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2001 DIGILAW 246 (ORI)

MEENAKSHI POWER LIMITED v. STATE OF ORISSA

2001-05-28

P.K.MISRA

body2001
P. K. MISRA, J. ( 1 ) THE facts and circumstances giving rise to the present writ application are as follows :-River Kolab is an east flowing river in Orissa and forms common boundary with Madhya Pradesh. The said river is classified as Upper Kolab, Middle Kolab and Lower Kolab. As per the agreement between Orissa and Madhya Pradesh, Orissa is free to make beneficial use of the water of Kolab river lying within its territory. With a view to develop hydro-electric projects by private entrepreneurs, the State Government in the Department of Energy framed a policy guidelines for promotion of Micro, Mini and Small hydro-electric projects by private entrepreneurs as per the G. O. dated 15th May, 1998, annexed as Annexure A/1 to counter-affidavit of opposite party No. 1. The petitioner, a private limited company, applied for Small Hydro-Electric Power Project in the middle Kolab region near Tentuliguma village in the district of Koraput by application dated 11-8-1999 and by letter dated 5-11-1999 the petitioner was granted permission to investigate the feasibility. On 16-12-1999, the petitioner submitted a preliminary feasibility report. The petitioner initially proposed to establish three units of 7 M. W. (total 21 M. W.) with estimated cost of Rs. 95. 65 crores. (These details are available from Annexure-C/1 to the counter-affidavit of opposite party No. 1 ). The petitioner also furnished a bank guarantee for Rs. 21 lakhs. Pursuant to the aforesaid pre-feasibility report, a Memorandum of Understanding (MOU) was executed between the petitioner and opposite parties 1 and 2 on 23-12-1999 (Annexure 1 ). Thereafter, the petitioner prepared Detailed Project Report (in short, the "dpr") wherein it was suggested to establish Small Hydro-Electric Project with capacity of 25 M. W. (instead of 21 M. W. as indicated in the pre-feasibility report) with two units of 12. 5 M. W. each. While the matter stood thus, the petitioner submitted another DPR in respect of two other waterfalls lying up-stream for generating 16 M. W. of electricity and submitted another bank guarantee and sought for amendment of the earlier MOU dated 23-12-1999 accordingly. This proposal was given by letter dated 24-10-2000 (Annexure-2 ). The relevant extracts of the said communication as per Annexure-2 are quoted hereunder :-"with reference to the above we had submitted a detailed project report for 25 MW Power House for Middle Kolab Small Hydro-Electric Power Station near Tentuliguma village in Koraput Distt. This proposal was given by letter dated 24-10-2000 (Annexure-2 ). The relevant extracts of the said communication as per Annexure-2 are quoted hereunder :-"with reference to the above we had submitted a detailed project report for 25 MW Power House for Middle Kolab Small Hydro-Electric Power Station near Tentuliguma village in Koraput Distt. The said scheme consists of 4 consecutive water falls of which the lower 2 falls are clubbed and a scheme had been prepared vide the above D. P. R. for 25 M. W. The other upper 2 falls could not be included in the above scheme because of the complexity and distance included as well as the utilization of forest lands is becoming more. Henceforth we had made a separate power house utilizing the remaining 2 upper falls (Upper Power House) to generate 16 MW of power which also comes in the plot Nos. of Tentuliguma village. We are herewith enclosing the detailed project report in 6 copies along with additional Bank guarantee for 16 lakhs and amendment to the MOU dated 23-12-1999 and amendment dt. 12-7-2000. "the petitioner's grievance is that though such a project report was given and was recommended by opposite party No. 2, opposite party No. 1 allotted the said site to opposite party No. 3 as per order under Annexure-3/a. The petitioner has accordingly prayed for quashing Annexure-3/a and for issuing a direction to opposite parties 1 and 2 to allot the project to the petitioner. ( 2 ) IT is claimed by the petitioner that since investigation had been made by the petitioner and pre-feasibility report had been submitted relating to both the sites and the MOU was in force, the site up-stream could not have been allotted to opposite party No. 3 in view of Cl. 14 of the MOU as well as the policy decision of the Government. It has been further contended that all the four waterfalls are situated within village Tentuliguma and since the said place had already been earmarked for being developed by the petitioner, the same could not have been again allotted to opposite party No. 3. 