MAHARASHTRA STATE ELECTRICITY DISTRIBUTION COMPANY LIMITED versus ADANI POWER MAHARASHTRA LIMITED & ORS.

Citation: [2023] 8 S.C.R. 85 · Decided: 03-03-2023 · Supreme Court of India · Bench: BHUSHAN RAMKRISHNA GAVAI · Disposal: Dismissed

Cited by 2 judgment(s) · cites 4 · see the full citation network in Lexace

Judgment (excerpt)

A
B
C
D
E
F
G
H
85
   [2023] 8 S.C.R. 85
85
MAHARASHTRA STATE ELECTRICITY DISTRIBUTION
COMPANY LIMITED
v.
ADANI POWER MAHARASHTRA LIMITED & ORS.
(Civil Appeal No. 684 of 2021)
MARCH 03, 2023
[B. R. GAVAI AND VIKRAM NATH, JJ.]
Power – Long-term Power Purchase Agreements (PPAs) –
Supply of coal to power producers – Change of New Coal
Distributional Policy, 2007 (NCDP, 2007) by New Coal
Distributional Policy, 2013 (NCDP 2013) – Claim for ‘Change in
Law’ relief compensation – Operating parameters – Held: In the
Energy Watchdog case as well as in Adani Rajasthan case, the
Supreme Court held that on account of the Change in Law, the
generating companies were entitled to compensation so as to restore
the party to the same economic position as if such Change in Law
had not occurred – Had the Change in Law not occurred, the
generating companies would have been entitled to the supply as
assured by the Coal India Ltd. (CIL)/Coal Companies under the
Fuel Supply Agreement (FSA) – The submission that when the bidders
submitted their bids, this was a risk they knowingly took, is without
substance – The generators are not claiming compensation on the
basis of rise in price of coal or on the ground of force majeure –
Their claims, in fact, are on the basis of the Change in Law, which
this Court, in the case of Energy Watchdog as well as in Adani
Rajasthan case, has upheld on the ground of Change in Law – The
contention of the Distribution companies (DISCOMS) that the Adani
Rajasthan case is not applicable to the facts of the present case
inasmuch as in Adani Rajasthan case, the State of Rajasthan had
assured 100% coal supply and that it was not a case of FSA, is
without substance – In the present case also, the NCDP 2007 had
assured 100% fuel/coal supply of the normative value – The
restitutionary principle has been stated by this Court in the case of
Uttar Haryana Bijli Vitran Nigam Limited (UHBVNL) – Undisputedly,
the claim of respondent no.1-APML stands on the basis of the Change
in Law – The DISCOMS, which are instrumentalities of the State,
cannot be expected to argue contrary to the stand of the Government,
A
B
C
D
E
F
G
H
86
SUPREME COURT REPORTS
[2023] 8 S.C.R.
which clearly provides that the generators would be entitled to pass-
through for the coal required to be imported or purchased from the
open market on the ground of Change in Law – The stand taken by
the DISCOMS that, since the loss being sustained by the generating
companies is on account of non-fulfillment of obligation by CIL/
Coal Companies, they should be relegated to the remedy available
to them in law against the CIL/Coal Companies, is totally
unreasonable – The claim is based on change of NCDP 2007 by
NCDP 2013, which, undisputedly, is covered by the term ‘Change
in Law’ – Compensation – ‘Change in law’ compensation.
Judicial Review – Of decision taken by expert bodies – Central
Electricity Authority (CEA), Central Electricity Regulatory
Commission (CERC) and Appellate Tribunal for Electricity (APTEL)
–Held: – These bodies are bodies consisting of experts in the field
– Courts should be slow in interfering with the decisions taken by
the experts in the field and unless it is found that the expert bodies
have failed to take into consideration the mandatory statutory
provisions or the decisions taken are based on extraneous
considerations or they are ex facie arbitrary and illegal, it will not
be appropriate for the Court to substitute its views with that of the
expert bodies.
Electricity Act, 2003 – Purpose and Object – One of the major
reasons for the enactment of the Electricity Act was the deterioration
in performance of the State Electricity Boards – It is seen that in a
number of matters, concurrent orders passed by the Regulatory Body
and the Appellate Forum are assailed – Such litigation would, in
fact, efface the purpose of the Electricity Act.
Vivek Narayan Sharma v. Union of India 2023 SCC
OnLine SC 1 – followed.
Energy Watchdog v. Central Electricity Regulatory
Commission and others (2017) 14 SCC 80 and Jaipur
Vidyut Vitaran Nigam Ltd. and others v. Adani Power
Rajasthan Limited and another 2020 SCC Online SC
697 – relied on.
Uttar Haryana Bijli Vitran Nigam Limited (UHBVNL)
and another v. Adani Power Limited and others (2019)
5 SCC 325 : [2019] 4 SCR 487; Reliance Infrastructure
Limited v. State of Maharashtra and others (2019) 3
A
B
C
D
E
F
G
H
87
SCC 352: [2019] 1 SCR 886; Central Warehousing
Corporation v. Adani Ports Special Economic Zone
Limite

Excerpt shown. Read the full judgment & AI analysis in Lexace.