Appellate Tribunal For ElectricityContract LawAdministrative and Public Law

Trader purely as conduit cannot be held liable for gaming or UI charges relinquished by discoms.

Tata Power Trading Company Limitedv.Karnataka Electricity Regulatory Commission & Ors.

Trader purely as conduit cannot be held liable for gaming or UI charges relinquished by discoms.. Tata Power Trading Company Limited vs Karnataka Electricity Regulatory Commission & Ors.. Appellate Tribunal For Electricity. LawLens
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In brief

The question

Whether the Appellant, acting as a trading licensee, can be held liable for Unscheduled Interchange (UI) charges and liquidated damages when it acted as a conduit between the generator and the ESCOMs.

The court held

A trader purely as a conduit cannot be held liable for gaming or UI charges relinquished by discoms.

01Facts

The Appellant, a trading licensee, entered into a Power Purchase Agreement (PPA) dated 06.09.2013 with Karnataka ESCOMs (Respondents 4-8) to supply 57MW of power

p. 6

Due to grid disturbances and technical failures, the generator failed to supply the full quantum in late 2013, leading to deviations exceeding 15% of the contracted capacity

p. 7

Consequently, the ESCOMs deducted liquidated damages, Unscheduled Interchange (UI) charges, and backup power charges from the Appellant’s invoices, including invoices belonging to subsequent, unrelated PPAs

pp. 8-10

02Issues

i.Whether the Appellant, acting as a trading licensee, can be held liable for Unscheduled Interchange (UI) charges and liquidated damages when it acted as a conduit between the generator and the ESCOMs.

03Law Applied

Electricity Act, 2003 regarding the regulatory framework for trading licensees and power purchase agreements.

Provisions in the judgment · 5 · Linked ones open on LawLens

Electricity Act, 2003 Section 3Section 14Section 66Section 79Section 86

04Reasoning

The court examined the back-to-back nature of the arrangement where the Appellant served as a conduit for the power supply from the generator to the ESCOMs.

05Holding

A trader purely as a conduit cannot be held liable for gaming or UI charges relinquished by discoms.

Appellate Tribunal For Electricity

Original Court PDF

Tata Power Trading Company LimitedvsKarnataka Electricity Regulatory Commission & Ors.

Appellate Tribunal For Electricity · July 15, 2026

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