THE ELECTRICITY DEPARTMENT, REP. BY ITS SUPERINTENDING ENGINEER, PORT BLAIR AND ANR. versus MIS SURYACHAKRA POWER CORPORATION LIMITED

Citation: [2016] 9 S.C.R. 68 · Decided: 22-09-2016 · Supreme Court of India · Bench: KURIAN JOSEPH · Disposal: Disposed off

Judgment (excerpt)

[2016] 9 S.C.R. 68 
A 
THE ELECTRICITY DEPARTMENT, REP. BY ITS 
B 
c 
SUPERINTENDING ENGINEER, PORT BLAIR AND ANR. 
v. 
MIS SURYACHAKRA POWER CORPORATION LIMITED 
(Civil Appeal No. 1652of2015) 
SEPTEMBER 22, 2016 
[KURIAN JOSEPH AND R. F. NARJMAN, JJ.) 
·; 
.••. ·'-' dll t <.:llC111 .1ur jJiiJ 111ea: uj l/t.hlitio11al costs 
and expenses - Power Project Agreement (PPA) - Delay in execution 
of project - Increase in various cost components, viz., illleresl during 
construction (JDC); financing charges (FC); and incidental 
expenses during construction (IEDC) incurred for the delay, suo 
moto allowed in appeal by Appellate Tribunal - Propriety of- Held: 
Appellants are on solid grou111;f in contending that an increase in 
D JDC, FC and IEDC was allowed in appeal by the Appellate Tribunal. 
suo moto - Appeal allowed only to this limited extent - On other 
points, it is dismissed 
E 
F 
Disposing of the appeal, the Court 
HELD: 1.1 The appellants are on solid ground when they 
contend that an increase in interest during construction, financing 
charges and incidental expenses incurred for the delay in the 
execution of the project due to reasons beyond the control of the 
respondent was allowed in appeal by the Appellate Tribunal suo 
moto. [Para 6] [72-A-Bl 
1.2 The appellant argued that the tribunal directed a suo 
moto payment of additional JDC, financing cost and incidental 
expenses during construction even though this was not the part 
of the appeal filed by the respondent (appellant therein) before 
the tribunal. The respondent contended that in any \:ase what 
G was referred to, in the Commission's judgment in order to arrive 
at the figure of Rs.78.29 Crores as the project cost in fact started 
with the figure of Rs. 77.595 Crores, being CEA approval as per 
"funds tied up" basis, which according to the respondent, included 
the aforesaid expenditure. It was argued by the respondent that 
certain figures which were referred to and relied upon by the 
H 
68 
ELECTRICITY DEPT., REP. BY ITS S.E., PORT BLAIR v. MIS 
69 
SURYACHAKRA POWER CORPN. LTD. 
CEA to arrive at this figure specifically included the aforesaid. 
A 
No such figures were shown. [Paras 7, 8) [72-C; 73-B-C] 
1.3 Therefore, the appeal is allowed only to this limited 
extent. Judgment of the Appellate Tribunal insofar as it allowed 
an increase in interest during construction (IDC), financing 
charges (FC) and incidental expenses during construction (IEDC) 
B 
incurred for the delay in execution of the project for reasons 
beyond the control of the respondent, is set aside.[Para 8)(73-D] 
CIVILAPPELLATE JURISDICTION: Civil Appeal No. 1652 of 
2015. 
From the Judgment and Order dated 28.11.2014 of the Appellate 
Tribunal for Electricity at New Delhi in Appeal No. 268 of2013. 
Rakesh Khanna, Sr. Adv., Ms. Ruchi Singhwani, Mohit Paul, 
Ms. Megha Bharara, Yikash Arora, Ms. Diksha Jhingan, Advs. for the 
Appellants. 
Gurukrishna Kumar, Sr. Adv., Rohit Rao N., Mukund P. Unny, 
Ananga Bhattacharyya, Advs. for the Respondent. 
The Judgment of the Court was delivered by 
R. F. NARIMAN, J, I. We have heard Shri Rakesh Khanna, 
learned senior counsel appearing for the appellants for quite some time, 
and Shri. Gurukrishna Kumar, learned senior counsel appearing for the 
respondent in reply. Though Shri Rakesh Khanna has taken us through 
the PPA, various documents, and various orders in great detail, we do 
not find it necessary to go into any of these for the reason that we find 
that the appellants had set up various expert committees to go into the 
bone of contention in this appeal, namely, project cost and completed 
cost. 
2. We find that Mis. K.P.C.L (Mis. Kamataka Power Corporation 
Ltd.) had been appointed by them in order to determine the project cost 
which was determined at Rs.73.40 crores. Mis. Tamil Nadu Electricity 
Generation and Distribution Corporation Ltd. (TANGEDCO), another 
expert, arrived at a finding of Rs. 82.11 crores, which was reconfirmed 
by a subsequent report, and ultimately arrived at a figure of Rs.79.439 
crores with other issues which were to be decided separately. A joint 
exercise between the appellants and respondent, also carried out in April, 
2010, where a figure of Rs. 76.14 crores was arrived at, and the balance 
c 
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G 
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~ 70 
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G 
H 
SUPREME COURT REPORTS 
[2016] 9 S.C.R. 
of Rs. 8.82 crores in respect of roe, that is, interest during construction 
and preliminary expenses was left to be exam

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