Dual Incomer - Interlock

Well, it does give the first <...contactor...> time to fully release before the second one is closed.

Doesn’t the auxiliary contact (NC) of the first contactor only comes back to its deenergised position when the main contacts of the first contactor are fully open, right?

If that's what it says on the drawing, which is difficult to read here, then that would be correct. If it is not what is shown on the drawing, then that would be incorrect.

That makes sense. However, I don’t have any motors connected to this panel—only instruments like power for PLCs, CCTV, and some lights. Will these types of loads be an issue?

In most cases, not a problem. A few cycles, 30-60 milliseconds should be enough for all well designed equipment.

So, why is 3-phase power connected to them? Ordinarily, 3-phase power is necessary for rotating objects.

Noted that there is no neutral shown on the drawing.

And, why is there any need to shut down <...PLCs, CCTV and some lights...> at all? That doesn't make any sense.

This is a valid question!. The incoming power supply is from 3 phase UPS power, since the capacity of the UPS is 150kVA (IT system) and serves several distribution boards; this being one of them.

After checking, it seems that when both the incoming power supplies are turned ON simultaneously from the upstream, there could be a chattering situation as both the incomers fights each other as to who closes first; may be a timer with very low setting would be helpful in this situation.

This is a make before break circuit, ensuring that there is no loss of power during transfer. Both being connected is not a problem because they are the same phase.

This is also sometimes called an ABT, an Automatic Bumpless Transfer.