Radiance Punjab Renewable Private Limited vs Punjab State Electricity Regulatory Commission & Ors
- Court
- Appellate Tribunal For Electricity
IN THE APPELLATE TRIBUNAL FOR ELECTRICITY
(Appellate Jurisdiction)
Court-2
APPEAL No. 200 of 2018
rd
Dated : 3 July, 2026
Present: Hon’ble Ms. Seema Gupta, Officiating Chairperson
Hon’ble Mr. Virender Bhat, Judicial Member
In the matter of:
1. Radiance Punjab Renewable Private Limited
Through its Authorized Representative
Leval 4, Rectangle 1, Commercial Complex,
D-4, Saket, New Delhi – 110017
Email: [email protected] … Appellant
Versus
1. Punjab State Electricity Regulatory Commission
Through its Secretary
SCO No. 220-221, Sector -34-A
Chandigarh – 160022
Email: [email protected]
2. Punjab State Power Corporation Limited
Through its Managing Director
The Mall, Patiala, Punjab – 147001
Email: [email protected]
3. Punjab Energy Development Agency
Through its Managing Director
Plot No. 1-2, Sector-33-D,
Chandigarh – 160034
Email: [email protected] ,
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 1 of 52
[email protected] … Respondent (s)
Counsel for the Appellant(s) : Varun Singh
Shri Venkatesh
Nishtha Kumar
Ashutosh Kumar Srivastava
Sandeep Rajpurohit
Vikas Maini
Somesh Srivastava
for App. 1
Counsel for the Respondent(s) : Sethu Ramalingam
for Res. 1
Anand K. Ganesan
Swapna Seshadri
Amal Nair
Neha Garg
For Res. 2
Aadil Singh Boparai
For Res. 3
J U D G M E N T
PER HON’BLE MR. VIRENDER BHAT, JUDICIAL MEMBER
1. The Appellant, M/s Radiance Punjab Renewable Private
Limited is assailing the order dated 4th June, 2018 passed by 1st
Respondent Punjab State Electricity Regulatory Commission
(hereinafter referred to as "the Commission") passed in Petition No. 24
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 2 of 52
of 2016 which was filed by M/s. Azure Renewable Energy Pvt. Ltd.,
(the predecessor in interest of the Appellant herein) seeking extension
of the commercial operation date of its solar power generation sites
beyond the schedule commercial operation date with further prayer for
st
entitlement to tariff of Rs.7.59 per kWh in terms of the PPA dated 31
nd
March, 2015 executed between the Appellant and the 2 Respondent
Punjab State Power Corporation Limited. Various Force Majeure
events were agitated by the Appellant in the petition which, according
to it, prevented it from achieving commercial operation on or before the
scheduled date. Vide the impugned order, the Commission has
condoned delay of only 29 days and has disallowed the claims of the
Appellant with regards to the majority of the Force Majeure events and
thus tariff for the solar power project sites of the Appellant was reduced
from Rs.7.59 per unit to Rs.5.09 per unit.
Description of the Parties :-
2. The Appellant is a generating company within the meaning of
Section 2(28) of the Electricity Act, 2003 and is a solar power
nd
developer. The 2 Respondent - Punjab State Power Corporation
Limited is an unbundled entity of the erstwhile Punjab State Electricity
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 3 of 52
Board and is vested with the distribution of electricity in the State of
Punjab.
3. The 3rd Respondent - Punjab Energy Development Authority
is a designated agency in the State of Punjab for development of
power projects and was the designated agency to conduct the
competitive bidding process on behalf of the 2nd Respondent - PSPCL
for procurement of electricity from solar generation projects.
Facts of the case
4. The facts and circumstances of the case in which the above
said appeal has arisen are noted hereunder.
5. Vide notification dated 26th December, 2012, the Government
of Punjab notified the New and Renewable Source of Energy Policy,
2012 (in short NRSE 2012) providing for various incentives and
benefits to renewable energy projects to be established in the State of
Punjab. The policy provided for the terms and conditions on the basis
of which the projects were to be established, the benefits to be granted
to the projects and also the tariff at which power was to be procured
by the Distribution Licensees i.e. the 2nd Respondent from such
projects. It also envisaged that the 3rd Respondent - PEDA to be a
nodal agency as a project facilitator for all such projects. PEDA was
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 4 of 52
given the responsibility of "Single Window Clearance" for all sanctions
and clearances from the Government departments within a period of
60 days in order to ensure seamless commissioning of renewable
energy power plants.
6. The bids/proposals for establishment of Solar RoofTop Projects
under Section 63 of Electricity Act, 2003 were invited against RFP by
PEDA in January, 2015 through e-bidding system.
7. The Appellant participated in the bidding in March, 2015 and
was declared successful bidder on 25th March, 2015 for capacity of 10
MW solar rooftop power project under category II bidders to establish
nd
a power plant and supply power to 2 Respondent - PSPCL for a
period of 25 years at net tariff of Rs.7.59 per kWh in accordance with
the provisions of RFP. The Appellant was required to submit
performance security by way of irrevocable Bank Guarantee at the rate
of Rs.40 lakhs per MW aggregating to Rs.4 crores and to sign the
Implementation Agreement (IA) with PEDA within 5 days of the date of
the issue of Letter of Award (LoA) and subsequently to sign Power
nd
Purchase Agreement (PPA) with 2 Respondent - PSPCL.
8. The Appellant executed Implementation Agreement with PEDA
on 28th March, 2015 and also submitted the required performance
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 5 of 52
guarantee in the amount of Rs.4 crores to PEDA in terms of Article
6.2(iv) of the IA. As per the terms of RfP & IA, the Solar Rooftop
Projects were to be commissioned by the Appellant within 10 months
from the date of signing of PPA.
9. The solar power developers including the Appellant were
nd
invited by the 2 Respondent - PSPCL on 31st March, 2015 to sign
the PPAs. The PPAs contained a clause No. 35 providing that the PPA
shall be effective and binding only upon approval by the Commission
and would be subject to the conditions, if any, to be stipulated by the
Commission.
nd
10. The 2 Respondent PSPCL filed Petition No. 23 of 2015
before the Commission seeking approval to procure electricity from the
solar power developers as well as to approve the PPAs executed by it
th
with them. The petition was allowed by the Commission on 11 May,
2015 and accordingly the PPAs were approved.
11. Thereafter, the Appellant identified the roofs for the entire 10
th
MW project and submitted the details to PEDA vide letter dated 26
August, 2015.
