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ESCROW AGREEMENT
Between
DELHI POWER SUPPLY COMPANY LTD.
and

SOUTH WEST DELHI ELECTRICITY
DISTRIBUTION COMPANY LIMITED

 
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THIS AGREEMENT is made on the 27th day of June 2002, effective 1st day of July 2002 by and between :

DELHI POWER SUPPLY COMPANY LIMITED, a Company incorporated under the Companies Act, 1956 and having its registered office at Shakti Sadan, Kotla Marg, New Delhi - 110019 (hereinafter referred to as "Transco" which expression shall unless repugnant to the context or meaning thereof include its successors and permitted assigns) of the One Part; and

South West Delhi Electricity Distribution Company Limited a company incorporated under the provisions of the Companies Act, 1956 and having its registered office at Shakti Bhawan, Nehru Place, Delhi-110002 (hereinafter referred to as "Company" which expression shall unless repugnant to the context or meaning thereof, include its successors and assigns) of the Other Part;

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RECITALS
   
A.

The COMPANY has been incorporated as a limited company under the Companies Act, 1956 to undertake the business of distribution and retail supply of electricity in the areas listed in part I of Schedule 'H' of the Transfer Scheme (Annexed as Schedule A)(hereinafter called the "specified Area"); the certificate of incorporation was granted by the Registrar of Companies, NCT of Delhi on July 4, 2001 and the certificate of commencement of business was granted on December 31st, 2001.

B

Transco will be the bulk supplier of electricity to the company and both transco and the COMPANY shall be governed by the regulations, directions and orders of the Delhi Electricity Regulatory Commission (hereinafter called the "Commission"), initially constituted under Section 17 of the Electricity Regulatory Commissions Act, 1998 and recognised in terms of section 3 of the Delhi Electricity Reform Act, 2000, in regard to the terms and conditions of the bulk supply of electricity including the tariffs.

C

Transco and the COMPANY have signed an Agreement dated June 2002 (hereinafter called the "Bulk Supply Agreement") for bulk supply of electricity by Transco to the COMPANY on the terms and conditions contained in the Bulk Supply Agreement, a copy whereof is attached hereto and duly initialed by the parties;

D

In terms of the Bulk Supply Agreement, the COMPANY is required to duly secure Transco, amongst others, by establishing an irrevocable arrangement for payment of all the amounts becoming due to Transco form the COMPANY under the Bulk Supply Agreement of otherwise under the Bulk Supply Tariff orders or directions issued by the Commission;

E

Transco and the COMPANY have agreed on an escrow mechanism for due payment of the amount failing due from the COMPANY to Transco under the Bulk Supply Tariff orders or directions issued by the Commission;

F

Transco and the COMPANY shall mutually agree on a Nationalised/Scheduled Bank having operations in the specified Area as Escrow Agent (hereinafter called the Escrow Agent).

   
NOW THIS AGREEMENT WITNESSETH AS UNDER
   
1.

Transco and the COMPANY shall within 60 days from the date of the transfer as defined in the Delhi Electricity Reform (Transfer Scheme) Rules 2001 identify a Nationalised/Scheduled Bank upon mutual agreement by the Company, Bank and Transco, the COMPANY shall appoint the Bank to be mutually agreed to by them and upon such identification the said Bank shall be appointed as the Escrow Agent shall then sign a tripartite agreement containing the terms of this Agreement with such modifications as the parties and the Bank may mutually agree in writing

2.

The COMPANY hereby irrevocably and unconditionally agree that upon any default by the COMPANY in the payment of dues, by the due date, to Transco under the Bulk Supply Agreement, the receivable for the electricity sold or supplied by the COMPANY shall be first deposited or remitted or caused to be deposited by the COMPANY in an account to be maintained by the Escrow Agent (hereinafter called the "Escrow Account"). Cash received towards payment of any receivable of the COMPANY shall be deposited by the COMPANY in the Escrow Account in the same manner within 72 hours and such cash realised shall not be utilised for any other purpose. The Agreement with Escrow Agent as mentioned in Clause 1 above shall provide for the working of the Escrow Mechanism including opening and maintenance of Collection Accounts by the COMPANY in which all the receivable will be collected, the remittance of the amount so collected to the Escrow Account and the manner of utilisation of the amount in the Escrow Account to be allowed by the Escrow Account consistent with the terms of this Agreement and the Bulk Supply Agreement.

3.

The COMPANY shall not given credit or make any adjustment against the receivables for any payment due from the COMPANY to the consumer on other accounts. The COMPANY shall ensure that no other person is authorised to utilise or appropriate any part of the receivables contrary to the above.

