of additional power to the State

of Karnataka at a lower cost.

3.2. As observed hereinabove, due to dire need for power in

the State of Karnataka, the Power Company of Karnataka Limited

('PCKL' for short) acting as authorized representative of various
6

distribution licensees including BESCOM notifies request for

proposal ('RFP') for procurement of 75 MW to 110 MW of power

round the clock through interstate transmission lines noted

hereinabove. It is through a competitive bidding process.

3.3. The RFP included a schedule of estimated hour-wise

power requirement in a day within the broader range of 75 MW to

110 MW, in the event the power would be supplied by the

successful bidder through the transmission lines. The petitioner

participates in the tender with an offer of ₹4.85 per unit for supply

of 75 MW to 110 MW of power indicating the generators location to

be in the State of Maharashtra. The supply was to be through the

transmission lines. The bid of the petitioner was accepted and a

letter of intent was issued by the PCKL, to which BESCOM was a

party. Accordingly process for drawing power through the

transmission lines began pursuant to the letter of intent issued as

noted hereinabove. The transmission lines were radial links

connecting the States of Maharashtra and Karnataka.

Geographically, parts of Chikkodi Transmission lines were located in

both the States.
7

3.4. The generator located in Maharashtra was connected to

220 KV Kolhapur sub-station and the distribution lines in Karnataka

were connected to 220 KV Chikkodi sub-station. The operationalize

power supply transmission of open access and use of transmission

lines to transmit power was necessary to avail this route of drawal

and distribution of power. Since the lines were not synchronized

with rest of the Karnataka grid, they were ultimately considered to

be intra-state Maharashtra transmission lines. This determination

took some time on account of grant of transmission open access.

Certain disputes have arisen between the parties which are pending

before various fora. The issue that is projected in the subject case

is not with regard to pending proceedings elsewhere. It is with

regard to the amount to be paid by BESCOM for overdrawing power

from the inception.

3.5. A Standby Power Agreement ('SPA') was executed

between BESCOM and the petitioner. After the execution of the SPA

and grant of transmission open access, BESCOM and the petitioner

executed a power purchase agreement ('PPA') for supplying a

contracted quantum of 75 to 110 MW at ₹4.85 per unit. The
8

averment in the petition is that BESCOM began deviating the

schedule drawal of power by overdrawing power under the SPA.

Consequent thereto, the Maharashtra State Electricity Development

Corporation Limited commenced issuing frequent invoices indicating

BESCOM's overdrawal of power beyond what was permissible from

September, 2014 onwards. These invoices were issued to the

petitioner and overdrawals by BESCOM had to be compensated.

That the invoices were raised by the Maharashtra State Electricity

Company and payments were being demanded. But, overdrawal of

power by BESCOM never stopped. The petitioner, in terms of

plethora of letters right from 10-07-2015 to 9-08-2016 repeatedly

requested BESCOM to revise schedules to avoid over drawal, as the

same was attracting higher tariff based upon the SPA. The

petitioner also requests BESCOM to tie up additional power and the

cap of BESCOM's liability to ₹4.85 per unit to be applied only in

cases of unintentional overdrawal. The overdrawal incurred at

₹11.85 per unit, as against ₹4.85 per unit as per the agreement

between the parties.
9

3.6. The petitioner began to demand amount from BESCOM in

terms of invoices raised. Instead, BESCOM issued another invoice

claiming underdrawal amounts between July, 2014 to June 2016 at

₹4.85 per unit. Dispute then subsisting between underdrawals and

overdrawals reached this Court in a writ petition filed by the

petitioner in Writ Petition No.53570 of 2016. BESCOM then comes

forward to redress the grievance of the petitioner. Therefore, the

petitioner filed a memo seeking to withdraw the petition and the

said petition comes to be disposed of as withdrawn. Then begins

the communication between the quarters of the State and reaches

the Board of BESCOM. The Board resolves to pay the petitioner the

admitted amount at the rate of ₹4.85 per unit which would be set

off against any other claim of underdrawal or overdrawal at the

relevant point in time. This resolution of the Board was not

implemented. Therefore, the petitioner is now before the Court

seeking implementation of the resolution of the Board along with

consequential relief including payment of interest for the delayed

payment of the admitted amount at the rate of ₹4.85 per unit.
10

4. The learned senior counsel Sri Sajan Poovayya appearing

for the petitioner would take this Court through the documents

appended to the petition like invoices, pending proceedings before

the NCLT or APTEL and even KERC and would contend that pending

all those disputes, if there has been any overdrawal or underdrawal,

it can be set off at a later point in time. The petitioner needs

money to be disbursed in terms of the resolution of the Board. This

forms an admitted amount. Therefore, this Court must direct the

respondents to pay the admitted amount by clearing invoices as

sought in the prayer at the admitted rate of ₹4.85 per unit with

certain interest.

