Karnataka High Court
M/S Mukund Limited vs State Of Karnataka on 1 March, 2024
Author: Hemant Chandangoudar
Bench: Hemant Chandangoudar
-1-
NC: 2024:KHC:8783
WP No. 11771 of 2021
C/W WP No. 10171 of 2018
WP No. 21487 of 2019
WP No. 25490 of 2019
WP No. 25569 of 2019
WP No. 30271 of 2019
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 1ST DAY OF MARCH, 2024
BEFORE
THE HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR
WRIT PETITION NO. 11771 OF 2021 (GM-KEB)
C/W
WRIT PETITION NO. 10171 OF 2018 (GM-KEB),
WRIT PETITION NO. 21487 OF 2019 (GM-KEB),
WRIT PETITION NO. 25490 OF 2019 (GM-KEB),
WRIT PETITION NO. 25569 OF 2019 (GM-KEB),
WRIT PETITION NO. 30271 OF 2019 (GM-KEB),
IN WP NO.11771/2021:
BETWEEN:
MANGALORE CHEMICALS AND FERTILIZERS LIMITED
A COMPANY INCORPORATED UNDER THE PROVISIONS OF
THE COMPANIES ACT, 1956,
HAVING ITS REGISTERED OFFICE AT LEVEL-11,
UB TOWERS, U.B. CITY NO.24,
VITTAL MALLYA ROAD,
Digitally signed by B
K BANGALORE - 560 001.
MAHENDRAKUMAR
Location: HIGH
COURT OF REPRESENTED BY AUTHORIZED SIGNATORY AND
KARNATAKA COMPANY SECRETARY,
SRI. VIJAYAMAHANTESH KHANNUR.
...PETITIONER
(BY SRI. AJAY J.N., ADVOCATE)
AND:
1. STATE OF KARNATAKA
DEPARTMENT OF ENERGY
2ND FLOOR, VIKASA SOUDHA,
BANGALORE - 560 001.
2. KARNATAKA ELECTRICITY
REGULATORY COMMISSION
-2-
NC: 2024:KHC:8783
WP No. 11771 of 2021
C/W WP No. 10171 of 2018
WP No. 21487 of 2019
WP No. 25490 of 2019
WP No. 25569 of 2019
WP No. 30271 of 2019
NO. 16C-1,
MILLER TANK BED AREA,
VASANTHNAGAR,
BENGALURU - 560 052,
REPRESENTED BY ITS CHAIRMAN.
3. CHIEF ENGINEER
KARNATAKA POWER TRANSMISSION
CORPORATION LTD.,
STATE LOAD DESPATCH CENTRE,
28, RACE COURSE ROAD,
BANGALORE - 560 009.
4. MANGALORE ELECTRICITY SUPPLY COMPANY
1ST FLOOR, MESCOM BHAVAN,
KAVOOR CROSS ROAD,
BEJAI,
MANGALORE - 575 004,
REPRESENTED BY ITS MANAGING DIRECTOR.
...RESPONDENTS
(BY SRI. S.R. KHAMROZ KHAN, AGA FOR R1;
SRI. B.N. PRAKASH, ADVOCATE FOR R2;
SRI. SHAHBAAZ HUSSAIN, ADVOCATE FOR R3)
THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA PRAYING TO DECLARE THAT CLAUSE 3(ii) OF
THE KERC (POWER PROCUREMENT FROM RENEWABLE SOURCES)
REGULATIONS 2015 DATED:16.11.2015 ANNEXURE-A AS ILLEGAL,
CAPRICIOUS AND ULTRA VIRES SECTION 86(1)(e) OF THE
ELECTRICITY ACT 2003 TO THE EXTENT THAT IT DOES NOT EXCLUDE
THE CO-GENERATION CAPTIVE UNITS FROM THE RENEWABLE
PURCHASE OBLIGATION AND ETC.
IN WP NO.10171/2018:
BETWEEN:
M/s. BMM ISPAT LTD.,
A COMPANY REGISTERED
UNDER THE COMPANIES ACT, 1956,
OFFICE AT NO.101, 1ST FLOOR,
"PRIDE ELITE" NO.10, MUSEUM ROAD,
-3-
NC: 2024:KHC:8783
WP No. 11771 of 2021
C/W WP No. 10171 of 2018
WP No. 21487 of 2019
WP No. 25490 of 2019
WP No. 25569 of 2019
WP No. 30271 of 2019
BENGALURU - 560 001,
REP. BY ITS GENERAL MANAGER PR,
MR. SILAS NERALLA.
