Supreme Court of India
JAIPUR VIDYUT VITRAN NIGAM LTD. & ORS.versusMB POWER (MADHYA PRADESH) LIMITED & ORS.
- Citation
- 2024 INSC 23
- Decided
- 8 January 2024
- Disposal
- Appeal(s) allowed
Holding
The State Commission is empowered under Section 63, read with Section 86(1)(b) and the Bidding Guidelines, to reject bids not market‑aligned and to consider consumer interest, and the High Court’s mandamus was unlawful.
Summary
The Rajasthan Electricity Regulatory Commission (State Commission) was asked to approve the procurement of 1,000 MW of power through a competitive bidding process. After negotiations, the Commission approved only 500 MW and adopted the tariffs of the lowest bidders, while the higher‑priced bids of L‑4 and L‑5 were rejected as not market‑aligned. The Appellate Tribunal for Electricity (APTEL) held that the State Commission could not consider market alignment, a view later upheld by the High Court which issued a mandamus directing the procurers to purchase 200 MW from MB Power at its higher tariff. The Supreme Court held that under Section 63 of the Electricity Act, read with Section 86(1)(b) and the Bidding Guidelines, the State Commission does have the power to reject bids not aligned with market prices and must consider consumer interest, rendering the High Court’s mandamus erroneous. Consequently, the Supreme Court quashed the High Court’s order and the APTEL’s decision, allowing the appeals and directing costs.
Issues considered
- The scope of power of the State Commission under Section 63 of the Electricity Act to consider whether tariffs are market‑aligned.
- Whether the State Commission may reject bids on the ground of lack of market alignment under Clause 5.15 of the Competitive Bidding Guidelines.
- The correctness of the High Court’s mandamus directing procurement from MB Power at its quoted tariff.
- The applicability of the rule of alternate remedy and the maintainability of the writ petition under Article 226.
- The interpretation of the words ‘any’ and ‘all’ in Clause 5.15 of the Bidding Guidelines.
Legislation cited
- Constitution of Indias. Article 226
- Electricity Act, 2003s. 62, s. 63, s. 64, s. 79(1)(b), s. 86(1)(b)
- General Clauses Acts. 13(2)
Subjects
ElectricityState Electricity Regulatory CommissionAppellate Tribunal for ElectricityBid Evaluation CommitteeRequest for ProposalPower Purchase AgreementReduction of quantum of powerTest of filling the bucketTariffs not aligned to the prevailing market pricesConsumers’ interestCompetitive Bidding GuidelinesAdoption of tariffDetermination of tariff by bidding processFunctions of State CommissionFunctions of Central Electricity Regulatory CommissionMandamusContract harmful to the public interestInterpretation of statutesLiteral interpretationPurposive constructionRegulation of tariffAlternate remedyJudicial reviewUnreasonableness or arbitrarinessAward of contractCommercial transactionCommercial considerationsJudicial scrutiny
Judgment
[2024] 1 S.C.R. 909 : 2024 INSC 23
Jaipur Vidyut Vitran Nigam Ltd. & Ors.
v.
MB Power (Madhya Pradesh) Limited & Ors.
(Civil Appeal No. 6503 of 2022)
08 January 2024
[B. R. Gavai* and Prashant Kumar Mishra, JJ.]
Issue for Consideration
State Commission held that the tariffs offered by the L-4 and L-5
bidders were not aligned to the prevailing market prices. In appeal
by L-5, APTEL held that the State Commission had to necessarily
adopt the tariff and had no power to consider whether the tariff was
aligned to market prices. Impugned judgment of the High Court
relying on the said judgment of the APTEL and the earlier orders
of this Court concluded that applying the test of “filling the bucket”,
the procurers were bound to take supply from the respondent No.1
at the rates quoted by it and it had a right to supply power since
there was a gap of 300 MW between the power procured by the
procurers and the ceiling of 906 MW determined by this Court. High
Court whether justified in issuing mandamus directing the appellants
to take supply of 200 MW power from the respondent No.1 at the
rates quoted by it. Power of the State Commission to go into the
question as to whether the prices quoted are market aligned or not
and to take into consideration the aspect of consumers’ interest.
Headnotes
Electricity Act, 2003 – ss.63, 86 – Rajasthan Rajya Vidyut
Prasaran Nigam Limited (RVPN) filed Petition before the State
Commission seeking approval for procurement of 1000 MW
of power by a competitive bidding process – RFP was issued
– Eventually, in consonance with the LoI, PPAs were signed
with the L-1, L-2 and L-3 bidders – State Commission held that
the quantum of only 500 MW power was liable to be approved
considering the demand in the State as recommended by the
EAC and it approved the tariff quoted by the L-1 to L-3 bidders
– Appeals filed by L-2 and L-3 bidders before APTEL, allowed
– Challenged by the appellants – Subsequently, Civil Appeals
were filed by L-5 bidder also– Disposing of the appeals, State
Commission was directed to go into the issue of approval for
adoption of tariff with regard to L-4 and L-5 bidders– Further,
* Author
910 [2024] 1 S.C.R.
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vide order dtd.19.11.18, State Commission was directed to
go into the issue of adoption of tariff – State Commission
held that the tariffs offered by the L-4 and L-5 bidders were
not aligned to the prevailing market prices – Appeal filed by
L-5 bidder, allowed by APTEL – Writ petition was filed by the
respondent No.1 – Allowed by impugned judgment:
Held: Unlike s.62 r/w ss.61 and 64, under the provisions of s.63,
the appropriate Commission does not “determine” tariff but only
“adopts” tariff already determined u/s.63 – Such “adoption” is only
if such tariff has been determined through a transparent process
of bidding, and this transparent process of bidding must be in
accordance with the guidelines issued by the Central Governments
– s.86(1)(b) gives ample power to the State Commission to regulate
electricity purchase and procurement process of distribution
licensees – It also empowers the State Commission to regulate
the matters including the price at which electricity shall be procured
from the generating companies, etc. – Further, orders relied upon
by the APTEL, specifically the order dtd. 19.11.2018, clarified
that the State Commission was to decide the tariff u/s.63 having
regard to the law laid down both statutorily and by this Court – As
such, the State Commission was bound to take into consideration
the Bidding Guidelines notified by the Central Government, and
specifically clause 5.15 thereof – State Commission justified in
considering the Clause 5.15 of the Bidding Guidelines which
specifically permits to reject all price bids if the rates quoted are
not aligned to the prevailing market prices – APTEL grossly erred
in holding that the State Commission has no power to go into the
question, as to whether the prices quoted are market aligned or not
and also not to take into consideration the aspect of consumers’
interest – It cannot be read from the orders of this Court that the
State Commission was bound to accept the bids as quoted by
the bidders till the bucket was filled – No such direction can be
issued by this Court de hors the provisions of ss.63 and 86(1)(b)
and the Bidding Guidelines – Since the decision-making process
adopted by the Bid Evaluation Committee approved by the State
Commission, was in accordance with the law laid down by this
Court, the same ought not to have been interfered with by the
APTEL – High Court could not have issued a mandamus to the
instrumentalities of the State to enter into a contract harmful to the
public interest inasmuch as, if the power was to be procured by
the procurers at the rates quoted by the respondent No.1, which
was even higher than the rates quoted by the L-5 bidder, then the
[2024] 1 S.C.R. 911
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
State would have to bear financial burden in thousands of crore
rupees, which in turn would have passed on to the consumers
– Impugned judgment quashed and set aside – Cost imposed.
[Paras 67, 71, 73-75, 78, 83, 104, 105]
Electricity – Competitive Bidding Guidelines notified by the
Government of India u/s.63 – Respondent No.1 contended
that the procurer is bound to accept all the bids emerged in
a competitive bidding process once the bidding process was
found to be transparent and in compliance with the Bidding
Guidelines:
Held: If the contention is to be accepted it will do complete violence
to clause 5.15 of the Bidding Guidelines itself – If that view is
accepted, the DISCOMS will be compelled to purchase electricity
at a much higher rate as compared with other suppliers – The
said higher rate will be passed on to the consumers – As such,
accepting the contention of the respondent No.1 would result in
adversely affecting the interests of the consumers and, in turn,
would be against the larger public interest. [Para 77]
Electricity Act, 2003 – s.63 – General Clauses Act – s.13(2)
– “all”, “any” – Principle of literal interpretation – Principle
of purposive construction – “all” used in clause 5.15 of
the Bidding Guidelines r/ws.86(1)(b) – Competitive Bidding
Guidelines notified by the Government of India u/s.63 – It was
contended that the power under clause 5.15 of the Bidding
Guidelines can be exercised only when the bidding process
is found to be not in compliance with the Bidding Guidelines
and is not transparent in respect of all the bidders and not in
respect of some of the bidders is concerned:
Held: The contention is without substance – Words “all” or “any” will
have to be construed in their context taking into consideration the
scheme and purpose of the enactment – What is the meaning which
the legislature intended to give to a particular statutory provision
has to be decided by the Court on a consideration of the context
in which the word(s) appear(s) and in particular, the scheme and
object of the legislation – The word “all” used in clause 5.15 of
the Bidding Guidelines, read with the legislative policy for which
the Electricity Act was enacted and r/ws.86(1)(b), will have to be
construed to be the one including “any” – Applying the principle of
literal interpretation, the evaluation committee/BEC would be entitled
to reject only such of the price bids if it finds that the rates quoted
912 [2024] 1 S.C.R.
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by the bidders are not aligned to the prevailing market prices – It
does not stipulate rejection of all the bids in the bidding process
– If the contention that clause 5.15 of the Bidding Guidelines will
come into play, which permits the Evaluation Committee to reject
“all” price bids and not “any” one of them is accepted, it will lead
to absurdity – The Court, while interpreting a particular provision,
will have to apply the principles of purposive construction – Such
an interpretation would result in defeating one of the main objects
of the enactment, i.e., protection of the consumer. [Paras 84, 87,
88 and 91]
Interpretation of Statutes – Principle of purposive construction
– Discussed.
Electricity Act, 2003 – ss.62, 63, 79(1)(b):
Held: The non-obstante clause advisedly restricts itself to s.62,
there is no reason to put s.79 out of the way altogether – Either
u/s.62, or 63, the general regulatory power of the Commission
u/s.79(1)(b) is the source of the power to regulate, which includes
the power to determine or adopt tariff – ss.62 and 63 deal with
“determination” of tariff, which is part of “regulating” tariff – In a
situation where the guidelines issued by the Central Government
u/s.63 cover the situation, the Central Commission is bound by
those guidelines and must exercise its regulatory functions, albeit
u/s.79(1)(b), only in accordance with those guidelines. [Para 68]
Alternate remedy – Electricity Act, 2003 – Constitution of
India – Article 226 – Judicial review – Scope:
Held: The Electricity Act is an exhaustive code on all matters
concerning electricity – Under the Electricity Act, all issues dealing
with electricity have to be considered by the authorities constituted
under the said Act – The State Electricity Commission and the
APTEL have ample powers to adjudicate in the matters with
regard to electricity – These Tribunals are tribunals consisting of
experts having vast experience in the field of electricity – In the
present case, the High Court erred in directly entertaining the writ
petition when the respondent No.1-the writ petitioner before the
High Court had an adequate alternate remedy of approaching the
State Electricity Commission – Although, availability of an alternate
remedy is not a complete bar in the exercise of the power of judicial
review by the High Courts but, recourse to such a remedy would
be permissible only if extraordinary and exceptional circumstances
are made out – While exercising its power of judicial review, the
[2024] 1 S.C.R. 913
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
Court can step in where a case of manifest unreasonableness or
arbitrariness is made out – There was not even an allegation with
regard to that effect – In such circumstances, recourse to a petition
under Article 226 of the Constitution of India in the availability of
efficacious alternate remedy under a statute which is a complete
code in itself was not justified. [Paras 93-95]
Contract – Award of contract, a commercial transaction –
Judicial Scrutiny – Scope:
Held: The award of a contract, whether by a private party or by
a public body or the State is essentially a commercial transaction
– In arriving at a commercial decision, considerations which are
paramount are commercial considerations – State can choose its
own method to arrive at a decision – It can fix its own terms of
invitation to tender and that is not open to judicial scrutiny – State
can enter into negotiations before finally deciding to accept one of
the offers made to it – Price need not always be the sole criterion
for awarding a contract – State may not accept the offer even
though it happens to be the highest or the lowest – However, the
State, its corporations, instrumentalities and agencies are bound
to adhere to the norms, standards and procedures laid down
by them and cannot depart from them arbitrarily – Though that
decision is not amenable to judicial review, the court can examine
the decision-making process and interfere if it is found vitiated by
mala fides, unreasonableness and arbitrariness – Only when the
Court comes to a conclusion that overwhelming public interest
requires interference, the court should intervene. [Para 102]
Case Law Cited
PTC India Limited v. Central Electricity Regulatory
Commission, Through Secretary [2010] 3 SCR 609 :
(2010) 4 SCC 603; Vivek Narayan Sharma and others
v. Union of India and others [2023] 1 SCR 1 : (2023)
3 SCC 1 – followed.
Energy Watchdog v. Central Electricity Regulatory
Commission and others [2017] 3 SCR 153 : (2017)
14 SCC 80; GMR Warora Energy Limited v. Central
Electricity Regulatory Commission (CERC) & Ors. [2023]
8 SCR 183 : 2023 SCC Online SC 464 – relied on.
R.Viswanathan and others v. Rukn-ul-Mulk Syed Abdul
Wajid since deceased and others [1963] 3 SCR 22 :
914 [2024] 1 S.C.R.