5.1. The learned Sri Shahbaaz Husain representing the

respondents 1 and 2 would vehemently refute to contend that the

petitioner has an efficacious and alternative remedy of preferring an

appeal under Section 86(1)(f) of the Electricity Act, which mandates

that disputes between the licensees must be adjudicated before the

Karnataka Electricity Regulatory Commission. Therefore, the

learned counsel submits that the petition should not be entertained.

The learned counsel would contend that the Appellate Tribunal for
11

Electricity - APTEL in the order dated 23-02-2011 in an appeal

preferred by the MANGALORE ELECTRICITY SUPPLY COMPANY

LIMITED v. M/S PUNE POWER DEVELOPMENT PRIVATE

LIMITED has considered the issue and directed that these matters

to be heard only before the Regulatory Commission under Section

86 (1)(f) of the Electricity Act. The learned counsel submits that it

is an added circumstance where the appeal ought to be preferred

and not a writ petition seeking the aforesaid prayer. He would

submit that no liability can be attributed to BESCOM owing to the

Board's resolution. Reliance being placed on the resolution of the

Board is misconceived is his emphatic submission, as it is an

internal document. Neither, it is addressed nor communicated to

the petitioner. It cannot be that it is a legally pending admission of

liability or commitment enforceable against the 1 st respondent. The

learned counsel submits that inter-departmental communications,

unless culminating in final form and communicated, would not

create an enforceable obligation.

5.2. The learned counsel submits that claims of overdrawal by

the BESCOM in terms of invoices are all erroneous; they require
12

adjudication and they are pending before the Maharashtra

Electricity Regulatory Commission ('MERC' for short) in Case No.71

of 2014. Therefore, the case must await the decision of MERC, as

the BESCOM and the petitioner have entered into a contract which

provides for underdrawal benefits also. Under the contract it is the

BESCOM which is entitled to a sum of ₹9.24 crores with interest on

account of such underdrawals and not the amount in terms of

invoices to be paid to the petitioner on account of claimed

overdrawal. He would, in all, seek dismissal of this writ petition.

6. I have given my anxious consideration to the submissions

made by the respective learned counsel and have perused the

material on record.

7. The afore-narrated facts, dates, link in the chain of events

are all a matter of record. A request for proposal was notified by

BESCOM owing to circumstances as narrated hereinabove for the

purpose of purchase of power and its distribution. RFP was notified

on 12-11-2013. The petitioner participates and emerges successful.
13

The RFP had some pre-requisites or pre-requirements. It would be

germane to notice those pre-requisites. They are as follows:

"Pre-requirements, permits and clearances to be obtained
by the Successful Bidder(s) for supply of power through
Chikkodi-Talangade & Chikkodi-Mudasangi Interstate
Lines in radial mode

Note: Bidders shall ensure that the pre-requirements/approvals
indicated in Annexure-2"
14

In terms of the RFP, the petitioner made application before the

BESCOM and the Maharashtra State Electricity Transmission

Company. The Maharashtra State Electricity Transmission Company

gave the petitioner open access in terms of a communication dated

12-02-2014. Likewise, the State of Karnataka also gave its open

access approval. A power purchase agreement is entered into

between the petitioner and BESCOM. Certain clauses of power

purchase agreement is germane to be noticed. Article-4 reads as

follows:

"ARTICLE 4

CAPACITY, AVALIABILITY AND DISPATCH

4.1 Availability

4.1.1 The Seller shall be responsible to ensure that the
Developer shall comply with the provisions of the
applicable Law regarding Availability including, in
particular, to the provisions of the ABT and Grid Code
from time to time relating to declaration of Availability
and the matters incidental thereto.

