TaxTMI 
TaxTMI 
2023 (4) TMI 1318
X X X X Extracts X X X X
X X X X Extracts X X X X
....ubmitted that those two appeals could be decided by deciding the three common issues. However, insofar as the other appeals are concerned, it was submitted that, in addition to the three common issues, certain additional issues were also involved and it was agreed that after those two appeals are decided, the other appeals should be heard for considering these additional issues. 2. The said three common issues are thus: (i) Whether 'Change in Law' relief on account of New Coal Distribution Policy, 2013 ("NCDP 2013" for short) should be on 'actuals' viz. as against 100% of normative coal requirement assured in terms of New Coal Distribution Policy, 2007 ("NCDP 2007" for short) OR restricted to trigger levels in NCDP 2013 viz. 65%, 65%, 67% and 75% of ACQ? (ii) Whether for computing 'Change in Law' relief, the operating parameters should be considered on 'actuals' OR as per technical information submitted in bid? (iii) Whether 'Change in Law' relief compensation is to be granted from 1st April 2013 (start of Financial Year) or 31st July 2013 (date of NCDP 2013)? 3. After extensively hearing all the learned Counsel for th....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... and that of Unit 2 was 1st September 2013. 11. GWEL had entered into long term Power Purchase Agreements ("PPAs" for short) with DNH-DISCOM for supply of 200 MW power to Maharashtra State Electricity Distribution Company Limited ("MSEDCL" for short) on 17th March 2010 ["MSEDCL PPA") and for supply of 200 MW power on 21st March 2013 ("DNH PPA"), after it emerged as the successful bidder for supply of power to MSEDCL/DNH-DISCOM. The Scheduled delivery date under the MSEDCL PPA was 17th March 2014, whereas under the DNH PPA, it was 1st April 2013. GWEL is also supplying 150 MW power from its power plant to Tamil Nadu Generation and Distribution Corporation ("TANGEDCO" for short) by way of back-to-back arrangement with trading company GMR Energy Trading Limited, for which purpose, a PPA was signed on 27th November 2013 ("TANGEDCO PPA"). 12. In terms of the PPAs, the cut-off date, which is 7 days prior to the bid deadline, is to be considered for the purpose of claims under 'Change in Law'. Following are the cut-off dates under the said PPAs. DNH PPA MSEDCL PPA TANGEDCO PPA Cut-off date 1.6.2012 31.7.2009 27.2.2013 13. Certain 'Change....
X X X X Extracts X X X X
X X X X Extracts X X X X
....C. Insofar as the appeal filed by DNH-DISCOM is concerned, the same was dismissed by the learned APTEL. Hence, these cross-appeals. 21. We have heard Mr. Vishrov Mukherjee, learned Counsel appearing on behalf of the GWEL and Mr. Samir Malik, learned Counsel appearing on behalf of MSEDCL and Mr. M.G. Ramachandran, learned Senior Counsel appearing on behalf of the DNH-DISCOM. 22. Mr. Vishrov Mukherjee submits that the learned APTEL has erred in disallowing the claim on the following items: (i) Withdrawal of Deemed Export Benefit by way of Circular dated 28th December 2011 and Notification dated 28th December 2011 issued by the Directorate General of Foreign Trade ("DGFT") and amendment to the Foreign Trade Policy dated 21st March 2012; (ii) Imposition of Crushing/Sizing charges and Surface Transportation Charges by Notification dated 15th October 2009; (iii) Change in system of classification of coal by Coal India Limited ("CIL" for short) from Useful Heat Value ("UHV" for short) to Gross Calorific Value ("GCV" for short) system of pricing by way of Notification dated 30th December 2011; (iv) Increase in levy of Minimum Alternate Tax ("MAT" f....