Case Note & Summary
The appeal arose from a dispute between electricity utilities and a power generator regarding compensation claims under Power Purchase Agreements. The respondent, Adani Power (Mundra) Limited, had set up a generating station in Gujarat and entered into agreements with the appellants, Uttar Haryana Bijli Vitran Nigam Limited and Dakshin Haryana Bijli Vidyut Nigam Limited, for power supply. The Central Electricity Regulatory Commission had previously allowed compensation for certain 'Change in Law' events claimed by the generator. Subsequently, the generator filed another petition claiming compensation due to changes in coal distribution policy, leading to interim directions by the Commission. The appellants then filed an application arguing that the generator had not accounted for benefits from Inter Plant Transfer permitted under a communication from Coal India Limited dated 19th June 2013, while the generator contended this issue had already been rejected by the Commission. The generator filed Petition No. 269/MP/2018 before the Commission seeking clarifications and declarations regarding the findings on this communication. The core legal issue was whether this communication constituted a 'Change in Law' event under the agreements. The Appellate Tribunal for Electricity held it was not, and the Supreme Court was asked to review this decision. The court analyzed the nature of the communication, finding it was an operational permission rather than a change in law, and upheld the tribunal's decision, dismissing the appeal.
Headnote
A) Electricity Law - Regulatory Compensation - Change in Law Event - Electricity Act, 2003 - The dispute centered on whether a communication from Coal India Limited permitting Inter Plant Transfer of coal constituted a 'Change in Law' event under the Power Purchase Agreements - The Supreme Court upheld the Appellate Tribunal for Electricity's finding that the communication was not a 'Change in Law' event, as it did not alter the legal framework governing coal supply - Held that the communication was merely an operational permission and did not trigger compensation provisions under the agreements (Paras 1-5).
Issue of Consideration
Whether the communication dated 19th June 2013 issued by Coal India Limited constitutes a 'Change in Law' event under the Power Purchase Agreements
Final Decision
The Supreme Court upheld the judgment of the Appellate Tribunal for Electricity, holding that the communication dated 19th June 2013 was not a 'Change in Law' event
Law Points
- Interpretation of 'Change in Law' under Power Purchase Agreements
- principles of regulatory compensation
- and judicial review of tribunal decisions