4.2 Scheduling and Dispatch

42.1 The Seller shall be responsible to ensure that the
Developer shall comply with the provisions of the
applicable Law regarding Dispatch Instructions, in
particular, to the provisions of the ABT and Grid Code
from time to time relating to scheduling and Dispatch and
the matters incidental thereto.
15

4.2.2 In case of exigencies either party may request to other
party for revision of agreed Schedule as per the Grid
Code.

4.2.3 Variation between scheduled energy and actual energy at
the Delivery Point shall be accounted for through UI as
per the provisions of the Grid Code and UI regulations
issued from time to time. For any over-drawal by the
procurer at the delivery point, the applicable UI charges
payable above the quoted tariff of Rs 4.85 per unit shall
be to the Sellers Account as voluntarily agreed by the
Seller."

Article 4.2.3 observes that variation between scheduled energy and

actual energy at the delivery point shall be accounted for through

Unscheduled Interchange as per the provisions of the grid code. It

was further observed that any overdrawal by the procurer at the

delivery point, the applicable charges payable would be above

₹4.85 per unit. Therefore, there was an observation by way of

agreement with regard to overdrawal as well.

8. The BESCOM, right from the inception began to overdraw

power, which could not be stopped by the petitioner, but continuous

invoices began to be generated by the Maharashtra Electricity

Supply Company Limited. All these invoices were communicated to

BESCOM at intermittent intervals which led BESCOM then to modify
16

the power purchase agreement. Article 4.2.3 stood modified by

way of supplemental power purchase agreement entered into on

06-12-2014. The modified clause reads as follows:

"ARTICLE 4 CAPACITY, AVALIABILITY AND DISPATCH

4.2 Scheduling and Dispatch-4.2.3

As existing:

Variation between scheduled energy and actual energy at the
Delivery Point shall be accounted for through UI as per the
provisions of the Grid Code and UI regulations issued from time
to time. For any over-drawal by the procurer at the delivery
point, the applicable UI charges payable above the quoted tariff
of Rs 4.85 per unit shall be to the Sellers Account as voluntarily
agreed by the Seller.

Modified:

Deviations due to system dynamics/unintentional deviation to
be settled between Seller/Procurer shall be as per the agreed
terms of Final Balancing and Settlement Mechanism of
Maharashtra or any other regulations applicable in Maharashtra
from time to time. However, the settlement rate for overdrawal
by the Procurer shall be at the quoted tariff of Rs 4.85 per unit
and any impact of the same over and above the quoted tariff
shall be borne by the Seller. In case of underdrawal by the
procurer, the same shall be settled as per the applicable FBSM
rate of Maharashtra State subject to the issue of the
corresponding FBSM account by the appropriate authority in
Maharashtra and to the extent of receipt and realization of the
same by the Seller. The seller shall inform the procurer, status
of FBSM of Maharashtra, by 15th of each month."

The admitted amount at the rate of ₹4.85 per unit was also not

paid. Therefore, the petitioner registers several claims before
17

BESCOM. One such communication for settlement of claim is as

follows:

"DO No. BESCOM/MD/GM (Elec) (Elee)/PP/BC-39/2016-17/94

DATE 4 DEC

Sub: Settlement of claims between BESCOM and M/s Global
Energy Pvt Ltd (GEPL)-Reg.

Ref:- 1. Letter dated 17.11.2016 of M/s Global Energy Pvt Ltd.

2. Letter No. BESCOM/MD/D(F)/GM(Elec)/PP/BC-
39/2016-17/90-93 dated 25.11.2016.

3. Meeting of Board of Directions of BESCOM on
26.11.2016.

4. Legal opinion from Law officer of BESCOM on
14.12.2016.

**********

1. In continuation of the letter cited under reference (2), the
payment of GEPL's claims of under drawal/over drawal
during the contract period, invoice amount of August-
2016 and transmission charges are placed before the
Board of Directors meeting of BESCOM held on
26.11.2016. The Board of BESCOM had directed to seek
legal opinion on the subject.

2. The Law officer, BESCOM had opined that the second fort
night bill of August-2016 may be processed after
withdrawing the invoices presented to Bank for LC
invoked since it is a undisputed claim.

3. The over drawal / under drawal issue is pending before
KERC/Hon'ble High Court of Karnataka. Hence, these
claims will be settled after outcome of the final orders.
The payment of transmission charges is yet to be
18

confirmed by PCKL. The second fort night bill is
undisputed and to be paid as per legal opinion.