12. It appears that PEDA issued a notice dated 3rd September,
2015 to the Appellant for termination of the LOA on the ground of not
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 6 of 52
providing the list of properties for installing solar power projects as per
clause 4.1 (vii) of the Implementation Agreement. The Appellant sent
a detailed response dated 29th September, 2015 to the said notice of
PEDA mentioning therein the difficulties in identifying the rooftops of
which the solar power projects were to be installed.
th
13. Meanwhile the Appellant, also vide letter dated 4 September,
2015, sought feasibility clearance for the entire power project from the
th
planning department of PSPCL. Vide letter dated 7 September, 2015,
the Appellant sought feasibility/technical clearance from PEDA for
implementation of the project at nine individual sites.
14. PEDA gave concurrence for setting up of SPV plants identified
th
by the Appellant on 14 October, 2015 copy of which was also marked
th
to PSPCL. The Appellant immediately addressed a letter dated 15
October, 2015 to PSPCL with the request for immediate
feasibility/connectivity/ technical approval for evacuation of power from
the 10 MW distributed capacity of the rooftop SPV plant at 11KV GSS
at various locations.
th
15. In subsequent letter dated 26 August, 2015, PEDA wrote to
PSPCL that at the time of signing of Implementation Agreement, the
Company i.e. the Appellant had informed that it has not identified any
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 7 of 52
location for setting up of the project and now the Appellant has
identified the rooftop areas and therefore supplementary PPA for 10
MW rooftop SPV plant has to be signed. Accordingly, the Appellant
th
wrote a letter dated 28 October, 2015 to PSPCL requesting it to
execute supplementary PPA with regards to the identified rooftop sites.
Instead of executing the supplementary PPA, PSPCL wrote a letter
th
dated 4 November, 2015 to PEDA with the request to first carry out
amendment in the Implementation Agreement before supplementary
PPA can be executed.
th
16. On 10 November, 2015, PEDA executed amended
Implementation Agreement with the Appellant specifying therein the
nine sites identified by the Appellant. This fact was intimated to PSPCL
th
by PEDA vide letter dated 13 November, 2015 with the request to
carry out amendments in the PPA with the Appellant.
th
17. On 13 November, 2015, the Appellant also requested PSPCL
to carry out requisite amendment in the PPA so that the Appellant
th
could set up its SPV plant in timely manner. Vide letter dated 18
November, 2015 PSPCL again sought clarification regarding
installation of projects at several sites. This position was clarified by
th
PEDA vide letter dated 20 November, 2015 stating that setting up of
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 8 of 52
the project at different sites was permissible as per the RFP document
and again requested PSPCL to carry out the requisite amendment in
the PPA.
th
18. However, PSPCL again, vide letter dated 24 November, 2015,
requested PEDA to relook into the matter. Thereafter, vide letter dated
th
26 November, 2015 PEDA again requested PSPCL to sign the
amended PPA with the Appellant clarifying that it was extremely
difficult to get a large single rooftop area of one lakh sq. meter in the
State of Punjab.
19. Ultimately, the PSPCL carried out necessary amendments in
nd
the PPA on 2 December, 2015 specifying therein the names of
identified cites for setting up of the solar power plant by the Appellant.
Subsequently, on 7th December, 2015, PSPCL gave technical
concurrence for these sites of the Appellant.
th
20. On 17 December, 2015, the Appellant addressed the letter to
PSPCL with the request to expedite the grant of grid connectivity which
was required to start the process of execution of the project in the
th
timely manner. This was followed by reminder dated 28 December,
2015. PSPCL gave grid feasibility to two rooftop sites of the Appellant
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 9 of 52
th
on the same day i.e. 28 December, 2015 and for seven remaining
st
sites on 31 December, 2015.
21. The Appellant along with other solar power developers sent a
th
representation dated 6 January, 2016 to PEDA mentioning therein
the circumstances in which approval of PPA was delayed much, in
turn, resulting in delay achieving financial closure as well as
th
disbursement of loan. However, PEDA vide letter dated 18 January,
2016 informed them that there will be no extension in the Schedule
Commissioning Date (SCOD) of the power projects.
th
22. The Appellant received a communication dated 24 February,
2016 from PEDA asking it to intimate the extent of capacity which has
been commissioned by the Appellant in the month of February, 2016.
PEDA also sought to impose penalty for non-commissioning /short fall
in the commissioning of allocated capacity as per clause 3.23 of RFP.
th
The Appellant submitted a detailed response dated 26 February,
2016 to the said letter of PEDA.
st nd
23. Thereafter, during 1 February, 2016 to 2 May, 2016, PSPCL
approved the route of transmission lines.
24. In these circumstances, the Appellant approached the
Commission with Petition No. 24 of 2016 seeking extension of SCOD
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 10 of 52
st
of the solar power project till 31 May, 2016 with applicable tariff of
Rs.7.59 per kWh and further direction to PSPCL as well as PEDA not
to take any coercive action against the Appellant with regard to the
Performance Bank Guarantee deposited by the Appellant. The prayers
made in the petition by the Appellant are extracted herein below:-
(a) set aside and / or quash the letters dated 18.01.2016 and
24.02.2016 of PEDA;
(b) hold and declare that the Commercial Operation Date of
the project of the petitioner stands extended till 31.05.2016 in
accordance with clause 10 of the PPA read with Article 7.0 of
the IA on account of force majeure events which are beyond
the control of the petitioner;
and
further hold and declare that the Commercial Operation Date
of the two sites / plants of the petitioner i.e. PSAMB Ludhiana
th
and Canam Consultants stands extended till 8 June, 2016
nd
and 22 June, 2016 respectively, in accordance with Article
10 of the PPA read with Article 7.0 of the Implementation
Agreement on account of Force Majeure events and events
which are beyond the control of the petitioner.
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 11 of 52
(c) hold and declare that the petitioner is entitled to tariff of Rs.
7.59 per kWh (levellised tariff) in terms of the PPA dated
31.03.2015 during the extended COD period;
(d) direct PEDA not to invoke the Performance Bank
Guarantee, and to not take any coercive actions whatsoever
against the petitioner.
25. The petition has been decided by the Commission vide order
th
dated 4 June, 2018 which is impugned in this appeal. Vide the said
impugned order, the Commission has condoned the delay of 29 days
which had occasioned due to delay on the part of the PSPCL in
granting grid feasibility clearance but has rejected the remaining Force
Majeure claims of the appellant thereby causing reduction of tariff for
the Appellant's solar power project from Rs.7.59 per unit to Rs.5.09
per unit.
26. It is the contention of the Appellant in this appeal that delays on
account of following events ought to have been taken into account by
the Commission in the impugned order and accordingly, the SCOD of
the power project ought to have been extended;
(a) Delay of 41 days in approval of PPA.
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 12 of 52
(b) Delay in grid connectivity and in execution of (b) supplementary
PPA.
(c) Delay on account of JAT agitation.
27. We have heard Learned Counsel for the Appellant as well as
Learned Counsel for Respondent Nos. 1, 2 & 3. We have also perused
the written submissions filed by the Learned Counsels.
