SUPREME COURT OF INDIA
B.R. GAVAI, VIKRAM NATH, JJ.
Uttar Haryana Bijli Vitran Nigam Limited and Another – Appellants
Versus
Adani Power (Mundra) Limited and Another – Respondents
Civil Appeal No. 5684 of 2021
Decided On : 20-04-2023
Electricity Act, 2003 – Section 63 – Power Purchase Agreements – Grant of relief for shortfall on account of change in Law – Concurrent view taken by CERC & APTEL cannot be said to be a view taken in ignorance of mandatory statutory provisions nor can it be said that it is based on extraneous consideration – View also cannot be said to be ex-facie arbitrary or illegal – As such, no interference would be warranted in present appeal – Appeal dismissed. (Paras 13 and 14)
Result : Appeal dismissed.
JUDGMENT :
B.R. GAVAI, J.
1. The present appeal challenges the judgment and order dated 30th June 2021, passed by the Appellate Tribunal for Electricity, New Delhi (hereinafter referred to as “APTEL”) in Appeal No. 358 of 2019, thereby dismissing the appeal filed by the Uttar Haryana Bijli Vitran Nigam Limited and Dakshin Haryana Bijli Vitran Nigam Ltd. (hereinafter referred to as “Haryana Utilities”) appellants herein, and maintaining the judgment and order dated 13th June 2019 passed by the Central Electricity Regulatory Commission (hereinafter referred to as “CERC”) in Petition No. 251/MP/2018.
2. The facts, in brief, giving rise to the present appeal are as under:
Haryana Utilities had entered into two Power Purchase Agreements (for short “PPA”) dated 7th August 2008 with the first respondent-Adani Power (Mundra) Limited (hereinafter referred to as “AP(M)L”) for a contracted capacity of 1424 MW from the generating Units 7, 8 and 9 established by AP(M)L in the State of Gujarat on the terms and conditions contained in the said PPAs. The said PPAs were entered into between Haryana Utilities and AP(M)L in pursuance to a Tariff Based Competitive Bidding Process initiated by the Haryana Utilities under Section 63 of the Electricity Act, 2003 as per the guidelines notified by the Central Government.
3. AP(M)L filed a petition being Petition No. 155/MP/2012 on 5th July 2012 seeking, inter-alia, relief of increase in tariff from the quoted tariff mentioned in the bid on various grounds. The CERC had passed orders in the said petition on 2nd April 2013 and 21st February 2014. The said orders were challenged before the APTEL. Finally, a batch of appeals challenging the order of APTEL reached this Court by way of Civil Appeal Nos. 5399-5400 of 2016. This Court, in the case of Energy Watchdog vs. Central Electricity Regulatory Commission and Others, (2017) 14 SCC 80, decided on 11th April 2017, observed thus:
“57. Both the letter dated 31-7-2013 and the revised Tariff Policy are statutory documents being issued under Section 3 of the Act and have the force of law. This being so, it is clear that so far as the procurement of Indian coal is concerned, to the extent that the supply from Coal India and other Indian sources is cut down, the PPA read with these documents provides in Clause 13.2 that while determining the consequences of change in law, parties shall have due regard to the principle that the purpose of compensating the party affected by such change in law is to restore, through monthly tariff payments, the affected party to the economic position as if such change in law has not occurred. Further, for the operation period of the PPA, compensation for any increase/decrease in cost to the seller shall be determined and be effective from such date as decided by the Central Electricity Regulation Commission. This being the case, we are of the view that though change in Indonesian law would not qualify as a change in law under the guidelines read with the PPA, change in Indian law certainly would.
58..........The Central Electricity Regulatory Commission will, as a result of this judgment, go into the matter afresh and determine what relief should be granted to those power generators who fall within Clause 13 of the PPA as has been held by us in this judgment.”
4. In pursuance to the aforesaid order passed by this Court, AP(M)L filed a petition being Petition No. 97/MP/2017 before the CERC, claiming relief on the ground of Change in Law. The CERC, vide order dated 31st May 2018, allowed the said petition in terms of Change in Law.
5. A review petition being Review Petition No. 24/RP/2018 was also filed by the Haryana Utilities before the CERC. The CERC, vide judgment and order dated 3rd December 2018, rejected the said review petition. Being aggrieved thereby, the appellants filed an appeal before the APTEL. The APTEL, vide judgment and order dated 3rd November 2020, dismissed the said appeal. Challenging the same, Civil Appeal No. 4143 o
Energy Watchdog v. Central Electricity Regulatory Commission and Others
Court should be slow in interfering with decision taken by expert bodies.
Any change resulting in a cost impact on selling electricity constitutes a Change in Law event, entitling affected parties to compensation under PPAs.
Expert bodies' decisions should not be interfered with unless they violate statutory provisions or are arbitrary.
The court upheld that coal supply from power generation must be allocated equitably among all electricity distribution companies, as mandated by regulatory guidelines, rejecting attempts to prioritiz....
Definition of “Law” is wide enough to include all rules, regulations, orders, notifications by Governmental instrumentalities.
The term “Law” in the PPAs would include all applicable rules, regulations, orders, Notifications issued by an Indian Governmental Instrumentality and shall also include all rules, regulations, decis....
Writ petitions challenging regulatory fixation of normative O&M charges as tariff component not maintainable due to statutory appeal to expert Appellate Tribunal under Electricity Act, absent jurisdi....
Tariff determination for hydro projects with enhanced capacity, binding nature of prior PPAs on successors, and writ jurisdiction limited; exclusive domain of regulatory commission, not courts, to fi....
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