NCLT Dismisses BHEL Plea Against Hinduja Power Corporation

Hyderabad: The National Company Law Tribunal rejected an application under the IBC Code against Hinduja National Power Corporation at the instance of Bharat Heavy Electrical Limited (BHEL).

The panel of Rajeev Bharadwaj, the judicial member, and Sanjay Puri, the technical member, dismissed the corporate insolvency petition of BHEL alleging default of `271 crore payment by the Hindujas.

BHEL had floated a tender for setting up a 1040-megawatt coal-based thermal power project at Vizag in two units. The tender was awarded for supply erection and commissioning in favour of the Hindujas. Various purchase orders were issued by Hinduja to the operation creditor namely, BHEL.

According to BHEL, the corporate debtor failed to repay outstanding invoices. The petitioner contended that as despite a legal notice, payments were not made, they moved the tribunal.

The Hindujas opposed the petition successfully. They contended that there were pre-existing disputes between the parties on account of defects and deficiencies of BHEL and in fact BHEL was liable to pay liquidated damages and various other facts relating to delays in milestones and failure of service obligations.

The plea of limitation was also raised. The panel faulted the filing of the petition through its officer; it recorded that neither a board resolution was passed nor a power of attorney executed and in the absence of the same the mere delegation of power by the executive director is invalid and not maintainable.

Out of the total amount that was claimed, the tribunal found a mismatch between the dates on the invoices and the claims. It calculated that the total amount due within the period of limitation was only Rs.3.54 lakh.

It also recorded that there were also disputes between the parties concerning quality of services and goods, reconciliation of accounts and various other disputes. The panel accordingly refused to admit the claim and dismissed the petition.