Relevant contractual clauses :-
28. Before embarking upon to discuss these issues raised in the
Appeal by the Appellant, we find it pertinent to refer to various
provisions of the RFP document, Implementation Agreement and the
PPA/SPPA.
29. Clause 3.2(B) of the RFP document relates to the scope of work
and provides that the scope of work for the bidder include identification
of buildings/leasing rooftop of buildings, obtaining No Objection
Certificate from PSPCL for grid connectivity, complete design,
engineering, manufacture, supply, storage, civil work, erection, testing
& commissioning of the grid connected rooftop solar PV project
including operation of maintenance of the project. Therefore, it was the
responsibility of the bidder to identify the rooftops upon which the
allocated solar power project was intended to be installed.
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 13 of 52
30. Clause 3.9 of the RFP is with regards to the Implementation
Agreement and is extracted hereinbelow :-
"Implementation Agreement (IA)
The terms and condition for Implementation of the project shall
be formulized through signing of Implementation Agreement
between successful bidder and PEDA. The Solar Project
Developer shall be required to pay non refundable facilitation
service charges @ 0.5% of the total Project Cost (as per the
project cost given in the Detailed Project Report (DPR) submitted
by the SPD) with a maximum limit of Rs. 50,00,000/- (Rupees Fifty
Lac only) before signing of Implementation Agreement.
The successful bidder shall execute separate Implementation
Agreement for each individual projects and shall pay separate
facilitation charges.
The detailed project report shall be submitted by the SPD
before signing of IA. The IA is attached as Annexure-4.”
31. Clause 3.10 of the RFP provided that the PPA shall be
executed between PSPCL and selected bidder within 30 days from the
date of signing of the Implementation Agreement and would be valid
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 14 of 52
for 25 years from the date of commissioning of the complete plant or
partial capacity. As per clause 3.23 of the RFP, the Rooftop Solar PV
project was to be commissioned within 10 months from the date of
signing of the PPA and in case of failure to do so, PEDA was entitled
to encash Performance Bank Guarantee in the following manner :-
(a ) Delay upto one month PEDA will encash 30% of the total
Performance Bank Guarantee proportionate to the Capacity
not commissioned.
(b) Delay of more than one month and upto two month, PEDA
will encash remaining 70% of the total Performance Bank
Guarantee proportionate to the Capacity not commissioned.
(c) The penalty on the delay in project commissioning as
stated above will be calculated on the number of days for
which delay occurs on pro-rate basis.
(d ) in case of part commissioning, the penalty shall be
calculated on the delay on un-commissioned capacity. In case
the commissioning of project is delayed beyond 12 months
from the date of signing of PPA, the Project Developer shall
pay to PSPCL the Liquidated Damages at a rate of Rs.
20,000/- (Rupees Twenty Thousand Rupees Only) per MW
per day for delay in such remaining Capacity which is not
commissioned. The maximum time period allowed for
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 15 of 52
commissioning of the full Project Capacity with encashment of
Performance Bank Guarantees and payment of Liquidated
Damages shall be limited to 15 months from the date of signing
of PPA. The amount of liquidated damages worked out as
above shall be recovered by PSPCL from the payments due
to the Project Developer on account of sale of solar power to
PSPCL. In case, the Commissioning of the Project is delayed
beyond 15 months from the date of signing of PPA, the PPA
capacity shall stand reduced/amended to the Project Capacity
Commissioned and the PPA for the balance Capacity will
stand terminated and shall be reduced from the selected
Project Capacity. The LOA & IA shall also stand terminated for
the balance un-commissioned capacity.
st
Note :-If due to delay COD of the project shifts beyond 31
March 2016 then in accordance to CERC Regulations the
tariff shall cease to exist and the project developer should
be required to get the tariff afresh by filing the petition in
PSERC.
Part Commissioning:
Part commissioning of the Project shall be accepted by PEDA
subject to the condition that the minimum capacity for
acceptance of part commissioning shall be 0.501 MW.
The PPA will remain in force for a period of 25 years from the
date of acceptance of part commissioning of the Project."
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 16 of 52
32. Article 3 of the Implementation Agreement dated 28th March,
2015 executed between the Appellant and PEDA provides that in case
the COD of the project crosses beyond 31st March, 2016 the tariff
mentioned in the agreement shall cease to exist and the developer will
be bound to get tariff re-determined from the Commission.
33. Article 6 of the IA also is material and is extracted hereinbelow:-
"6.1 Obligations of PEDA:
PEDA will provide necessary support including Single
Window Clearances to facilitate the development of the
projects. This may include facilitation in assisting and
advising in respect of obtaining various approvals from
the Government Departments. However, it will be the
sole responsibility of the Company to obtain such
Approvals.
6.2 Obligations of Company:
i The Company shall act as per the terms and
conditions of RfP;
ii. In case of Consortium, the share holding pattern
and Controlling Shareholding pattern (held by the Lead
Member holding more than 50% of the voting rights) shall
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 17 of 52
not change from the date of submission of RfP up to one
year after the commissioning of the Project.
iii. Power Purchase Agreement (PPA):
The PPA shall be executed between PSPCL and the
Selected Bidder(s), on or before 31st March 2015 after
signing of Implementation Agreement. However, PPA will
remain in force for 25 (Twenty five) years from the date
of Commercial Operation.
iv. Performance Bank Guarantee:
The Company has submitted Performance Bank
Guarantees(s) of Rs. 40,00,000/- (Rupees Forty Lac
Only) per MW for each project at the time of signing of IA
as per the Format - 6.3 B of RfP and other terms and
conditions mentioned in Section 3 of RfP thereof. The
Performance Bank Guarantee shall be valid for a period
of 15 months from the date of signing of IA.
v. Technology:
The Company shall submit a certificate from the project /
its client, situated anywhere in world that the technology
proposed to be supplied by the Manufacturer /
Technology Provider is in successful operation for at least
one year.
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 18 of 52
The Company shall promote only commercially
established and operational technologies to minimize the
technology risk and to achieve the timely commissioning
of the Projects.
vi. Rooftop for Construction of Solar PV Power
Project :
The Bidder / SPD shall acquire rooftop on ownership
/leasehold basis for 30 years. The rooftop area
approximately 100000 Sq. foot per MW shall be in clear
possession of the project developer. In this regard the
Project Developer shall be required to furnish the
documentary evidences i.e. Regd. Sale deed of building
showing ownership/regd. Rooftop lease deed of building
in the name of SPD to PEDA within 120 days from issue
of Letter of Award.
vii. Commissioning of Project:
The Rooftop Solar PV Project shall be commissioned
within 10 (Ten) months from the date of signing of PPA.
viii. Grid Feasibility Letter from PSPCL:
The Company shall obtain and submit to PEDA the grid
feasibility letter from PSPCL within 120 days from the
date of signing of PPA."