4. Hence, it is requested to withdraw the involves from
Bank, furnish the confirmation from Bank for withdrawing
the invoices to BESCOM. BESCOM will pay the August-
2016 invoice amount of Rs 9.312 Crore immediately.

Approved By MD, BESCOM

Your's Sincerely,
Sd/-
(P. Krishnamurthy)"

Since no amount was paid, Writ Petition No.53570 of 2016 comes

to be filed. This comes to be withdrawn by the petitioner pursuant

to letter of BESCOM by filing following memo:

"IN THE HIGH COURT OF KARNATAKA AT BANGALORE

WRIT PETITION NO. 53570/2016 (GM-KEB)

BETWEEN:

Global Energy Pvt Ltd PETITIONER

AND:

KERC & Others RESPONDENTS

Memo for Withdrawal

The undersigned Counsel respectfully submits that Petitioner is
before this Hon'ble Court challenging the ex-parte order dated
03.10.2016 passed by the Respondent No. 1 KERC in OP No.
82/2016 (Annexure-A) in restraining the invocation of Letter of
Credit. It is submitted that in view of settlement negotiation and
correspondences between the parties subsequent to institution
of the above petition and settlement terms agreed between the
19

parties, the Petitioner hereby craves leave of this Hon'ble Court
to withdraw the above writ Petition as not pressed. The copies
of the said letters between the parties are produced herewith for
kind consideration of this Hon'ble Court.

Wherefore, in view of the correspondences dated 14.12.2016
and 16.12.2016 between the parties i.e., BESCOM,
Petitioner/GEPL and the SBM, it is humbly prayed that the
Hon'ble Court may be pleased to dispose of the above writ
petition as not pressed and in terms of the above referred
letters between the parties in the interest of justice and equity.

Bangalore
17.12.2016

Sd/-
Advocate for Petitioner"

Even then the amount was not paid. Therefore, the petitioner

represented again, which was met by a reply from BESCOM. The

reply reads as follows:

"NO: BESCOM/MD/D(F)/GM(Ele)/PP/BC-39/14-4

Date: 05-05-2017

The Managing Director,
M/s Global Energy Pvt Limited,
6th Floor, Le Meridien Commercial Tower,
Raisina Road,
New Delhi-110001.

Sir,

Sub:- Payment of outstanding amount of Rs
63,06,38,435/- owed to GEPL towards the
power over drawals by BESCOM - Reg.
20

Ref:- Global Energy Pvt Limited Letter dated
21.04.2017.

Referring to the above, GEPL vide letter cited under reference
had explained in detail the transactions between Global Energy
Pvt Limited, PCKL, MSLDC, MSEDCL and BESCOM with regard to
the contract executed with BESCOM and extended subsequently
through supplemental PPAs for procurement of power through
220 Kv Chikkodi Kholapur Line on radial mode. Global Energy
Pvt Limited is requesting for release of Rs 63.06 Crore as
outstanding dues payable by BESCOM on following issues and
remarks of BESCOM on these issues are as furnished below.

1. Over drawal Charges as per contracted price of
Rs 4.85 per Kwh Rs 24,28,70,976/-

MERC vide orders dated 27.04.2015 and 28.04.2015 in
Petition No. 181/2015 and 38/2015 had upheld that FBSM
is not applicable to Global Energy Pvt Limited since it is
not a State pool participant of FBSM. The applicability of
FBSM to GEPL is pending before APTEL. in Appeal No. 245
and 246 of 2016 filed by PCKL. and in the Petition OP No.
85/2016 before KERC filed by BESCOM.

On 25th July-2016, the Director of Global Energy had
given an undertaking stating that the claim for over
drawal will be made on BESCOM only after settlement of
under drawal of BESCOM after the outcome of final order
in Appeals filed by PCKL.

Global Energy Pvt Limited has to settle the under drawal
of 141 Mu by BESCOM before seeking payment for over
drawal. Further, the assumption of Global Energy Pvt
Limited that over drawal by BESCOM as willfull and
intentional is to be sorted out by the Nodal Agency PCKL
since BESCOM neither schedule the power nor monitor
the Grid Operation.

