The High Court on Wednesday ordered India鈥檚 Adani Power (Jharkhand) Ltd not to begin or continue arbitration proceedings at the Singapore International Arbitration Centre until the court disposes of its pending ruling over the power firm鈥檚 payment disputes with Bangladesh government.
The bench of Justice Md Bazlur Rahman and Justice Urmee Rahman issued the injunction after hearing an application from Supreme Court lawyer M Abdul Qaiyum, who had earlier filed a writ petition challenging the 2017 power purchase agreement with Adani Power.
The lawyer told the High Court that there was a media report on November 3 that Adani Power opted for an international arbitration process to resolve disputes over Bangladesh鈥檚 power supply payments.
The company led by Indian billionaire Gautam Adani has been at loggerheads with the Bangladesh Power Development Board over pending payments for the electricity it supplies as part of a pact that both sides signed in 2017.
The latest stance from Dhaka came amid threats by Adani Power to suspend supply of about 1,400 megawatts of power from November 11 unless clearing of outstanding payment of about $496 million.
Adani Power, in a statement issued on Wednesday, said that it could not comment as it had not yet reviewed the Bangladesh High Court order.
鈥榃e would like to mention that the terms of the power purchase agreement between Adani Power and the Bangladesh Power Development Board do not place Adani Power under the jurisdiction of the Bangladesh High Court,鈥� it said.
鈥楳oreover, under the PPA, any dispute between the parties must be resolved through the Singapore International Arbitration Centre, which is also not subject to the jurisdiction of Bangladesh courts,鈥� the company said.
On November 4, energy, power and mineral resources adviser Muhammad Fouzul Kabir Khan said that Adani Power had also given similar threats in the past, but did not suspend the supply.
鈥楽till, we are looking into it,鈥� said the adviser.
On November 10, the adviser told reporters that they would clear about $100 million in Adani dues in phases over the next one month.
In June, Bangladesh cleared $437 million dues following assurance by Adani Power to re-negotiate the power purchase agreement under which Bangladesh Power Development Board buys per unit of electricity at Tk 16, at least Tk 2 higher than the prices of coal-based power generated by other private companies in the country.
Instead of re-negotiation, Adani Power has shown disposition towards an international arbitration process to resolve disputes over power supply payments by the Bangladesh Power Development Board.
The energy adviser said they would not veer away from the arbitration process when it will come at their way.
Regarding possible arbitration, Adani Power has already requested the Power Development Board to appoint an expert on mediation process to the Singapore International Arbitration Centre.
But the Power Development Board that had engaged in extensive discussion with Adani Power for amending the power purchase agreement favouring the power seller disproportionately dismissed the request.
It viewed the proposed mediation inappropriate because of complexities of the ongoing dispute over power purchase agreement now being examined by a National Committee under a directive by the High Court of Bangladesh.
Headed by retired High Court Division judge Moinul Islam Chowdhury, the five-member committee submitted its initial report on November 3 after reviewing contracts signed under the Speedy Increase of Power and Energy Supply (Special Provisions) Act, 2010, during the Awami League regime which was ousted on August 5, 2024, in the wake of a mass uprising.
The interim government that assumed power on August 8, 2024, cancelled the controversial Speedy Increase of Power and Energy Supply (Special Provisions) Act, 2010, which had allowed the AL regime to bypass tendering and other standard procedures for power and energy projects to ensure quick supply.
On November 19, 2024, the High Court had directed the interim government to form a high-powered committee of international energy, fuel and legal experts to review the controversial agreement signed with Adani Power during the previous Awami League government.
The Energy and Mineral Resources Division was instructed to form the committee within 30 days and submit a detailed report within two months. The Power Development Board was also asked to provide all records of negotiations leading up to the signing of the deal.
On Wednesday, lawyer Qaiyum told the High Court that the government had still not submitted the committee鈥檚 report.
He argued that Adani鈥檚 move to shift the dispute to SIAC and the Power Division鈥檚 participation in mediation undermined the writ process now under the High Court鈥檚 scrutiny.
He said that starting arbitration abroad would make the pending rule nisi meaningless and cause irreparable harm to the petitioner and the public.
He requested that all respondents be restrained from moving ahead with any arbitration until the High Court completes its review.
The court agreed and observed that it has the constitutional authority to issue injunctions to protect its jurisdiction and prevent its orders from being rendered ineffective.
The lawyer at the court had argued that the Adani power deal drawn widespread criticism for its alleged potential for harming Bangladesh鈥檚 energy sector and lack of transparency with the growing calls for accountability and reform.