2026 (7) TMI 1618

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....id by the NTPC to water resource department, Government of Madhya Pradesh for supply of water. 2. Briefly stated, the appellant is a public sector undertaking engaged in the business of generation and supply of electricity. The appellant requires water for operation of its thermal power plant as for the said purpose they had entered into an agreement dated 27.12.2008 with the Government of Madhya Pradesh for supply of water. In terms of agreement, the Madhya Pradesh Government raises invoices on the appellant for sale of water on the basis of actual consumption of water multiplied by the rate per cubic meter. 3. On the basis of investigation initiated, show cause notice dated 20.10.2010 was issued alleging that the appellant was grant....

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..../508 dated 25.07.2003 issued by the Water Resources Department. iii. The water shall be used for the purposes of the plant only. iv. The arrangement for measuring the water drawn by NTPC would be made by NTPC itself in the manner as directed by the MP Government or the Executive Engineer, Water Resources Division. v. NTPC would maintain a security deposit of a specified amount with the MP Government, which would be adjustable in the event of any default. 7. From the aforesaid terms and conditions as laid down in the agreement dated 27.12.2008, it is crystal clear that the arrangement between the appellant and the MP Government is for sale of water. From the contents of the agreement and the provisions of the MP....

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....lant. The Agreement also specifically provided that the government has not given any guarantee for the uninterrupted supply of water during and the government also would not be responsible for non supply or inadequate supply of water as a result of any event of Force Majeure. The appellant has to pay water rates/water charges depending on the quantity of water drawn by the appellant. The Agreement also deals with a situation where there can be reduction or shortage in the water supply. This clearly means that the Agreement is for supply of water and not mere access to water source. 18. It is, therefore, more than apparent that the Agreement is for supply of water by the government to the appellant and is not for assignment of any r....