ENFIELD INFRASTRUCTURE LIMITED Vs. NTPC VIDYUT VYAPAR LTD.

JUDGEMENT

(1.) THIS petition under Section 9 of the Arbitration and Conciliation Act, 1996 ('Act') by Enfield Infrastructure Limited ('EIL') seeks interim relief in respect of a bank guarantee for Rs.5,07,54,000 and two bank guarantees for Rs.10,15,08,000 each against Respondent No. 1 NTPC Vidyut Vyapar Ltd. ('NVVL') furnished by EIL to NVVL.

(2.) EIL and NVVL entered into a power purchase agreement ('PPA') on 25th January 2012. Pursuant thereto the aforementioned three bank guarantees were furnished by EIL to NVVL. In terms of the PPA, EIL was required to commission the Solar PV Project of 10MW capacity at village Mandali in Jodhpur district, Rajasthan. The Rajasthan Renewable Energy Corporation Limited ('RRECL') was appointed as the State nodal agency and was obligated to facilitate EIL in constructing and commissioning the power plant. As per the PPA, EIL was required to commission the project and inject power from the power project to the delivery point within 13 months of signing the PPA. The effective commissioning date was, therefore, 26th February 2013.

(3.) AS a result of delay in commissioning the project by the scheduled commissioning date, EIL sent letters to NVVL on 28th January 2013 and 5th February 2013 seeking extension of time under clause 4.5 of the PPA. According to EIL, the request for extension of time was due to Force Majeure events. On 5th February 2013, NVVL wrote to EIL rejecting its request for extension of time. It is stated that despite a further letter sent by EIL to NVVL on 21st February 2013, NVVL threatened to invoke the bank guarantees in question. It was in the above circumstances that the Petitioner approached the Court to restrain NVVL from invoking the bank guarantees.