Contractual tariff entitlement depends on the power purchase agreement, not later tariff orders after delayed commissioning.

A solar power developer could not claim the later tariff order as an automatic contractual entitlement where the power purchase agreement tied payment to the tariff order in force and provided that, if commissioning was delayed, the lower of the agreed tariff and the tariff effective on the commissioning date would apply. The earlier tariff order had proceeded on the basis of accelerated depreciation, while also recognising a separate tariff where that benefit was unavailable, but the developer's election to forgo accelerated depreciation did not override the contract. The later tariff was therefore not available as a matter of contract, and the impugned orders were set aside.

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Issues: Whether a solar power developer that commissioned its project after the control period in the earlier tariff order and did not avail accelerated depreciation could nevertheless claim the tariff under the later tariff order despite the terms of the power purchase agreement.

Analysis: The tariff orders and the power purchase agreement had to be read together. The earlier tariff order fixed tariff on the footing that projects would take the benefit of accelerated depreciation, while also indicating that a separate tariff could be determined where that benefit was not available. The agreement, however, expressly tied the payable tariff to the tariff order in force and further provided that if commissioning was delayed beyond the stipulated date, the lower of the agreed tariff and the tariff effective on the date of commissioning would apply. The developer's choice under the Income-tax Act to forgo accelerated depreciation did not override the contractual commitment already undertaken under the agreement. The later tariff order could not be invoked as an automatic contractual entitlement merely because the project was commissioned after the earlier control period.

Conclusion: The developer was not entitled to claim the tariff fixed in the later tariff order as a matter of contract. The impugned orders were unsustainable and were set aside, and relief was granted to the appellant.

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