14 of the MOU as well as the policy decision of the Government. It has been further contended that all the four waterfalls are situated within village Tentuliguma and since the said place had already been earmarked for being developed by the petitioner, the same could not have been again allotted to opposite party No. 3. It is also contended that on the request made by opposite party No. 3, the place had been indicated as river Kolab near Pujariguda and since there is no such river near Pujariguda, the order in favour of opposite party No. 3 is of no consequence and should not affect the right of the petitioner to develop and utilise the site for the purpose of establishing a power house. ( 3 ) COUNTER-AFFIDAVIT has been filed on behalf of opposite parties 1 and 2. Separate counter-affidavit has been filed on behalf of opposite party No. 3. It has been indicated in the said counter-affidavits that the pre-feasibility report of the petitioner related to the two waterfalls in the lower part and did not relate to the two waterfalls in the upstream and as opposite party No. 3 had applied for the site upstream earlier by application dated 23-11-1999, the said project has been rightly allotted to opposite party No. 3. ( 4 ) REJOINDER affidavit and further affidavits have been filed by the petitioner reiterating the earlier position. Similarly, additional affidavits have been filed on behalf of opposite parties 1 and 2 as well as opposite party No. 3. ( 5 ) BEFORE considering the submissions of the parties it is profitable to notice the relevant provisions in the guidelines, annexed as Annexure-A/1 and the Memorandum of Understanding between petitioner and opposite party No. 1, annexed as Annexure-1 :-"government OF ORISSAPolicy Guidelines on Development of Micro, Mini and Small Hydro-Electric Pro-jects :2. 0. DEFINITIONS. (a) Micro Hydro-Electric Schemes. Hydro-electric schemes with a total installed capacity up to 100 K. W. having individual generating units with capacities from a few K. W. to 100 K. W. (b) Mini Hydro-Electric Schemes. Hydro-electric schemes with a total installed capacity upto 2000 KW of near around with capacities of individual units from 100 to 1000 K. W. (c) Small Hydro-Electric Schemes. Hydro-electric schemes with a total installed capacity up to 100 K. W. having individual generating units with capacities from a few K. W. to 100 K. W. (b) Mini Hydro-Electric Schemes. Hydro-electric schemes with a total installed capacity upto 2000 KW of near around with capacities of individual units from 100 to 1000 K. W. (c) Small Hydro-Electric Schemes. Hydro-electric schemes with a total installed capacity up to 15 M. W. with individual units having capacities from 1 M. W. to 5 M. W. (admittedly increased to 25 M. W. subsequently ). 3. 0. ELIGIBILITY. Any willing public sector or private sector entrepreneur will be considered by the State Government for setting up such project if in the opinion of the State Government the party is found capable after considering various aspects like (i) technical soundness of the pre-feasibility detail survey and investigation report (ii) financial standing of the party, (iii) experience in the relevant field etc. The State Government will sign MOU with such parties for execution of projects where total cost of the project is less than Rs. 100 crores and installed capacity is 15 M. W. or below per site. 10. 0. Application procedure :developer interested in setting up such small, mini and micro hydro-electric project or projects for generation of electricity from the non-conventional energy sources may apply to the (Engineer-in-Chief, Electricity) Government of Orissa, Bhubaneswar, in the prescribed form (annexed) who will process and submit the same to the Government for approval. . . . . . . . . . . . . . . . . . . . . . . . . . 11. PROCEDURE FOR DEVELOPMENT OF MICRO, MINI, SMALL HYDRO-ELECTRIC PROJECTS IN ORISSA :. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. A developer who investigates a project will have the first right to take up the project. The developer will communicate his final decision within a period of one year from the date of commencement of investigation. After receipt of letters of interest it will be segregated into two groups- (i) Captive Power Plant, and (ii) IPPs. The State Government will allocate the project through MOUs. On receipt of a report from the EIC, electricity. The developer will communicate his final decision within a period of one year from the date of commencement of investigation. After receipt of letters of interest it will be segregated into two groups- (i) Captive Power Plant, and (ii) IPPs. The State Government will allocate the project through MOUs. On receipt of a report from the EIC, electricity. In case there are large number of interested parties for any project, it would be short-listed through a 'pro-qualification' process by the State Technical Committee (STC ). In case there is no response for any particular project, the project will be assigned through MOU to a developer on 'first come first serve' basis. 