DSK Legal Delhi partner Ravi Prakash and senior associate Varun Pathak, having briefed senior advocate Parag Tripathi, acted for PTC India which obtained the court’s direction to JVPL to abide by the terms of a power purchase agreement (PPA) it had entered into with PTC.

Ruling in favor of PTC India, justice Muralidhar observed that the sale of power by trading licensee PTC India to distribution licensee JVPL was not excluded from the ambit of the Electricity Act 2003.

Prakash said: “This judgment was required to balance the rights of the various parties involved in the process of supply of electricity to end consumers – namely,  the rights of generating company, trading licensee, distribution licensee and end consumers”.

Prakash told Legally India that the judgment effectively rules out the scope of evasion of regulation by electricity generating companies routing sale of electricity through trading licensees. 

“What has been excluded from regulatory jurisdiction of the Electricity Act is only a direct commercial relationship between a generating company and an end consumer and a direct commercial relationship between trading licensee and an end consumer” he added.

Pathak said: “This is an important judgment with wide ranging repercussions for the entire power sector. The honourable Court has rightly declared the private arbitration award to be contrary to the public policy of India.

In the past regulatory jurisdiction under the Electricity Act was being excluded for short term gains by the private developers to the detriment of distribution licensees and the consumers. This judgment will balance the interests of all stakeholders to a large extent.”

JVPL’s predecessor-in-interest Jaypee Karcham had derecognized the existence of a PPA with PTC India in December 2009, saying that the procedure for determination of tariff for electricity supply as contemplated in the PPA was unenforceable under the present law, rendering the PPA void.

PTC India had protested against JVPL’s decision in court and arbitral proceedings.

Download text of the judgment of Delhi High Court in PTC India V JVPL