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Supreme Court of India · 20/04/2023

UTTAR HARYANA BIJLI VITRAN NIGAM LIMITED AND ANOTHER versus ADANI POWER (MUNDRA) LIMITED AND ANOTHER

[2023] 4 S.C.R. 1095 · 2023 INSC 403

AI-generated headnote. Verify against the judgment before relying on it. Paragraph numbers refer to the judgment.

Summary

The Haryana distribution utilities contended that Adani Power (Mundra), in claiming Change in Law compensation for domestic coal shortfall, had not accounted for the benefit of Inter Plant Transfer of linkage coal permitted by a Coal India communication of 19 June 2013, which APTEL held was not a Change in Law. The Supreme Court set that finding aside: the communication records a decision of Coal India, a Government instrumentality, and falls within the PPA's wide definition of 'Law', so Inter Plant Transfer is a Change in Law whose savings in railway transportation cost must be passed on to the distribution companies. The matter was remitted to CERC to work out the effect after hearing all affected DISCOMs; the computation of shortfall compensation as assured coal quantity minus actual supply was upheld.

Issues

  1. Whether the communication dated 19 June 2013 of Coal India Limited permitting Inter Plant Transfer of coal under the model Fuel Supply Agreement amounts to a 'Change in Law' within the meaning of the power purchase agreements.
  2. Whether Change in Law compensation for domestic coal shortfall is to be computed as Assured Coal Quantity minus actual supply.
  3. How the benefit of transportation cost savings arising from Inter Plant Transfer is to be worked out and to whom it must be passed on.

Provisions considered

Held

Result

Appeal partly allowed; APTEL's finding that the communication of 19 June 2013 is not a Change in Law set aside and Inter Plant Transfer held to be a Change in Law; matter remitted to CERC to work out its effect and calculate the benefits within six months after notice to MSEDCL and the Rajasthan DISCOMs; pending applications disposed of; no costs.

Judgment PDF: Supreme Court of India, [2023] 4 S.C.R. 1095.