Digital Supreme Court Reports
AIR 1963 SC 1; Deccan Paper Mills Company Limited
v. Regency Mahavir Properties & Ors. [2020] 13 SCR
427 : (2021) 4 SCC 786; Tata Power Company Limited
Transmission v. Maharashtra Electricity Regulatory
Commission & Ors. [2022] 19 S.C.R. 620 : 2022 SCC
Online 1615; Tata Cellular v. Union of India [1994]
2 Suppl. SCR 122 : (1994) 6 SCC 651; Rajasthan
Housing Board and another v. G.S. Investments and
another [2006] 7 Suppl. SCR 868 : (2007) 1 SCC 477;
Laxmikant and others v. Satyawan and others [1996] 3
SCR 532 : (1996) 4 SCC 208; Reliance Infrastructure
Limited v. State of Maharashtra and others [2019] 1 SCR
886 : (2019) 3 SCC 352; Radha Krishan Industries v.
State of Himachal Pradesh and others [2021] 3 SCR
406 : (2021) 6 SCC 771; South Indian Bank Ltd. and
others v. Naveen Mathew Philip and another [2023] 4
SCR 18 : 2023 SCC OnLine SC 435; Air India Ltd. v.
Cochin International Airport Ltd. and others [2000] 1
SCR 505 : (2000) 2 SCC 617 – referred to.
List of Acts
Electricity Act; RERC (Power Purchase & Procurement Process
of Distribution Licensee) Regulations 2004; Constitution of India;
General Clauses Act.
List Keywords
Electricity; State Electricity Regulatory Commission; Appellate
Tribunal for Electricity; Bid Evaluation Committee; Request for
Proposal; Power Purchase Agreement; Reduction of quantum of
power; Test of filling the bucket; Tariffs not aligned to the prevailing
market prices; Consumers’ interest; Competitive Bidding Guidelines/
Process; Approval for adoption of tariff; Determination of tariff
by bidding process; Functions of State Commission; Functions
of Central Electricity Regulatory Commission; Bid Evaluation
Committee; Mandamus; Contract harmful to the public interest;
Interpretation of Statutes; Principle of literal interpretation; Principle
of purposive construction; Determination of tariff, Regulating
tariff; Alternate remedy; Judicial review; Unreasonableness
or arbitrariness; Award of contract; Commercial transaction;
Commercial considerations; Judicial Scrutiny.
[2024] 1 S.C.R. 915
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
Case Arising From
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6503 of 2022.
From the Judgment and Order dated 20.09.2021 of the High Court
of Judicature for Rajasthan Bench at Jaipur in D.B. Civil Writ Petition
No.14815 of 2020.
With
Civil Appeal Nos. 6502 of 2022 And 4612 of 2023.
Appearances for Parties
P. Chidambaram, Sr. Adv., Anand K Ganesan, Amal Nair, Ms. Shivani
Verma, Nitin Saluja, Nikunj Dayal, Ms. Kritika Khanna, Advs. for the
Appellants.
Vikramjit Banerjee, A.S.G., Dr. A.M. Singhvi, Prag Tripathi, C.S.
Vaidhyanathan, Sr. Advs., Atul Shanker Mathur, Mahesh Agarwal,
Rishi Agrawala, Vaibhav Mishra, Dr. Rajeshwar Singh, Avishkar
Singhvi, Ms. Priya Singh, Prabal Mehrotra, Shubhankar, Ankur
Saigal, Karan Verma, Apoorv Agarwal, E. C. Agrawala, Atul Shankar
Mathur, Buddy Rangnathan, Umang Katariya, Ms. Mishika Bajpai,
Ms. Apoorva Agrawal, Sidharth Seem, M/s. Khaitan & Co., Jayant
Mohan, Zoheb Hossain, P.V. Yogeshwaran, Siddhartha Sinha, Ms.
Megha Saxena, Aditya Kashyap, Ms. Vanshja Shukla, Nring C.
Zeliang, Gurmeet Singh Makker, Saurabh Mishra, Ms. Prerna Singh,
Guntur Prabhakar, Ravi Kishore, Guntur Pramod Kumar, Umesh
Kumar Khaitan, Advs. for the Respondents.
Judgment / Order of the Supreme Court
Judgment
B. R. Gavai, J.
CIVIL APPEAL NO. 6503 OF 2022 AND CIVIL APPEAL NO. 6502
OF 2022
1. These appeals challenge the judgment and order dated 20th September
2021, passed by the Division Bench of the High Court of Judicature
for Rajasthan, Bench at Jaipur, in D.B. Civil Writ Petition No. 14815
of 2020, thereby allowing the said writ petition filed by MB Power
(Madhya Pradesh) Limited (hereinafter referred to as “MB Power”),
respondent No.1 herein. By the impugned judgment and order, the
916 [2024] 1 S.C.R.
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High Court held that the respondent Nos. 1 to 5 therein (appellants
herein and the State of Rajasthan) are bound to purchase a total of 906
MW electricity from the successful bidders. It, therefore, directed the
writ petitioner- MB Power (respondent No.1 herein) and respondent
No.7 - PTC India Ltd. (hereinafter referred to as “PTC India”) in the
said writ petition (respondent No.2 in the present appeals) to supply
200 MW electricity to the respondents therein (appellants herein)
within the limit of 906 MW. It also directed the writ petitioner-MB Power
and PTC India, respondent No.7 in the said writ petition, to file an
appropriate application before the respondent Nos. 1 to 5 in the said
writ petition, within two weeks from the date of the order, complying
with the necessary requisite conditions, including bank guarantee
etc., as required in terms of the Request for Proposal (hereinafter
referred to as “the RFP”). It further directed the respondent Nos. 1
to 5 in the said writ petition, for issuance of Letter of Intent (“LoI”
for short) in respect of bid filed through PTC India for supplying 200
MW power from the power generating station of the writ petitioner
i.e. MB Power at levelized tariff of Rs.5.517/Kwh, being in terms of
their bid qualified by the Bid Evaluation Committee (“BEC” for short)
and ranked L-7. It further directed the respondents No.1 to 5 in the
said writ petition, to immediately within two weeks thereafter, execute
the Power Purchase Agreement (“PPA” for short) with PTC India for
procuring 200 MW power from the power generating station of MB
Power, and then to start procuring power in accordance with law.
As an interim measure, it directed that the tariff to be actually paid
by the procurer-respondents before it, shall be the interim tariff i.e.
Rs.2.88 per unit, as specified by this Court in its interim order dated
28th September 2020, passed in I.A. No.83693 of 2020 in Civil Appeal
No.2721 of 2020. It further held that the final adoption of tariff to be
paid to PTC India (respondent No.7 before it) under the PPA shall
be subject to the final outcome of the said Civil Appeal No. 2721 of
2020, pending before this Court.
BRIEF FACTS:
2. The facts leading to the filing of these two appeals, as mentioned
in Civil Appeal No. 6503 of 2022, are as under:
2.1 The Government of India vide Notification dated 19th January
2005, notified the Competitive Bidding Guidelines (hereinafter
referred to as “the Bidding Guidelines”) under Section 63 of the
[2024] 1 S.C.R. 917
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
Electricity Act, 2003 (hereinafter referred to as “the Electricity
Act”). The objective of the said Bidding Guidelines is for
introduction of competition and protection of consumer interest.
2.2 On 21st September 2009, Rajasthan Rajya Vidyut Prasaran
Nigam Limited (hereinafter referred to as “RVPN”) filed Petition
No.205 of 2009 before the Rajasthan Electricity Regulatory
Commission (hereinafter referred to as “the State Commission”)
seeking approval for procurement of 1000 MW of power by a
competitive bidding process.
2.3 On 28th May 2012, RVPN issued an RFP, inviting sellers to
participate in the competitive bidding for procurement of 1000
MW under the Bidding Guidelines.
2.4 In the month of February 2013, bids were received from the
bidders.
2.5 On 4th April 2013, based on the preliminary evaluation of the
non-financial bids by the BEC, 7 bidders were declared as
qualified for opening of the financial bids. The respondent
No.1-MB Power herein was not a bidder in the above process.
Respondent No.2-PTC India herein had submitted a bid for 1041
MW, which it was to procure from five different generators. PTC
India is a power-trading licensee company, which had procured
the bid document after depositing a Bid Bond.
2.6 In the various meetings held between 17th April 2013 and 22nd
April 2013, the BEC had placed the bids received in ascending
order, from lowest to the highest tariff as follows:
Rank Qualified Levelized Tariff Capacity Cumulative Average
Bidder Name (Rs/kWh) Offered Capacity Cumulative
Offered Tariff
(Rs/ kWh)
L-1 PTC – Maruti 4.517 195 195 4.517
Clean Coal
and Power
Limited
L-2 PTC – DB 4.811 311 506 4.698
Power Limited
918 [2024] 1 S.C.R.
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L-3 LPL – Lanco 4.943 100 606 4.738
Babandh
Power Limited
L-4 PTC – Athena 5.143 200 806 4.839
Chhattisgarh
Power Ltd
L-5 SKS Power 5.300 100 906 4.890
Generation
(Chhattisgarh)
Limited
L-6 LPL – Lanco 5.490 100 1006 4.949
Vidarbha
Thermal
Power Limited
L-7 PTC – MB 5.517 200 1206 5.043
Power
(Madhya
Pradesh) Ltd.
L-8 KSK 5.572 475 1681 5.193
Mahanadi
Power
Company
Limited
L-9 Jindal Power 6.038 300 1981 5.321
Limited
L-10 LPL – Lanco 7.110 100 2081 5.407
Amarkantak
Power Ltd
2.7 In the 216th Meeting of the Board of Directors of RVPN, it
was decided to take an opinion from the BEC as to whether
negotiations should be held to reduce tariff keeping in view of
the long-term impact and quantum of the amounts involved.
2.8 On 4th June 2013, the BEC gave its opinion that since the rates
quoted vary considerably, negotiations could be held with the
bidders.
2.9 Vide Resolution dated 4th June 2013, the Board of the RVPN
decided to hold negotiations with the qualified bidders.
2.10 In the negotiations, the following offers were received:
[2024] 1 S.C.R. 919
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
“
• L-1/Maruti Clean Coal & Power Ltd. offered an
additional capacity of 55 MW, aggregating to a total
of 250 MW.
• L-2/DB Power Limited, inter-alia, agreed to provide
additional quantum of power to the tune of 99 MW,
aggregating to a total of 410 MW.
• Similarly, L-3/Lanco Power Ltd. offered an additional
capacity of 250 MW, aggregating to a total of 350 MW.”
2.11 The Board of Directors of the RVPN, in its meeting held on 27th
September 2013, directed that, LoI be issued in favour of the
L-1, L-2 and L-3 bidders as under, subject to the approval of
the State Commission while adopting the tariff.
“S. Bidder Quoted Capacity Additional
No. Tariff offered in Capacity
(Rs. / Bid (MW) Offered
kWh) (MW)
1 M/s PTC India Ltd 4.517 195 55
(through developer M/s
Maruti Clean Coal and
Power Limited)
2 M/s PTC India Ltd (through 4.811 311 99
their developer M/s DB
Power Limited)4.811
3 M/s Lanco Power Limited 4.892 100 250
(Generation Source – M/s
Lanco Babandh Power
Limited)
Total 606 404
G. Total (A+B) 1010 MW”
2.12 In consonance with the LoI, on 1st November 2013, PPAs were
signed with the L-1, L-2 and L-3 bidders. Thereafter, RVPN
filed Petition No.431 of 2013 before the State Commission
under Section 63 of the Electricity Act read with clause 5.16
920 [2024] 1 S.C.R.