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n Law'. 27. The Chart of claims which were allowed and disallowed by the CERC is as under: 107. Based on the above analysis and decisions, the summary of our decision under the Change in Law during the operating period of the project is as under: Components Change in Law Event Change in Rate of Royalty Allowed Levy of Central Excise Duty subject to directions in para 32 of the order Allowed Levy of Clean Energy Cess Allowed Levy of Customs Duty on energy removed from SEZ to DTA Allowed Increase in Busy Season Surcharge on transportation of coal Not Allowed Increase in Development Surcharge on transportation of coal Not Allowed Levy of Service Tax on transportation of coal Allowed Levy of Green Energy Cess in Gujarat Liberty granted to approach after Hon`ble Supreme Court's Decision Increase in Sizing Charges of coal Not Allowed Increase in Surface Transportation Not Allowed Change in pricing of coal from UHV to GCV basis Not Allowed Change in class from 140 to 150 for Railway freight for coal for train....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the Developmental Surcharge are revised as per the Notifications/Circulars issued by the Ministry of Railways and as such, they would come within the definition of 'Change in Law'. Civil Appeal Nos. 12055-12056 of 2018 35. These appeals, filed by Jaipur Vidyut Vitran Nigam Ltd., Ajmer Vidyut Vitaran Nigam Ltd. and Jodhpur Vidhyut Vitaran Nigam Ltd. (hereafter referred to as "Rajasthan DISCOMS"), challenge the common judgment and order dated 14th August 2018, passed by the learned APTEL in Appeal No. 119 of 2016 & I.A. Nos. 668 and 674 of 2016 and in Appeal No. 277 of 2016 & I.A. No. 572 of 2016. 36. Appeal No. 119 of 2016 & I.A. Nos. 668 & 674 of 2016 were filed by M/s. Adani Power Rajasthan Ltd. ("APRL" for short), being aggrieved by the judgment and order dated 15th March 2016, passed by the Rajasthan Electricity Regulatory Commission (hereinafter referred to as "State Commission") thereby disallowing some of its claims on account of 'Change in Law', whereas Appeal No. 277 of 2016 and I.A. No. 572 of 2016 were filed by the Rajasthan DISCOMS, being aggrieved by the order of the State Commission of the same date vide which some of the 'Change in Law....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... and order dated 29th January 2020, passed by the learned APTEL in Appeal No. 284 of 2017 and Appeal No. 09 of 2018. 44. Appeal No. 284 of 2017 was filed by APRL challenging the order dated 8th June 2017 passed by the State Commission, being aggrieved by the disallowance of its claim on some components on the ground of 'Change in Law' and carrying cost, whereas Appeal No. 9 of 2018 was filed by Rajasthan DISCOMS being aggrieved by the claims which were allowed by the State Commission. 45. The list of the components which were allowed and which were not allowed on the ground of 'Change in Law' is thus: Sr. No. Change in Law's items Decision of the Commission A. Levies on Royalty • National Mineral Exploration Trust effective from 14.08.2015 • District Mineral Foundation effective from 12.01.2015 Allowed B. Levy of Swachh Bharat Cess (SBC) along with Service Tax for rail transportation effective from 15.11.2015 Allowed C. Levy of Swachh Bharat Cess @0.5% along with Service Tax Operation Period effective from 15.11.2015 Not Allowed D. Levy....