The Chief Engineer (Elec), Chikkodi had given the
schedules and SLDC had monitored the Grid. Hence, the
allegation of willfull and intentional over drawal is not
attributable to BESCOM alone.
21

2. Late payment surcharge at 15% per annum on over
drawal Rs 6,06,43,802/-.

The applicability of Rs 4.85 per unit for over drawal is
under dispute in the cases pending before APTEL and
KERC. If Global Energy Pvt Limited insists for late
payment surcharge for over drawal, contrarily Global
Energy Pvt Limited has also to pay late payment
surcharge Rs 17,08,68,822/- on under drawal amount if
calculated at Rs 4.85 per unit for under drawal of 141 Mu
which works out to Rs 68,38,50,000/- (141 Mu * Rs
4.85). Hence, the late payment surcharge claim is denied.

3. Penalty levied by MSEDCL on deliberate over drawal
by BESCOM Rs 23,74,88,976/-.

BESCOM had not agreed to pay the penalty imposed by
MSEDCL in original PPA and subsequent supplemental
PPA. BESCOM had never over drawn the power. As per
Energy balancing certified by SLDC, KPTCL, BESCOM is
continuously under drawing the power. BESCOM had
under drawan 2834 Mu and 1245 Mu during FY-16 and
FY-17 respectively. The willfull/intentional/deliberate over
drawal mentioned by Global Energy Pvt Limited is not
acceptable by BESCOM. Hence, BESCOM is not concerned
with the penalty levied by MSEDL.

4. Late payment surcharge at 15% Pa on penalty
levied by MSEDCL Rs 7,16,58,507/-.

As BESCOM is not accepting the penalty levied by
MSEDCL itself, the payment of late payment surcharge on
that penalty is denied in toto. Since, BESCOM is not a
party in the Standby Agreement between MSEDCL and
Global Energy and there is no contractual binding on
BESCOM to bear the exorbitant costs.

5. Open Access charges due to revision in power
scheduled to BESCOM Rs 1,79,76,173/-.

BESCOM vide letter No. 6316 dated 19th Steptember-
2016 had referred this issue to PCKL for clarification and
22

clarification from PCKL is still awaited. Hence, this claim is
not considered for payment.

The above details are for information and it is requested
not to raise frivolous claims on BESCOM which are not at
all agreed elsewhere in contracts between Global Energy
and BESCOM.

Yours faithfully,
Sd/-
Managing Director,
BESCOM, Bangalore."

Therefore, the lurking dispute between the two led to an opinion to

be sought from the hands of the learned Advocate General. What

was opined is as follows:

".... .... ....

Under the circumstances, in my considered view; it would
not be justifiable to withhold GEPL's payment until the
disposal of proceedings before APTEL and KERC. Even
after the disposal of matters before APTEL and KERC, it
cannot be said with certainty that, either party to such
proceedings will not pursue its remedies by way of
Appeal/s before the appropriate forum. In view of the
totality of circumstances, it would be fair to opine that
GEPL's claim for over drawls may be honoured
expeditiously, along with contractual late payment
surcharge.

In any event, if issues are not to be settled per advise
and claim; it is certainly advisable, as a goodwill
measure, for BESCOM to, at least, pay GEPL at the
agreed rate of Rs. 4.85 per unit, if not more. As stated
earlier, GEPL has been subject to high penal charges of
Rs. 12.82 per unit of overdrawn power. It appears to be
highly unjust for GEPL to bear such high charges, and yet
23

not be reimbursed any amounts, for overdrawals by
BESCOM.

The Queries are answered accordingly.

21st December 2017
Sd/-
(MADHUSUDAN R NAIK)
ADVOCATE GENERAL
PÀ£ÁðlPÀ gÁdåzÀ CqÉÆéÃPÉÃmï d£ÀgÀ¯ïgÀªÀgÀÄ, ¨ÉAUÀ¼ÀÆgÀÄ
Advocate General for Karnataka,
Bangalore."

If the opinion had remained an opinion it would not be necessary to

notice the same in this order. The opinion was placed before the

Board. The Board, in its meeting held on 20-02-2018, resolves as

follows:

"CERTIFIED COPY OF THE RESOLUTIONS PASSED AT THE
87TH MEETING OF THE BOARD OF DIRECTORS OF
BANGALORE ELECTRICITY SUPPLY COMPANY LIMITED
HELD ON FEBRUARY 20TH 2018.