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 19 of 52
34. Article 10 of the Implementation Agreement defines Force
Majeure and provides consequences thereof. The same is extracted
hereinbelow:-
“ARTICLE 10: FORCE MAJEURE
10.1 Force Majeure Event
In this Agreement, Force Majeure means an event occurrence in
India of any or all of non-political events described in clause 10.2
and political events described in clause 10.3 respectively hereinafter
which prevents the party claiming Force Majeure. (The affected
party) from performing its obligations under this agreement and
which act or event,
i. Is beyond the reasonable control of and not arising out of the
fault of the affected party.
ii. The affected party has been unable to prevent by the exercise
of due diligence and reasonable efforts, skill and care,
including through expenditure of reasonable sum of money
and
iii. Has a materially adverse effect on the project.
10.2 Non-political force majeure events
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 20 of 52
For the purpose of 10.1 non-political force majeure events shall
mean one or more of the following acts or events:
i) Acts of God or events beyond the reasonable control of the
affected party which could not reasonably have been expected
to occur such as extreme adverse weather or environment
conditions, lighting, heavy rains, cyclones, tempest, whirlwind,
landslides, storms, floods, volcanic, eruptions or fire (to the
extent originating from the source external to the site or not
designed for in construction works);
ii) Radioactive contamination or ionising radiation;
iii) An act of war (whether declared of undeclared) invasion,
armed conflict or act of foreign enemy, unexpected call up of
armed forces, embargo, blockade, rebellion, riot religious
strike, bombs or civil commotion, sabotage terrorism;
iv) Strikes or boycotts interrupting operations of the project
continuing for at least 7 days;
v) Any judgement or order of any court of competent jurisdiction
or statutory authority in India made against the Company in
any proceedings for the reason other than failure of the
Company to comply with any applicable law or clearance or
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 21 of 52
on account of breach thereof, with any applicable law or
clearance or on account of breach thereof, or of any contract,
or enforcement of this Agreement or exercise of any of its
rights under this Agreement by PEDA; or
vi) Any other event or circumstances of nature analogues to the
foregoing.
10.3 Political Force Majeure Event
Political Events shall mean one or more of the following acts or
events by or an account of PEDA, GoP, Gol or any other
Government Agency or Statutory Authority.
i) Change in law.
ii) Expropriation or compulsory confiscation, by any Government
Agency of any Project Assets-or rights of the Company.
iii) The unlawful or un-authorised or without jurisdiction
revocation of, or refusal to renew or grant without valid clause
any consent or approval required by the Company to perform
its obligations under the Agreement (Other than a consent the
obtaining of which is a condition precedent) provided that such
delay, modification, denial, refusal or revocation did not result
from the Company's inability or failure to comply with any
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 22 of 52
condition relating to grant, maintenance or renewal of such
consent or permits.
10.4 Notification obligations
If a party is affected by any force Majeure event, the affected party
shall give the other parties written notice describing the particulars
of the Force Majeure event as soon as reasonably practicable after
its occurrence but not later than five days after the date on which
such party knew of the commencement of the Force Majeure event
or of its effect on such party.”
35. Coming to the Power Purchase Agreement dated 31st March,
2015 executed between the Appellant and PSPCL. It is stated in its
preamble that the Implementation Agreement signed between the
Appellant and PEDA shall be treated as an integral part of the PPA
and all the clauses as well as regulatory norms applicable to the
Implementation Agreement shall be unequivocally applicable to the
Power Purchase Agreement in letter and spirit. Article 10 of the PPA
relates to the commissioning of the power project and is extracted
hereinbelow :-
“10.0.0 FACILITY COMMISSIONING OF GENERATING FACILITY
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 23 of 52
10.1.0 The Generating Company shall commission the
Generating Facility (which shall be Scheduled Date of Commercial
Operation) and synchronize with the PSPCL/PSTCL's Grid within 10
months from the Effective Date i.e. date of signing of this PPA which
is 31st March 2015. Therefore, the scheduled date of commissioning
for this project is 31st January, 2016.
In case of delay after the scheduled date of commissioning within
grace period of further two months i.e. 12 months from the date of
signing of PPA, with forfeiture of performance B.G. by PEDA, the
commissioning date for the project shall be 31 March, 2016.
In case of further delay in commissioning beyond 12 months but
within 15 months from the date of signing of PPA, with applicable
liquidated damages payable to PSPCL as per Clause 10.1.1, the
revised commissioning date of the project shall be 31st June, 2016.
10.1.1 In case there is delay in commissioning of project
beyond 12 months from the effective date then the project developer
shall pay to PSPCL the liquidated damages @ 20,000/- (Rupees
Twenty Thousand Only) per MW per day for delay in such capacity
which is not commissioned. The amount of liquidated damages
worked out as above shall be recovered by PSPCL from the
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 24 of 52
payments due to the Project Developer on account of sale of solar
power to PSPCL. The liquidated damage will be applicable without
prejudice to any other penalty imposed for delay in commissioning.
In case, the Commissioning of the Project is delayed beyond 15
months from the date of signing of PPA, the PPA capacity shall
stand reduced / amended to the Project Capacity Commissioned
and the PPA for the balance Capacity will stand terminated and shall
be reduced from the selected Project Capacity. The LoA & IA shall
also stand terminated for the balance un-commissioned capacity.
10.1.2 This PPA will remain valid for the capacity
commissioned within 15 months from the effective date and the
capacity for the purpose of this PPA will stand revised accordingly."
36. Article 19 of the PPA specifies the Force Majeure events and
its impact upon the rights and liabilities of the parties, the same is
extracted hereinbelow :-
19.0.0 FORCE MAJEURE
19.1.0 If any party hereto shall be wholly or partially prevented
from performing any of its obligations under this
Agreement by reason of or on account of lightning,
earthquake, fire, floods, invasion, insurrection, rebellion,
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 25 of 52
mutiny, civil unrest, riot, epidemics, explosion, the order
of any court, judge or civil authority, change in applicable
law, war, any act of God or public enemy or any other
similar cause or reason reasonably beyond its control and
not attributable to any negligent or Intentional act, error or
omission, then such party shall be excused of its
obligations/ liabilities under this Agreement and shall not
be liable for any damage, sanction or loss resulting there
from to the other party.
19.2.0 The party invoking this clause shall satisfy the other party
of the existence of any Force Majeure event and give
written notice within seven (7) days of the occurrence of
such Force Majeure event to the other party and also take
all reasonable and possible steps to eliminate, mitigate or
overcome the effect and consequence of any such Force
Majeure event.