...PETITIONER
(BY SRI. AJAY J.N., ADVOCATE)
AND:
1. STATE OF KARNATAKA
DEPARTMENT OF ENERGY
2ND FLOOR, VIKASA SOUDHA,
BANGALORE - 560 001.
2. KARNATAKA ELECTRICITY
REGULATORY COMMISSION
6TH AND 7TH FLOORS, NO.9/2,
MAHALAXMI CHAMBERS,
MAHATMA GANDHI ROAD,
BANGALORE - 560 001,
REPRESENTED BY ITS SECRETARY.
3. CHIEF ENGINEER
KARNATAKA POWER TRANSMISSION,
CORPORATION LTD.,
STATE LOAD DESPATCH CENTRE,
28, RACE COURSE ROAD,
BANGALORE - 560 009.
...RESPONDENTS
(BY SRI. S.R. KHAMROZ KHAN, AGA FOR R1;
SRI. B.N. PRAKASH, ADVOCATE FOR R2;
SRI. S. SRIRANGA, SENIOR COUNSEL FOR
SMT. SUMANA NAGANAND, ADVOCATE FOR R3)
THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA PRAYING TO DECLARE THAT CLAUSE 3(ii) OF
THE KERC (POWER PROCUREMENT FROM RENEWABLE SOURCES)
REGULATIONS 2015, DATED 16 NOVEMBER 2015 (ANNEXURE-A) AS
ILLEGAL, CAPRICIOUS AND ULTRA VIRES SECTION 86(1)(E) OF THE
ELECTRICITY ACT, 2003 TO THE EXTENT THAT IT DOES NOT EXCLUDE
THE CO-GENERATION CAPTIVE UNITS FROM THE RENEWABLE
PURCHASE OBLIGATION AND ETC.
-4-
NC: 2024:KHC:8783
WP No. 11771 of 2021
C/W WP No. 10171 of 2018
WP No. 21487 of 2019
WP No. 25490 of 2019
WP No. 25569 of 2019
WP No. 30271 of 2019
IN WP NO.21487/2019:
BETWEEN:
1. SHATHAVAHANA ISPAT PRIVATE LIMITED,
A COMPANY INCORPORATED UNDER THE PROVISIONS OF
THE COMPANIES ACT, 1956,
HAVING ITS REGISTERED OFFICE AT PLOT NO.169/11,
GRAND TRUNK ROAD,
NEAR RTO OFFICE, CANTONMENT,
BALLARI - 583 104.
REP. BY AUTHORISED SIGNATORY
SRI. D. RAMANA KUMAR.
2. ILC IRON AND STEEL PRIVATE LIMITED
A COMPANY INCORPORATED UNDER THE PROVISIONS OF
THE COMPANIES ACT, 1956,
HAVING ITS REGISTERED OFFICE AT C-30, INDUSTRIAL
ESTATE, DAM ROAD,
HOSAPETE - 583 203,
REP. BY ITS AUTHORISED SIGNATORY
SRI. B. NAGARAJ.
3. DHRUVDESH METASTEEL PRIVATE LIMITED
A COMPANY INCORPORATED UNDER THE PROVISIONS OF
THE COMPANIES ACT, 1956,
HAVING ITS REGISTERED OFFICE AT SURVEY
NO.150-156, HIREBAGANAL VILLAGE,
GINIGERA POST,
TALUQ & DISTRICT: KOPPAL,
KARNATAKA - 583 228.
REP. BY ITS AUTHORISED SIGNATORY
SRI V.S.KAMATH
4. JANKI CORP LIMITED
A COMPANY INCORPORATED UNDER THE PROVISIONS OF
THE COMPANIES ACT, 1956, HAVING ITS REGISTERED
OFFICE AT MANDPIYA CHORAHA, CHOTTIR ROAD,
BHILWARA, RAJASTHAN 311 001.
