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Madhya Pradesh Power Management Co. Ltd. & Anr. v. M/s Dhar Wind Power Projects Pvt. Ltd. & Ors.

Civil Appeal · 2019 INSC 814Decided 25 Jul 2019
Civil Appeal Nos. 9218-9219 of 2018
Dr. Justice D.Y. Chandrachud · Justice Indira Banerjee

Background

A wind power developer's project was covered by a 2013 tariff policy promising Rs. 5.92/unit if commissioned by 31 March 2016, after which a revised 2016 order fixed a lower rate of Rs. 4.78/unit. The developer obtained a commissioning certificate dated 31 March 2016, but the power distribution company disputed this, relying on grid data showing actual power injection only began on 1 April 2016, and later revoked the certificate. The developer challenged this before the High Court, which ruled in its favour and ordered the higher 2013 tariff to apply; the power company then appealed to the Supreme Court.

Decision Breakdown

The Supreme Court disagreed with the High Court's finding that commissioning was complete by 31 March 2016, holding that the objective data from the State Load Despatch Centre (a statutory body) showing actual grid injection from 1 April 2016 should prevail over the disputed commissioning certificate. However, the Court found it would be unfair to the developer, who had genuinely pursued its claim, to deny it any benefit at all, so it held the developer was entitled to the next-best applicable rate, i.e., the 2016 Tariff Order's Rs. 4.78/unit rate from 1 April 2016, rejecting the power company's separate argument that a later competitive-bidding policy should instead apply.

Lesson Learnt

In regulatory/contractual disputes depending on a specific cut-off date, objective third-party technical data (like grid injection records from a statutory body) can override a self-issued or disputed certificate. Courts may also calibrate relief to what is fair on the facts, rather than an all-or-nothing outcome, when a party has acted in good faith even if its primary legal claim fails.

Official source (sci.gov.in)View Judgment (PDF)

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