# Teq Green Power XIII Private Ltd. Vs. REMC Ltd. W.P.(C) 17599/2022 & CM APPL. 56263/2022

> HC judgment dated 2023-03-21. Citation: TCN-2023-HC-00074. TEQ Green Power XIII Private Limited filed a writ petition challenging the decision by REMC Limited…

- **Court:** HC
- **Order date:** 21 Mar 2023
- **Citation:** TCN-2023-HC-00074
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/teq-green-power-xiii-private-ltd-vs-remc-ltd-wp-4841ad32

## Summary

### Background

TEQ Green Power XIII Private Limited filed a writ petition challenging the decision by REMC Limited to disqualify them from participating in a tender process for the procurement of 1000 MW of Round-the-Clock Power from Grid-Connected Renewable Energy Power Projects. The disqualification was based on REMC's assessment that TEQ Green Power's net worth did not meet the required criteria after excluding the value of redeemable preference shares issued by its parent company, O2 Power. The petitioner contends that preference shares should be included in the calculation of net worth as per the Companies Act.

## Facts

REMC Limited issued a Notice Inviting Tender (NIT) for the selection of project developers for the supply of 1000 MW Round-the-Clock (RTC) Power from Grid-Connected Renewable Energy (RE) Power Projects. TEQ Green Power XIII Private Limited, a wholly-owned subsidiary of O2 Power SG PTE. LTD, submitted a bid. REMC Limited disqualified TEQ Green Power XIII Private Limited from the tender process, stating that its net worth was below the required threshold after excluding redeemable preference shares issued by O2 Power. TEQ Green Power XIII Private Limited challenged this disqualification, arguing that the preference shares should be included in the calculation of net worth as per the Companies Act. The dispute centers on whether redeemable preference shares should be

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## Issues and analysis

### Issue 1: Whether the value of redeemable preference shares should be included in the calculation of 'net …

**Ratio:** Net worth, as defined under Section 2(57) of the Companies Act, includes paid-up share

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**Reasoning:** The court reasoned that the Companies Act does not explicitly exclude preference shares

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**Interpretation:** The court interpreted the relevant sections of the Companies Act to mean that

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**Application:** The court applied this ratio to the facts of the case, finding that the

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## Parties

- **Judges:** THE CHIEF J…; Subramonium…
- **Appellants:** TEQ GREEN POWER…
- **Respondents:** REMC LI…

## Timeline

- **2022-07-14 — Notice Invitin…**: REMC Limited issued a Notice Inviting Tender (NIT) being NIT No:…
- **2022-11-09 — Submission of…**: The Petitioner submitted the relevant documents along with the technical bid and…

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