5. The State Government will allocate the specific project to specific developers based on PQ evaluation judged by the State Technical Committee already set up for approving DPR for the projects. " ( 6 ) THE developer will then prepare DPR for the project along with power evacuation arrangement approval and submit to EIC (Electricity) and GRIDCO for approval. The EIC will process the DPR to be approved by the State Technical Committee set up for the purpose. ""memorandum OF UNDERSTANDING BETWEEN THE GOVERNMENT OF ORISSA, MEENAKSHI POWER LIMITED FOR IMPLEMENTATION OF SMALL HYDRO-ELECTRIC PROJECT IN ORISSA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AND, whereas the 'developer' at its own cost is desirous of setting up a Hydro-Electric Power Station on Kolab River near Tentuliguma village in the district of Koraput, Orissa. AND WHEREAS, the State Government and the developer have reached an understanding for implementation of the said project and are desirous of reducing in writing the terms and conditions of the said understanding :now THIS MEMORANDUM OF UNDERSTANDING BETWEEN THE PARTIES HERETO WITNESSETH AS FOLLOWS :1. The 'developer' at its own cost is desirous of and has submitted its proposal to the State Government for implementation of the proposed Middle Kolab Hydro-Electric Project near Tentuliguma village, in Koraput District, hereinafter referred to as the 'said Project. 2. The State Government has accepted the proposal of the 'developer' and has agreed in principal to allow the 'developer' to implement the said project (s) at its own cost provided there is no damage to the existing structures where applicable. 3. 2. The State Government has accepted the proposal of the 'developer' and has agreed in principal to allow the 'developer' to implement the said project (s) at its own cost provided there is no damage to the existing structures where applicable. 3. The State Government agrees to make available to the 'developer' all available documents, data, information and all other reports, studies and papers available with the Water Resources, Energy and Revenue Department of the State Government for conducting Techno-economic studies of the said project (s ). The State Government further agrees to extend such facilities as are necessary for the 'developer' immediately after signing of the MOU for undertaking detailed survey and investigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14. The State Government agrees that till this MOU is in force, the State Government shall not entertain any proposal in respect of the projects from any other party. If the 'developer' does not take effective steps to the satisfaction of the State Government within 12 (Twelve) months from the date of signing of the MOU, the Government reserves the right to terminate/alter the conditions stipulated in the MOU. The 'developer' should furnish monthly progress of preparation of DPR to the Government for its information. " ( 7 ) IT has been contended by learned counsel appearing for the petitioner that as per the terms of the guidelines as well as MOU, opposite parties 1 and 2 could not have been allotted the site lying upstream to opposite party No. 3. In this context, the learned counsel for the petitioner has laid emphasis on paragraphs 2 and 3 of the MOU where the petitioner has been permitted to implement the "said project (s)" on Kolab river near Tentuliguma village. It has been submitted that since the disputed site is also part of Tentuliguma village and the petitioner has been permitted to establish more than one project, and since application and pre-feasibility report had been submitted earlier, allotment of the disputed site to opposite party No. 3 is contrary to the policy decision as well as the MOU. The aforesaid submission, though prima facie attractive cannot bear closer scrutiny. The aforesaid submission, though prima facie attractive cannot bear closer scrutiny. It has to be borne in mind that as per the policy decision, the cost of the project has been fixed at rupees one hundred crores so as to be characterized as a small hydro-electric power project, which can be settled on the basis of memorandum of understanding. Moreover, in the said guidelines, it is also indicated that the proposal should be for generating 25 M. W. of energy and not more. In the present case, the detailed project report (DPR) as per Annexure-C/1 has visualized production of 25 M. W. of electricity at a cost of about Rs. 96 crores and if the subsequent proposal of the petitioner is taken into account, it is obvious that the project can no longer be characterised as a small hydro-electric project as the generation of power would be more than 25 M. W. and the expenditure would be in excess of Rs. 100 crores. The learned counsel for the petitioner has, however, submitted that the figure of Rs. 100 crores has been subsequently enhanced by the Central Government. Even assuming it to be so, the fact remains that the capacity of the project or projects would be more than 25 M. W. and as such the project cannot be characterised as small hydro-electric project so as to be settled in accordance with the policy guidelines as per Annexure-A/1. ( 8 ) FACED with this