19.3.0 In the event of a Force Majeure event or conditions, any
payment due under this Agreement shall be made as
provided herein and shall not be withheld.
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 26 of 52
19.4.0 This clause as provided in this PPA will be operative after
the project achieves COD. For force majeure events
occurring during the commissioning period of the project,
provisions of IA will be applicable.”
37. Article 35 of the PPA provides that the PPA shall be effective
and binding on the parties only on approval by the Commission and
shall be subject to such condition as may be stipulated by the
Commission while granting such approvals.
th
38. Amended/supplementary PPAs dated 10 November, 2015
nd
and 2 December, 2015 specifies the names of the nine ware houses
on the rooftops of which the Appellant proposed to install the solar
power project. It is mentioned herein that all other clauses contained
st
in the already executed PPA dated 31 March, 2015 shall remain
unchanged.
Analysis and findings:
39. Our Analysis and findings (issue wise) is as under :-
(a) Delay of 41 days in approval of PPA.
40. It is not disputed that after the execution of the PPA between
nd st nd
the Appellant and the 2 Respondent on 31 March, 2015, the 2
Respondent filed petition No. 23 of 2015 before the Commission
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 27 of 52
seeking approval to procure electricity from the solar power
developers as well as for approval of the PPAs executed by it with
th
them. The petition was allowed by the Commission on 11 May, 2015
and accordingly the PPA got approved.
41. As per Section 86(1)(b) of the Act, the State Commission is
empowered to regulate the electricity purchase and procurement
process of the Distribution Licensees including the price at which
electricity is procured from the generating companies through power
purchase agreement. Therefore, a Distribution Licensee can
procure/purchase power only in the manner and at the price as
approved by the State Commission upon satisfying the Commission
about its requirement for such power. It is for the Commission to
determine whether Distribution Licensee actually requires the power
for supply to its consumers and whether the rate quoted in the PPA
is reasonable as well as in consonance to the market conditions and
whether the Distribution Licensee can obtain such power from other
cheaper sources. Thus, it is the State Commission which regulates
the entire process of purchase and procurement of power by each
Distribution Licensee in the State by virtue of power conferred upon it
under Section 86(1)(b) of the Electricity Act, 2003. In this regard, we
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 28 of 52
also find it relevant to refer Regulation 46 of Punjab State Electricity
Regulatory Commission (Conduct of Business) Regulations, 2005
which is quoted herein below :-
46. POWER PROCUREMENT AND PURCHASE
1. In accordance with the provisions of the Act and the licence
conditions, every Distribution Licensee shall purchase and procure
electricity required for the Licensed Business of the Distribution
Licensee in an economical and efficient manner and under a
transparent power purchase and procurement process and generally
based on the principles of purchase of electricity at the least cost.
2. The power purchase by a Distribution Licensee may be classified
by the Commission as short term power purchase and long term
power purchase on terms as may be decided by the Commission from
time to time.
3. The Commission may, from time to time, issue guidelines, practice
directions and orders governing the short term purchases and long
term purchases which the Distribution Licensee can undertake for the
purpose of the Licensed Business.
4. (a) The Distribution Licensee shall satisfy the Commission as
to the need for additional power procurement on a long term
basis
(b) The Distribution Licensee shall not enter into a binding or
enforceable contractual commitment of such long term power
purchase till the Commission by a general or special order
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 29 of 52
approves the procurement of electricity by the Distribution
Licensee.
5. Unless otherwise approved by the Commission by a general or
special order, a long term power purchase or procurement by the
Distribution Licensee shall be done through a competitive
procurement process approved by the Commission.
6. (a) The Distribution Licensee shall satisfy the Commission
that the electricity procured under long term power purchase
otherwise than through a competitive bidding process or any
short term power purchase is economical in the prevalent
circumstances and that the Distribution Licensee has made
prudent and best efforts to minimise the cost of purchase.
(b) The Commission may not permit any such long term
purchase if the manner or method proposed for such
procurement of electricity is not conducive to the objective of
least cost purchase or for any other reason the purchase is not
economical or efficient ……….
(Emphasis Supplied)
42. This Regulation also makes it mandatory for Distribution
Licensee within the State of Punjab to satisfy the Commission about
its need for additional power procurement on a long-term basis and
that such procurement is economical and that Distribution Licensee
has made prudent and best efforts to minimize the cost of purchase.
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 30 of 52
43. In Tata Power Company Limited vs. Reliance Energy Limited,
(2009) 16 SCC 659, the Hon'ble Supreme Court has held as under:-
“108. A generating company, if the liberalization and
privatization policy is to be given effect to, must be held to
be free to enter into an agreement and in particular long-
term agreement with the distribution agency; terms and
conditions of such an agreement, however, are not
unregulated. Such an agreement is subject to grant of
approval by the Commission. The Commission has a
duty to check if the allocation of power is reasonable.
If the terms and conditions relating to quantity, price,
mode of supply, the need of the distributing agency
vis-à-vis the consumer, keeping in view its long-term
need are not found to be reasonable, approval may
not be granted.
………………
115. A PPA may be a long-term one or a short-term one.
Regulations have been made by the Commission by
making the MERC (Terms and Conditions of Tariff)
Regulations, 2005. Short-term power procurement refers
to an agreement for procurement of power for a period of
less than one year. Regulation 23.1 requires the
distribution licensee to prepare a five-year plan inter alia
upon taking into consideration the sources for
procurement thereof. Regulation 24.1 mandates
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 31 of 52
obtaining of prior approval of the Commission
therefor. Approval by the Commission is granted
upon examining the process of procurement having
regard to the factors specified in Regulation 24.2. It is
in the aforementioned context that grant of approval of
PPA by and between TPC (G) on the one hand and BEST
and TPC (D), on the other hand, necessitated. The
proposal of TPC (G) that Rinfra should enter with it into a
long-term agreement assumes significance.”
(Emphasis supplied)
44. This Tribunal as in the case of Rithwik Energy Generation Pvt.
Limited vs. Karnataka Power Transmission Corp. Limited and
others, 2011 ELR (APTEL) 1651 held as under :-
“10. Let us take up the first issue regarding the validity of
the PPA. 10.1According to the learned counsel for the
appellant, the PPA is not enforceable by law as the
respondents no. 2 had already exceeded the permissible
limit of power purchase from the renewable sources of
energy as per the State Commission's Regulations and
for this reason the PPA was returned by the State
Commission on 6.6.2007. The approval of the State
Commission was mandatory under Section 25 (3) of the
Karnataka Electricity Reform Act, 1999. The PPA became
void on account of the approval not having been given by
the State Commission.
………...