X X X X Extracts X X X X
X X X X Extracts X X X X
....No. 3123 of 2019 has been filed by Bihar State Power (Holding) Company Ltd. (hereinafter referred to as "Bihar DISCOMS") and Civil Appeal No. 5372 of 2019 has been filed by GMR Kamalanga Energy Limited and GMR Energy Limited (hereinafter referred to as "GKEL"), challenging the judgment and order dated 21st December 2018 passed by the learned APTEL in Appeal No. 193 of 2017 & I.A. No. 449 of 2018. 52. Appeal No. 193 of 2017 & I.A. No. 449 of 2018 were filed by GKEL challenging the order of the CERC dated 7th April 2017, aggrieved by the denial of its claims on certain components on the ground of 'Change in Law'. The Bihar DISCOMS have challenged that part of the order of the learned APTEL which allowed claims of GKEL on the ground of 'Change in Law'. 53. By the impugned order, the learned APTEL granted claims on the ground of: (i) Change in NCDP (cancellation of Captive Block vis-à-vis tapering linkage), (ii) busy season surcharge and developmental surcharge, (iii) carrying cost; and (iv) add on premium price. 54. We have heard Mr. Vishrov Mukherjee, learned Counsel appearing on behalf of the GKEL/Generator and Ms. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ent of India; (b) Increase/revision in the railway freight charges pursuant to notifications issued by Ministry of Railways and Ministry of Finance; (c) Increase in the rate of Minimum Alternate Tax ("MAT") rates; (d) Increase in Value Added Tax in the State of Odisha; (e) Increase in water charges pursuant to notifications issued by the Government of Odisha; (f) Incremental increase in interest on working capital on account of increase in costs during the operating period. 61. Being aggrieved thereby, Appeal No. 195 of 2016, was preferred by GKEL. As stated above, the learned APTEL partly allowed the appeal and held that GKEL was entitled to compensation on following grounds. (i) Increase/revision in the railway freight charges in terms of notifications issued by the Ministry of Railways and Ministry of Finance on account of imposition of development surcharge, busy season surcharge and service tax; (ii) VAT rate enhancement from 4% to 5% from 30.03.2012 onwards; (iii) Carrying cost/interest on compensation on the above items after ascertainment of the same by computation, which shall be assessed from the d....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... same economic position as before as if no 'Change in Law' event had occurred. 70. We have heard Ms. Anushree Bardhan, learned Counsel appearing on behalf of the Appellant-Bihar DISCOMS and Mr. Maninder Singh, learned Senior Counsel appearing on behalf of GKEL. 71. Ms. Anushree Bardhan submits that the learned APTEL ought to have granted benefit of 'Change in Law' restricting it to shortfall for only 894.5 MW, which was the amount specified in the PPA, and not for the entire 1050 MW, which is the installed capacity. She further submits that the learned APTEL had also erred in granting add on premium on account of extension of tapering linkage by three years. 72. Shri Maninder Singh, learned Senior Counsel submits that insofar as the first issue with regard to shortfall of coal supply is concerned, the same is squarely covered by the judgments of this Court in the cases of Energy Watchdog v. Central Electricity Regulatory Commission and Ors. (2017) 14 SCC 80, Jaipur Vidyut Vitaran Nigam Ltd. and Ors. v. Adani Power Rajasthan Limited and Anr. (hereinafter referred to as "Adani Rajasthan case") and MSEDCL v. APML and Ors. (supra). 73. He further submits tha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....before the learned APTEL. In appeal, the learned APTEL remanded the matter to the CERC vide order dated 14th August 2018 for considering certain issues. Being aggrieved by the order dated 14th August 2018, the Appellant-DNH-DISCOM filed an appeal, being Civil Appeal No. 11910 of 2018, before this Court. The said appeal is also being decided in the present batch of appeals, by this common judgment. 80. On remand, the CERC passed an order dated 16th May 2019 and allowed the claim of GWEL/Generator on the ground of 'Change in Law' occurring on account of the enforcement of the 'Scheme for Harnessing and Allocating Koyala (Coal) Transparently in India' ("SHAKTI Policy" for short). Being aggrieved thereby, DNH-DISCOM had filed an appeal before the learned APTEL. As stated herein above, the same was dismissed by the learned APTEL vide the impugned judgment. 81. We have heard Mr. C.A. Sundaram, learned Senior Counsel appearing on behalf of the DNH-DISCOM and Mr. Niranjan Reddy, learned Senior Counsel appearing on behalf of the Respondent-GWEL. 82. Mr. C.A. Sundaram submits that, from the presentation which was given by the GWEL, it was apparent that it was given o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d the Generators to be entitled to compensation on the said ground. Being aggrieved thereby, the MSEDCL has preferred these appeals. 