The high court bench of justices Jitendra Chauhan and Vivek Puri acted on the plea of UT Powermen Union, a worker’s collective that had challenged the move to privatise 100% distribution and supply functions of the electricity wing of UT’s engineering department.

Even as the detailed order was awaited, by the evening, the administration said it will file a review petition. “We will first file a review in the HC, failing which we will move the Supreme Court," said UT adviser Manoj Parida.

The decision to privatise the department was taken on May 12 after directions from the Centre. An empowered committee has been constituted to oversee and implement the process. The administration has assured the Centre that the process will be completed by the end of this year.

As many as 17 firms, including Adani Transmission Limited, Tata Power Company Limited, GMR Generation Asset Limited, NTPC Electricity Supply Limited and Sterlite Power, have expressed interest after the administration on November 9 invited bids for privatisation, which primarily involves the distribution of electricity supply.

“The electricity department caters to a city with relatively low demand of around 400MW. If privatised, the efficiency is expected to improve, specifically of the distribution of power," said a UT official, not wishing to be named.

Not sustainable in law, argue powermen

The union had sought quashing of the decision to privatise the department and subsequent process of tendering initiated by the administration.

The court was told that the administration is selling 100% stake of the government in the absence of such a provision under Section 131 of the Electricity Act, 2003. As per Section 131 (2), the power department cannot be transferred to a totally private entity with no stake or control of the government at all, the court was informed.

The department is running into profits and its revenue has been surplus for the past three years, the court was told, adding that the current system is economically efficient with transmission and distribution losses less than the target of 15% fixed by the power ministry.

It was pointed out that the transfer scheme has been prepared without calling for objections from all stakeholders — neither employees nor consumers. “In the absence of an advise from the advisory committee to the Joint Electricity Regulatory Commission (JERC) and without there being any recommendation of the JERC to that effect, privatisation of electricity wing of UT is not sustainable in the eyes of law," it was argued.

Issue has led to several protests, strike