Supreme Court Reserves Verdict On Adani Power's Claim Of 1375 Crores Late Payment Surcharge From Jaipur Vidyut Vitran Nigam Ltd

This week, the Supreme Court reserved its verdict on Adani Power's application for a payment of Rs. 1376.35 crores as outstanding late payment surcharge (LPS) from Rajasthan DISCOM.

The present dispute can be traced back to the Supreme Court's 2020 judgment, where it upheld the decisions of the Rajasthan Electricity Regulatory Commission and the Appellate Tribunal for Electricity, stating that Adani Power was entitled to compensatory tariff but not to the late payment surcharge, a claim made in the Power Purchase Agreement.

After the court registry faced scrutiny for not listing the matter despite earlier instructions, a bench comprising Justices Aniruddha Bose and PV Sanjay Kumar finally heard Adani Power's application this week.

Senior Advocate AM Singhvi represented the applicant during the proceedings. In essence, Adani Power contended that the delay in receiving 'change in law' compensation, mandated by the 2020 judgment, justified its claim for LPS. This prompted a stern response from the Jaipur Vidyut Vitran Nigam Limited (JVVNL), a government-owned electricity distribution company in Rajasthan, which questioned the legitimacy of Adani Power's move. Represented by Senior Advocate Dushyant Dave, who was assisted by Advocate Kartik Seth, the energy utility asserted that Adani Power is not entitled to the claimed LPS, emphasising its compliance with the court's directives and insisting that the issue of LPS had been settled by the top court. The miscellaneous application in question was 'mischievous' and a classic case of suppressio veri suggestio falsi, Dave argued, pointing especially to the omission by the power company to file a review against the 2020 judgment.

Singhvi offered to withdraw Adani Power's application in view of the objection raised by the other side over the filing of the miscellaneous application. "We have been prosecuting this miscellaneous application with the bona fide belief that court's earlier orders entitles us to. But we can withdraw, and be granted liberty to go before an appropriate forum."

Protesting, Dave exclaimed, "That's an abuse of process. Allowing them to withdraw their petition would not be in public interest. 1400 crores of rupees is sought to be extracted from the state. They just wanted to grab another order from this court...That's why they have taken this shortcut."

The senior counsel also suggested that the earlier orders in Adani Power's favour had been obtained by suppressing material facts and by misleading the court, and as such, they went against the 2020 three-judge bench ruling. Dave's attempt to question the correctness of these orders, however, was resisted by Singhvi, who exclaimed that JVVNL was trying to seek a review of the court's earlier decisions without filing a formal review. He also argued that the aspect of late payment surcharge was never in dispute before the lower tribunals or the Supreme Court. "What was decided in this case were 'change in law' compensation and carrying cost. But the third concept, i.e., late payment surcharge, was never decided."

"I said please record my statement that I am withdrawing. But I argued on merits because my learned friend made it sound like a crime to want to withdraw. If there's any clarification required, let another three-judge bench decide," Singhvi added before concluding his oral submission.

Dave, at the end of his submissions, insisted that Adani Power ought not to be allowed to withdraw its application. "The court has decided this aspect of late payment surcharge already. It's not an obiter, but ratio decidendi. They want 1400 crores of rupees more. If they go today from here to a tribunal...You know how tribunals function. Don't give them that liberty, I beseech Your Lordships. Would Your Lordships allow this kind of exercise? Please dismiss the application with extraordinary costs. Do not allow this abuse of process to go on for a second. Do not allow them to get away with this. Withdrawing is not a right."

After hearing the lawyers' submissions, the bench reserved its judgment on Adani Power's application.

Case Details

Jaipur Vidyut Vitran Nigam Limited v. Adani Power Rajasthan Limited | Diary No. 21994-2022