Breaking: Supreme Court Issues Notice In Curative Petition Filed By GUVL Challenging 2019 Judgment Which Allowed Adani Group's Appeal

The Supreme Court has issued notice in a curative petition filed by Gujarat Urja Vikas Ltd(GUVL) against the judgment dated 2nd July 2019 that upheld termination of the Power Purchase Agreement by Adani Power.

In our prima facie opinion, there are substantial questions of law raised in this Curative Petition, which require consideration, the five judge bench headed by CJI NV Ramana observed.

While issuing notice, the bench, also comprising Justices UU Lalit, AM Khanwilkar, BR Gavai and Surya Kant, also directed the registry to list the matter in Open Court on 30 September 2021.

Senior Advocate and former President of Supreme Court Bar Association Dushyant Dave had written a letter to the Chief Justice of India alleging this case (and another one) with high commercial stakes for Adani group were irregularly listed before a particular bench in violation of the Supreme Court practice and procedure. "Clearly, hearing and disposal of these two appeals have been done in complete contravention of the settled practice of the Supreme Court as also its established procedure. Both these matters were listed, taken up and heard without any justification, and in hurry and in an improper manner. As a result, besides causing grave injury to public interest and public revenue, it has caused immense damage to the image of the Supreme Court and the administration of justice.", he had stated in the letter.

In the case, Adani Power had terminated the PPA with GUVL on the ground that Gujarat Mineral Development Corporation(GMDC) had failed to supply coal to it. According to Adani, it was the understanding between the parties that supply of power to GUVL was conditional on coal supply by GMDC. Adani also deposited the amount of Rs. 25 crores as liquidated damages.

Challenging the termination, GUVL approached the Gujarat State Electricity Regulatory Commission. The Commission held the termination to be illegal. The terms of the PPA permitted termination only if both the parties were in agreement that default had occurred, found the Commission. This finding was upheld by the Appellate Tribunal

In appeal, the Apex Court bench of Justices Arun Mishra, BR Gavai and Surya Kant observed that the findings of the Tribunal and Commission that termination clause can be invoked only when there is an agreement between the parties that there is violation of any of the conditions specified is totally incorrect. The Court allowed the appeal filed by Adani and held that compensatory tariff be paid to Adani based on the principles of economic justice since Adani would have incurred huge losses.

The review petition filed by the GUVL was dismissed by the same bench on 3rd September.

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