4.

Subject to clause 5.9 of the Bulk Supply Agreement, the COMPANY and Transco shall unconditionally and irrevocably authorised the Esrow Agent to make payment from the Escrow Account to Transco and discharge all outstanding dues of COMPANY under the Bulk Supply Agreement.

Provided however during the period till 31st March 2004, the COMPANY shall be entitled to utilise the receivables in priority for payment of salary, wages and other statutory payment related and restricted to personnel of the COMPANY. This relaxation in the Escrow shall be without in any manner affecting the liability of the COMPANY to Transco for any shortfall in the payment by reason of utilisation of receivables for payment towards personnel related liabilities.

5.

Without prejudice to its other rights and subject to Clause 5.9 of the Bulk Supply Agreement, Transco shall have the charge over all receivables of the COMPANY as provided in the Bulk Supply Agreement and the Escrow Agent such acknowledge and accept the same.

6.

It is clarified that notwithstanding anything contained in the Agreement, unless there is a subsisting default by the COMPANY in payments to Transco, the COMPANY shall be entitled to utilise all or any of the receivables without the need to deposit the same in the Esrow Account. For so long as there is as subsisting default by the COMPANY all the monies in the Ecrow Account shall be utilised only as specified in the Bulk Supply Agreement. The COMPANY shall be entitled to utilise any of the monies in the Escrow Account only after full payment and discharge of all outstanding amount to Transco under the Bulk Supply Agreement.

7.

This Agreement read with the Bulk Supply Agreement constitutes the entire agreement between the parties with respect of the matters dealt with herein and supersedes any previous agreement, discussions, correspondence, meetings, facsimile transmissions, letters, communication, telexes, understandings and arrangements between the parties or any of them in relation to such, matters.

8.

Without prejudice to any liability for fraudulent misrepresentation each of the parties hereby acknowledges that in entering into this agreement it has not relied on any representation, warranty, condition or assurance save as expressly set out herein and any implied representation, warranty, condition or assurance is hereby expressly excluded.

9.

No variation of this agreement shall be valid or effective unless agreed to in writing by all the parties.

10.

This Agreement shall be governed by and construed in accordance with Indian Law and the parties irrevocably submit to the jurisdiction of the appropriate courts in Delhi.

11.

The COMPANY shall obtain, maintain and comply with all authorisation, licenses and consents for operation of the Escrow Account at its own cost and pay any taxes, fee, charges or duties including stamp duty or registration fees as may be required from time to time without raising any debit in the Escrow Account.

12.

The COMPANY shall indemnify the ESCROW Agent against any financial liability which may arise while the Escrow Agent discharges his duties and functions as per Tripartite Agreement to be signed with the Escrow Agent.

13

The time an date wherever mentioned shall be of the essence in this Agreement in fulfillment of all the covenants and conditions of performance of obligations of the parties including the Escrow Agent.

14.

The Askew Agent shall be appointed and shall act as an agent of the COMPANY and shall have all powers to operated the Escrow Account to fulfill its obligations under the agreement. The Escrow Agent shall not be removed or otherwise replaced or his authority curtailed or restricted without the prior consent of Transco and the COMPANY

15.

Except as otherwise expressly provided elsewhere in this agreement all notices and/or communications which are required and permitted to be in writing and shall be sufficient if delivered personally by registered, speed post, facsimile or telegram shall be addressed as follows :

  DELHI POWER SUPPLY COMPANY LIMITED

Company Secretary

Shakti Sadan,

Kotla Marg,

New Delhi-110002
   
  South West Delhi Electricity Distribution Company Limited

Company Secretary

Shakti Bhawan,
  Nehru Place

New Delhi-110019

 

16.

Dispute Resolution

 

Any dispute arising under or in connection with this Agreement, if not mutually resolved within 30 days from the date the dispute is raised by either party and notified to the other, shall first be referred tot eh Chief Executives of Transco and the COMPANY for amicable resolution over a period of 30 days from the date of reference to the Commission for resolution in accordance with the matter shall be referred to the Commission under Delhi Electricity Reform Act, 2000.

   
 

IN WITNESS WHERE OF THIS AGREEMENT HAS BEEN SIGNED ON BEHALF OF THE PARTIES HERETO THE DAY AND YEAR FIRST WRITTEN ABOVE.

 
Signed By
for and on behalf of

DELHI POWER SUPPLY COMPANY LIMITED

   
  By Ramesh Chandra
  Director
   
  Signed By
for and on behalf of
  South West Delhi Electricity Distribution Company Limited
   
  By Jagdish Sagar
  Director


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