MSEB misses deadline for payments to Enron

MSEB misses deadline for payments to Enron
PRAFULLA MARPAKWAR

MUMBAI, FEB 1: Maharashtra State Electricity Board (MSEB) today missed the deadline for payments to Dabhol Power Company (DPC). Officials of DPC, who met the MSEB chairman on Thursday, have now decided to chalk out a course of action within a couple of days -- DPC is likely to serve a notice to the Central Government to invoke a counter-guarantee issued to it, say officials.

``Since the deadline set by us ended today, our officials personally called on MSEB Chairman Vinay Bansal for recovery of Rs 90 crore. Bansal expressed his inability to clear the dues, saying since the state government has not released financial assistance, he was unable to help. Now our officials will meet in a day or two to decide the future course of action,'' Jimmy Mogal, Regional Vice President, DPC said.

The DPC had on January 25 served a notice to invoke the state government's guarantee for recovering Rs 90 crore from MSEB. The notice, inter alia stated that since the government has taken the guarantee, it should clear the bills by February 1.

Mogal said since there was no response, now the DPC has two options. Either to invoke the letter of credit or approach the centre with a similar notice. ``DPC will decide on the options in a day or two,'' Mogal said.

Finance Minister Jayant Patil confirmed that his government did not clear the dues despite a legal notice from DPC. ``We have not paid the money. Now it is for DPC to decide the future course of action,'' Patil said.

According to a senior official, DPC is now likely to serve a notice on the Centre for recovery of the arrears. ``If a notice for invoking the counter guarantee is served on the Centre, we don't think it will wait for a week, but clear the dues the same day and the same will be deducted from the Central grants earmarked for Maharashtra,'' the official said.

A senior official described as political the decision of the government not to bail out the MSEB. ``At a juncture when the government has failed to curb administrative expenditure, no one will believe that it is not in a position to release Rs 90 crore for the DPC,'' the official said.

The official said, since the government has signed the counter guarantee, it cannot shirk its responsibility. ``The decision has adversely affected the credibility of the government in the international market. It will have an adverse impact on future foreign investments,'' the official added.