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of the Bidding Guidelines for adoption of tariff for purchase
of long-term base load power of 1000 MW (±10%) as quoted
by the successful bidders (being L-1, L-2 and L-3) under the
Case-I bidding process.
2.13 The Energy Assessment Committee (“EAC” for short),
constituted by the Government of Rajasthan pursuant to
Regulation 3 of the Power Procurement Regulations, in its
4th meeting held on 29th January 2014, recommended that
there was no requirement for long term procurement of 1000
MW (±10%) power under Case-I for which PPAs had been
executed and tariff adoption petition had been filed before the
State Commission.
2.14 In the meantime, the L-4 and L-5 bidders filed Writ Petitions
being CWP No. 19437 of 2013 and CWP No.18699 of 2013
respectively, before the High Court, seeking to strike down
the negotiations process and the higher quantum awarded
to L-1, L-2 and L-3 bidders.
2.15 The High Court vide judgment dated 7th February 2014, refused
to entertain the writ petitions and relegated the parties to the
State Commission. The said order dated 7th February 2014
came to be challenged by the L-4 and L-5 bidders by way
of writ appeals being DB Special Appeals (Writ) Nos. 538 of
2014 and 604 of 2014. The said appeals also came to be
dismissed by the High Court vide judgment and order dated
18th April 2014.
2.16 Subsequently, in its 5th meeting held on 21st May 2014, the
EAC recommended that as against the quantum of 1000 MW
power, for which PPAs had been executed and tariff adoption
petition had been filed, a demand of 600 MW power ought to
be considered, on account of availability of power from various
sources and to meet future contingencies.
2.17 The Government of Rajasthan, therefore, vide its letter dated
25th July 2014, issued to the RVPN, approved the purchase of
a quantum of 500 MW power on long term basis as against
the quantum of 1000 MW for which PPAs had already been
executed.
[2024] 1 S.C.R. 921
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
2.18 On the basis of the decision/recommendation of the EAC
and the direction issued by the Government of Rajasthan,
RVPN filed an application under Regulation 7 of the RERC
(Power Purchase & Procurement Process of Distribution
Licensee) Regulations 2004 (hereinafter referred to as “RERC
Regulations 2004”) in Petition No.431 of 2013, to bring on
record the EAC decision/recommendation and the Government
of Rajasthan approval. In the said application, inter alia, it
was prayed for adoption of tariff and approval of the reduced
quantum of 500 MW of power to be purchased as against the
original 1000 MW of power for which PPAs had already been
executed with the successful bidders.
2.19 Vide order dated 22nd July 2015 in Petition No.431 of 2013,
the State Commission held that the quantum of only 500 MW
power was liable to be approved considering the demand in
the State as recommended by the EAC. The State Commission
also approved the tariff quoted by the L-1 to L-3 bidders.
2.20 Aggrieved by the reduction of quantum by the State
Commission, the L-2 and L-3 bidders preferred appeals
before the learned Appellate Tribunal for Electricity (hereinafter
referred to as “the learned APTEL”) being Appeal Nos. 235 of
2015 and 191 of 2015 respectively.
2.21 Two separate appeals were also preferred by the L-4 and
L-5 bidders, being Appeal No. 264 of 2015 and Appeal No.
202 of 2015 respectively, wherein apart from challenging the
reduction of quantum by the State Commission from 1000
MW to 500 MW, the increase in quantum granted to the L-1,
L-2 and L-3 bidders was also challenged.
2.22 Vide order dated 2nd February 2018, the learned APTEL allowed
the Appeal Nos. 191 of 2015 and 235 of 2015, filed by the L-3
and L-2 bidders, holding that the reduction of quantum by the
State Commission from 1000 MW to 500 MW was incorrect. It,
therefore, directed the State Commission to pass consequential
orders for approving the PPAs for the L-2 and L-3 bidders for
the higher quantum which was negotiated.
2.23 The order of the learned APTEL dated 2nd February 2018,
was challenged by the present appellants before this Court by
922 [2024] 1 S.C.R.
Digital Supreme Court Reports
way of Civil Appeal Nos. 3481-3482 of 2018, on the ground
that the RFP quantum cannot be restored from 500 MW to
1000 MW. Subsequently, Civil Appeal Nos. 2502-2503 of 2018
also came to be filed by L-5 bidder- SKS Power Generation
(Chhattisgarh) Limited (hereinafter referred to as “SKS Power”),
on the ground that the State Commission could not have
permitted the procurement of higher quantum by the L-2 and
L-3 bidders.
2.24 Vide order dated 25th April 2018, the said Civil Appeals were
disposed of by this Court, upholding the decision of the learned
APTEL, setting aside the reduction of quantum of procurement
from 1000 MW to 500 MW after the bidding process was
over. However, this Court held that the decision of the learned
APTEL on the quantum to be procured from individual bidders
was liable to be reversed and that the quantum originally
offered by the bidders in the bidding process has to be taken
into consideration and increase in quantum by means of
negotiation was not permissible. Insofar as L-4 and L-5 bidders
are concerned, since the tariff quoted was not considered at
any stage by either the procurer, or by RVPN or by the State
Commission, this Court directed the State Commission to go
into the issue of approval for adoption of tariff with regard to
L-4 and L-5 bidders.
2.25 Subsequent to the judgment and order dated 25th April 2018,
passed by this Court, the BEC came to a finding that the
tariffs quoted by the L-4 and L-5 bidders were not aligned to
the prevailing market prices.
2.26 In the meantime, vide order dated 19th November 2018, this
Court, on an application filed by RVPN, directed the State
Commission to go into the issue of adoption of tariff in terms
of Section 63 of the Electricity Act and the law laid down by
this Court under the said provision.
2.27 Vide order dated 26th February 2019, the State Commission
held that the tariffs offered by the L-4 and L-5 bidders were
not aligned to the prevailing market prices.
2.28 Being aggrieved by the same, SKS Power (L-5 bidder)
challenged the above order dated 26th February 2019 before
the learned APTEL by way of Appeal No.224 of 2019.
[2024] 1 S.C.R. 923
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
2.29 Vide the judgment and order dated 3rd February 2020, the
learned APTEL allowed the appeal of the L-5 bidder – SKS
Power and held that the State Commission had to necessarily
adopt the tariff, and had no power to consider whether the
tariff was aligned to market prices.
2.30 Aggrieved by the same, the present appellants have filed Civil
Appeal No. 1937 of 2020 and Civil Appeal No.2721 of 2020.
Initially, the present appeals were tagged along with the said
appeals. However, vide order dated 10th October 2023, the
same have been de-tagged.
2.31 On an interlocutory application being I.A. No.83693 of 2020
filed by L-5 bidder-SKS Power in Civil Appeal No. 2721 of 2020,
an interim order 28th September 2020, came to be passed by
this Court, holding that the L-5 bidder was entitled to supply
power to the appellants at the tariff of Rs.2.88 per unit.
2.32 It appears that subsequently thereafter on 14th December 2020,
a writ petition being Writ Petition No. 14815 of 2020 came to
be filed by the respondent No.1-MB Power before the High
Court, seeking following relief:
“(a) Issue appropriate Writ or order or direction in the
nature of declaration or certiorari or any other writ
or direction declaring Rule 69(2)(b) of the RTPP
Rules as ultra vires Article 14, 19(1)(g) and 21 of
the Constitution of India as well as Section 63 of
the Electricity Act, 2003;
(b) Issue appropriate Writ or order or direction in the
nature of mandamus directing the Respondent
Nos. 1-4 to immediately issue a Letter of Intent in
favour of the Petitioner, sign the power Purchase
Agreement with the Petitioner as per its bid tariff,
take steps for adoption of tariff of the Petitioner and
immediately commence supply of power;
(c) Pass such further order(s) as this Hon’ble Court may
deem fit and proper in the facts and circumstances
of the instant case in the interest of justice.”
924 [2024] 1 S.C.R.
Digital Supreme Court Reports
2.33 In the appeals filed by the present appellants, i.e., Civil
Appeal Nos. 1937 of 2020 and 2721 of 2020, respondent
No.1-MB Power filed an application for impleadment, on
the ground that the issue of role of the State Commission
in adoption of tariff being decided by this Court in the said
appeals would have an impact on the writ petition filed by it
before the High Court.
2.34 Vide order dated 19th April 2021, this Court directed the said
application for impleadment to be considered at the stage of
hearing of the said appeals.
2.35 By the impugned judgment and order, the said writ petition
filed by MB Power has been allowed by the High Court in
terms of the aforesaid directions.
2.36 Hence the present appeals.
CIVIL APPEAL NO. 4612 OF 2023
3. This appeal filed by Rajasthan Urja Vikas Nigam Limited (hereinafter
referred to as “RUVNL”) challenges the order dated 1st June 2023,
passed by the learned APTEL, whereby the learned APTEL has
stayed the operation of the order dated 31st March 2023, passed by
the State Commission in Petition No.RERC-2097 of 2023.
4. The facts, in brief, leading to the filing of Civil Appeal No.4612 of
2023, are as under:
4.1 In the year 2022, the RUVNL had proposed the procurement of
294 MW of power on long term basis and for that purpose had
filed Petition No.2017 of 2022 before the State Commission.
4.2 Vide order dated 2nd November 2022, the State Commission
rejected the procurement of power on long term basis.
4.3 Thereafter, considering the assessment and requirement of
power, the RUVNL filed Petition No.RERC-2097 of 2023 before
the State Commission, seeking approval for procurement of
160 MW of power on medium term basis i.e., for a period of 5
years and not for 25 years on long term basis.
[2024] 1 S.C.R. 925
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
4.4 Vide order dated 31st March 2023, the State Commission granted
approval to the distribution licensees in the State of Rajasthan
for procurement of 160 MW round-the-clock fuel agnostic power
on medium term basis by way of a competitive bidding process.
4.5 Aggrieved thereby, the respondent No.1 herein, i.e., MB Power
(Madhya Pradesh) Limited filed Appeal No. 466 of 2023 before
the learned APTEL against the order dated 31st March 2023
passed by the State Commission, along with I.A. No.1004 of
2023 for the stay of the order.
4.6 Vide impugned order dated 1st June 2023, the learned APTEL
stayed operation of the order passed by the State Commission
and directed that in the bidding process for procurement of 160
MW of power on medium term basis the bid shall neither be
finalized nor shall any Letter of Intent be issued pursuant to
the opening of the bids.
4.7 Aggrieved thereby, the RUVNL has filed the present appeal.
5. Vide order dated 26th September 2023, this Court had permitted the
appellant to proceed further with the tender process for procurement
of 160 MW of power for 5 years on the basis of model bidding
documents for medium term procurement.
6. Vide order dated 10th October 2023, this Court had been informed
that pursuant to the aforesaid order dated 26th September 2023,
bids had been opened and the lowest bid was at Rs.5.30 per unit.
As a result, this Court had clarified that the pendency of the present
appeal would not come in the way of the appellant in finalizing the
tender and executing power purchase agreement with the successful
bidders and the appellant would be at liberty to do so in order to
overcome the difficulty of power shortage.
7. The order of the learned APTEL dated 1st June 2023 basically relies
on the judgment of the Division Bench of the High Court of Judicature
for Rajasthan, bench at Jaipur, passed in D.B. Civil Writ Petition No.
14815 of 2020, which is a subject matter of challenge in Civil Appeal
Nos. 6503 of 2022 and 6502 of 2022. As such, the result of Civil
Appeal No.4612 of 2023 would depend upon the outcome of Civil
Appeal Nos. 6503 of 2022 and 6502 of 2022.
926 [2024] 1 S.C.R.
Digital Supreme Court Reports
SUBMISSIONS OF THE APPELLANTS
8. We have heard Shri P. Chidambaram, learned Senior Counsel
appearing for the appellants, and Dr. A.M. Singhvi and Shri
C.S. Vaidyanathan, learned Senior Counsel appearing for the
respondents.
9. Shri Chidambaram, at the outset, submits that the writ petition, filed
by the respondent No.1-MB Power, was not maintainable before
the High Court in its original jurisdiction under Article 226 of the
Constitution of India. It is submitted that, if the respondent No.1-MB
Power had any grievance, it could have either approached the State
Commission or the learned APTEL.
10. He submits that this Court in the case of PTC India Limited v. Central
Electricity Regulatory Commission, Through Secretary1 has held
that the Electricity Act is an exhaustive code on all matters concerning
electricity. The Electricity Act provides for the forum for adjudication
of all disputes between a generator and the procurer/licensee. As
such, the respondent No.1-MB Power, if had any grievance, ought
to have filed an application before the State Commission or the
learned APTEL and it could not have approached the High Court
directly in its writ jurisdiction.