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 32 of 52
10.3. Let us first examine the Section 25(3)(4) of the
Karnataka Reform Act referred to by the appellant. The
relevant extracts are reproduced below:
“25 (3) A holder of a supply or transmission licence may,
unless expressly prohibited by the terms of its licence,
enter into arrangements for the purchase of electricity
from,-
(a) The holder of a supply licence which permits the holder
of such licence to supply energy to other licensees for
distribution by them; and (b) Any person or generating
company with the consent of the Commission”.
“25(4) Any agreement relating to any transaction of the
nature described in sub-sections (1), (2), or (3) unless
made with, or subject to, such consent as aforesaid, shall
be void”.
Section 185(3) of the 2003 Act specifically stipulates that
the provisions of the enactments specified in the
schedule, which includes the Karnataka Reform Act, not
inconsistent with the provisions of the 2003 Act, shall
apply to the States in which such enactments are
applicable.”
10.4. According to Section 86 (b) of the 2003 Act, the
State Commission is empowered to requlate
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 33 of 52
electricity purchase and procurement process of the
distribution licensees including the price at which
electricity is procured from the generating companies
through agreement for purchase of power.
10.5. In view of above, the distribution licensee has to
obtain the consent of the State Commission for
procurement of power against the PPA. Unless the
State Commission gives its consent to the PPA, the
distribution licensee cannot procure power under the
PPA. Thus, the PPA will come into effect only after
obtaining the consent of the State Commission. If the
consent is denied by the State Commission, the PPA
shall become void as per Section 25(3) of the
Karnataka Reform Act and Section 86(b) of the 2003
Act. Accordingly, the second respondent had submitted
the PPA dated 3.5.2007 signed with the appellant before
the State Commission on 25.5.2007 for its consent.
(Emphasis supplied)
45. Again this Tribunal in Appeal No. 41 of 2018 - Hinduja National
Power Corporation Limited vs. Andhra Pradesh Electricity
th
Regulatory Commission and others decided on 7 January, 2020
held as under:-
“75. If the State Commission fails in discharging its duties
by deciding the matter without proper reasoning and
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 34 of 52
justification, it is nothing but failure of its duty. Since
proceedings before the State Commission are not in the
nature of a lis as in the case of a Civil Suit, it has to take
within its fold the interest of various stakeholders
concerned. Therefore, utmost duty of the State
Commission while discharging its functions must be
public interest and decide the matter on merits so far
as adoption of capital cost and Continuation
Agreement. The functions provided under Section
86(1)(b) of the Act is not merely a formality to approve
the Power Purchase Agreement. In other words, it does
not mean one of the parties to the petition can interdict the
implementation of Power Purchase Agreement at its
whims and fancies totally ignoring the fact that the
Commission's duty is to regulate electricity purchase
and procurement process of a distribution licensee
including the price at which electricity shall be
procured from generating companies through
agreements.
……………
80. As stated above, so far as the procurement of power
is concerned, it must be in the interest of the consumer.
Between April 2017 to January 2018 as against the
declared capacity, 3273.83 million units were delivered to
the Respondent DISCOMs from the Appellant's project.
Since it was conducive for AP DISCOMs to schedule and
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 35 of 52
take delivery of electricity for maintaining the retail supply
to its consumers the above number of units was taken by
the DISCOMs. To decide the matter pertaining to
capital cost or approval of Continuation Agreement,
one has to see whether it is in the interest of the
consumers at large. The State Commission is the
ultimate authority to decide procurement of power
including the price, but unfortunately the
Commission declined to decide the matter on merits.
In this process what Commission ought to have done in
OP No. 21 of 2015 is to determine whether the capital cost
and resultant tariff would be conducive to the interest of
the consumers at large, since it is incumbent to do so as
a regulatory authority. Therefore it was possible to first
decide O.P. No. 21 of 2015 on merits, and based on its
decision it should have proceeded to consider
Continuation Agreement instead of passing the impugned
order
…………………..
99. The Respondents contend that approval of Continuation
Agreement so that PPA of 1998 could get revived is based on
the principle enunciated in contingent contracts. According to
Respondents, the right if any to Appellant gets created only on
approval of Continuation Agreement dated 28.04.2016. They
contend that happening of approval is happening of some
future event, therefore question of neither of parties making
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 36 of 52
any offer and acceptance would arise. In a contingent contract
happening of something marks the moment at which a right is
created, so that the contract becomes enforceable. As against
this, Appellant contends that no doubt status of agreement
dated 28.04.2016 can be treated as a contingent contract. The
contract comes in to effect once approval is given by the
Commission. It is also not the case of Appellant that approval
of the state Commission is unnecessary. It is seen that
agreement for the purchase of energy was duly finalised and
agreed between the parties, which came in the form of a
document pertaining to confirmation of terms agreed. By virtue
of this agreement parties agreed to continue the amended and
restated PPA dated 15.04.1998 with modifications which are
clearly mentioned in the agreement. Parties also had
consensus that tariff will be as determined by the State
Commission in Petition No. 21 of 2015 filed by the Appellant.
The Continuation Agreement in a way becomes
concluded terms and conditions subject to approval by
the State Commission. It was not an inchoate or incomplete
contract as contended by AP DISCOMs."
(Emphasis supplied)
46. In Eswari Green Energy LLP Vs. Karnataka Electricity
Regulatory Commission and Ors., Appeal No. 180 of 2018 and
th
batch decided on 13 November, 2020, it was held by this Tribunal
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 37 of 52
"42.We do not agree with the broad argument of the
appellants that there is no need for separate approval of
the State Commission in respect of initiated PPAs simply
because the general format of the PPA had been approved
by the Commission on 22.7.2015. It cannot be overlooked
that the Commission regulates the purchase and procurement
process of each distribution licensee by virtue of the power
conferred on it under Section 86(1)(b) of the Electricity Act,
2003. The statute saves the operation of the Karnataka
Electricity Reforms Act, 1999 by virtue of Section 185(3). The
provision contained in Section 17(1) of the Karnataka
Electricity Reforms Act, 1999 reads as under:
…………
44. A perusal of the statutory provisions and Rules
formulated thereunder shows that the distribution licensee can
procure power only in the manner approved and it is required
to place a proposed Power Purchase Agreement for approval
of the State Commission. The Regulation also prescribes a
timeframe for approval of the PPA. It also requires final version
of the PPA to be provided to the State Commission
……………..
47. In above context, reference may be made to following
observations of the Supreme Court in Tata Power Company
Limited vs Reliance Energy reported in (2009) 16 SCC 659,
while construing the functions of the Regulatory Commission
under Electricity Act, 2003:
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 38 of 52
……………..
48. The documents produced show that all concerned
have throughout been of unanimous view that the power
purchase agreements which had been initiated required
the approval of the State Commission. Having sought such
approval though HESCOM, it is not permissible for the
appellants to now contend that no approval was required.
