Supreme Court Lifts Stay Order on Dadra & Nagar Haveli, Daman & Diu DISCOM Privatization

The Supreme Court of India has lifted the suspension order imposed by the Bombay High Court on the distribution company (DISCOM) privatization process, according to the update provided to the Bombay Stock Exchange by Torrent Power. The tendering process for a 51% equity share in the power DISCOMs for the union territories of Dadra & Nagar Haveli and Daman and Diu, was earlier halted due to the court order.

The High Court had suspended the auction after public interest litigation was filed against the privatization of the DISCOM.

In the auction held in March this year, Torrent Power had emerged as the highest bidder to acquire the DISCOM in the union territory of Dadra & Nagar Haveli and Daman and Diu.

The acquisition was part of the Government of India’s initiative to privatize DISCOMs to make them more efficient.


In December last year, Dadra & Nagar Haveli and Daman and Diu had invited bids to acquire a 51% stake in its DISCOM, responsible for the distribution and retail supply of electricity.

Under the arrangement, Torrent Power would distribute nearly 25 BU of power to over 3.8 million customers and cater to a peak demand of over 5,000 MW.

In January this year, the Supreme Court had issued similar orders, placing a hold on a stay order put in place by the High Court of Punjab and Haryana to privatize Chandigarh’s DISCOM.

Earlier in September last year, the Ministry of Power had issued draft standard bidding documents to select bidders for acquiring a majority stake in the distribution licensees for the distribution and retail sale of electricity.

Last year, the central government came up with a proposal to privatize DISCOMs in the union territories. DISCOMs in the union territories come under the administration of the central government while the respective state governments govern those in the states. The UTs include Andaman and Nicobar Islands, Chandigarh, Dadra and Nagar Haveli, and Daman and Diu, Delhi, Jammu and Kashmir, Lakshadweep, Ladakh, and Puducherry.

In January this year, Tata Power had announced its takeover of Western Electricity Supply Company of Odisha and Southern Electricity Supply Company of Odisha. In December 2019, Tata Power was awarded the letter of intent by the Odisha Electricity Regulatory Commission to distribute and supply the electricity in Odisha’s five circles that constitute the Central Electricity Supply of Odisha.

Earlier, Mercom had written about the business models through which DISCOMs could be privatized. These could vary from licensing, distribution franchisee, and profit-sharing models. Despite the $900 billion relief package provided to the DISCOMs, the DISCOMs owed $124.2 billion (~$1.66 billion) to renewable energy generators (excluding disputed amounts) in overdue payments across 193 pending invoices at the end of May 2021.