Kathmandu, March 13:

Refusing to issue a stay order in the Upper Karnali Hydropower Project case, the Supreme Court today permitted the government to go ahead with the implementation of the understanding reached with Hyderabad-based GMR Energy Limited on the 300-MW power project.

A division bench of Chief Justice Kedar Prasad Giri and Justice Ram Kumar Prasad Shah refused to issue a stay order, and said the constitutional and legal questions raised by the petitioners will be settled by the court while delivering a final verdict on the case.

“The question whether the understanding needed a parliamentary approval or not will be decided while delivering the final verdict,” the bench stated.

The bench said: “Though the water flowing in a river is a natural resource, further discussion is required to decide on whether electricity generated from it is a natural resource or not, and whether an MoU signed with any national, international or joint venture company is a treaty or not.”

Advocates Bal Krishna Neupane, Borna Bahadur Karki, Tika Ram Bhattarai, Bhimarjun Acharya and Kamal Nayan Panta pleaded on behalf of the petitioners while Attorney General Yagya Murti Banjade and Deputy Attorney General Narendra Prasad Pathak defended the government.

Advocates Bharat Raj Upreti, Sushil Kumar Pant, Anil Kumar Sinha and Amarjivi Ghimire pleaded on behalf of the GMR Energy Limited.

Gorakha Bahadur BC of Kalikot and Ram Singh Rawal of Surkhet had jointly challenged the understanding reached between the government and the GMR Energy Limited to generate 300-MW hydropower from the Karnali River.

The counsels of the petitioners claimed that the signing of the agreement between the government and the GMR Energy Limited was unconstitutional.

They also claimed that it was a treaty related to sharing of a natural resource, and that the government violated the constitution by not seeking a parliamentary approval for it.

The constitution says any treaty related to sharing of natural resources must be approved by a two-thirds majority of the parliament.

The government however claimed that the Memorandum of Understanding was not related to sharing of natural resources and it did not need a parliamentary approval.