JAIPUR VIDYUT VITRAN NIGAM LTD. & ORS. versus MB POWER (MADHYA PRADESH) LIMITED & ORS.

Citation: [2024] 1 S.C.R. 909 · Decided: 08-01-2024 · Supreme Court of India · Bench: BHUSHAN RAMKRISHNA GAVAI, PRASHANT KUMAR MISHRA · Disposal: Appeal(s) allowed

Cited by 3 judgment(s) · cites 12 · see the full citation network in Lexace

Judgment (excerpt)

* Author
[2024] 1 S.C.R. 909 : 2024 INSC 23
Jaipur Vidyut Vitran Nigam Ltd. & Ors. 
v. 
MB Power (Madhya Pradesh) Limited & Ors.
(Civil Appeal No. 6503 of 2022)
08 January 2024
 [B. R. Gavai* and Prashant Kumar Mishra, JJ.] 
Issue for Consideration
State Commission held that the tariffs offered by the L-4 and L-5 
bidders were not aligned to the prevailing market prices. In appeal 
by L-5, APTEL held that the State Commission had to necessarily 
adopt the tariff and had no power to consider whether the tariff was 
aligned to market prices. Impugned judgment of the High Court 
relying on the said judgment of the APTEL and the earlier orders 
of this Court concluded that applying the test of “filling the bucket”, 
the procurers were bound to take supply from the respondent No.1 
at the rates quoted by it and it had a right to supply power since 
there was a gap of 300 MW between the power procured by the 
procurers and the ceiling of 906 MW determined by this Court. High 
Court whether justified in issuing mandamus directing the appellants 
to take supply of 200 MW power from the respondent No.1 at the 
rates quoted by it. Power of the State Commission to go into the 
question as to whether the prices quoted are market aligned or not 
and to take into consideration the aspect of consumers’ interest.
Headnotes
Electricity Act, 2003 – ss.63, 86 – Rajasthan Rajya Vidyut 
Prasaran Nigam Limited (RVPN) filed Petition before the State 
Commission seeking approval for procurement of 1000 MW 
of power by a competitive bidding process – RFP was issued 
– Eventually, in consonance with the LoI, PPAs were signed 
with the L-1, L-2 and L-3 bidders – State Commission held that 
the quantum of only 500 MW power was liable to be approved 
considering the demand in the State as recommended by the 
EAC and it approved the tariff quoted by the L-1 to L-3 bidders 
– Appeals filed by L-2 and L-3 bidders before APTEL, allowed 
– Challenged by the appellants – Subsequently, Civil Appeals 
were filed by L-5 bidder also– Disposing of the appeals, State 
Commission was directed to go into the issue of approval for 
adoption of tariff with regard to L-4 and L-5 bidders– Further, 
910
[2024] 1 S.C.R.
Digital Supreme Court Reports
vide order dtd.19.11.18, State Commission was directed to 
go into the issue of adoption of tariff – State Commission 
held that the tariffs offered by the L-4 and L-5 bidders were 
not aligned to the prevailing market prices – Appeal filed by 
L-5 bidder, allowed by APTEL – Writ petition was filed by the 
respondent No.1 – Allowed by impugned judgment:
Held: Unlike s.62 r/w ss.61 and 64, under the provisions of s.63, 
the appropriate Commission does not “determine” tariff but only 
“adopts” tariff already determined u/s.63 – Such “adoption” is only 
if such tariff has been determined through a transparent process 
of bidding, and this transparent process of bidding must be in 
accordance with the guidelines issued by the Central Governments 
– s.86(1)(b) gives ample power to the State Commission to regulate 
electricity purchase and procurement process of distribution 
licensees – It also empowers the State Commission to regulate 
the matters including the price at which electricity shall be procured 
from the generating companies, etc. – Further, orders relied upon 
by the APTEL, specifically the order dtd. 19.11.2018, clarified 
that the State Commission was to decide the tariff u/s.63 having 
regard to the law laid down both statutorily and by this Court – As 
such, the State Commission was bound to take into consideration 
the Bidding Guidelines notified by the Central Government, and 
specifically clause 5.15 thereof – State Commission justified in 
considering the Clause 5.15 of the Bidding Guidelines which 
specifically permits to reject all price bids if the rates quoted are 
not aligned to the prevailing market prices – APTEL grossly erred 
in holding that the State Commission has no power to go into the 
question, as to whether the prices quoted are market aligned or not 
and also not to take into consideration the aspect of consumers’ 
interest – It cannot be read from the orders of this Court that the 
State Commission was bound to accept the bids as quoted by 
the bidders till the bucket was filled – No such direction can be 
issued by this Court de hors the provisions of ss.63 and 86(1)(b) 
and the Bidding Guidelines – Since the decision-making process 
adopted by the Bid Evaluation Committee approved by

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