position, the learned counsel for the petitioner has advanced an ingenuous contention to the effect that the capacity and ceiling of expenditure relate to one project at a particular site and a person can take up more than one project at different sites. However, if this submission is accepted, it must be taken that the first application or the pre-feasibility report related to a project of 25 M. W. or less and expenditure of less than Rs. 100 crores. The subsequent proposal was mooted by the petitioner for the first time in December, 2000, and admittedly by then, opposite party No. 3 had already submitted its pre-feasibility report/application. Therefore, even though a person can take up different projects, the question of considering the project must be decided in accordance with the first date of such application. 100 crores. The subsequent proposal was mooted by the petitioner for the first time in December, 2000, and admittedly by then, opposite party No. 3 had already submitted its pre-feasibility report/application. Therefore, even though a person can take up different projects, the question of considering the project must be decided in accordance with the first date of such application. In the present case, neither in the first application, nor in the first pre-feasibility report, anything had been indicated that the petitioner was also desirous of setting up small hydro-electric project at the disputed site. This is apparent from the relevant portions of the report (Annexure-C/1) extracted hereunder :-"investigation : Investigations have been carried out along river Kolab in the Mathili plateau revealed that there are two falls very closely located along the river Kolab Tentuliguma village near Jeypore town. The co-ordinates of the proposed project site are 1845' latitude and 828' longitude. The first fall is having a drop of about 13 m. and the lower one about 15 m. Below the second fall the river follows to run in fairly steep gradient. In a distance of about one km. lower down of the first fall a small stream joins the Kolab river. There is a drop of about 43 m. in the river bed existing between the Ist fall and the confluence point of the stream lower down. It is proposed to utilize this fall of 43 m. for power generation by constructing a Small Hydel Project on Kolab river. Surveys have been conducted between Ist fall and confluence point of the stream and the locations of the two falls have been indicated in the plans. The survey revealed that it would be feasible to have the scheme constructed on the right flank of the Kolab river between the 1st fall and the confluence point at a distance of about one km. A detailed study of the right flank is, therefore, made and a layout plan of the proposed power scheme has been prepared. " ( 9 ) THE learned counsel for the petitioner also submitted that the portion of the river near village Tentuliguma and within boundaries of Tentuliguma having been allotted to petitioner for development and establishment of power project, the same could not have been reallotted to opposite party No. 3. This submission is also without any merit. " ( 9 ) THE learned counsel for the petitioner also submitted that the portion of the river near village Tentuliguma and within boundaries of Tentuliguma having been allotted to petitioner for development and establishment of power project, the same could not have been reallotted to opposite party No. 3. This submission is also without any merit. The MOU does not indicate that all the four waterfalls near village Tentuliguma or within village Tentuliguma had been allotted to the petitioner. The pre-feasibility report of the petitioner is clear that its project was relating to the waterfalls on the lower portion of the river. ( 10 ) THE learned counsel for the petitioner has further submitted that the distance between the two projects would be hardly 200 metres and as such if opposite party No. 3 is allowed to have a project just 200 metres upstream, the petitioner's project may become redundant and useless, as petitioner may not get sufficient water particularly during lean period. This has been disputed by opposite parties by stating that the distance between the two projects would be at least 800 metres. The petitioner has referred to several reports and contended that the distance is, in fact, hardly 200 metres. However, it is significant to note that in the detailed project report (DPR) relating to the first and undisputed project, the petitioner had indicated that the transmission line to be drawn by the petitioner would cover three power houses, one on the undisputed site as per the project report; one at a lower place already allotted to a sister concern and another about a kilometre upstream for which DPR was being prepared separately. There is no doubt that the present dispute relates to this latter site. From the aforesaid, it is obvious that the distance between the two waterfalls would be about 800 metres or more and not 200 metres as