Anil Ambani-led Reliance Infrastructure on Friday said it has received Rs 94 crore from the Goa government against the arbitration award of Rs 350 crore. These funds will be used to pay lenders and reduce the debt of company. Reliance Infrastructure aims to be debt-free in 2020.
The company said that it will request the government of Goa to pay remaining 75 per cent of the arbitral award against bank guarantee immediately, the infrastructure major said in an exchange filing.
"As per the tribunal order, the government of Goa has deposited in Court, Rs 50 crore in November 2019 and Rs 44 crore on 20 December 2019," Reliance Infra said in a filing to the Bombay Stock Exchange.
The arbitration tribunal, on February 16, 2018, had ordered the Goa government to pay Rs 350 crore, including interest, in favour of Reliance Infrastructure. The tribunal has also directed that in the event government of Goa fails to comply with the award, interest at the rate of 15 per cent per annum will be payable in favour of the company.
The matter went into arbitration when Goa state utility delayed payments to Reliance Infrastructure for power supplied from its 48 MW-Goa Power Plant in Sancoale.
The state government had entered into a power purchase agreement (PPA) with Reliance Infra on January 10, 1997, to commission and operate an open cycle electricity generation station of 39.8 MW at Sancoale, Goa. The station was to be operated by the company on Naphtha, subject to the parties consensually agreeing to the use of any alternate fuel.
During the term of the PPA, several disputes arose between the parties regarding the computation and payment of invoices raised by the company under the period utilising Naptha as well as the subsequent period in which there was a shift to Regasified Liquified Natural Gas. As a result, on July 31, 2014, Reliance Infrastructure invoked the dispute resolution provisions under the PPA and the matters were placed before a panel. The company also filed claims before the Joint Electricity Commission (JERC) in petition in 2015.
On Monday, the company had won Rs 1,250 crore arbitration award against government-owned Damodar Valley Corporation (DVC). The arbitration tribunal awarded the case in favour of Reliance Infrastructure and directed DVC to pay Rs 896 crore and return the bank guarantees of Rs 354 crore within four weeks or pay additional interest, at the rate of 15 per cent annually, for any delay in payment beyond four weeks.
By Chitranjan Kumar