REP. BY ITS AUTHORISED SIGNATORY
SRI SUJIT MURARKA
...PETITIONERS
(BY SRI. AJAY J.N., ADVOCATE)
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NC: 2024:KHC:8783
WP No. 11771 of 2021
C/W WP No. 10171 of 2018
WP No. 21487 of 2019
WP No. 25490 of 2019
WP No. 25569 of 2019
WP No. 30271 of 2019
AND:
1. STATE OF KARNATAKA
DEPARTMENT OF ENERGY
2ND FLOOR, VIKASA SOUDHA,
BANGALORE - 560 001.
2. KARNATAKA ELECTRICITY
REGULATORY COMMISSION
6TH AND 7TH FLOORS NO.9/2,
MAHALAXMI CHAMBERS,
MAHATMA GANDHI ROAD,
BANGALORE - 560 001,
REPRESENTED BY ITS CHAIRMAN.
3. CHIEF ENGINEER
KARNATAKA POWER TRANSMISSION,
CORPORATION LTD.,
STATE LOAD DESPATCH CENTRE,
28, RACE COURSE ROAD,
BANGALORE - 560 009.
...RESPONDENTS
(BY SRI. S.R. KHAMROZ KHAN, AGA FOR R1;
SRI. B.N. PRAKASH, ADVOCATE FOR R2;
SRI. S. SRIRANGA, SENIOR COUNSEL FOR
SMT. SUMANA NAGANAND, ADVOCATE FOR R3)
THIS W.P IS FILED UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA PRAYING TO DECLARE THAT CLAUSE 3(ii) OF
THE KERC [POWER PROCUREMENT FROM RENEWABLE SOURCES]
REGULTIONS 2015 DATED:16.11.2015 [ANNEXURE-A] AS ILLEGAL,
CAPRICIOUS AND ULTRA VIRES SECTION 86[1][e] OF THE ELECTRICITY
ACT, 2003 TO THE EXTENT THAT IT DOES NOT EXCLUDE THE CO-
GENERATION CAPTIVE UNITS FROM THE RENEWABLE PURCHASE
OBLIGRATION AND ETC.
IN WP NO.25490/2019:
BETWEEN:
M/s. SLR METALIKS LIMITED,
NARAYANA DEVARA KERE,
LOKAPPANA HOLA,
-6-
NC: 2024:KHC:8783
WP No. 11771 of 2021
C/W WP No. 10171 of 2018
WP No. 21487 of 2019
WP No. 25490 of 2019
WP No. 25569 of 2019
WP No. 30271 of 2019
HAGARI BOMMANA HALLI,
BELLARY - 583 222,
REPRESENTED BY ITS DIRECTOR
MR. K.C. SIDDAPPA.
...PETITIONER
(BY SRI. H. SRINIVAS ROA, ADVOCATE)
AND:
1. STATE OF KARNATAKA
DEPARTMENT OF ENERGY
2ND FLOOR, VIKASA SOUDHA,
BANGALORE - 560 001.
REPRESENTED BY ADDITIONAL
CHIEF SECRETARY.
2. KARNATAKA ELECTRICITY
REGULATORY COMMISSION
No.9/2, MAHALAXMI CHAMBERS
6TH AND 7TH FLOOR,
M G ROAD
BANGALORE - 560 001
REPRESENTED BY ITS CHAIRMAN.
3. KARNATAKA POWER TRANSMISSION
CORPORATION LTD.,
STATE LOAD DESPATCH CENTRE,
RACE COURSE ROAD,
BANGALORE - 560 009,
REPRESENTED BY ITS CHIEF ENGINEER
...RESPONDENTS
(BY SRI. S.R. KHAMROZ KHAN, AGA FOR R1;
SRI. B.N. PRAKASH, ADVOCATE FOR R2;
SRI. S. SRIRANGA, SENIOR COUNSEL FOR
SMT. SUMANA NAGANAND, ADVOCATE FOR R3)
THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA PRAYING TO DECLARE THAT CLAUSE 3(ii) OF
THE KERC (POWER PROCUREMENT FROM RENEWABLE SOURCES)
REGULATIONS 2015 DATED 19.11.2015 VIDE NOTIFICATION DATED
16.11.2015 AT ANNEXURE-A AS ILLEGAL AND ULTRA VIRES SECTION
86(1)(e) OF THE ELECTRICITY ACT, 2003 TO THE EXTENT THAT IT DOES
NOT EXCLUDE THE CO-GENERATION CAPTIVE UNITS FROM THE
RENEWABLE ENERGY PURCHASE OBLIGATIONS AND ETC.