1. Agenda Item No. BODM 87/21: Procurement of power
through Chikkodi-Kolhapur Lines Regarding settlement
of Deviations(over drawal/under drawal).

Ref: DO No. PCKL/MD/PS/2017-18/2939-42 dated 26.12.2017.

The Managing Director explained the background of the
proposal to the Board as below:

(1) PCKL has issued Letter of intents for procurements of
power from Maharashtra through the Trader M/s Global
Energy Pvt Limited under short term contract through the
Chikkodi - Kolhapur radial lines from 02.07.2014. The
Power Purchase Agreement (PPA) was executed between
M/s Global Energy Pvt Limited and BESCOM for
procurement of power at Rs 4:85 per unit.
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(2) Before expiry of term of PPA, PCKL had obtained approval
of it's Board and KERC for renewal and extention of term of
PPA for varied capacities PCKL had informed BESCOM to
execute Supplemental -PPA after approvals. Accordingly
BESCOM had executed the Supplemental PPAS

(3) As per agreed PPA, the payments were made for scheduled
energy and the difference between actual energy and
scheduled energy is to be settled through "Final, Balancing
Settlement Mechanism" (FBSM) as stated by PCKL in the
letter dated 19.11.2014. In the Petition filed by M.s Global
Energy Pvt Limited OP No. 181 of 2014 and 38 of 2014
before MERC, it was ordered by MERC that the FBSM is not
applicable to M/s Global Energy Pvt Limited since it is a
trader but not a Generator or Distribution Licensee.

(4) Under certain emergent circumstance, BESCOM had filed a
Petition Op No. 82 of 2016 before KERC requesting to
adopt UI Mechanism of CERC for deviation settlement
based on MERC order. PCKL had filed two Appeals 244 &
245 of 2016 before Appellate Tribunal of Electricity for
settlement of deviation account as per FBSM. The Petitions
and Appeals are pending for Final orders.

(5) M/s Global Energy Pvt. Limited is frequently approaching
GOK, PCKL and BESCOM for release of payment for over
drawal energy. PCKL has placed the issue before the 49th
PCKL Board of Directors meeting. As there was difference
of opinion in settlement of deviation account between PCKL
and BESCOM, the Board of PCKL has suggested to refer the
matter to Advocate General of Karnataka for considered
opinion.

(6) PCKL vide letter No. DO No. PCKL/MD/PS/2017-18/1689
dated 12.09.2017 had referred the matter along with
supporting documents to Sri Madhu Sudhan R Naik,
Advocate General of Karnataka for opinion.

(7) The Advocate General of Karnataka has furnished the
opinion on 23.12.2017 to PCKL and PCKL vide letter No. DO
No. PCKL/MD/PS/2017-18/2939-42 dated 26.12.2017. The
PCKL had forwarded the opinion to BESCOM.
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(8) The opinion of Advocate General is as below.

(a) It would not be justifiable to withhold M/s Global Energy
Pvt Limited's payment until the disposal of proceedings
before APTEL and KERC. Even after the disposal of
matter before APTEL and KERC, it cannot be said with
certainty that, either party to such proceedings will not
pursue. ............ Appeals before the appropriate forum. In
view of the totality of Circumstances, it would be fair to
opine that M/s Global Energy Pvt Limited's claim for
over drawals may be honored expeditiously, along with
contractual late payment surcharges.

(b) In any event, of issues are not to be settled per advise
and claim it is certainly advisable, as a goodwill
measure, for BESCOM to, at least, pay M/s Global
Energy Pvt Limited at the agreed rate of Rs 4.85 per
unit, if not more. As stated earlier, M/s Global Energy
Pvt Limited has been subject to high penal charges of Rs
12.82 per unit of overdrawn power. It appears to be
highly unjust for M/s Global Energy Pvt Limited to bear
such high charges, and yet not be reimbursed any
amounts, for over drawals by BESCOM

(9) It is advised in the legal opinion that PCKL has to ascertain
the facts regarding the over drawals/under drawals
schedules and settle the issue relating to over
drawal/under drawal by BESCOM.

(10) According to the opinion of Advocate General of Karnataka,
BESCOM at least pay M/s Global Energy Pvt Limited at
agreed rate of Rs 4.85 per unit for energy overdrawn as
per settlement issued by PCKL regarding over drawal/under
drawal.

