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Wardha Power Co. Ltd. v. Maharashtra State Electricity Distribution Co. Ltd. and Anr.

Civil Appeal · Neutral citation not assigned (Civil Appeal No. 5919 of 2013)Decided 7 Sept 2016
Civil Appeal No. 5919 of 2013
Justice Kurian Joseph · Justice Rohinton Fali Nariman

Background

Wardha Power Co. Ltd. had agreed to generate and supply power to the Maharashtra State Electricity Distribution Company at agreed Power Purchase Agreement (PPA) rates. When Wardha Power could not meet its supply schedule from its own generation, it made ad-hoc purchases of power from other sources to cover the shortfall. A dispute arose over whether Wardha Power could charge the distribution company the PPA rate for this substitute power, or only its actual (lower) purchase cost.

Decision Breakdown

Both the Maharashtra Electricity Regulatory Commission and the Appellate Tribunal for Electricity had concurrently found against Wardha Power, holding that it could only claim what it actually paid for the substitute power (or the PPA rate if lower), and could not "trade" the shortfall for extra profit. The Supreme Court noted that under Section 125 of the Electricity Act, an appeal to it lies only on a "substantial question of law," similar to a second appeal under the Civil Procedure Code, and that Wardha Power's 34 grounds were really just objections to the Tribunal's factual findings, not genuine questions of law. Finding no substantial question of law warranting interference with the concurrent findings of two specialist bodies, the Court dismissed the appeal with no order as to costs.

Lesson Learnt

When a specialised regulator and an appellate tribunal both agree on the facts, the Supreme Court will not re-open that factual dispute on a further appeal unless a genuine, substantial legal question (not just disagreement with the outcome) is shown.

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

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