11. Shri Chidambaram further submitted that though L-1 to L-5 bidders
have continuously been litigating their grievances from 2013
onwards, the respondent No.1-MB Power, since it was not short-
listed, had taken no steps from 2013 onwards. It is submitted that,
as a matter of fact, the bid of L-7 bidder was returned and on 6th
January 2015, the Bid Bond bank guarantee was also directed to
be not extended. Still, it kept silent for about 6 years. He further
submits that even after the judgment and order was passed by
this Court on 25th April 2018, respondent No.1-MB Power did not
take any steps for about two years, and for the first time, on 14th
December 2020, it filed a writ petition before the High Court. As such,
it is clear that the respondent No.1-MB Power had acquiesced the
direction by the appellants dated 6th January 2015 not to renew the
Bid Bond bank guarantee. Shri Chidambaram, therefore, submits
that the writ petition was liable to be dismissed on the ground of
delay and laches itself.
1 [2010] 3 SCR 609 : (2010) 4 SCC 603=2010 INSC 146
[2024] 1 S.C.R. 927
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
12. Shri Chidambaram further submits that the term “successful bidder”
has been defined in the RFP. It is submitted that the bidder(s)
selected by the procurer/authorized representative, pursuant to the
RFP for supply of power by itself or through the project company
as per the terms of the RFP, and to whom a LoI has been issued,
can only be termed as the “successful bidder”. Since no LoI was
issued to the respondent No.1-MB Power, it could not be construed
as a “successful bidder”.
13. Shri Chidambaram submits that the theory of “filling the bucket”, as
put forth by the respondent No.1-MB Power, has no basis either in
the RFP or in the Bidding Guidelines. It is further submitted that the
said theory is a dangerous proposition inasmuch as, it is expected
that the procurer would be obliged to accept the bids of lower ranked
financial bids, irrespective of the exorbitant tariff quoted by them.
Shri Chidambaram has given an illustration to that effect that, if in
a bid to procure 1000 MW, 2 bidders can be put forward as stalking
horses who would bid lower tariffs and are ranked as L-1 and L-2.
Thereafter, L-3 onwards can quote exorbitant tariffs which are not
aligned to market prices. He submits that this specious theory of
“filling the bucket”, which would oblige the procurer to go to the last
bidder, irrespective of their tariffs being completely exorbitant, is very
dangerous. It is submitted that, in any case, clause 3.5.12 of the
RFP enables the procurer to reject any bid where the quoted tariff
is not aligned to market prices.
14. Shri Chidambaram further submits that the directions issued by this
Court vide order dated 25th April 2018, were specifically restricted
to L-1 to L-5 bidders, which were litigating. It is submitted that the
contention of the respondent No.1-MB Power that the order of this
Court dated 25th April 2018 was an order in rem is erroneous.
15. Relying on the judgment of this Court in the case of R. Viswanathan
and others v. Rukn-ul-Mulk Syed Abdul Wajid since deceased
and others2, Shri Chidambaram submits that the judgment in rem
settles the destiny of the res itself. Whereas an order in personam
determines the rights of persons before the Court and binds only
2 (1963) 3 SCR 22=AIR 1963 SC 1=1962 INSC 205
928 [2024] 1 S.C.R.
Digital Supreme Court Reports
the parties to the lis. Reliance in this respect is also placed on the
judgment of this Court in the case of Deccan Paper Mills Company
Limited v. Regency Mahavir Properties & Ors.3
16. Shri Chidambaram further submits that the reliance by the
respondents on the certificate, which certified the bid evaluation
process was carried out in conformity with the provisions of the RFP,
and, therefore, it is not permissible to go into the determination of
tariff is incorrect. He submits that the certificate is not certifying that
L-7 was qualified to be selected as a “successful bidder” or it had
earned a right to have his bid accepted irrespective of the quoted
tariff. He submits that if the quoted tariff of L-4 bidder of Rs.5.143
and L-5 bidder of Rs.5.300 were misaligned, then, most certainly,
the quoted tariff of L-7 bidder of Rs.5.517 was also misaligned.
17. The learned Senior Counsel submits that the jurisdiction under
Section 63 of the Electricity Act is not that of a mere post office.
The State Commission has a power to reject the adoption of tariff
if it is not aligned to market prices. In this respect, he refers to the
judgments of this Court in the cases of Tata Power Company Limited
Transmission v. Maharashtra Electricity Regulatory Commission
& Ors.4 and Energy Watchdog v. Central Electricity Regulatory
Commission and others5.
18. Shri Chidambaram submits that the State Commission while adopting
the tariff is bound to take into consideration the protection of consumer
interest. Reliance in this respect has been placed on the judgment
of this Court in the case of GMR Warora Energy Limited v. Central
Electricity Regulatory Commission (CERC) & Ors.6, wherein this
Court has emphasized the need for balancing the interest of the
consumers with that of the generators.
19. Shri Chidambaram further submits that in view of clauses 2.15.1 and
3.5.12 of the RFP and clause 5.15 of the Bidding Guidelines, the
appellants had the power to reject all price bids if the rates quoted
are not aligned to the prevailing market prices.
3 [2021] 13 SCR 786 : (2021) 4 SCC 786=2020 INSC 497
4 [2022] 19 SCR 620 : 2022 SCC Online 1615=2022 INSC 1220
5 [2017] 3 SCR 153 : (2017) 14 SCC 80=2017 INSC 338
6 [2023] 8 SCR 183 : 2023 SCC Online SC 464=2023 INSC 398
[2024] 1 S.C.R. 929
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
20. Shri Chidambaram lastly submitted that the bidders have no vested
right to contract. Article 226 of the Constitution of India cannot be
used to award a contract in favour of the bidder. In this respect, he
refers to the following judgments of this Court:
i. Tata Cellular v. Union of India7
ii. Rajasthan Housing Board and another v. G.S. Investments
and another8
iii. Laxmikant and others v. Satyawan and others9
21. Shri Chidambaram, therefore, submits that the impugned judgment
and order is not sustainable and is liable to be set aside.
SUBMISSIONS OF THE RESPONDENTS
22. Dr. A.M. Singhvi, learned Senior Counsel, per contra, submits that
unlike Section 62 read with Sections 61 and 64 of the Electricity Act,
under Section 63 of the Electricity Act, the appropriate Commission
only “adopts” tariff and does not “determine” tariff. However, in cases
under Section 63 of the Electricity Act, the Central Commission is
bound by the guidelines issued by the Central Government and it
is required to exercise its regulatory functions, albeit under Section
79(1)(b) only in accordance with those guidelines. In this respect, he
relies on the judgment of this Court in the case of Energy Watchdog
(supra) and Tata Power Company Limited Transmission (supra).
23. Dr. Singhvi submits that two issues that can be considered in a case
under Section 63 of the Electricity Act by the Commission are:
(1) as to whether the bidding process was transparent; and
(2) as to whether the bidding process was held in accordance with
the guidelines issued by the Central Government.
24. He submits that once the tariff is an outcome of the bidding process
and the bidding process is transparent and held in accordance with
the Bidding Guidelines, the appropriate Commission is mandated
to adopt such tariff and it does not have a discretion to go into the
question as to whether it is market aligned or not.
7 [1994] 2 Supp. SCR 122 : (1994) 6 SCC 651 (para 94)= 1994 INSC 283
8 [2006] 7 Supp. SCR 868 : (2007) 1 SCC 477 (para 8, 9 and 11)= 2006 INSC 766
9 [1996] 3 SCR 532 : (1996) 4 SCC 208=1996 INSC 409
930 [2024] 1 S.C.R.
Digital Supreme Court Reports
25. Dr. Singhvi further submits that while adopting an already determined
tariff by the bidding process as per Section 63 of the Electricity Act,
the issue of market alignment of respondent No.1’s bid does not and
cannot arise for consideration in these proceedings.
26. Without prejudice to the aforesaid submissions, Dr. Singhvi submits
that it is not permissible for the State Commission to go into the
question of market alignment. He submitted that the respondent
No.1’s quoted tariff was market aligned not only in the year 2013
but also today. Dr. Singhvi submits that in the recent tender for
procurement of 160 MW electricity, conducted in pursuance to the
permission granted by this Court, the lowest bid for 1st year tariff
discovered and approved by the appellants is at Rs.5.30 per unit. It
is submitted that there is a vast difference between “1st year tariff”
and “levelized tariff”. Dr. Singhvi submits that however, if this offer
for supply in the first year of the bid is to be levelized for 25 years,
it would come to Rs.7.91 per unit, which is around 50% higher than
the 1st year tariff of the said bidder itself.
27. Dr. Singhvi submits that M/s Deloitte is a common consultant insofar
as the appellants and the Uttar Pradesh Power Corporation Limited
(“UPPCL” for short). He submits that, in fact, BEC of UPPCL, in
March 2013, accepted tariff up to Rs. 5.849 per unit i.e., a tariff
much higher than that of respondent No.1-MB Power. It is submitted
that the bidding period in the present case as well as in the case
of UPPCL is the same. It is submitted that, however, in 2018, the
Rajasthan BEC mischievously and selectively considered tariff only
up to 2012 and compared bids of Andhra Pradesh and Kerala, which
were, in fact, discovered in 2015 and 2014 respectively. It is submitted
that similarly, in the State of Tamil Nadu, for the same period, the
equivalent levelized tariff was determined by M/s Deloitte at Rs.5.75
per unit for 25 years and the same was accepted. It is, therefore,
submitted that, considering the aforesaid, the levelized tariff of the
respondent No.1-MB Power for 25 years at Rs.5.517 per unit is
indisputably market aligned even as on 2012-2013.
28. Dr. Singhvi, relied on the following charts to show that the levelized
tariff for 25 years, as quoted by the respondent No.1-MB Power, is
very much market aligned.
[2024] 1 S.C.R. 931
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
“Market Price as of 2012-13 – at the time of Rajasthan Bid
Procurer State 1st Year Levelized PPA Duration
Quoted Tariff for 25
Tariff years
Rajasthan – L5 (i.e. 3.976 5.300 25 years
SKS)
Rajasthan – L7 4.137 5.517 25 years
(i.e. R1 – MB
Power Bid)
UP – 2013 Tariff 4.36 5.849 25 years
approved by
BEC (Deloitte as
consultant)
TN – Approved 4.117 5.75 15 years
Tariff
Prices discovered in Rajasthan Medium Term Tender in Sept /
Oct 2023
Procurer State 1st Year Levelized PPA
Quoted Tariff for 25 Duration
Tariff years
Rajasthan – 2023 5.30 7.91 5 years
Rajasthan – R1 (i.e. L7 – 4.137 5.517 25 years”
MB Power 2012 Bid)
29. Dr. Singhvi, the learned Senior Counsel, relying on clause 3.5.9 of
the RFP, submits that, no negotiations were permissible in spite of
the specific clause in the RFP and the opinion to the contrary given
by the consultant. It is submitted that the appellants tried to negotiate
the prices with L-1 to L-3 bidders, which decision has been finally
set aside by this Court vide order dated 25th April 2018.
932 [2024] 1 S.C.R.
Digital Supreme Court Reports
30. Dr. Singhvi submits that in view of the specific certificate dated 4th
June 2013, issued by the BEC, certifying that the bidding procedure
for the bids in question had been carried out by the appellants in
conformity with the provisions of the RFP and the Bidding Guidelines
issued by the Government of India, it is not permissible for the
appellants to take a contradictory stand.
31. Dr. Singhvi submits that what this Court had directed by order dated
25th April 2018, was to adopt the tariff with regard to L-4 and L-5
bidders. By the subsequent order dated 19th November 2018, this
Court clarified and directed to decide the tariff under Section 63 of
the Electricity Act having regard to the law laid down both statutorily
and by this Court. It is submitted that the only scrutiny that could
be done by the Commission was only with regard to the following
of the twin requirements as observed by this Court in the case of
Energy Watchdog (supra).
32. Dr. Singhvi submits that the power to reject the bids is in respect of
all price bids. He submits that if it is found that the bidding process
was not transparent and the Guidelines were not followed or the
bids are not market aligned, then the appellants would be entitled
to reject all bids and not individually and selectively some bids. He
submits that if the interpretation as placed by the appellants is to be
accepted, it will vest an arbitrary power with the procurer of energy
to arbitrarily reject the bid of any of the bidders. It is submitted that
such an unfettered and unchecked discretion cannot be permitted to
be exercised by the appellants/distribution companies (“DISCOMS”).
33. Dr. Singhvi submits that insofar as the aspect with regard to
“consumer’s interest” is concerned, the learned APTEL has squarely
covered the same. It has been held by the learned APTEL that the
consumers’ interest is a broad term and among others, involves
reliable, quality and un-interrupted power on long term basis besides
being competitive.
