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MANOJ MISRA, JOYMALYA BAGCHI
Rattanindia Power Limited – Appellant
Versus
Maharashtra State Electricity Distribution Company Limited – Respondent
JUDGMENT :
MANOJ MISRA, J.
1. This appeal under Section 125 of the ELECTRICITY ACT , 20031[2003 Act] impugns the order dated 06.10.2023 passed by the Appellate Tribunal For Electricity2[APTEL] in Appeal No.341 of 2023 to the extent it disallows Carrying Cost to RattanIndia Power Limited3[RPL] (the appellant) on compounding interest basis.
FACTS
2. RPL is supplying power to Maharashtra State Electricity Distribution Co. Ltd.4[MSEDCL] (first respondent) under two long term Power Purchase Agreements5[PPA] (i.e., dated 22.04.2010 and 05.06.2010 for supply of 450 MW and 750 MW, respectively) with MSEDCL.
3. In connection therewith, RPL filed a petition (i.e., Case No.84 of 2016) under Section 86 of the 2003 Act before the Maharashtra Electricity Regularity Commission6[MERC] seeking compensation on account of various Change in Law events affecting the project from the date of commencement of supply of power by RPL along with the Carrying Cost, and requested MERC to allow the compensation with effect from the date of commencement of supply.
4. MERC vide order dated 05.04.2018 had allowed certain Change in Law claims. However, it held: (i) increase in rates of Chhattisgarh Paryavaran Upkar Ce
Carrying Cost is compensable for Change in Law events, and the affected party must be restored to its original economic position, supporting claims for compound interest.
The central legal point established in the judgment is the entitlement to compound interest on carrying cost under the restitutionary principle of the PPAs, emphasizing the aim of restituting the aff....
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....
The Notification imposing Evacuation Facility Charges constitutes a change in law, entitling the affected party to compensation from that date.
(1) Condition precedent for entertaining appeal under Section 125 of Electricity Act, 2003 is existence of a substantial question – A question of law which arises incidentally or collaterally and has....
Any change resulting in a cost impact on selling electricity constitutes a Change in Law event, entitling affected parties to compensation under PPAs.
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