There is no doubt that approval of the State Commission
in respect of individual PPA is a condition precedent
without which the PPA cannot come into existence
though, the respondent HESCOM concedes, with post-facto
approval the PPA becomes operational retrospectively from
the date of the PPA.
49. The respondents are also right in submission that there is
no vested right to get approval of the PPA from the
Commission which is duty-bound to consider it in light of
statutory provisions and within regulatory framework.”
(Emphasis supplied)
47. Having regard to the clear legal position indicated by the
above noted legal provisions as well as law laid down by this
Tribunal as well as by the Hon'ble Supreme Court in the above noted
judgement, it cannot be gain said that a PPA become effective only
upon getting approval from the State Commission and till then the
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 39 of 52
parties are incapacitated from enforcing any rights or obligations
under the same.
48. Therefore, in this case, since the PPA was approved by the
th
Commission on 11 May, 2015, that day became the effective date
as per Article 10 of the PPA and, therefore, the scheduled date of
th
commissioning for the Appellant's power project was 10 March,
th
2016. The PPA was only a piece of paper till 11 May, 2015 i.e. the
date when it got approval from the Commission and, therefore,
nd
neither the Appellant nor the 2 Respondent could have initiated
any action on the basis of the PPA prior to the said date. The
Appellant was not expected to take any step for the execution of the
power project prior to the approval of the PPA by the Commission.
Had the Appellant initiated such step and incurred expenditure on
the same but later on the PPA was not approved by the Commission,
the time, efforts and money spent by the Appellant would have gone
into the drain. Therefore, the findings of the Commission in the
impugned order that the preliminary/preparatory works for execution
of the power project were not hampered for want of approval of the
PPA by the Commission, are absolutely unwarranted and perverse.
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 40 of 52
49. It is argued on behalf of the Respondents that the Appellant
has not issued any notice of Force Majeure in respect of the said
delay of 41 days on account of lack of approval of the PPA, as
required under Article 10.4 of the IA as well as 19.2 of the PPA and,
therefore, he is precluded from seeking any benefit of such event.
On this aspect, reliance is placed upon the judgements of this
Tribunal in Earth Solar Pvt. Ltd. V/s. PSERC & Ors., 2019 SCC
Online Aptel 41 & Omega Infra Engineers Pvt. Ltd. V/s. PSERC &
Ors., 2019 SCC online Aptel 8 and the Judgement of the Hon'ble
Supreme Court in Chamundeshwari Electricity Supply Company
Ltd. Vs. Sai Sudhir Pvt. Ltd. 2025 SCC online SC 1816.
50. Concededly, no Force Majeure notice with regards to the delay
of 41 days in approval of the PPA has been served by the Appellant
upon the respondents. However, we may note here that the main
purpose for requirement to issue notice regarding force majeure
events by the affected party to the counterparty is to apprise the
counterparty of such events which are preventing the affected party
from fulfilling its obligations under the contract so that no surprise is
sprung upon the counterparty later on when the affected party seeks
mitigation of losses on account of those force majeure events.
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 41 of 52
Generally, the force majeure clauses in the contracts explicitly state
that notice must be given within the stipulated timeframe and in a
specific manner. Failure to meet those conditions disentitle affected
party from claiming benefit under the force majeure clause. A timely
force majeure notice creates a contemporaneous record that the
disruption was due to a force majeure event and not due to any
default on the part of the affected party. A late or a vague notice
weakens the credibility of the contentions of the affected party in this
regard and provides the counterparty ground to reject the claim on
the basis of force majeure events. A proactive notice indicates that
the affected party is acting in good faith and is being transparent in
the contractual relations with the other party.
51. In the above noted judgments relied upon by the learned
counsels for the Respondents, it is found that claim of the affected
party was with regards to the force majeure events which were
totally external events entirely unconnected with the counterparty
and in no manner related to any act, omission or representation of
the affected party. In these circumstances, since the counterparty
would not have been aware of the occurrence of the force majeure
events for which the affected party was claiming relief and
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 42 of 52
consequently not in a position to take any mitigating steps, this
Tribunal denied any relief to the affected party on the ground that no
force majeure notice, as stipulated in the contract, had been issued
by it.
nd
52. However, in the instant case, it was the obligation of the 2
Respondent itself, to approach the Commission and seek approval
of the PPA. Both Respondent Nos. 2 & 3 were well aware of the fact
st
that even though the PPA has been executed on 31 March, 2015,
th
it got approval from the Commission on 11 May, 2015. Therefore,
nd
the period of 41 days, which was consumed by the 2 Respondent
for obtaining approval of the PPA, being the Force Majeure event
rd
was clearly within its knowledge as well as in the knowledge of 3
Respondent - PEDA. It was not an event of such nature about which
the Respondent Nos. 2 & 3 can claim ignorance or had occasioned
on account of any omission or mis-representation of the Appellant.
In such a case Force Majeure notice was only a formality and non
issuance of such notice within the stipulated time cannot be held
against the affected party i.e. Appellant herein in order to dis-entitle
him from claiming benefit under the Force Majeure event. To permit
the respondents to rely upon the absence of formal Force Majeure
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 43 of 52
notice as required under Article 10.4 of the IA and Article 19.2 of the
PPA in the instant case would tantamount to allowing them to take
advantage of the delay caused by Respondent No. 2 itself. In so far
as the judgement of the Hon'ble Supreme Court in Chamundeshwari
Electricity Supply Company case (supra) is concerned, no force
majeure notice had ever been issued by the affected party and
accordingly, it was held by the Apex Court that requirement of
issuance of force majeure notice within the stipulated time is not
merely directory but is a condition precedent for invoking the force
majeure clause. However, in that case also the force majeure events
upon which the affected party had based its claims, were not of such
nature about which the counter party could be attributed knowledge
and awareness in spite of non-service of the force majeure notice.
53. Hence, we are of the opinion that the non-issuance of formal
Force Majeure notice by the Appellant with regards to the delay of
41 days in the approval of PPA is not fatal to its claim under this
head. The Appellant is entitled to extension of scheduled date of
commissioning of its power project by 41 days on account of said
delay caused in approval of the PPA which ultimately took place on
th
11 May, 2015.
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 44 of 52
(b) Delay in grid connectivity and in execution of
supplementary PPA
54. It is argued on behalf of the Appellant that the Appellant
th
initiated the approval process for identifying the project sites on 26
August, 2015 and formally submitted the site details to Respondent
th
No. 3 on 7 September, 2015 which granted concurrence only on
th
14 October, 2015. Thereafter, the Appellant immediately applied
th
for grid feasibility on 15 October, 2015. It is submitted that in spite
of processing the request of Appellant for grid connectivity,
Respondent No. 2 raised objections regarding multiple locations
leading to insistence on amendment of contractual documents ie. IA
and PPA. Thereafter the amendment to the IA as well as the PPA
th nd
was done on 10 November, 2015 and 2 December, 2015
respectively. Subsequently, technical concurrence was granted to
th
Appellant's power project on 7 December, 2015 followed by final
st
grid connectivity on 31 December, 2015.
