NEW DELHI: The Supreme Court on Wednesday approved the out-of-court settlement arrived at between the Maharashtra Government and Dabhol Power Corporation (DPC) — GE and Bechtel, thus putting an end to the litigation and clearing the decks for revival of the power plant.A Bench, comprising Justice S. N. Variava and Justice A. R. Lakshmanan, approved the Rs.1330-crore settlement that was put in place by the July 12 International agreement among the parties concerned and disposed of the five petitions pending before the apex court.

The National Thermal Power Corporation (NTPC) and the Gas Authority of India Ltd (GAIL) had formed a joint venture — Ratnagiri Gas and Power Private Limited (RGPPL) to take over the project. Senior counsel Fali S. Nariman and T. R. Andhyarujina explained to the Bench the terms of the settlement and said they wanted to give a quietus to the litigation. The Bench then ordered disposal of all pending litigation in terms of the settlement. According to the settlement, a total of 3,226,736,924 shares (equivalent to 85.85 per cent of the total issued, subscribed and paid up capital) of DPC, which earlier belonged to GE, Bechtel and Enron, would stand transferred to New Age Power Company Private Ltd, a special purpose vehicle floated by GE and Bechtel.

As per the consent terms, the court set aside as null and void all resolutions passed at the meeting of the Board of Directors of DPC held on June 4, 2002 and ordered that till the share transfers took place in favour of New Age, there would be six Directors in the new DPC Board — two each from Maharashtra Power Development Corporation Limited (MPDCL), New Age and Indian financial institutions. It said that both GE and Bechtel had reached an agreement with domestic financial institutions earlier this month from which they had borrowed money for the investment. The GE and Bechtel would be getting $145 million and $160 million respectively. The GE and Bechtel held 85.85 per cent shares of DPC of which they had 10 per cent each originally and the two had acquired 65.85 per cent of the now defunct Enron in the DPC. The NTPC with a 50 per cent stakeholder in Ratnagiri Gas and Power Limited would invest Rs. 500 crores as equity capital. The GAIL would pump in another Rs. 500 crores.

The plant lying idle for over four years would be transferred to Newage Power Company and then to Ratnagiri. The MPDCL had signed an agreement with the companies to purchase electricity.

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