34. The learned Senior Counsel submits that the State of Rajasthan
needed 1000 MW of power when it invited the bids in question. He
submits that the DISCOMS have even fairly admitted that they are
still in need of power and as such, filed an Interlocutory Application
[2024] 1 S.C.R. 933
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
being I.A. No. 150366 of 2023 in Civil Appeal No.4612 of 2023
(for permission to file additional documents) seeking permission
to procure power for medium term from the State Commission. It
is, therefore, submitted that even in the larger public interest and
consumer interest, the appellants should procure the power from the
respondent No.1-MB Power. Dr. Singhvi submits that the appellants
are bound to procure 906 MW of power in view of the orders passed
by this Court on 25th of April 2018. He submits that the RFP provides
for bucket filling. It is, therefore, submitted that the appellants are
required to procure the power going down the ladder from the bidders
starting from L-1 to the one till procurement of 906 MW of power is
complete. It is submitted that since many of the bidders had now
gone into insolvency, it is only 3 bidders, which are left in the fray.
L-1 bidder is supplying 195 MW power and L-2 is supplying 311 MW
power. It is submitted that even in the event, this Court permits L-5
bidder to supply 100 MW power and 160 MW power for medium term
in pursuance to the order passed by this Court on 26th September
2023, still the total would not be beyond 766 MW. Still the balance
of 140 MW power would remain.
35. Dr. Singhvi submits insofar as contention of the appellants with regard
to delay and laches is concerned, the same is without substance.
He submits that only after the respondent No.1 came to know about
the incapacity of L-3, L-4 and L-6 bidders to honour their offered
capacity, the occasion to revalidate the claim of the respondent
No.1 arose. The learned Senior Counsel, relying on clause 3.5.6 of
the RFP, submits that the selection process shall continue till the
requisitioned capacity has been achieved through the summation
of the quantum offered by the “successful bidders” or when the
balance of the requisitioned capacity is less than the minimum bid
capacity. It is submitted that since there is still a gap of 140 MW, to
comply with this Court’s order dated 25th April 2018, the appellants
are bound to enter into PPAs with the qualified bidders until the
entire requisitioned capacity of 906 MW is met.
36. Dr. Singhvi relied on the following chart to show that the prices
discovered in all medium and long term bids are much higher than
the levelized price quoted by the respondent No.1-MB Power.
934 [2024] 1 S.C.R.
Digital Supreme Court Reports
“Prices discovered in all medium and long term bids since 2022
Procurer State 1st Year Levelized PPA Duration
Quoted Tariff for 25
Tariff years
Adani Mumbai– 2022 5.98 8.78 2.1 years
Uttarakhand–2023 5.41 7.93 1.5 years
Noida Power – 2022 5.15 7.46 3 years
Mundra SEZ– 2023 5.00 6.69 15 years
Haryana – 2022 5.70 to 5.75 8.36 3 years
J & K – 2023 6.05 8.22 5 years
Haryana – 2023 6.05 8.22 5 years
NDMC – 2023 6.05 8.22 5 years
Madhya Pradesh–2023 6.05 8.22 5 years
Haryana – 2023 5.79 8.49 5 years
Gujarat – 2023 5.18 to 5.69 6.81 15 years
Uttarakhand–2023 7.97 11.72 3.5 years
Noida Power – 2023 6.30 9.18 3 years”
37. Dr. Singhvi, therefore, submits that, if the directions as issued by
the High Court are maintained, it will be in the interests of the
consumers, who will be getting the electricity at lesser prices than
what has recently been emerged as a levelized price in the bidding
process. He submits that this is specifically so when indisputably
even according to the appellants they are in dire need of power.
Dr. Singhvi, therefore, prays for dismissal of the present appeals.
38. Shri C.S. Vaidyanathan, learned Senior Counsel also addressed
similar arguments and prayed for dismissal of the present appeals.
CONSIDERATIONS
39. For considering the rival submissions, it will be necessary to refer
to some of the provisions of the Electricity Act, which are as under:
“63. Determination of tariff by bidding process. -
Notwithstanding anything contained in section 62, the
Appropriate Commission shall adopt the tariff if such
[2024] 1 S.C.R. 935
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
tariff has been determined through transparent process
of bidding in accordance with the guidelines issued by the
Central Government.”
xxx xxx xxx
79. Functions of Central Commission.-(1) The Central
Commission shall discharge the following functions,
namely:-
(a) ………………………………………
(b) to regulate the tariff of generating companies other
than those owned or controlled by the Central
Government specified in clause (a), if such generating
companies enter into or otherwise have a composite
scheme for generation and sale of electricity in more
than one State;
xxx xxx xxx
“86. Functions of State Commission.- (1) The State
Commission shall discharge the following functions,
namely: -
(a) …………….
(b) regulate electricity purchase and procurement
process of distribution licensees including the price at
which electricity shall be procured from the generating
companies or licensees or from other sources through
agreements for purchase of power for distribution and
supply within the State;”
40. It will also be relevant to refer to part of the preamble of the Bidding
Guidelines notified by the Union of India vide Resolution dated 19th
January 2005, which is as under:
“These guidelines have been framed under the above
provisions of section 63 of the Act. The specific objectives
of these guidelines are as follows:
1. Promote competitive procurement of electricity by
distribution licensees;
936 [2024] 1 S.C.R.
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2. Facilitate transparency and fairness in procurement
processes;
3. Facilitate reduction of information asymmetries for
various bidders;
4. Protect consumer interests by facilitating competitive
conditions in procurement of electricity;
5. Enhance standardization and reduce ambiguity and
hence time for materialization of projects;
6. Provide flexibility to suppliers on internal operations
while ensuring certainty on availability of power and
tariffs for buyers.”
41. It will also be relevant to refer to certain clauses of the RFP, which
are as under:
2.15 Right to withdraw the RFP and to reject any Bid.
2.15.1 This RFP may be withdrawn or cancelled by the
Procurer/ Authorized Representative at any time
without assigning any reasons thereof. The Procurer/
Authorized Representative further reserves the right,
at its complete discretion, to reject any or all of the
Bids without assigning any reasons whatsoever and
without incurring any liability on any account.”
xxx xxx xxx
“3.5 STEP IV- Successful Bidder(s) Selection
3.5.1 Bids qualifying in Step III shall only be evaluated in
this stage.
3.5.2 The Levelized Tariff calculated as per Clause 3.4.8
for all Financial Bids of Qualified Bidders shall be
ranked from the lowest to the highest.
3.5.3 The Bidder with the lowest Levelized Tariff shall be
declared as the Successful Bidder for the quantum
of power (in MW) offered by such Bidder in its
Financial Bid.
3.5.4 The selection process of the Successful Bidder as
mentioned above in Clause 3.5.3 shall be repeated for
[2024] 1 S.C.R. 937
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
all the remaining Financial Bids of Qualified Bidders
until the entire Requisitioned Capacity is met or
until the time when the balance of the Requisitioned
Capacity is less than the Minimum Bid Capacity.
3.5.5 At any step in the process in Clause 3.5.4, in case
the Requisitioned Capacity has not been achieved
and the offered capacity of the Bidder with the lowest
Levelized Tariff amongst the remaining Financial Bids
is larger than the balance Requisitioned Capacity, any
fraction or combination of fractions offered by such
Bidder shall be considered for selection, towards
meeting the Requisitioned Capacity.
3.5.6 The selection process shall stand completed once
the Requisitioned Capacity has been achieved
through the summation of the quantum offered by
the Successful Bidders or when the balance of the
Requisitioned Capacity is less than the Minimum
Bid Capacity.
Provided however in case only one Bidder remains
at any step of the selection process and the balance
Requisitioned Capacity exceeds the Minimum Bid
Capacity, Financial Bid(s) of such Bidder shall be
referred to Appropriate Commission and the selection
of the Bidder shall then be at the sole discretion of
the Appropriate Commission.
3.5.7 At any step during the selection of Successful
Bidder(s) in accordance with Clauses 3.5.2 to 3.5.6,
the Procurer / Authorized Representative reserves
the right to increase / decrease the Requisitioned
Capacity by up to ten percent (10%) of the quantum
indicated in Clause 1.3.1 to achieve the balance
Requisitioned Capacity and select the Successful
Bidder with the lowest Levelized Tariff amongst
the remaining Bids. Any increase / decrease in the
Requisitioned Capacity exceeding ten percent (10%)
of the quantum in Clause 1.3.1. can be made only
with the approval of the Appropriate Commission.
938 [2024] 1 S.C.R.
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3.5.8 The Letter(s) of Intent shall be issued to all such
Successful Bidder(s) selected as per the provisions
of this Clause 3.5.
3.5.9 There shall be no negotiation on the Quoted Tariff
between the Authorized Representative/ Procurer
and the Bidder(s) during the process of evaluation.
3.5.10 Each Successful Bidder shall unconditionally accept
the LOI, and record on one (1) copy of the LOI,
“Accepted Unconditionally”, under the signature of
the authorized signatory of the Successful Bidder
and return such copy to the Procurer/ Authorized
Representative within seven (7) days of issue of LOI.
3.5.11 If the Successful Bidder, to whom the Letter of Intent
has been issued does not fulfill any of the conditions
specified in Clauses 2.2.8 and 2.2.9, the Procurer /
Authorized Representative reserves the right to annul
the award of the Letter of Intent of such Successful
Bidder. Further, in such a case, the provisions of
Clause 2.5 (b) shall apply.
3.5.12 The Procurer / Authorized Representative, in its own
discretion, has the right to reject all Bids if the Quoted
Tariff are not aligned to the prevailing market prices.”
42. It will also be relevant to refer to clause 5.15 of the Bidding Guidelines,
which is as under:
“5.1 The bidder who has quoted lowest levellised tariff as
per evaluation procedure, shall be considered for the
award. The evaluation committee shall have the
right to reject all price bids if the rates quoted
are not aligned to the prevailing market prices.”
[emphasis supplied]
43. Successful bidder has been defined in the RFP as under:
“Successful Bidder(s)” shall mean the Bidder(s)
selected by the Procurer/ Authorized Representative, as
applicable pursuant to this RFP for supply of power by
itself or through the Project Company as per the terms of
[2024] 1 S.C.R. 939
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
the RFP Documents, and to whom a Letter of Intent has
been issued;”
44. The impugned judgment of the High Court is basically based on the
judgment of the learned APTEL dated 3rd February 2020 in the case
of SKS Power and orders passed by this Court as already observed
herein above. After the bids were received for procurement of 1000
MW, the BEC decided to accept the bids of L-1, L-2 and L-3 bidders.
However, as the State government had recommended reduction of
purchase to only 500 MW power, RVPN filed an application under
Regulation 7 of the RERC Regulations 2004, for adoption of tariff
of L-1 to L-3, so also allowing it to purchase only 500 MW of power
as against 1000 MW. The said application was allowed by the State
Commission. The State Commission also adopted the tariff determined
through the bidding process for purchase of 500 MW power vide its
order dated 22nd July 2015. The said order of the State Commission
was challenged before the learned APTEL by M/s D.B. Power Ltd
[L-2 bidder] and by M/s Lanco Power Ltd. [L-3 bidder] by way of
Appeal Nos. 235 of 2015 and 191 of 2015 respectively.
45. The learned APTEL in the said appeals, vide judgment and order
dated 2nd February 2018, set aside the order of the State Commission
dated 22nd July, 2015, and passed the following directions:
“ORDER
Hence, the Appeal Nos. 235 of 2015 and 191 of 2015
are allowed and the State Commission’s order dated
22.07.2015 is set aside. The State Commission is directed
to pass consequential order in accordance with the law
keeping in view our observations made above as well as the
judgments of this Tribunal rendered earlier on the aspects
of the scope of Section 63 of the Act as expeditiously as
possible, preferably, within 2 months from today. No order
as to costs.”
46. After the learned APTEL passed the aforesaid order, M/s D.B. Power
Ltd. (L-2 bidder) filed an Interlocutory Application before the State
Commission, praying for passing forthwith consequential orders in
terms of the judgment of the learned APTEL. It also sought a direction
to DISCOMS to start procuring power from it to the extent of 410
MW as per the PPA dated 1st November 2013.
940 [2024] 1 S.C.R.
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47. When the matter was heard by the State Commission on 8th March
2018, it was noticed that appeals against the order of the learned
APTEL were pending before this Court.
