VidhiSangh

Supreme Court of India · 21/09/2021

PUNJAB STATE POWER CORPORATION LIMITED AND ANOTHER versus EMTA COAL LIMITED

[2021] 11 S.C.R. 772 · 2021 INSC 523

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Summary

The Court set aside the High Court’s grant of a first right of refusal to EMTA. Section 11 of the Coal Mines (Special Provisions) Act gave the successful allottee a choice whether to adopt prior mining contracts; satisfactory performance and reallotment to the same corporation did not compel continuation. PSPCL reasonably chose competitive bidding to obtain the best operator under changed investment parameters. Legitimate expectation did not override that lawful policy choice. Investment-related compensation or other available remedies remained open, without an award in this appeal.

Issues

  1. Whether Section 11 required continuation of a prior mining contractor or gave it a first right of refusal.
  2. Whether PSPCL’s rejection of EMTA’s representation and choice of competitive bidding were arbitrary or defeated an enforceable legitimate expectation.

Provisions considered

Held

Result

Appeals allowed; High Court judgment granting EMTA a first right of refusal quashed. PSPCL’s competitive-bidding decision sustained, without prejudice to available compensation or other legal remedies.

Judgment PDF: Supreme Court of India, [2021] 11 S.C.R. 772.