An interim order allowing a third party to participate in a utility's statutory inquiry to ensure transparency and factual accuracy is not perverse and does not warrant interference under Article 136, despite the Electricity Act being an exhaustive code.

ORDER :

1. This Special Leave Petition is filed against the interim order dated 05.02.2026 passed by the High Court¹[High Court of Jharkhand at Ranchi in W.P. (PIL) No. 3347 of 2025.] by which an interlocutory application filed by petitioner no.1 raising an objection to the maintainability of the Public Interest Litigation (PIL) filed by respondent no.1 was rejected and the same was held to be maintainable.

2. The facts giving rise to the present Special Leave Petition, briefly stated, are that petitioner no.1 entered into an agreement with Jharkhand Bijli Vitran Nigam Ltd. (JBVNL) for supply of surplus power from the captive power plant of petitioner no.1 to petitioner no.2 on 17.05.2012 (CPP Agreement), which was renewed in the years 2017 and 2023.

3. Respondent no. 1, ‘Energy Watchdog’ made a complaint on 15.04.2024 to the Additional Chief Secretary, Department of Energy, State of Jharkhand. In the complaint, it was alleged that petitioner no.2 is using the power generated from the Captive Power Generation Unit set up by petitioner no.1 without holding a valid ‘captive user’ status in accordance with Rule 3 of the Electricity Rules, 2005 (the Rules). Respondent no.1, therefore, sought action against petitioner no.1 under Section 135 of the Electricity Act, 2003 (the Act). According to respondent no.1, on the basis of the aforesaid complaint, on 28.06.2024, the Government of Jharkhand and JBVNL initiated a fact-finding inquiry against the petitioners.

4. Respondent no.1 filed a PIL seeking a declaration that supply of electricity by petitioner no.1 to petitioner no.2 in the absence of any Open Access Approval and without satisfying the statutory conditions of captive status under the Act and the Rules, is illegal and unauthorised. Respondent no.1 in the said PIL sought a direction to the authorities of the State Government to conduct a detailed investigation into unauthorised power supply between the petitioners and further sought a direction to the authorities to recover the loss caused to the state utility due to illegal sale of electricity.

5. On 26.08.2025, JBVNL issued show cause notices to the petitioners on the allegations that they have breached the terms and conditions of the CPP Agreement and have supplied power without consent of JBVNL and have violated the right of first refusal of JBVNL. On 26.08.2025, the JBVNL issued a demand notice to the petitioners seeking payment of cross subsidy surcharge to the tune of Rs.176.74 crores as against petitioner no.1 and a sum of Rs.108.17 crores qua petitioner no.2.

6. Petitioner no.1 filed an interlocutory application raising a preliminary objection to the maintainability of the PIL. The High Court, by an interim order dated 05.02.2026, inter alia held that the affidavit of JBVNL discloses that, prima facie, there is some substance in the allegation made in the petition and the averments made therein are sufficient to reject the objection to the maintainability of the PIL. The High Court, while deciding the interlocutory application, and while noting that even though respondent no.1 is not privy to the contract between JBVNL and petitioner no.1, in the peculiar facts of the case, directed that the interest of justice would be better served if respondent no.1 is also heard along with the petitioners in the proceedings pending pursuant to the show cause notice issued by JBVNL. In the aforesaid factual background, this Special Leave Petition arises for our consideration.

7. Dr. A.M. Singhvi, learned Senior Counsel for the petitioners submits that respondent no.1 is a stranger having no right and not having suffered any legal injury. He, therefore, argues that respondent no.1 cannot be treated as a person aggrieved and thus, has no locus to maintain the Writ Petition. It is urged that the Act is a comprehensive and self-contained statutory framework governing regulation, adjudication and compliance within the electricity sector. It is contended that the High Court could not have judic