48. This Court disposed of the said appeals vide judgment and order
dated 25th April 2018, and issued the following directions:
“We are in agreement with the earlier conclusion of the
APTEL. We are of the view that the direction of reduction
of capacity from 1000 mw to 500 mw by the State
Commission was correctly set aside. Since L-1 to L-5 were
represented before this Court, we direct that they shall be
entitled to supply of power in terms of the originally offered
amount, mentioned above, in accordance with para 3.5
of the Request for Proposal. The power supply will now
be reduced to a total of 906 mw. The State Commission
may now go into the issue of approval for adoption of tariff
with regard to L-4 and L-5. All Letters of Intent (LOIs) shall
stand modified in terms of the above. All the appeals shall
stand disposed of in terms of the above order.”
49. Consequent to the orders passed by this Court, the State Commission
vide its order dated 29th May 2018, directed RVPN/DISCOMS to file an
appropriate application/petition in relation to L-3, L-4 and L-5 bidders.
50. RVPN accordingly filed an application on 27th August 2018 before
the State Commission, submitting therein that the tariff of L-4 and
L-5 bidders was very high and not aligned to market prices and,
therefore, sought not to be adopted in terms of the competitive
bidding guidelines and documents.
51. In the meantime, a Contempt Petition came to be filed before this
Court by SKS Power. This Court vide order dated 20th September
2018, in the said Contempt Petition, issued the following directions:
“We are of the view that there is no doubt whatsoever
that now the PPA has to be signed between the parties.
However, the State Commission, may, as per our order,
go into the issue of approval of adoption of tariff with
regard to L-5, who is the party before us, and will decide
the same within a period of six weeks from today.
[2024] 1 S.C.R. 941
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
PPA is to be signed immediately thereafter.”
[emphasis supplied]
52. Thereafter, SKS Power filed an Interlocutory Application on 5th October
2018, praying for adoption of its tariff as per the orders of this Court
dated 25th April 2018 and 20th September 2018.
53. It was contended before the State Commission by SKS Power that
the State Commission was bound to adopt tariff as quoted by it.
However, per contra, it was contended by the RVPN and DISCOMS
that since the tariff quoted by SKS Power was not market aligned,
it could not be adopted. In view of the counter submission, the
State Commission vide its order dated 16th October 2018, gave an
opportunity to the RVPN to file an amended application or seek
direction on the issue from this Court.
54. Accordingly, RVPN filed a Miscellaneous Application before this
Court. This Court vide order dated 19th November 2018, passed
the following order:
“Having heard learned counsels for both the parties,
we only clarify that the Rajasthan Electricity Regulatory
Commission [the State Commission) is to decide the tariff
under-Section 63 of the Electricity Act, 2003 having regard
to the law laid down both statutorily and by this Court.
The State Commission to finalise the aforesaid prices
within a period of eight weeks from today.
The MAs are disposed of accordingly.”
55. A review application was also filed on behalf of the SKS Power. The
said review application was disposed of by this Court vide order
dated 21st January 2019, with the following directions:
“------. We find that as per the Standard Bidding Guidelines
the PPA is first to be signed after which the question of
adoption of tariff has to be taken up.
With this clarification of the 20.09.2018 order, we dispose
of the review and the M.A.
The State Commission which has reserved its judgment
942 [2024] 1 S.C.R.
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on 16.01.2019 will hear the parties within a period of two
weeks from today and will pass orders after taking into
account the order that we have passed today.”
56. In accordance with the directions issued by this Court, the State
Commission considered the rival submissions of the parties and
came to a conclusion that the tariff quoted by SKS Power was not
market aligned. The State Commission also found that, adoption of
such high rate would be against the consumer interest. The State
Commission, therefore, vide order dated 26th February 2019, decided
not to adopt the tariff quoted by L-4 and L-5 bidders.
57. The said order dated 26th February 2019 of the State Commission
was challenged before the learned APTEL by SKS Power by way
of Appeal No.224 of 2019. The learned APTEL framed the following
three issues in the said appeal:
“ISSUE NO.1: Whether the Respondent Commission
could reject the tariff/bid of the Appellant,
in terms of Section 63 of the Electricity
Act, 2003 and the directions issued by the
Hon’ble Supreme Court?
ISSUE NO.2: Whether there was a sufficient proof to
show that the bid of the Appellant was
market aligned?
ISSUE NO.3: Whether the argument of Consumer interest
be advanced by the Rajasthan Discoms in
the facts of the present Appeal?”
58. The learned APTEL while answering the first issue, came to the
conclusion that the State Commission, while adopting tariff under
Section 63, has to only consider that the Bidding Guidelines issued
by the Central Government providing for tariff structure were complied
with or not. The learned APTEL also held that the State Commission
cannot exercise its powers de hors such guidelines. It further held that
the State Commission has no power to reject the tariff of a bidder.
59. Insofar as the second issue is concerned, the learned APTEL came
to a finding that, since the bid of SKS Power was already evaluated,
and the subsequent certificates were issued by the BEC confirming
[2024] 1 S.C.R. 943
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
the transparency of the bid, it was not open for the State Commission
to go into the question, as to whether the tariff quoted by SKS Power
was market aligned or not. It further held that, after the order dated
25th April 2018 was passed by this Court, it was not open for the
State Commission to re-evaluate the bid.
60. Insofar as the third issue with regard to consumers’ interest is
concerned, the learned APTEL held that the said issue cannot be
raised again at that stage when the same had been dealt with in
detail by the learned APTEL vide order dated 2nd February 2018
and also considered by this Court before passing the order dated
25th April, 2018.
61. Accordingly, the appeal was allowed by the learned APTEL vide order
dated 3rd February 2020 and the order dated 26th February 2019 of
the State Commission was set aside. The learned APTEL directed
that the tariff of SKS Power, as offered in its bid, shall be adopted.
The parties were directed to revive and implement the PPA dated 4th
February 2019. This order dated 3rd February 2020, passed by the
learned APTEL has been challenged by the DISCOMS and RVPN
before this Court by way of Civil Appeal No.1937 of 2020 and Civil
Appeal No. 2721 of 2020 respectively.
62. The respondent No.1 in the present proceedings rests its claim on
the aforesaid orders passed by this Court and the order dated 3rd
February 2020, passed by the learned APTEL.
63. Basically, it is the contention of the respondent No.1-MB Power that
after the orders were passed by this Court, RVPN and the DISCOMS
were bound to procure electricity/power from the bidders going down
the ladder until the entire 906 MW power was exhausted. It is their
contention that once it is certified that the bid evaluation process
has been complied with as per the Bidding Guidelines issued by the
Central Government, it is presumed that the process was transparent
and it is not permissible for the State Commission to go into the
question of market aligned tariff and also the consumer interest. It is
their contention that without considering the question, as to whether
the tariff was market aligned or not, the procurers were bound to
accept supply from the bidders at the rates quoted by them. It is
their submission that the power under Section 63 of the Electricity
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Act restricted the scrutiny only to two aspects, viz., (1) whether the
Bidding Guidelines framed by the Union of India under Section 63
of the Electricity Act were followed; and (2) whether the bidding
process was transparent or not.
64. The High Court in the impugned judgment, relying on the observations
of the learned APTEL and the earlier orders of this Court has come
to a conclusion that, applying the test of “filling the bucket”, the
procurers were bound to take supply from the respondent No.1-MB
Power at the rates quoted by it. On the basis of the judgment of the
learned APTEL, the High Court held that the respondent No.1-MB
Power had a right to supply power since there was a gap of 300
MW between the power procured by the procurers and the ceiling
of 906 MW determined by this Court. In these premises, the High
Court issued a mandamus directing the appellants to take supply
of 200 MW electricity/power from the respondent No.1-MB Power
at the rates quoted by it.
65. We, therefore, find that, before deciding the correctness or otherwise
of the impugned judgment, it will be necessary for us to examine
the correctness of the judgment and order dated 3rd February 2020,
passed by the learned APTEL in the case of SKS Power.
66. We have already reproduced Section 63 of the Electricity Act. The
provisions of Section 63 of the Electricity Act fell for consideration
before this Court in the case of Energy Watchdog (supra). It will
be apposite to refer to paragraphs 19 and 20 of the said judgment,
which are as under:
“19. The construction of Section 63, when read with the
other provisions of this Act, is what comes up for decision
in the present appeals. It may be noticed that Section
63 begins with a non obstante clause, but it is a non
obstante clause covering only Section 62. Secondly, unlike
Section 62 read with Sections 61 and 64, the appropriate
Commission does not “determine” tariff but only “adopts”
tariff already determined under Section 63. Thirdly, such
“adoption” is only if such tariff has been determined
through a transparent process of bidding, and, fourthly,
this transparent process of bidding must be in accordance
with the guidelines issued by the Central Government.
[2024] 1 S.C.R. 945
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
What has been argued before us is that Section 63
is a standalone provision and has to be construed
on its own terms, and that, therefore, in the case of
transparent bidding nothing can be looked at except
the bid itself which must accord with guidelines issued
by the Central Government. One thing is immediately
clear, that the appropriate Commission does not
act as a mere post office under Section 63. It must
adopt the tariff which has been determined through a
transparent process of bidding, but this can only be
done in accordance with the guidelines issued by the
Central Government. Guidelines have been issued under
this section on 19-1-2005, which guidelines have been
amended from time to time. Clause 4, in particular, deals
with tariff and the appropriate Commission certainly has
the jurisdiction to look into whether the tariff determined
through the process of bidding accords with Clause 4.
20. It is important to note that the regulatory powers of
the Central Commission, so far as tariff is concerned, are
specifically mentioned in Section 79(1). This regulatory
power is a general one, and it is very difficult to state
that when the Commission adopts tariff under Section
63, it functions dehors its general regulatory power under
Section 79(1)(b). For one thing, such regulation takes
place under the Central Government’s guidelines. For
another, in a situation where there are no guidelines or in
a situation which is not covered by the guidelines, can it
be said that the Commission’s power to “regulate” tariff is
completely done away with? According to us, this is not a
correct way of reading the aforesaid statutory provisions.
The first rule of statutory interpretation is that the statute
must be read as a whole. As a concomitant of that rule,
it is also clear that all the discordant notes struck by the
various sections must be harmonised. Considering the fact
that the non obstante clause advisedly restricts itself to
Section 62, we see no good reason to put Section 79 out
of the way altogether. The reason why Section 62 alone
has been put out of the way is that determination of tariff
can take place in one of two ways — either under Section
946 [2024] 1 S.C.R.
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62, where the Commission itself determines the tariff in
accordance with the provisions of the Act (after laying
down the terms and conditions for determination of tariff
mentioned in Section 61) or under Section 63 where the
Commission adopts tariff that is already determined by a
transparent process of bidding. In either case, the general
regulatory power of the Commission under Section 79(1)
(b) is the source of the power to regulate, which includes
the power to determine or adopt tariff. In fact, Sections
62 and 63 deal with “determination” of tariff, which is part
of “regulating” tariff. Whereas “determining” tariff for inter-
State transmission of electricity is dealt with by Section
79(1)(d), Section 79(1)(b) is a wider source of power
to “regulate” tariff. It is clear that in a situation where
the guidelines issued by the Central Government under
Section 63 cover the situation, the Central Commission is
bound by those guidelines and must exercise its regulatory
functions, albeit under Section 79(1)(b), only in accordance
with those guidelines. As has been stated above, it is only
in a situation where there are no guidelines framed at all
or where the guidelines do not deal with a given situation
that the Commission’s general regulatory powers under
Section 79(1)(b) can then be used.”
[emphasis supplied]
67. It could thus be seen that it has been held by this Court that unlike
Section 62 read with Sections 61 and 64, under the provisions of
Section 63 of the Electricity Act, the appropriate Commission does
not “determine” tariff but only “adopts” tariff already determined under
Section 63. It has further been held that, such “adoption” is only if
such tariff has been determined through a transparent process of
bidding, and that, this transparent process of bidding must be in
accordance with the guidelines issued by the Central Government.
It was sought to be contended before this Court in the said case
that Section 63 is a standalone provision and has to be construed
on its own terms, and that, therefore, in the case of transparent
bidding nothing can be looked at except the bid itself which must
accord with guidelines issued by the Central Government. However,
rejecting the said contention, this Court observed that the appropriate
[2024] 1 S.C.R. 947
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
Commission does not act as a mere post office under Section 63.
It has been observed that, Clause 4, in particular, deals with tariff
and the appropriate Commission certainly has the jurisdiction to look
into whether the tariff determined through the process of bidding
accords with Clause 4.
68. This Court in the said case, in paragraph 20, further observed that
the entire Act shall be read as a whole. It has been held that, all the
discordant notes struck by the various sections must be harmonized.
