SC puts stay on Himachal Pradesh High Court’s penalty order on Jaiprakash Associates

21 Mar 2013

In an interim relief to infrastructure company Jaiprakash Associates, the Supreme Court has put a stay on Himachal Pradesh High Court’s order, till its next hearing, which is scheduled to be held on April 20, 2013. The order required Jaypee Group’s firm to pay Rs 100 crore as penalty for setting up its captive thermal power plant fraudulently bypassing environmental clearance. Thus, with this order, the firm will not have to pay its second installment of Rs 25 crore, due on March 31, 2013, until further order by Supreme Court.

The Jaypee group firm, on February 4, 2013, while seeking early hearing in the matter, had expressed its difficulty in arranging funds to pay off its second installment of Rs 25 crore, due on March 31, to the Supreme Court. A bench headed by chief justice Altamas Kabir agreed for an early hearing even though the environment ministry and the state government opposed the plea saying that there is no stay on the Rs 100-crore fine imposed on the company.

The HC, back in May 4, 2013, had also directed the Jaypee group company to dismantle its 60-MW captive power plant within three months, but had allowed its 1.75-million-tonne cement plant in Solan to stay.

The company argued that State Electricity Board (SEB) had granted no objection in setting up 25- MW multi-fuel based power plant for captive use in April 2006, which was later withdrawn in 2007. According to company, the HC had wrongly ordered dismantling of the power plant which was never put up.

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