-7-
NC: 2024:KHC:8783
WP No. 11771 of 2021
C/W WP No. 10171 of 2018
WP No. 21487 of 2019
WP No. 25490 of 2019
WP No. 25569 of 2019
WP No. 30271 of 2019
IN WP NO.25569/2019:
BETWEEN:
HARE KRISHNA MATALLICS PVT. LIMITED,
A COMPANY INCORPORATED UNDER THE PROVISIONS OF
THE COMPANIES ACT, 1956,
HAVING ITS REGISTERED OFFICE AT
SURVEY NO.20, KASAN KANDI ROAD,
VILLAGE HIRENAGNAL, DIST-KOPPAL,
KARNATAKA -583 228,
REPRESENTED BY AUTHORISED SIGNATORY,
SRI. MEKALA STANLEY NARAYANA PRASAD.
...PETITIONER
(BY SRI. AJAY J.N., ADVOCATE)
AND:
1. STATE OF KARNATAKA
DEPARTMENT OF ENERGY
2ND FLOOR, VIKASA SOUDHA,
BANGALORE - 560 001.
2. KARNATAKA ELECTRICITY
REGULATORY COMMISSION
NO.9/2, MAHALAXMI CHAMBERS
6TH AND 7TH FLOORS, M.G.ROAD
BANGALORE - 560 001
REPRESENTED BY ITS CHAIRMAN.
3. CHIEF ENGINEER
KARNATAKA POWER TRANSMISSION
CORPORATION LTD.,
STATE LOAD DESPATCH CENTRE,
28, RACE COURSE ROAD,
BANGALORE - 560 009,
...RESPONDENTS
(BY SRI. S.R. KHAMROZ KHAN, AGA FOR R1;
SRI. B.N. PRAKASH, ADVOCATE FOR R2;
SRI. S. SRIRANGA, SENIOR COUNSEL FOR
SMT. SUMANA NAGANAND, ADVOCATE FOR R3)
THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA PRAYING TO DECLARE THAT CLAUSE 3(ii) OF
-8-
NC: 2024:KHC:8783
WP No. 11771 of 2021
C/W WP No. 10171 of 2018
WP No. 21487 of 2019
WP No. 25490 of 2019
WP No. 25569 of 2019
WP No. 30271 of 2019
THE KERC [POWER PROCUREMENT FROM RENEWABLE SOURCES]
REGULATIONS 2-15, DATED:16.11.2015 [ANNEXURE-A] AS ILLEGAL,
CAPRICOUS AND ULTRA VIRES SECTION 86[1] [e] OF THE ELECTRICITY
ACT, 2003 TO THE EXTENT THAT IT DOES NOT EXCLUDE THE CO-
GENERATION CAPTIVE UNITS FROM THE RENEWABLE PURCHASE
OBLIGATION AND ETC.
IN WP NO.30271/2019:
BETWEEN:
M/s. MUKUND LIMITED
A COMPANY INCORPORATED UNDER THE PROVISIONS OF
THE COMPANIES ACT, 1956,
HAVING ITS REGISTERED OFFICE AT
BAJAJ BHAWAN, JAMNALAL BAJAJ MARG,
226, NARIMAN POINT, MUMBAI,
INDIA - 400 021.
ALSO AT: HOSPET ROAD,
GINIGEAR, KOPPAL DISTRICT,
KARNATAKA - 583 228,
REPRESENTED BY AUTHORISED SIGNATORY
SRI. DEBABRATA DAS.
...PETITIONER
(BY SRI. AJAY J.N., ADVOCATE)
AND:
1. STATE OF KARNATAKA
DEPARTMENT OF ENERGY
2ND FLOOR, VIKASA SOUDHA,
BANGALORE - 560 001.
BY ITS SECRETARY.
2. KARNATAKA ELECTRICITY
REGULATORY COMMISSION
NO.9/2, MAHALAXMI CHAMBERS,
6TH AND 7TH FLOOR,
M.G. ROAD, BANGALORE - 560 001
REPRESENTED BY ITS CHAIRMAN.