It has been held that, considering the fact that the non obstante
clause advisedly restricts itself to Section 62, there is no reason to
put Section 79 out of the way altogether. It has been held that, either
under Section 62, or under Section 63, the general regulatory power
of the Commission under Section 79(1)(b) is the source of the power
to regulate, which includes the power to determine or adopt tariff. It
has been held that, Sections 62 and 63 deal with “determination” of
tariff, which is part of “regulating” tariff. It has further been held that,
in a situation where the guidelines issued by the Central Government
under Section 63 cover the situation, the Central Commission is bound
by those guidelines and must exercise its regulatory functions, albeit
under Section 79(1)(b), only in accordance with those guidelines. It
has further been held that, it is only in a situation where there are
no guidelines framed at all or where the guidelines do not deal with
a given situation that the Commission’s general regulatory powers
under Section 79(1)(b) can be used.
69. The aforesaid view of this Court in the case of Energy Watchdog
(supra), which is a judgment delivered by two Judge Bench, has
been approved by three Judge Bench of this Court in the case of
Tata Power Company Limited Transmission (supra).
70. We have already referred to Section 86(1)(b) of the Electricity Act,
which is analogous to Section 79 of the Electricity Act. Section 79
determines the functions of Central Commission, whereas Section 86
provides for the functions of the State Commission. Section 86 of the
Electricity Act empowers the State Commission to regulate electricity
purchase and procurement process of distribution licensees including
the price at which electricity shall be procured from the generating
companies or licensees or from other sources through agreements
for purchase of power for distribution and supply within the State.
948 [2024] 1 S.C.R.
Digital Supreme Court Reports
71. It can thus be seen that Section 86(1)(b) of the Electricity Act gives
ample power on the State Commission to regulate electricity purchase
and procurement process of distribution licensees. It also empowers
the State Commission to regulate the matters including the price at
which electricity shall be procured from the generating companies, etc.
72. It will also be relevant to refer to the Bidding Guidelines notified by
the Central Government vide Resolution dated 19th January 2005. The
preamble of the Bidding Guidelines specifically states that, one of the
objectives of the said Bidding Guidelines is to facilitate transparency
and fairness in procurement processes and protection of consumer
interests by facilitating competitive conditions in procurement of
electricity.
73. Clause 5.15 of the Bidding Guidelines is an important clause. It
provides that, the bidder who has quoted lowest levelized tariff as
per evaluation procedure, shall be considered for the award. It also
provides that the evaluation committee shall have the right to reject
all price bids if the rates quoted are not aligned to the prevailing
market prices.
74. It is thus amply clear that the evaluation committee is empowered to
consider, as to whether the rates quoted are aligned to the market
price or not, and that the evaluation committee shall have the right to
reject all the price bids if it finds that the rates quoted are not aligned
to the prevailing market price. The orders which are relied upon by
the learned APTEL, specifically the order dated 19th November 2018
of this Court, had specifically clarified that the State Commission
was to decide the tariff under Section 63 of the Electricity Act having
regard to the law laid down both statutorily and by this Court.
75. In this background, the State Commission was justified in considering
clause 5.15 of the Bidding Guidelines, which specifically permits to
reject all price bids if the rates quoted are not aligned to the prevailing
market prices.
76. The contention that this Court has ordered that the bids quoted by
the bidders are to be accepted without going into the question of it
being market aligned or not, in our view, is without substance.
77. If the contention of the respondent No.1-MB Power that the procurer
is bound to accept all the bids emerged in a competitive bidding
[2024] 1 S.C.R. 949
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
process once the bidding process was found to be transparent and in
compliance with the Bidding Guidelines is to be accepted, in our view,
it will do complete violence to clause 5.15 of the Bidding Guidelines
itself. If that view is accepted, the DISCOMS will be compelled to
purchase electricity at a much higher rate as compared with other
suppliers. The said higher rate will be passed on to the consumers.
As such, accepting the contention of the respondent No.1 would
result in adversely affecting the interests of the consumers and,
in turn, would be against the larger public interest. For example,
if in a bidding process for 1000 MW power, 10 persons emerged
as “qualified bidders”. L-1 bidder quotes Rs.2 per unit for 100 MW
power and L-2 bidder quotes Rs.2.25 per unit for another 100 MW
power and from L-3 bidder onwards, they start quoting Rs.10 per
unit and above for balance 800 MW power, could the public interest
be subserved by compelling the procurer to buy balance 800 MW
power at Rs.10 per unit and above when the prices quoted are totally
not aligned to market prices.
78. We are, therefore, of the considered view that the learned APTEL
has grossly erred in holding that the State Commission has no power
to go into the question, as to whether the prices quoted are market
aligned or not and also not to take into consideration the aspect of
consumers’ interest.
79. When the Bidding Guidelines itself permit the BEC to reject all price
bids if the rates quoted are not aligned to the prevailing market prices,
there is no question of the State Commission being not in a position
to go into the question, as to whether the rates quoted are market
aligned or not, specifically, in the light of ample powers vested with
the State Commission under Section 86(1)(b) of the Electricity Act,
which also includes the power to regulate the prices at which electricity
shall be procured from the generating companies, etc. The finding
of the learned APTEL, in our view, therefore, is totally erroneous.
80. In the case of SKS Power, the BEC, consisting of following 6 members,
has considered the levelized tariff quoted by L-4 and L-5 bidders:
(i) Shri R.K. Jain, Chief Engineer (NPP & RA), RVPN, Jaipur;
(ii) Shri Manish Saxena, Chief Controller of Accounts, RVPN, Jaipur;
(iii) Shri M.M. Ranwa, Chief Engineer, RUVNL, Jaipur;
(iv) Shri K.L. Meena, Addl. Chief Engineer (Fuel), RVUN, Jaipur;
(v) Shri S.K. Mathur, Chief Engineer (HQ), JVVNL, Jaipur; and
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(vi) Shri Tarun Agarwal, CA, Partner M/s Shyamlal Agrawal & Co.,
Jaipur
81. It can be seen that the said Committee consisted of 4 technical
members of the rank of Chief Engineer/Additional Chief Engineer.
It consisted of the Chief Controller of Account, RVPN, Jaipur. It also
consisted of a Chartered Accountant, who is an expert in financial
matters. After due deliberations, the BEC consisting of experts found
that the prices quoted by L-4 and L-5 bidders were exorbitantly
high and it would result in additional financial burden of more than
Rs.1715 crore on the consumers of the State as compared to the
tariff of L-1 bidder.
82. The State Commission after considering the detailed analysis of the
BEC had come to the considered conclusion that the prices offered
by SKS Power (L-5 bidder) were not market aligned, and therefore,
not in the consumers’ interest. We, therefore, find that the learned
APTEL has grossly erred in reversing the well-reasoned order passed
by the State Commission, which was, in turn, based on the decision
of the BEC in accordance with clause 5.15 of the Bidding Guidelines.
83. We further find that it cannot be read from the orders of this Court
that the State Commission was bound to accept the bids as quoted
by the bidders till the bucket was filled. Firstly, no such direction
can be issued by this Court de hors the provisions of Section 63
and 86(1)(b) of the Electricity Act and the Bidding Guidelines. In
any event, vide order dated 19th November 2018, this Court had
specifically directed the State Commission to decide the tariff under
Section 63 of the Electricity Act having regard to the law laid down
both statutorily and by this Court. As such, the State Commission
was bound to take into consideration the Bidding Guidelines and
specifically clause 5.15 thereof.
84. With regard to the contention that the power under clause 5.15 of the
Bidding Guidelines can be exercised only when the bidding process
is found to be not in compliance with the Bidding Guidelines and
is not transparent in respect of all the bidders and not in respect of
some of the bidders is concerned, in our view, the same is without
substance.
85. We may in this respect refer to Section 13(2) of the General Clauses
Act, which reads thus:
[2024] 1 S.C.R. 951
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
“13. Gender and number.—In all Central Acts and
Regulations, unless there is anything repugnant in the
subject or context,—
(1) …………………; and
(2) words in the singular shall include the plural, and vice
versa.”
86. Apart from that, the Constitution Bench of this Court in the case of
Vivek Narayan Sharma and others v. Union of India and others10
had an occasion to consider the question, as to whether the word
“any” would include “all” and vice versa. The Constitution Bench of
this Court observed thus:
“113. It is strenuously urged by the learned Senior Counsel
appearing on behalf of the petitioners that the word “any” used
in sub-section (2) of Section 26 of the RBI Act will have to be
given a restricted meaning to mean “some”. It is submitted that if
sub-section (2) of Section 26 of the RBI Act is not read in such
manner, the very power available under the said sub-section
will have to be held to be invalid on the ground of excessive
delegation. It is submitted that it cannot be construed that
the legislature intended to bestow uncanalised, unguided and
arbitrary power on the Central Government to demonetise the
entire currency. It is, therefore, the submission of the petitioners
that in order to save the said section from being declared void,
the word “any” requires to be interpreted in a restricted manner
to mean “some”.
114. Per contra, it is submitted on behalf of the respondents
that the word “any” under sub-section (2) of Section 26 of the
RBI Act, cannot be interpreted in a narrow manner and it will
have to be construed to include “all”.
Precedents construing the word “any”
115. A Constitution Bench of this Court in Chief Inspector of
Mines v. Lala Karam Chand Thapar [Chief Inspector of Mines
v. Lala Karam Chand Thapar, (1962) 1 SCR 9 : AIR 1961 SC
10 [2023] 1 SCR 1 : (2023) 3 SCC 1=2023 INSC 2
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838] was considering the question as to whether the phrase
“any one of the Directors” as found in Section 76 of the Mines
Act, 1952 could mean “only one of the Directors” or could it
be construed to mean “every one of the Directors”. In the said
case, all the Directors of the Company were prosecuted for the
offences punishable under Sections 73 and 74 of the Mines Act,
1952. The High Court had held [Lala Karam Chand Thapar v.
State of Bihar, 1958 SCC OnLine Pat 30] that any “one” of the
Directors of the Company could only be prosecuted.
116. The Constitution Bench of this Court observed thus : (Lala
Karam Chand Thapar case [Chief Inspector of Mines v. Lala
Karam Chand Thapar, (1962) 1 SCR 9 : AIR 1961 SC 838],
AIR pp. 847-48, paras 29-34)
“29. It is quite clear and indeed not disputed that in some
contexts, “any one” means “one only it matters not which
one” the phrase “any of the Directors” is therefore quite
capable of meaning “only one of the Directors, it does
not matter which one”. Is the phrase however capable
of no other meaning? If it is not, the courts cannot look
further, and must interpret these words in that meaning
only, irrespective of what the intention of the legislature
might be believed to have been. If however the phrase
is capable of another meaning, as suggested viz. “every
one of the Directors” it will be necessary to decide which
of the two meanings was intended by the legislature.
30. If one examines the use of the words “any one”
in common conversation or literature, there can be no
doubt that they are not infrequently used to mean “every
one” — not one, but all. Thus we say of any one can
see that this is wrong, to mean “everyone can see that
this is wrong”. “Any one may enter” does not mean that
“only one person may enter”, but that all may enter. It is
permissible and indeed profitable to turn in this connection
to Oxford English Dictionary, at p. 378, of which, we find
the meaning of “any” given thus:‘In affirmative sentences,
it asserts, concerning a being or thing of the sort named,
without limitation as to which, and thus collectively of
[2024] 1 S.C.R. 953
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
every one of them’. One of the illustrations given is — “I
challenge anyone to contradict my assertions”. Certainly,
this does not mean that one only is challenged; but that
all are challenged. It is abundantly clear therefore that
“any one” is not infrequently used to mean “every one”.
31. But, argues Mr Pathak, granting that this is so, it must
be held that when the phrase “any one” is used with the
preposition “of”, followed by a word denoting a number
of persons, it never means “every one”. The extract from
Oxford Dictionary, it is interesting to notice, speaks of an
assertion “concerning a being or thing of the sort named”;
it is not unreasonable to say that, the word “of” followed
by a word denoting a number of persons or things is just
such “naming of a sort” as mentioned there. Suppose, the
illustration “I challenge any one to contradict my assertions”
was changed to “I challenge any one of my opponents
to contradict my assertion”. “Any one of my opponents”
here would mean “all my opponents” — not one only of
the opponents.
