Orissa HC stays construction of KVK Nilachal project

Uncertainty looms large over the Rs 5,000-crore 1050 Mw thermal power project of KVK Nilachal Power (P) Ltd at Kandarei in Cuttack district with the Orissa High Court staying the construction work of the project.

A two-member bench of the Orissa High Court comprising of acting chief justice IM Quddusi and justice BK Nayak asked AMS Raju, director of KVK Nilachal Power Private Ltd (KVKPL), K Vijaya Kumar, managing director of KVKP and M/S KVK Energy and Infrastructure (P) Ltd. “not to do any activities in Orissa” until further order.

The construction work of the project was slated to start from November.

The stay order of the court follows filing of public interest litigation (PIL) by a person named Narendra Kumar Mohapatra.

In his PIL, Mohapatra stated that he strongly doubts diversion of Satyam Computer Services’ fund in the form of equity participation to the KVK Nilachal project through KVK Energy and Infrastructure (P) Ltd and Maytas Infra (P) Limited. While suspecting the motive of the promoters, the petitioner has requested the court to issue a directive for a CBI order into the scam.

However, the company is yet to receive the court’s order. “We are yet to get a copy of the Orissa High Court order but we will comply with any order of the court”, a company official said.

It may be noted, the project was at an advanced stage and the construction was to start from November 2009.

The company obtained the environmental clearance and water permission and received the coal linkage.

The financial closure for the first unit (350 Mw) was achieved and the Power Trading Corporation (PTC) had expressed interest to participate in the equity of the project.