3. CHIEF ENGINEER
KARNATAKA POWER TRANSMISSION
CORPORATION LTD.,
STATE LOAD DESPATCH CENTRE,
-9-
NC: 2024:KHC:8783
WP No. 11771 of 2021
C/W WP No. 10171 of 2018
WP No. 21487 of 2019
WP No. 25490 of 2019
WP No. 25569 of 2019
WP No. 30271 of 2019
28, RACE COURSE ROAD,
BANGALORE - 560 009
...RESPONDENTS
(BY SRI. S.R. KHAMROZ KHAN, AGA FOR R1;
SRI. B.N. PRAKASH, ADVOCATE FOR R2;
SRI. S. SRIRANGA, SENIOR COUNSEL FOR
SMT. SUMANA NAGANAND, ADVOCATE FOR R3)
THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA PRAYING TO DECLARE THAT CLAUSE 3(ii) OF
THE KERC (POWER PROCUREMENT FROM RENEWABLE SOURCES)
REGULATIONS 2015, DATED 16.11.2015 (ANNEXURE-A) AS ILLEGAL,
CAPRICIOUS AND ULTRA VIRES SECTION 86(1)(e) OF THE ELECTRICITY
ACT, 2003 TO THE EXTENT THAT IT DOES NOT EXCLUDE THE CO-
GENERATION CAPTIVE UNITS FROM THE RENEWABLE PURCHASE
OBLIGATION AND ETC.
THESE PETITIONS, COMING ON FOR ORDERS, THIS DAY, THE
COURT MADE THE FOLLOWING:
ORDER
In all these petitions, the following reliefs are sought:
"a. Issue Writ of certiorari or orders/s, direction/s of
the like nature declaring that Clause 3(ii) of the
KERC (Power Procurement from Renewable
Sources) Regulations 2015, dated 16.11.2015
(Annexure-A), as illegal, capricious and ultra vires
Section 86(1)(e) of the Electricity Act, 2003 to the
extent that it does not exclude the co-generation
captive units from the Renewable Purchase
Obligation;
b. Issue a Writ of Mandamus directing the
respondent Nos.1 and 2 to include co-generation
units in the same ambit as renewable generators;
c. Grant any other relief that this Hon'ble Court
deems fit to grant in the circumstances of the
case, in the interest of Justice and equity;
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NC: 2024:KHC:8783
d. Award costs to the Writ Petition."
2. Under impugned Clause 3(ii) of the KERC (Power
Procurement from Renewable Sources) Regulations 2015, dated
16.11.2015, the petitioners, which are involved in generating heat
power from using waste heat recovery processes, were excluded
from the ambit of renewable generators. The issue involved in this
case was examined by the Appellate Tribunal for Electricity at New
Delhi in Appeal No.322 of 2016 and Appeal No.333 of 2016, and by
its Judgment dated 09.04.2019, it ruled as follows:
"40. It is manifest on the face of the judgment, as
stated supra, the Captive consumers having
cogenerating plants cannot be fastened with the
obligation to procure electricity from renewable energy
sources, as that would defeat the object of section
86(1)(e) of the Electricity Act, 2003 and cogenerating
plants have to be treated at par with renewable energy
generating plants for the purpose of RPO obligations."
3. The challenge to the order passed by the Appellate
Tribunal for Electricity was dismissed on the ground of delay in SLP
(Civil) Appeal Diary No.35931/2019 dated 07.02.2020. The
Appellate Tribunal for Electricity having categorically held that the
co-generating plant has to be treated at par with renewable energy
generating plant for the purpose of RPO Application, the impugned
clause requires to be held to be unenforceable against the
petitioners.
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NC: 2024:KHC:8783
4. The claim of the petitioners to include co-generation
units in the same ambit as renewable generators require to be
considered dehorse the impugned clause.
5. Accordingly, the petitions stand disposed of directing
respondent Nos.1 and 2 to consider the claim of the petitioners to
include them in the same ambit as renewable generators dehorse
the impugned clause. It is needless to state that the impugned
demand notices issued in exercise of the impugned clauses shall
be held to be inoperative and cannot be enforced against the
petitioners.
Sd/-
JUDGE
CP
