• The news comes days after Torrent Power announced on February 20 that it had emerged as the highest bidder for the acquisition of 51 percent stake in the discoms in Union Territories

• A petitioner has filed a public interest litigation (PIL), claiming that the distribution company, in which 51 percent stake has been put up for sale, does not exist

New Delhi: The most recent acquisition made by Torrent Power, who put in the winning bid for the privatisation of discoms in Dadra & Nagar Haveli and Daman & Diu, hangs in uncertainty as the Bombay High Court (HC) has suspended the tender process. In a regulatory filing to the stock exchanges on Thursday, Torrent Power said, "We refer to the above intimation to the Stock Exchange in the subject matter wherein it was informed that Torrent Power Ltd had emerged as the highest bidder in the tender for 51 percent equity stake in Power Distribution Company for the Union Territories of Dadra & Nagar Haveli and Daman & Diu. In this connection, we would like to further inform that Hon'ble Bombay High Court has, inter alia, suspended the tender process in a PIL case before the Court until further orders in the matter."

The news comes days after Torrent Power announced on February 20 that it had emerged as the highest bidder for the acquisition of 51 percent stake in the discoms in Union Territories.

Privatisation of discoms: What has the PIL claimed?

A petitioner has filed a public interest litigation (PIL), claiming that the distribution company, in which 51 percent stake has been put up for sale, does not exist. The petition further said that despite the relevant electricity department on incurring any loss, there was an attempt to transfer 51 percent shares of a company which is yet to be incorporated.

ALSO READ: Privatisation of discoms: Govt releases draft doc; private owner to acquire discoms sans liabilities, losses

The Bombay HC admitted the petition on March 3, saying, "In the absence of any provision of the Act justifying the action of the respondents, we are prima facie satisfied that not only has the petitioner set up an arguable case on merits for admission of the PIL petition but he has also set up a strong case for grant of interim relief."

The backdrop

Torrent Power had earlier said that the discom sold 9,000 Million Units (MU) of power every year and had 1,50,000 consumers. The tender process for finding the highest bidder for the acquisition of 51 percent stake in the discoms was part of the Centre's plan for privatisation of discoms in Union Territories. 

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Telegram. Join PSU Watch Channel in your Telegram and stay updated.)