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Legal Case Shots

Court judgements broken down into the case type, how the decision played out, and the lesson worth remembering, with the full judgement available as a PDF.

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Legal Case Shots is a searchable database of Supreme Court of India judgments, each broken down into the case type, the court's key holding, and a practical lesson learnt, with the full judgment available as a PDF for citation or deeper reading.

Electricity & Energy LawSupreme Court of India

Maharashtra State Electricity Distribution Co. Ltd. v. M/s JSW Steel Limited

Civil Appeal · 2021 INSC 866Decided 10 Dec 2021
Civil Appeal Nos. 5074-5075 of 2019
Justice M.R. Shah

Background

A Maharashtra state electricity distribution company sought to levy an "additional surcharge" under Section 42(4) of the Electricity Act, 2003 on industrial consumers (including JSW Steel) who generate their own power through "captive" generating plants rather than drawing all their power from the distribution grid. The Appellate Tribunal for Electricity held that such captive consumers are not liable to pay this surcharge, and the distribution company appealed to the Supreme Court.

Decision Breakdown

The Supreme Court upheld the Tribunal's ruling and dismissed the distribution company's appeals. It held that Section 42(4)'s additional surcharge applies only when the State Commission specifically permits a consumer to receive power from an alternate supplier through "open access"; captive generation under Section 9 of the Act is a separate statutory right that doesn't require any such permission, making captive consumers a distinct category outside the scope of Section 42(4). Since the company had already collected the surcharge under an earlier interim court order, the Court directed that this amount be adjusted against future billing rather than refunded all at once.

Lesson Learnt

Businesses that generate their own electricity for self-use through a "captive" plant have a statutory right to do so, and this right exempts them from the additional surcharge meant for consumers who opt to switch suppliers through regulator-approved "open access."

Maharashtra State Electricity Distribution Co. Ltd. v. M/s JSW Steel Limited – Legal Case Shots | LegalAware