87. We have heard Shri Balbir Singh, learned Additional Solicitor General (for short, "ASG") and Shri G. Saikumar, learned Counsel appearing on behalf of the Appellant and Shri Sajan Poovayya, learned Senior Counsel for the Respondents in Civil Appeal No. 5005 of 2022 and Shri Vishrov Mukherjee, learned Counsel appearing on behalf of the Respondents in Civil Appeal No. 4089 of 2022. 88. Shri Balbir Singh, relying on Clause 9.1 of the Coal Supply Agreement (for short, "CSA") dated 28th December 2012 entered into between Southeastern Coalfields Limited and APML, submitted that CSA defines as to what shall be the base price of coal. He submitted that Clause 9.2 of the said CSA specifically provides for other charges which are permissible. Relying on Clause 9.4 of the CSA, he submitted that in all cases, the entire freight charges, irrespective of the mode of transportation of coal supplied, shall be borne by the purchaser. The learned ASG submitted that the EFC does not partake the character of a statutory levy. However, he submitted that, in any c....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., as to whether various taxes/charges imposed by various State Governments would also fall under 'Change in Law' events or not. The other question that requires considerations is, as to whether at what rate the Generators would be entitled to 'carrying cost'. IV. CONSIDERATION 93. For appreciating the rival submissions, we will have to construe the term "Law", which has been defined in the PPAs, which reads thus: "Law" means, in relation to this Agreement, all laws including Electricity Laws in force in India and any statute, ordinance, Regulation, Notification or code, rule, or any interpretation of any of them by an Indian Governmental Instrumentality and having force of law and shall further include all applicable rules, Regulations, orders, Notifications by an Indian Governmental Instrumentality pursuant to or under any of them and shall include all rules, Regulations, decisions and orders of the CERC and the MERC. 94. Perusal of the definition of the term "Law" itself would clearly show that the term "Law" would mean all laws including Electricity Laws in force in India and any statute, ordinance, Regulation, Notification or code, rule, or ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Charges and Statutory Charges, as applicable at the time of delivery of Coal. It is thus clear that price of coal includes the sum of base price, other charges and statutory charges as applicable at the time of delivery of coal. 98. As discussed herein above, the term 'Law' would also include all applicable rules, Regulations, orders, Notifications issued by an Indian Governmental Instrumentality. 99. It would thus be clear that all such additional charges which are payable on account of orders, directions, Notifications, Regulations, etc., issued by the instrumentalities of the State, after the cut-off date, will have to be considered to be 'Change in Law' events. The Generators would be entitled to compensation on the restitutionary principle on such changes occurring after the cut-off date. 100. Having held thus, we will now consider some of the components which are common in most of these appeals. Busy Season Surcharge, Development Surcharge And Port Congestion Surcharge 101. Insofar as increase in Busy Season Surcharge, Development Surcharge on transportation of coal, and Port Congestion Surcharge by the Indian Railways are concerned, the lear....
X X X X Extracts X X X X
X X X X Extracts X X X X
....here was no Forest Tax applicable on coal mined and transported from South Eastern Coalfields Limited ("SECL" for short) mines located in Forest area. For the first time, vide Notification of the Chhattisgarh State Government, Department of Forest, under the provisions of Chhattisgarh Transit (Forest Produce Rule) 2001, a fee at the rate of Rs. 7 per ton was levied. Undisputedly, the said Notification is issued by the Forest Department of the Government of Chhattisgarh, which is an instrumentality of the State. As such, no error can be found with the finding of the learned APTEL in that regard. Add on Premium Price 108. Insofar as 'Add on premium price' is concerned, undisputedly, 'add on premium' was required to be paid on account of cancellation of captive coal blocks and inordinate delay on account of Go-No-Go policy. As such, it cannot be said that the reasoning adopted by the learned APTEL is perverse and arbitrary. Evacuation Facility Charges (EFC) 109. Undisputedly, EFC was imposed by CIL vide its Circular dated 19th December 2017. 110. As already discussed herein above, CIL is an instrumentality of the State. It is thus clear that, on the cut-....