The Madras High Court on Wednesday questioned whether the state government would provide a sovereign guarantee for temple funds invested by the Hindu Religious and Charitable Endowments (HR&CE) department in the Tamil Nadu Power Finance Corporation (TNPFC).
Court's Query During Hearing
A vacation bench comprising Justice G.R. Swaminathan and Justice V. Lakshminarayanan raised the query while hearing a public interest writ petition. The petition sought to quash the amendment of statutory rules under the HR&CE Act, which permits the deposit of temple funds in state-owned non-banking finance corporations such as TNPFC. The PIL was filed by T.R. Ramesh.
Government's Response
In response, Advocate-General Vijay Narayan submitted that the Tamil Nadu Power Distribution Corporation and transport corporations are backed by the state government, and the latter will not allow their financial health to deteriorate.
Senior counsel S. Ravi, representing the petitioner, questioned how temple funds amounting to Rs 2,700 crore could be invested in TNPFC, which lends 90% of its loans to debt-ridden power utilities like TNPDCL.
Further Proceedings
When the Advocate-General submitted that there has not been a single instance of default in interest payments by the power distribution company, the judges asked if the state government would provide a sovereign guarantee for the temple funds invested in TNPFC. The government sought time to file detailed counter-affidavits. The case was adjourned to Friday for further hearing.
