Supreme Court says NTPC can cut power to Delhi distributor if not paid

NEW DELHI Tue May 6, 2014 2:39pm IST

The illuminated India Gate is pictured before Earth Hour in New Delhi March 29, 2014. REUTERS/Vijay Mathur/Files

The illuminated India Gate is pictured before Earth Hour in New Delhi March 29, 2014.

Credit: Reuters/Vijay Mathur/Files

Related Topics

Stocks

   

NEW DELHI (Reuters) - The Supreme Court has told India's top power producer that it can cut supplies to an electricity distributor in New Delhi if it is not paid arrears by end-May, intensifying a dispute that could lead to blackouts in the capital.

The court on Tuesday ordered BSES - part of billionaire Anil Ambani's Reliance Infrastructure Ltd (RLIN.NS) - to pay state-run NTPC (NTPC.NS) the 7 billion rupees ($116 million) it is owed by May 31.

If BSES fails to pay by the end of May, the court said NTPC is entitled to cut the power it supplies to the distributor, overturning an earlier court order that NTPC should keep power flowing despite the outstanding bill.

BSES did not immediately respond to a request for comment. It has previously said lower tariffs and a revenue shortfall meant it could not pay.

The case in Delhi reflects a growing battle over who should bear the rising cost of power in India.

On the one side are many consumers who consider cheap or free power to be a right and want tariffs kept low.

But pressure to keep prices low makes it tough for distributors to force through tariff rises they say are necessary to keep pace with changes in the cost of power, which has risen as the country imports expensive oil and gas.

BSES, which runs two distributors in Delhi, and a third firm say they face a revenue loss, built up over years of operations, totalling more than 150 billion rupees ($2.4 billion).

($1 = 60.1800 rupees)

(Reporting by Suchitra Mohanty and Tommy Wilkes; Editing by Ron Popeski)

FILED UNDER:

Politics

REUTERS SHOWCASE

Fund Raising

Fund Raising

Flipkart raises $700 million in fresh funding.   Full Article 

Reforms Push

Reforms Push

Modi may order insurance, coal reforms if vote delayed - officials.  Full Article 

Reuters Exclusive

Reuters Exclusive

India looks to sway Americans with nuclear power insurance plan  Full Article 

To Boost Growth

To Boost Growth

Crank up public spending to revive growth - chief economic adviser.   Full Article 

Bold Steps

Bold Steps

SpiceJet rescue plan marks bold bet on Indian aviation recovery.   Full Article 

New Airline

New Airline

Tata, Singapore Air venture Vistara to take off on Jan 9.  Full Article 

Online Sales

Online Sales

Knock knock. Who's there? Amazon's best-selling holiday author.  Full Article 

Hacking Attack

Hacking Attack

N.Korea says did not hack Sony, wants joint probe with U.S.  Full Article 

Reuters Poll

Reuters Poll

BSE Sensex to hit 32,980 by December 2015  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage