REPORTABLE

2026 INSC 202 IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NOS.2584-2585 OF 2026 West Bengal State Electricity Distribution Co. Ltd.

….Appellant(s)

Versus Adhunik Power & Natural Resource Ltd. & Ors.

….Respondent(s) J U D G M E N T Joymalya Bagchi, J.

1. The appeals are directed against the judgment and order dated 04.09.2025 whereby the Appellate Tribunal for Electricity (‘APTEL’) modified the order dated 29.01.2020 passed by the Central Electricity Regulatory Commission, Signature Not Verified Digitaly signed by SATISH KUMAR YADAV Date: 2026.02.27 New Delhi (‘CERC’) and directed that Respondent No.1, Reason:

Adhunik Power and Natural Resources Ltd. (‘APNRL’), was entitled to (i) compensation for coal purchased through e- auction/import to meet the shortfall in tapering linkage granted to it pending operationalization of the Ganeshpur captive coal block, and (ii) compensation on account of Change in Law events with effect from 25.08.2014 as per Article 10.2 of the PPA, Power Purchase Agreement./PSA, Power Supply Agreement., along with carrying costs till actual payment was made.

2. On 05.01.2011, a PSA was executed between the Appellant, West Bengal State Electricity Distribution Company Ltd. (‘WBSEDCL’) and Respondent No. 3, PTC India Limited, An inter-state trader of electricity. (‘PTC’)

for supply of 100 MW of power for a period of 25 years.

3. As a back-to-back arrangement on 25.03.2011, a PPA was executed between APNRL and PTC for onward sale of 100 MW of power to WBSEDCL.

4. The West Bengal Electricity Regulatory Commission vide its order dated 15.12.2011 approved the PPA/PSA.

Relevant clauses of the PPA/PSA

5. Article 10 of the PPA/PSA defines “Change in Law” events that entitle the affected party to compensation through monthly tariff payments in a manner that restores such party to the same economic position as if the Change in Law had not occurred. For better appreciation, Article 10 of the PPA/PSA is extracted hereinbelow:

“In this Article 10, the following terms shall have the following meanings:

I. Change in Law means occurrence of any of the following events:

a) the enactment, coming into effect, adoption, promulgation, amendment, modification or repeal (without re-enactment or consolidation) in India, of any Law, including rules and regulations framed pursuant to such Law;

b) a change in the interpretation or application of any Law by any Indian Governmental Instrumentality having the legal power to interpret or apply such Law, or any Competent Court of Law;

c) the imposition of a requirement for obtaining any Consents, Clearances and Permits which was not required earlier;

d) change in the terms and conditions prescribed for obtaining any Consents, Clearances and Permits or the inclusion of any new terms or conditions for obtaining such Consents, Clearances and Permits; except due to any default of the Seller;

e) any change in tax or introduction of any tax made applicable for supply of power by the Seller f) any change in law relating to Mining laws and Environment Laws or tax cess or duty affecting input cost or raw material.

II. But Change in Law shall not include:

a) Any change in any withholding tax on income or dividends distributed to the shareholders of the Seller, or b) Change in respect of UI charges or frequency intervals by an Appropriate Commission.

III. Such Change in Law could be but not restricted to any of the following cases where it, a) Results in any change in respect of tax.

b) Affects Seller’s or PTC’s obligation under this Agreement.

c) Materially affects the construction, Commissioning or operation of the Project.”

6. Article 2.2 of the PPA/PSA provides that for sale of power under the Agreement, the buyer shall pay capacity charge, non-escalable energy charge and escalable energy charge in accordance with Table A of Schedule A to the PPA/PSA. Article

2.2 of the PPA/PSA is reproduced hereinbelow:

“2.2 For sale of power under this Agreement PTC shall pay the Capacity Charges,