The Punjab and Haryana High Court Friday issued notices to the Centre, Punjab government and others on a petition challenging the Punjab State Power Corporation Limited (PSPCL)’s decision to invoke force majeure — a clause in contracts to seek reprieve from liability when there is an unforeseen situation — in the power purchase agreements during the lockdown period.
When the state authorities sought time to file their response in the case, the court in the order said, “Let the needful be done within two weeks from today positively.” The order was passed in the cases filed by Talwandi Sabo Power Limited and Nabha Power Limited. The cases have been adjourned for arguments on June 29.
The PSPCL had issued a notice to the Mansa-based power producer Talwandi Sabo Power Limited on March 29, declaring that there has been a sudden drastic reduction in the demand in Punjab as all the industrial and commercial units have been shut and asking it to stop declaring the availability from the generating station with regard to PSPCL as it is not obliged under the force majeure conditions to avail the power declared available and pay capacity charges. The force majeure clause remained applicable till May 25, the date when it was rescinded.
Talwandi Sabo Power Limited has challenged the invoking of force majeure saying the action is contrary to provisions of the Disaster Management Act and guidelines issued by the Ministry of Power. The decision has been taken to deny capacity charges of the two months’ period to the company and will lead to non-payment of salary to 70 direct employees and 1,776 indirect workers, the petition states. The capacity charges are a fixed amount paid for the available capacity of the power plant. According to the petition, the Punjab State Transmission Corporation Limited issued State Energy Account for the month of April 2020 but failed to consider the company’s declared capacity.
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