55. Thus, according to the Appellant, there was a delay of 127
th st
days i.e. from 26 August, 2015 to 31 December, 2015 in approval
of location for roof top solar sites technical concurrence and grid
connectivity which is absolutely attributable to Respondent Nos. 2 &
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 45 of 52
3. It is argued that the findings of the Commission on this aspect in
the impugned order are absolutely erroneous and cannot be
sustained.
56. In the impugned order, the Commission has noted that the
Appellant submitted lease agreements pertaining to private roof tops
th
on 13 September, 2015 and Respondent No. 3 gave concurrence
th
to the same on 14 October, 2015 for setting up of solar pv power
plants on these nine roof top sites identified by the Appellant.
th
Subsequently, IA was amended on 10 November, 2015. The
Commission has further noted that thus, Respondent No. 3 has
taken 41 days from the date of submission of these agreements by
the Appellants to incorporate amendment in the IA which was done
th
on 10 November, 2015. The Commission has observed that two
weeks time was reasonable for Respondent No. 3 for giving
concurrence for setting up of solar pv power plants on the sites
identified by the Appellant and thereafter three weeks time was
reasonable for incorporating amendments in this regard in the IA.
Accordingly, discounting 35 days from the total number of 41 days
st th
from 31 September, 2015 till 10 November, 2015, the
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 46 of 52
Commission has held Respondent No. 3-PEDA responsible for the
delay of 6 days on this account.
57. We are unable to find any fault in these findings of the
Commission.
58. Taking note of the fact that subsequent to amendments in the
th
IA on 10 November, 2015, amendment was incorporated in the
nd
PPA on 2 December, 2015 specifying therein the nine locations for
setting up of solar pv power plants as finalized by the Appellant and
the fact that Respondent No. 2 PSPCL raised frivolous objection
regarding multiple locations identified by the Appellant for setting up
of solar pv power plants leading to the amendments to be
incorporated in the IA as well as PA coupled with the fact that
PSPCL ultimately granted feasibility clearance for the two sites on
th st
28 December, 2015 and to the remaining seven sites on 31
December, 2015, the Commission concluded that 48 days were
taken by PSPCL for granting feasibility clearance in respect of the
two sites and 51 days in respect of the remaining seven sites.
According to the Commission, 28 days time was reasonable for the
grant of feasibility clearance by PSPCL and, therefore, the
Commission held PSPCL responsible for 23 days delay in case of
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 47 of 52
five sites and 21 days delay in case of two sites for grant of feasibility
clearance. In so far as remaining two sites are concerned, the
Commission concluded that the delay in feasibility clearance for the
same is attributable to the Appellant.
59. Taking into account the delay of six days attributable to
Respondent No. 3 - PEDA for giving concurrence for setting up of
solar pv power plants, the Commission observed that the delay
attributable to Respondent No. 2-PSPCL in respect of grid feasibility
clearance for the nine sites identified by the Appellant would be as
under :-
Sr.
No.
Rooftop Solar PV Power Plant Site
Delay by PEDA
(6 days)/PSPCL
(Days)
1. PSAMB, SAS Nagar, (Mohali) 29
2. Bhagwant Singh & Others,
29
(ITC/Chunni), Fatehgarh Sahib
3. Boss Computers Pvt. Ltd. (Zirakpur) 29
4. PSAMB Grain Market Mansa 29
5. CA Vegefruit Stores (Kharar) 26
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 48 of 52
6. Skyross enterprises (Pepsi
26
Warehouse/Channo), Sangrur
7. Bhagwant Singh & Kulwinder Kaur,
29
(Reliance Fresh), Kotla Fazal, Teh.
Bassi Pathana
8. PSAMB, New Vegetable Market,
06
Ludhiana
9. CANAM Consultants, (Morinda) 06
60. We are unable to find any error or infirmity in these
findings/observations of the Commission on this aspect and
therefore affirm the same.
(C) Delay on account of JAT agitation
61. It is argued on behalf of the Appellant that the Commission, in
the impugned order, has failed to return any findings on the claim of
the Appellant regarding Jat agitation as a Force Majeure event
which also caused delay in commissioning of the power project.
According to the Appellant, said agitation caused delay of 10 days
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 49 of 52
in procurement activities as during the said period, highways and
railway lines were blocked and major part of the State was under
curfew thereby hampering the transportation of material for
construction of the power project.
62. On this aspect, we find force in the submission of Respondent
Nos. 2 & 3 that the Commission has rightly refused to take
cognizance of Jat agitation as a Force Majeure event for the reason
that the Appellant had not served the requisite Force Majeure notice
in this regard upon the respondents.
63. Jat agitation as well as its impact upon the progress of
construction work of the solar pv power plants by the Appellant was
an external factor about which knowledge can not be imputed to the
respondents and therefore the Appellant was required to serve the
requisite notice in this regard upon the respondents as mandated
under Article 10.4 of the IA and Article 9.2 of the PPA. Since
concededly, no such notice has been issued by the Appellant to the
Respondents, the law laid down in this regard by the Hon'ble
Supreme Court in Chamundeshwari case (supra), squarely applies
to this case also. Therefore, the delay if any, in achieving of
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 50 of 52
scheduled commissioning date of the power project by the Appellant
on account of Jat agitation cannot be considered.
Conclusion
64. We summarize our findings on the Force Majeure events
agitated by the Appellant in this appeal as under :-
1. Delay of 41 days in approval of PPA
Allowed in favour of the
Appellant
2. Delay in grid connectivity in execution
Findings/observations
of supplementary PPA
of the Commission on
this aspect in the
impugned order
affirmed.
3. Delay on account of Jat agitation
Held that the Appellant
is not entitled to any
benefit on account of
Jat agitation.
65. The case is now remanded back to the Commission for giving
benefit to the Appellant of 41 days delay in commissioning of the
power project which occurred on account of delay in approval of the
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 51 of 52
PPA and accordingly, to do a fresh computation of the delay in
commissioning of each of nine solar pv power plants due to the
stated Force Majeure events and to determine the tariff for the same
accordingly.
66. The appeal stands disposed of in these terms.
rd
Pronounced in the open court on this 3 day of July, 2026.
(Virender Bhat) (Seema Gupta)
Judicial Member Officiating Chairperson
✓
REPORTABLE / NON REPORTABLE
js
-------------------------------------------------------------------------------------------------------------
Appeal No. 200 of 2018 Page 52 of 52