SC: Discoms can’t shake off DESU’s burden

The private discoms that supply electricity in the Capital would now bear liabilities such as cost of retirement or dismissal of former employees of their predecessor, Delhi Electric Supply Undertaking (DESU), following a Supreme Court verdict dismissing their appeal challenging a Delhi High Court order.

A Supreme Court bench headed by Justice V.S. Sirpukar dismissed NDPL and BSES Rajdhani Power Limited's appeals assailing the high court order that had directed them to take over the liabilities from the erstwhile DESU.

The HC had on March 30, 2006, directed the two companies to meet the liabilities of the ex-employees.

The court said: “We are of the clear opinion that these appeals do not have any merits and must be dismissed.”

The discoms had claimed they were not bound to bear the cost of retirement, removal, dismissal or compulsory retirement of employees that took place prior to July 2002, when they took over operations in Delhi.

They stated in their appeal that under the Delhi Electricity Reforms Act, 2000, the Delhi government had handed over distribution of erstwhile DESU to BSES and NDPL.

The bench interpreted the Act’s provisions and said: “It clearly puts the responsibilities of the erstwhile staff on the discoms.”

The bench declined NDPL’s contentions that it has responsibility only for those personnel who have been transferred to it post privatisation.

“We do not agree with this contention... as per schedules, it clearly fixes the responsibility on the discoms,” the court said.

The court further observed that prior to privatisation, employees were taken into confidence by assuring them that entering into a tripartite agreement among Delhi government, DVB and their associations will protect their services.

Under the agreement, the existing pensioners as well as employees were protected.