Summary
The Supreme Court upheld the rejection of Rithwik’s purported termination of its power purchase agreement. Its earlier letter identified payment-related defaults but did not call upon BESCOM to remedy them within the contractual period, an essential requirement before termination. Substantial compliance could not cure that omission. The earlier tribunal finding about the letter was also binding: Rithwik had itself requested adjudication of that subsequent event and could not later characterize it as merely collateral.
Issues
- Whether the earlier finding concerning the default letter bound the generator.
- Whether a letter listing defaults without requiring their cure satisfied the contractual prerequisite to termination.
Held
- Having itself brought subsequent events before the tribunal and successfully sought their consideration over the other party’s objection, Rithwik was estopped from treating the adverse determination as merely collateral. The tribunal had also considered that issue material and essential to its decision, so the challenge to its binding effect failed independently. (¶¶ 12, 13, 14, 15)
- Clause 9.3.2 required written particulars of default and a call to remedy it, with the contractual opportunity of 30 days unless otherwise agreed, before a termination notice could follow. Both components were important. The 5 May 2011 letter only described defaults and sought permission for third-party sales; it did not require cure as stipulated. (¶¶ 3, 16, 17)
- Substantial compliance did not answer omission of this mandatory contractual requirement. Authorities concerning wrong statutory labels or immaterial defects in forms were distinguishable. The consequent termination founded on that letter was invalid; no further determination about late interest payment or the letter of credit was necessary. (¶¶ 18, 19, 20, 21, 22)
Result
Appeals dismissed; the finding that the purported termination was invalid remained undisturbed. Further questions about late payment and the letter of credit were not decided.