Andhra Pradesh High Court - Amravati
Azure Power India Private Limited vs The Union Of India on 16 October, 2023
Bench: Ravi Cheemalapati
HIGH COURT OF ANDHRA PRADESH
MAIN CASE No: W.P.No.27320 of 2023
PROCEEDING SHEET
OFFI
Sl. CE
DATE ORDER
No. NOT
E.
01. 16.10.2023 RC,J
W.P.No.27320 of 2023
Notice before admission.
Sri Metta Chandrasekhar Rao, learned standing
counsel takes notice for R6.
Learned Government Pleader for Energy takes
notice for R2.
Sri V.R.Reddy Kovvuri, learned standing counsel
takes notice for R5 and R7.
Sri N.Harinath, learned Deputy Solicitor General
takes notice for R1.
Learned counsel for the petitioners is permitted to
take out personal notice on the Respondent nos.3 and 4
through RPAD and file proof of service before the
Registry.
Post on 06.11.2023.
________
RC, J
I.A.N0.02/2023
Heard.
Sri Aniket Prasoon, learned counsel representing
learned counsel for the petitioner contended that,
pursuant to the tenders invited by the 3rd respondent,
the petitioners being successful bidders entered into two
agreements ie., Power Purchase Agreement(PPA) and
Power Sale Agreement(PSA) wherein the petitioners have
to generate renewable energy and supply to 3rd
respondent. He further contended that, as per the
agreement, there is a condition that, the 3rd respondent
has to obtain unconditional adoption tariff from the
Central Regulatory Commission within 60 days from date
of signing the agreement and unless the unconditional
adoption of tariff is fixed, the petitioners cannot
commence the project. He further submitted that, in the
present case, though the agreement was entered in the
year 2021, till today, the authorities have not placed
unconditional adoption tariff.
He further contended that, after entering into
agreements, one Sri Rama Krishna has filed PIL vide
PIL.No.76/2022 before this Court and the same is
pending adjudication and no interim orders are passed to
his knowledge. He further contended that, pending PIL,
Central Regulatory Commission has fixed adoption tariff,
subject to the outcome of the PIL. Now, basing on the
same, the 3rd respondent is insisting the petitioners to
commence with the project.
Learned counsel for the petitioner further
contended that, in this regard the 3rd respondent has
sent communication dated 12.10.2023 to the petitioners
stating that, due to pendency of PIL in AP High Court,
the petitioners are not going ahead with the
implementation of Projects and stated that the
petitioners will get back on possible resolution of the
matter by 30.09.2023, and requested to clear the
petitioners stand on the 2333 MW capacity by 06:00 pm
of 16.10.2023 so that further view/suitable action can be
taken in line with the provisions of the PPA & Rfs
Documents".
He further submitted that, to the said
communication, the petitioners have given his reply
dated 16.10.2023 duly stating that, on conditional
adoption tariff fixed by the Central Regulatory
Commission, it has become impossible to perform and
thereby requested to return the bank guarantee and
refrain the respondents from taking any coercive steps
against the petitioner. He further submitted that, the
authorities are contemplating to revoke bank guarantee
at any moment and if the same is allowed to happen, the
petitioners will be put to irreparable loss and great
hardship for no fault on their behalf. He further
submitted that, when such a condition has been imposed
no banks will come forward to give loans to the
petitioners.
In support of his contentions, he relied on the
judgment of Appellate Tribunal for Electricity at New
Delhi and contended that, though the said order is not
binding it has persuasive value, the conditional adoption
of tariff cannot be fixed and by virtue of the same they
cannot insist the petitioners to proceed with the project.
As such prayed to protect the interest of the petitioners.
Perused the record.
The relevant conditions 2.1.2 in the Power
Purchase Agreement(PPA) and Power Sale Agreement
(PSA) reads as follows:
"...2.1.2. Notwithstanding the Effective Date, the
condition precedent for the enforcement of the
obligations of either party against the other under SECI-
SPD PPA shall be that within 60 days from the date of
submission to the Appropriate Commission, the Buying
Entity (ies) shall obtain all requisite approvals including
approval of PSA (including adoption of tariff and trading
margin) Com its State Fleeticity Regulatory Commission
and/ or CFRC (as applicable), on the terms and
conditions contained in this Agreement read with the
terms and conditions contained in the Power Sale
Agreement entered into between SECI and the Buying
Entity(ies). The Parties agree that in the event, the order
of adoption of tariff,trading margin and the approval of
PPA & PSA, as mentioned above is not issued by the
SERC and/ or CERC (as applicable) within the time
specified above, the provisions of Article 2.1.3 of SECI
SPD PPA shall apply. Any liability other than ISTS
charges and losses arising on account of termination of
such PAs to SECI shall be settled by the Buying Entity...."
In the present case, the Central Regulatory
Commission has passed orders fixing adoption tariff
subject to the outcome of the PIL referred supra. As
rightly contended by the learned counsel for the
petitioners that, when such a condition has been
imposed no banks will come forward for giving loans to
the petitioners. In these circumstances proceeding with
the project by the petitioners, prima facie would be
difficult. In the proceedings dated 12.10.2023, they have
categorically mentioned and sought plan of action from
the petitioners by 6:00 pm of 16.10.2023, now the
petitioners are apprehending that, the respondents may
invoke bank guarantee. Prima facie, a point is made out
for consideration in the present writ petition. In the
event, if the respondents take any coercive steps against
the petitioners, it not only affects the rights of the
petitioners but also the purpose of filing the writ petition
would be defeated. As such this Court is inclined to pass
the following order, as an interim measure:
The 3rd respondent is hereby directed not to take
any coercive steps pursuant to the letter dated
12.10.2023 till next date of hearing.
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RC, J
BRS