(11) Present proposal is submitted to the Board seeking
direction/orders for making payment of energy over drawn
at Rs 4.85 per unit as per settlement issued by PCKL for
over drawl/under drawal pending final orders in Appeals
and Petitions filed by PCKL and BESCOM respectively.

(12) During deliberations, GM(PP) was called to explain, who
explained that as per Agreed PPA the payments are made
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for scheduled energy. During real time operation the over
drawal and under drawals will happen. As per PPA between
GEPL and BESCOM, the over drawal/under drawal initially
agreed at UI Mechanism of CERC and then as per FBSM of
Maharashtra in supplemental PPAs based on PCKL letter
dated 19.11.2014. GEPL had Stand by Power Agreements
with MSEDCL where It was agreed between GEPL and
MSEDCL for deviation settlement, under which, over drawal
at temporary tariff initially and later at HTI (A) tariff. For
over injection (under drawal) the units will be lapsed in
grid. The standby Power Agreements are executed at the
risk of GEPL BESCOM is not a party to that standby Power
Agreement. The quantum of energy details given by GEPL
for over drawal and under drawl from 11.07.2014 to
31.07.2016 are 49.924 Mu and 114.468 Mu respectively.
BESCOM had paid for scheduled energy which includes the
under drawl quantum of 114.468 Mu. Hence under drawal
of 114.468 Mu had already paid by BESCOM to GEPL at Rs
4.85 per unit which works out to Rs 55.52 Crore. Hence,
the under drawal 114.468 Mu is to be refunded by GEPL
either at Ul rate or at FBSM rate. But GEPL is insisting for
payment over drawal energy of 49.924 Mu at Rs 4.85 per
unit which works out to Rs 24.21 Crore. As BESCOM had
already paid for scheduled energy which includes
underdrawal quantum of 114.468 Mu, amounting to Rs
55.52 Crore (which is not yet settled) the payment for
overdrawal quantum of 49.924 Mu, amounting to Rs 24.21
Crore will amounts to double payment to GEPL without
settlement of deviation account. Hence, the finance of
BESCOM shall be safe guarded to avoid unnecessary
burden on Consumers.

Board went through the proposal discussed and debated at
length in view of safeguarding the funds of BESCOM.

(a) ACS was on the considered opinion that a justifiable &
fair solution needed at this point of time and further
expressed that M/s Global Energy Pvt Ltd (GEPL) is
demanding settlement/Payment for energy overdrawn.
However. for underdrawal component, they are not
prepared to pay at this point of time and their contention
is to pay it later after the decision of pending appeal
petition in APTEL.ACS further expressed that, without
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obtaining a relevant bank guarantee for the money due to
BESCOM from GEPL, it is not appropriate to pay as
demanded by M/s.Global Energy Pvt Ltd, without keeping
in mind the security for BESCOM finance.

(b) MD also expressed the same view and re-iterated the
necessity of security for BESCOM money in the interest of
safeguarding against unjust claim if any by M/s.GEPL and
further strongly opposed the demand and proposal of M/s
Global Energy Pvt Ltd for settlement without looking at
the security for BESCOM finance.

(c) Board further perused the correspondences made by the
MD, PCKL with Advocate General of Karnataka dtd
12.09.2017 and opinion of Advocate General thereon and
certain significant points were noted as below:

(i) It is indicated in PPA that will overdrawal intentional or
unintentional are to be settled at the rate of Rs.4.85 per
unit.

(ii) PCKL, has to ascertain the authenticated facts and details
regarding Overdrawals, schedule of drawal etc. for
settlement of claims against overdrawal/under drawal by
BESCOM.

(iii) Penal charges claimed by GEPL is at abnormal level,
whether the same is sustainable under agreement clauses
in the eyes of law, need to be looked into.

(d)Board debated further at length in view of safeguarding
the finance of BESCOM besides adherence to legally valid
agreement clauses of PPA. After a lengthy and elaborate
discussion the other Board members/ Board of Directors
intervened at this point of time and expressed that the
issue need to be looked into the Advocate General's
opinion in this behalf which is already given and BESCOM
can proceed accordingly. After a detailed discussion Board
passed the following resolutions in this context:

"RESOLVED THAT, for the reasons explained, approval
be and is hereby accorded to admit the claims of M/s
Global Energy Pvt. Ltd(GEPL) for settlement at the agreed
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rate of Rs.4.85 (Rs four and ps eighty five only)for energy
overdrawn during the period of power agreement. The
approval is subject to the following:

(1) The claim of M/s GEPL for overdrawal and underdrawal
energy and scheduled energy shall be accurately
ascertained by authentic. scrutiny/comprehensive
verification by PCKL as per the opinion of Advocate
General.