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of billing, a late payment surcharge shall be payable at same terms applicable to the monthly bill in Article 11.3.4. 116. A perusal of Article 11.3.4 of the PPA would reveal that in the event of delay in payment of a monthly bill by any procurer beyond its due date, a late payment surcharge shall be payable by the procurer to the seller at the rate of 2% in excess of the applicable State Bank Advance Rate ("SBAR" for short) per annum, on the amount of outstanding payment, calculated on a day to day basis (and compounded with monthly rest), for each day of the delay. Article 11.8 of the PPA deals with Payment of Supplementary Bill. It enables either party to raise a supplementary bill on the other party for payment on account of certain events. Clause (iii) of Article 11.8.1 of the PPA deals with 'Change in Law' as provided in Article 13. It requires the bill to be paid by the other party. Article 11.8.3 of the PPA also provides that in the event of delay in payment of a supplementary bill by either party beyond one month from the date of billing, a late payment surcharge shall be payable at same terms applicable to the monthly bill in Article 11.3.4. 117. This Court ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....erned, compensation for any increase/decrease in revenues or costs to the seller is to be determined and effected from such date as is decided by the appropriate Commission. Here again, this compensation is only payable for increase/decrease in revenue or cost to the seller if it is in excess of an amount equivalent to 1% of the Letter of Credit in aggregate for a contract year. What is clear, therefore, from a reading of Article 13.2, is that restitutionary principles apply in case a certain threshold limit is crossed in both Sub-clauses (a) and (b). There is no dispute that the present case is covered by Sub-clause (b) and that the aforesaid threshold has been crossed. The mechanism for claiming a change in law is then set out by Article 13.3 of the PPA. 118. It could thus be seen that this Court has held that insofar as the "operation period" is concerned, compensation for any increase/decrease in revenues or costs to the seller is to be determined and effected from such date as is decided by the appropriate Commission. It has further been held that the compensation is only payable for increase/decrease in revenue or cost to the seller if it is in excess of an amount equivale....
X X X X Extracts X X X X
X X X X Extracts X X X X
....payment of charges by the procurer i.e. the Appellant. In other words, LPS dissuades the procurer from delaying payment of charges. The rate of LPS has no bearing or impact on tariff. Changes in the basis of the rates of LPS do not affect the rate at which power was agreed to be sold and purchased under the power purchase agreements. The principle of restitution under the change in law provisions of the power purchase agreements are attracted in respect of tariff. 177. LPS cannot be equated with carrying cost or actual cost incurred for the supply of power. The Appellant has a contractual obligation to make timely payment of the invoices raised by the power generating companies, subject, of course, to scrutiny and verification of the same. Mr. Mukul Rohatgi has a point that if the funding cost was so much lesser than the rate of LPS, as contended by the Appellant, the Appellant could have raised funds at a lower rate of interest, made timely payment of the invoices raised by the power generating companies, and avoided LPS. 178. The proposition that courts cannot rewrite a contract mutually executed between the parties, is well settled. The Court cannot, through it....
X X X X Extracts X X X X
X X X X Extracts X X X X
....m on the amount of outstanding payment calculated on day to day basis (and compounded with monthly rest), for each day of the delay. 123. Recently, this Court, in the case of Uttar Haryana Bijli Vitran Nigam Limited and Anr. v. Adani Power (Mundra) Limited and Anr. (2023) 2 SCC 624, had an occasion to consider the similar issue. The Court observed thus: 20. It is clear that the restitutionary principles encapsulated in Article 13.2 would take effect for computing the impact of change in law. We see no reason to interfere with the impugned judgment [Adani Power (Mundra) Ltd. v. CERC,], wherein it has been held by the Appellate Tribunal that Respondent 1 Adani Power had started claiming change in law event compensation in respect of installation of FGD unit along with carrying cost, right from the year 2012 and that it has approached several fora to get this claim settled. Respondent 1 Adani Power finally succeeded in getting compensation towards FGD unit only on 28-3-2018, but the carrying cost claim was denied. The relief relating to carrying cost was granted to Respondent 1 Adani Power by the Appellate Tribunal vide order dated 13-4-2018 [Adani Power Ltd. v. CERC, whic....