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Power Grid Corporation of India Limited v. Madhya Pradesh Power Transmission Company Limited and Others

Civil Appeal · 2025 INSC 697Decided 15 May 2025
C.A. No.-006847-006847 - 2025 (arising from SLP(C) No. 7605 of 2021, heard with Civil Appeal No. 6848 of 2025)
Justice J.B. Pardiwala · Justice R. Mahadevan

Background

Power Grid Corporation, a central transmission utility, built inter-state transmission assets at Indore under an approved scheme, but Madhya Pradesh Power Transmission Company (the intra-state utility) delayed constructing its own connecting line, delaying the whole project's commissioning by several weeks to months. Power Grid asked the CERC to approve a later "commercial operation date" and to fix transmission charges to be paid by the party responsible for the delay. The CERC granted Power Grid liberty to claim compensation from the state utility, which then challenged the CERC's jurisdiction to do so before the Madhya Pradesh High Court, which entertained the writ petition and ruled against the CERC's approach.

Decision Breakdown

The Supreme Court examined the relationship between Section 79 (CERC's general regulatory and adjudicatory powers) and Section 178 (CERC's power to frame regulations) of the Electricity Act, 2003, and held that ordering compensation/transmission charges against the party responsible for delay is a regulatory function that falls squarely within CERC's power under Section 79(1): a specific, ad hoc power distinct from CERC's general rule-making power under Section 178. It held the High Court was wrong to entertain a writ petition on this issue at all, since an appeal lay to the Appellate Tribunal for Electricity (APTEL) under Section 111 of the Act, and there was no procedural unfairness in how CERC had proceeded. It set aside the High Court's judgment and dismissed the writ petitions, while leaving it open to the state utility to actually contest the merits of its liability before APTEL.

Lesson Learnt

When a specialised regulator like CERC has the power to decide a dispute and a statutory appeal route (to a tribunal like APTEL) exists, parties should generally use that route rather than going straight to a High Court's writ jurisdiction, bypassing the specialised forum is usually not permitted just because a party disagrees with the regulator's order.

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

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