(2) Final settlement of deviation account
(overdrawal/underdrawal) shall be on disposal of pending
appeal case and final orders thereon in APTEL. An
authenticated and accurate amount to be paid to BESCOM
shall be ascertained by GM(PP), BESCOM in co-ordination
with PCKL. Also regarding interim settlement, if any,
made by PCKL pending final orders in respective Appeal
petitions filed with APTEL and KERC.

(3) The D(T), BESCOM and GM(PP) shall ensure re-
imbursement of claim already made, if any, by GEPL for
overdrawal as penal charges at Rs.12.82 per unit, and
payment, if any, made, within the ambit of legal
provisions."

"RESOLVED FURTHER THAT, the D(T) and GM(PP),
BESCOM be and are hereby authorized to take all further
necessary actions within the ambit of legal provisions as
required under all applicable laws for settlement of disputed
claims. The GM(PP) be and is hereby authorized to co-ordinate
with M/s PCKL to take necessary action on deviation settlement
within the legal framework and contractual obligation between
BESCOM and GEPL. The GM(PP) shall make proper and valid
documentation in this behalf within the legal framework."

The Board has opined that for the reasons explained in the opinion

of the learned Advocate General and the deliberations by the Board,

approval was accorded to admit claims of the petitioner for
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settlement at agreed rate of ₹4.85 per unit for the energy

overdrawn during the period of the agreement. This is further

amplified by the subsequent clauses by authorizing BESCOM to take

all necessary steps within the ambit of law to make proper and valid

documentation in furtherance of the said resolution. This resolution

is not acted upon for a long time. Communications between the two

galore and the petitioner files the subject petition seeking a

mandamus for release of admitted amount.

9. The contention of the learned counsel appearing for the

respondents is that the petitioner has to prefer an appeal under

Section 86(1)(f) of the Electricity Act, as it is a dispute between two

distribution Companies - one the petitioner and the other BESCOM.

Insofar as admitted amount at the rate of ₹4.85 per unit, one need

not be driven to the Appellate Authority under Section 86(1)(f). If

it were to be inter-departmental correspondence between the two

officers it would have become unenforceable per se. No doubt it is

an inter-departmental correspondence, but it is by the highest body

of BESCOM. The Board is the highest body of BESCOM. The Board

admits the liability way back in the year 2018. 8 years passed by;
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not a rupee is paid to the petitioner. Rupee I mean, not even the

admitted amount. Therefore, the petitioner becomes entitled to

admitted amount, subject to all the claims that would spring in

future with regard to various disputes pending between the parties

before any fora, including before the Maharashtra Electricity

Regulatory Commission. Therefore, the petition deserves a

mandamus for release of the amount, not a mandamus simpliciter,

but with certain amount of interest, for the reasons that the

resolution of the Board is 8 years old and the amount to be paid to

the petitioner is struck with the respondents for the last 8 years,

notwithstanding unequivocal and emphatic resolution of the Board.

10. For the aforesaid reasons, the following: -

ORDER

(i) Writ Petition is allowed.

(ii) Mandamus issues to 1st respondent/BESCOM to pay the petitioner in terms of resolution of the Board in pursuance of invoices dated 9-03-2017 and 17-04-2017, wherein the petitioner had demanded

disbursal of admitted amount at the rate of ₹4.85 per unit.

(iii) Since the resolution of the Board is of the year 2018 which had remained unimplemented even today, I deem it appropriate to direct the 1st respondent to disburse the amount within an outer limit of 8 weeks from the date of receipt of a copy of this order, along with interest at the rate of 6% per annum, from the date of the resolution of the Board till the date of payment.

(iv) In the event the 1st respondent/BESCOM would not paid the amount within 8 weeks, the petitioner becomes entitled to interest at 9% per annum from the date of resolution till the date of payment.

Sd/-

(M.NAGAPRASANNA) JUDGE

bkp CT:MJ