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 'Change in Law' event is based on sound logic. It has been held that it is aimed at restituting a party that is adversely affected by a 'Change in Law' event and restore it to its original economic position as if such a 'Change in Law' event had not taken place. 125. The argument that there is no provision in the PPAs for payment of compound interest from the date when the 'Change in Law' event had occurred, has been specifically rejected by this Court. 126. In view of this consistent position of law and application of restitutionary principles and privity of contractual obligations between the parties as contained in the PPAs, we do not find that the view taken by the learned APTEL with regard to carrying cost warrants interference. Concurrent Finding of Fact 127. Apart from the aforesaid issues, there is one another common thread in all these appeals. Many of these appeals arise out of concurrent findings recorded by the Central/State Electricity Regulatory Commissions and the learned APTEL. 128. This Court, in the case of MSEDCL v. APML and Ors. (supra), after considering the statutory provisions in the Electricity Act, 2003, held ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to be satisfied with is that the Commission has followed the proper procedure and unless it can be demonstrated that its decision is on the face of it arbitrary or illegal or contrary to the Act, the court will not interfere. Fixing a tariff and providing for cross-subsidy is essentially a matter of policy and normally a court would refrain from interfering with a policy decision unless the power exercised is arbitrary or ex facie bad in law. xxx xxx xxx 123. Recently, the Constitution Bench of this Court in the case of Vivek Narayan Sharma v. Union of India has held that the Courts should be slow in interfering with the decisions taken by the experts in the field and unless it is found that the expert bodies have failed to take into consideration the mandatory statutory provisions or the decisions taken are based on extraneous considerations or they are ex facie arbitrary and illegal, it will not be appropriate for this Court to substitute its views with that of the expert bodies. 130. As is indicated in the aforesaid judgments, this Court should be slow in interfering with the concurrent findings of fact unless they are found to be perverse, arbitrary and eit....
X X X X Extracts X X X X
X X X X Extracts X X X X
....unt to 'Change in Law' events. 139. Insofar as levy of 'Forest Tax' is concerned, the same is levied by the State Government under the statutory provisions. 140. The issue with regard to 'Carrying Cost' has also been discussed by us herein above. 141. In that view of the matter, we do not find any reason to interfere with the order of the learned APTEL. The appeals are, accordingly, liable to be dismissed. Civil Appeal Nos. 2935-2936 of 2020 142. In addition to the 'Change in Law' benefits granted by the State Commission, 'Coal Terminal Surcharge', 'Chhattisgarh Paryavaran Upkar' and 'Chhattisgarh Vikas Upkar' were also considered to be 'Change in Law' events by the learned APTEL. 143. The 'Coal Terminal Surcharge' was levied by the Indian Railways subsequent to the cut-off date. Similarly, the Government of Chhattisgarh, Under Section 8 of the Chhattisgarh Adhosanrachna Vikas Evam Paryavaran Upkar Adhiniyam, 2005, vide Notification dated 16th June 2015, which is admittedly after the cut-off date, introduced 'Chhattisgarh Paryavaran Upkar' and 'Chhattisgarh Vikas Upkar'. Even t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 151. Insofar as other claims which were concurrently allowed and disallowed by the CERC and the learned APTEL are concerned, in view of the concurrent findings, we are not inclined to interfere with the same. 152. The appeals of both DISCOMS as well as Generating Companies are, therefore, liable to be dismissed. Civil Appeal No. 6641 of 2019 153. This appeal is filed by GKEL, being aggrieved by the concurrent denial of benefits on certain components. 154. As already discussed herein above by us, in view of the concurrent findings recorded by the CERC as well as the learned APTEL for disallowing the claims, we are not inclined to interfere with the same. The appeal is, accordingly, liable to be dismissed. Civil Appeal Nos. 5583-5584 of 2021 155. In the present case, the benefit is granted on following grounds: (i) Shortfall in domestic coal on account of Change in NCDP; (ii) Add on premium on account of existing tapering linkage by three years; (iii) Busy Season Surcharge 156. The first issue sands covered by the judgments of this Court in the cases of Energy Watchdog (supra), Adani Rajasthan case (supra) and MSEDCL v. APML and Ors. (....