claimed by the petitioner. It appears that the petitioner has confused between the distance from his proposed power house in the undisputed site and proposed power house at the disputed site. From the aforesaid, it is obvious that the distance between the two waterfalls would be about 800 metres or more and not 200 metres as claimed by the petitioner. It appears that the petitioner has confused between the distance from his proposed power house in the undisputed site and proposed power house at the disputed site. Moreover, it is apparent from the document produced on behalf of the State Government that the Engineer-in-Chief has already advised opposite party No. 3 to maintain reasonable distance so that there would not be any difficulty in the matter of supply of sufficient water to the lower portion where the petitioner's first undisputed project is to come up. This aspect also can be ensured if ultimately opposite party No. 3 is allowed to establish the project at the upper portion. ( 11 ) AS already indicated, the learned counsel for the petitioner had laid too much emphasis on the words "project (s)" appearing at two or three places in the Memorandum of Understanding (Annexure-1 ). The learned counsel for the petitioner inferred from the incorporation of the word " (s)" that the petitioner had been permitted to establish more than one project and that is why it had been indicated as "project (s ). " A perusal of the MOU makes it clear that the word "project" and the word "project (s)" had been used rather loosely. For example, in the preamble portion, it has been indicated that the developer is desirous of setting up "a Hydro-Electric Power Station. . . . . . " and further that ". . . . . . the State Government and the developer have reached an understanding for implementation of the said project. . . . . . . " In paragraph 1 of the MOU, similarly, it has been indicated :-"the 'developer' at its own cost is desirous of and has submitted its proposal to the State Government for implementation of the proposed Middle Kolab Hydro Electric Project near Tentuliguma village, in Koraput district, hereinafter referred to as the 'said project'. "similarly, in paragraph 5 of the MOU, there is reference to the "said project. " In paragraph 6 there is reference to "implementation of the project. "similarly, in paragraph 5 of the MOU, there is reference to the "said project. " In paragraph 6 there is reference to "implementation of the project. " It is thus obvious that the opposite parties were not very particular about the exact expression and the addition or absence of the letter " (s)" in some paras is quite insignificant. It has to be kept in mind that the persons who had drafted the MOU did not have the skills of a Shakespeare or a Wordsworth while drafting the agreement. Moreover, such a contention has to be rejected as otherwise, the project would cease to be a small hydro-electric project as the capacity would exceed 25 M. W. and could not have been settled through MOU. From the correspondence between the petitioner and Government, it can nowhere be said that, in fact, the Government had intended that the petitioner would develop two small hydro-electric projects at two different though nearby places. ( 12 ) THE counsel for the petitioner has also submitted that in the past many other entrepreneurs had been allowed to establish projects total capacity of which exceeded the scheduled limit. Without any further details about such projects, it is not possible to come to a conclusion as to whether those projects were treated as separate individual projects or one combined project. Since the State Government had never given out that the petitioner would also be given the presently disputed site and since there is no material to show that the present petitioner had also submitted a report for the present disputed site at earlier point of time, there is no scope for interference in this writ application which is liable to be dismissed. It has to be noted, however, that as per the policy guidelines, the Government is required to consider the detailed project report. If the Technical Committee finds that any difficulty would be created for the petitioner if the site upstream is allotted to opposite party No. 3, that aspect has to be taken into consideration by the appropriate authority at the time of final decision. As rightly pointed out by opposite party No. 3, the matter is only at the preliminary stage and as such, the writ application can be characterized as premature so far as said aspect is concerned. ( 13 ) FOR the aforesaid reasons, the writ application is dismissed. As rightly pointed out by opposite party No. 3, the matter is only at the preliminary stage and as such, the writ application can be characterized as premature so far as said aspect is concerned. ( 13 ) FOR the aforesaid reasons, the writ application is dismissed. There will, however, be no order as to costs. All interim orders are vacated. Application dismissed.