X X X X Extracts X X X X
X X X X Extracts X X X X
....its Circular dated 19th December 2017. 166. As discussed herein above, it is not in dispute that EFC has been paid by the Generators while paying the base price, other charges and statutory charges at the time of delivery of coal. As such, no interference is warranted with the said finding. 167. Insofar as 'carrying cost' is concerned, we have elaborately discussed the said issue herein above. As such, no interference, therefore, is warranted on the said issue also. 168. We do not find any merit in the appeals. The same are, accordingly, liable to be dismissed. VI. EPILOGUE 169. Before we part with the judgment, we must note that we have come across several appeals in the present batch which arise out of concurrent findings of fact arrived at by two statutory bodies having expertise in the field. We have also found that in some of the matters, the appeals have been filed only for the sake of filing the same. We also find that several rounds of litigation have taken place in some of the proceedings. 170. Recently, this Court, in the case of MSEDCL v. APML and Ors. (supra), has noted that one of the reasons for enacting the Electricity Act, 2003 was that the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....by generating companies on account of delay in recovery of Change in Law compensations and has recommended thus: The Committee, therefore, recommend that appropriate steps should be taken to ensure that there should be consistency and uniformity with regard to orders emanating from the status of change in law. Provisions should also be made for certain percentage of payments of regulatory dues to be paid by DISCOMS in case the orders of regulators are being taken to APTEL/higher judiciary for their consideration and decision 116. The Report lays stress on the obligation of the distribution companies to pay the approved Change in Law compensation even while Regulatory Commission's orders are challenged. The Policy directive dated 27.08.2018 issued in terms of Section 107 of the Electricity Act, 2003 by the Ministry of Power (MoP) to the CERC emphasized on the need to ensure expeditious recovery of Change in Law compensation. The desirability of this was recognized by this tribunal in its judgment dated 14.09.2019 in Jaipur Vidyut Vitran Nigam Limited v. RERC and Ors. It is against such backdrop that Electricity (Timely Recovery of Costs due to Change in Law) Ru....
X X X X Extracts X X X X
X X X X Extracts X X X X
....PS for delay in making payments to the generator. This cannot be countenanced, given the earlier dispensation on the subject by the statutory regulator and appellate forum(s), since it smacks of approach that is designed to frustrate the legislative command, and extant State policy, as indeed constitutes abject indiscipline infringing the Rule of law. Borrowing the words of Hon'ble Supreme Court in SEBI v. Sahara India Real Estate Corporation Ltd., (2014) 5 SCC 429 "non-compliance with the orders passed... shakes the very foundation of our judicial system and undermines the Rule of law" which this tribunal is also duty-bound to "honour and protect", so essential "to maintain faith and confidence of the people of this country in the judiciary". [emphasis supplied] 174. It could thus be seen that even the Standing Committee of Parliament, in its report, has recommended that there should be consistency and uniformity with regard to orders emanating from the status of 'Change in Law'. It has also recommended that the provisions should also be made for certain percentage of payments of regulatory dues to be paid by DISCOMS in case the orders of regulators are being tak....
X X X X Extracts X X X X
X X X X Extracts X X X X
....uses in the PPA, they are required to pay late payment surcharges, which are much higher. Even in case of 'Change in Law' claims, the same procedure is required to be followed. 178. Ultimately, these late payment surcharges are added to the cost of electricity supplied to the end consumers. It is, thus, the end consumers who suffer by paying higher charges on account of the DISCOMS not making timely payment to the Generators. 179. It is further to be noted that the appeal to this Court Under Section 125 of the Electricity Act, 2003 is only permissible on any of the grounds as specified in Section 100 of the Code of Civil Procedure, 1908. As such, the appeal to this Court would be permissible only on substantial questions of law. However, as already observed herein, even in cases where well-reasoned concurrent orders are passed by the Electricity Regulatory Commissions and the learned APTEL, the same are challenged by the DISCOMS as well as the Generators. On account of pendency of litigation, which in some of the cases in this batch has been more than 5 years, non-payment of dues would entail paying of heavy carrying cost to the Generators by the DISCOMS, which, in tu....