32. While the phrase “any one of them” or any similar
phrase consisting of “any one”, followed by “of” which is
followed in its turn by words denoting a number of persons
or things, does not appear to have fallen for judicial
construction, in our courts or in England — the phrase “any
of the present Directors” had to be interpreted in an old
English case, Isle of Wight Railway Co. v. Tahourdin [Isle
of Wight Railway Co. v. Tahourdin, (1883) LR 25 Ch D 320
(CA)] . A number of shareholders required the Directors
to call a meeting of the company for two objects. One
of the objects was mentioned as ‘To remove, if deemed
necessary or expedient any of the present Directors, and
to elect Directors to fill any vacancy on the Board’. The
Directors issued a notice to convene a meeting for the
other object and held the meeting. Then the shareholders,
under the Companies Clauses Act, 1845, issued a notice
of their own convening a meeting for both the objects in
the original requisition. In an action by the Directors to
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restrain the requisitionists, from holding the meeting, the
Court of Appeal held that a notice to remove “any of the
present Directors” would justify a resolution for removing all
who are Directors at the present time. “Any”, Lord Cotton,
L.J. pointed out, would involve “all”.
33. It is true that the language there was “any of the present
Directors” and not “any one of the present Directors” and
it is urged that the word “one”, in the latter phrase makes
all the difference. We think it will be wrong to put too much
emphasis on the word “one” here. It may be pointed out in
this connection that the Permanent Edition of Words and
Phrases, mentions an American case Front & Huntingdon
Building & Loan Assn. v. Berzinski [Front & Huntingdon
Building & Loan Assn. v. Berzinski, 130 Pa Super 297 :
196 A 572 (Superior Court of Pennsylvania 1938)] where
the words “any of them” were held to be the equivalent
of “any one of them”.
34. After giving the matter full and anxious consideration,
we have come to the conclusion that the words “any one
of the Directors” is ambiguous; in some contexts, it means
“only one of the Directors, does not matter which one”, but
in other contexts, it is capable of meaning “every one of
the Directors”. Which of these two meanings was intended
by the legislature in any particular statutory phrase has to
be decided by the courts on a consideration of the context
in which the words appear, and in particular, the scheme
and object of the legislation.”
(emphasis supplied)
117. The Constitution Bench in Lala Karam Chand Thapar case
[Chief Inspector of Mines v. Lala Karam Chand Thapar, (1962)
1 SCR 9 : AIR 1961 SC 838] found that the words “any one”
have been commonly used to mean “every one” i.e. not one,
but all. It found that the word “any”, in affirmative sentences,
asserts, concerning a being or thing of the sort named, without
limitation. It held that it is abundantly clear that the words “any
one” are not infrequently used to mean “every one”.
[2024] 1 S.C.R. 955
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
118. It could be seen that the Constitution Bench in Lala Karam
Chand Thapar case [Chief Inspector of Mines v. Lala Karam
Chand Thapar, (1962) 1 SCR 9 : AIR 1961 SC 838], after giving
the matter full and anxious consideration, came to the conclusion
that the words “any one of the Directors” was an ambiguous
one. It held that in some contexts, it means “only one of the
Directors, does not matter which one”, but in other contexts, it
is capable of meaning “every one of the Directors”. It held that
which of these two meanings was intended by the legislature in
any particular statutory phrase has to be decided by the courts
on consideration of the context in which the words appear, and
in particular, the scheme and object of the legislation.
119. After examining the scheme of the Mines Act, 1952, the
Constitution Bench of this Court further observed thus : (Lala
Karam Chand Thapar case [Chief Inspector of Mines v. Lala
Karam Chand Thapar, (1962) 1 SCR 9 : AIR 1961 SC 838],
AIR pp. 848-49, paras 36-38)
“36. But, argues Mr Pathak, one must not forget the
special rule of interpretation for “penal statute” that if the
language is ambiguous, the interpretation in favour of
the accused should ordinarily be adopted. If you interpret
“any one” in the sense suggested by him, the legislation
he suggests is void and so the accused escapes. One
of the two possible constructions, thus being in favour of
the accused, should therefore be adopted. In our opinion,
there is no substance in this contention. The rule of strict
interpretation of penal statutes in favour of the accused
is not of universal application, and must be considered
along with other well-established rules of interpretation.
We have already seen that the scheme and object of the
statute makes it reasonable to think that the legislature
intended to subject all the Directors of a company owning
coal mines to prosecution and penalties, and not one only
of the Directors. In the face of these considerations there
is no scope here of the application of the rule for strict
interpretation of penal statutes in favour of the accused.
37. The High Court appears to have been greatly
impressed by the fact that in other statutes where the
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legislature wanted to make every one out of a group or a
class of persons liable it used clear language expressing
the intention; and that the phrase “any one” has not
been used in any other statute in this country to express
“every one”. It will be unreasonable, in our opinion, to
attach too much weight to this circumstance; and as for
the reasons mentioned above, we think the phrase “any
one of the Directors” is capable of meaning “every one
of the Directors”, the fact that in other statutes, different
words were used to express a similar meaning is not of
any significance.
38. We have, on all these considerations come to the
conclusion that the words “any one of the Directors”
has been used in Section 76 to mean “every one of the
Directors”, and that the contrary interpretation given by
the High Court is not correct.”
(emphasis supplied)
120. It could thus be seen that though it was sought to be
argued before the Court that since the rule of strict interpretation
of penal statutes in favour of the accused has to be adopted
and that the word “any” was suffixed by the word “one”, it
has to be given restricted meaning; the Court in Lala Karam
Chand Thapar case [Chief Inspector of Mines v. Lala Karam
Chand Thapar, (1962) 1 SCR 9 : AIR 1961 SC 838] came to
the conclusion that the words “any one of the Directors” used
in Section 76 of the Mines Act, 1952 would mean “every one
of the Directors”. It is further to be noted that the word “any”
in the said case was suffixed by the word “one”, still the Court
held that the words “any one” would mean “all” and not “one”.
It is to be noted that in the present case, the legislature has
not employed the word “one” after the word “any”. It is settled
law that it has to be construed that every single word employed
or not employed by the legislature has a purpose behind it.
121. On the very date on which the judgment in Chief Inspector
of Mines v. Lala Karam Chand Thapar [Chief Inspector of Mines v.
Lala Karam Chand Thapar, (1962) 1 SCR 9 : AIR 1961 SC 838]
was pronounced, the same Constitution Bench also pronounced
the judgment in Banwarilal Agarwalla [Banwarilal Agarwalla v.
[2024] 1 S.C.R. 957
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
State of Bihar, (1962) 1 SCR 33 : AIR 1961 SC 849], wherein
the Constitution Bench observed thus : (Banwarilal Agarwalla
case [Banwarilal Agarwalla v. State of Bihar, (1962) 1 SCR 33
: AIR 1961 SC 849], AIR p. 850, para 3)
“3. The first contention is based on an assumption that
the word “any one” in Section 76 means only “one of
the Directors, and only one of the shareholders”. This
question as regards the interpretation of the word “any
one” in Section 76 was raised in Criminal Appeals Nos. 98
to 106 of 1959 (Chief Inspector of Mines [Chief Inspector
of Mines v. Lala Karam Chand Thapar, (1962) 1 SCR 9
: AIR 1961 SC 838], etc.) and it has been decided there
that the word “any one” should be interpreted there as
“every one”. Thus under Section 76 every one of the
shareholders of a private company owning the mine, and
every one of the Directors of a public company owning
the mine is liable to prosecution. No question of violation
of Article 14 therefore arises.”
(emphasis supplied)
122. Another Constitution Bench of this Court in Tej Kiran Jain
[Tej Kiran Jain v. N. Sanjiva Reddy, (1970) 2 SCC 272] was
considering the provisions of Article 105 of the Constitution of
India and, particularly, the immunity as available to the Member
of Parliament “in respect of anything said … in Parliament”.
The Constitution Bench observed thus : (SCC p. 274, para 8)
“8. In our judgment it is not possible to read the provisions
of the article in the way suggested. The article means what
it says in language which could not be plainer. The article
confers immunity inter alia in respect of “anything said …
in Parliament”. The word “anything” is of the widest import
and is equivalent to “everything”. The only limitation arises
from the words “in Parliament” which means during the
sitting of Parliament and in the course of the business of
Parliament. We are concerned only with speeches in Lok
Sabha. Once it was proved that Parliament was sitting and
its business was being transacted, anything said during the
course of that business was immune from proceedings in
any Court this immunity is not only complete but is as it
should be. It is of the essence of parliamentary system of
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Government that people’s representatives should be free
to express themselves without fear of legal consequences.
What they say is only subject to the discipline of the rules
of Parliament, the good sense of the members and the
control of proceedings by the Speaker. The Courts have
no say in the matter and should really have none.”
(emphasis supplied)
123. This Court held in Tej Kiran Jain case [Tej Kiran Jain v.
N. Sanjiva Reddy, (1970) 2 SCC 272] that the word “anything”
is of the widest import and is equivalent to “everything”. The
only limitation arises from the words “in Parliament” which
means during the sitting of Parliament and in the course of the
business of Parliament. It held that, once it was proved that
Parliament was sitting and its business was being transacted,
anything said during the course of that business was immune
from proceedings in any court.
124. This Court, in LDA [LDA v. M.K. Gupta, (1994) 1 SCC 243],
was considering clause (o) of Section 2(1) of the Consumer
Protection Act, 1986 which defines “service”, wherein the word
“any” again fell for consideration. This Court observed thus :
(SCC p. 255, para 4)
“4. … The words “any” and “potential” are significant.
Both are of wide amplitude. The word “any” dictionarily
means “one or some or all”. In Black’s Law Dictionary it
is explained thus, ‘word “any” has a diversity of meaning
and may be employed to indicate “all” or “every” as well
as “some” or “one” and its meaning in a given statute
depends upon the context and the subject-matter of the
statute’. The use of the word “any” in the context it has
been used in clause (o) indicates that it has been used
in wider sense extending from one to all.”
125. This Court held in LDA case [LDA v. M.K. Gupta, (1994)
1 SCC 243] that the word “any” is of wide amplitude. It means
“one or some or all”. Referring to Black’s Law Dictionary, the
Court observed that the word “any” has a diversity of meaning
and may be employed to indicate “all” or “every” as well as
“some” or “one”. However, the meaning which is to be given
to it would depend upon the context and the subject-matter of
[2024] 1 S.C.R. 959
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
the statute.
126. In K.P. Mohammed Salim [K.P. Mohammed Salim v. CIT,
(2008) 11 SCC 573], this Court was considering the power of
the Director General or Chief Commissioner or Commissioner
to transfer any case from one or more assessing officers
subordinate to him to any other assessing officer or assessing
officers. This Court observed thus : (SCC p. 578, para 17)
“17. The word “any” must be read in the context of the
statute and for the said purpose, it may in a situation of this
nature, means all. The principles of purposive construction
for the said purpose may be resorted to. (See New India
Assurance Co. Ltd. v. Nusli Neville Wadia [New India
Assurance Co. Ltd. v. Nusli Neville Wadia, (2008) 3 SCC
279 : (2008) 1 SCC (Civ) 850] .) Thus, in the context of a
statute, the word “any” may be read as all in the context
of the Income Tax Act for which the power of transfer
has been conferred upon the authorities specified under
Section 127.”
(emphasis supplied)
127. The Court in K.P. Mohammed Salim [K.P. Mohammed
Salim v. CIT, (2008) 11 SCC 573] again reiterated that the
word “any” must be read in the context of the statute. The
Court also applied the principles of purposive construction to
the term “any” to mean “all”.
128. In Raj Kumar Shivhare [Raj Kumar Shivhare v. Directorate
of Enforcement, (2010) 4 SCC 772 : (2010) 3 SCC (Civ) 712],
an argument was sought to be advanced that since Section 35
of the Foreign Exchange Management Act, 1999 uses the words
“any decision or order”, only appeals from final order could be
filed. Rejecting the said contention, this Court observed thus :
(SCC pp. 779-80, paras 19-20 & 26)
“19. The word “any” in this context would mean “all”. We
are of this opinion in view of the fact that this section
confers a right of appeal on any person aggrieved. A right
of appeal, it is well settled, is a creature of statute. It is
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never an inherent right, like that of filing a suit. A right of
filing a suit, unless it is barred by statute, as it is barred
here under Section 34 of FEMA, is an inherent right (see
Section 9 of the Civil Procedure Code) but a right of appeal
is always conferred by a statute. While conferring such
right a statute may impose restrictions, like limitation or
pre-deposit of penalty or it may limit the area of appeal to
questions of law or sometime to substantial questions of
law. Whenever such limitations are imposed, they are to be
strictly followed. But in a case where there is no limitation on
the nature of order or decision to be appealed against, as
in this case, the right of appeal cannot be further curtailed
by this Court on the basis of an interpretative exercise.
20. Under Section 35 of FEMA, the legislature has
conferred a right of appeal to a person aggrieved from
“any” “order” or “decision” of the Appellate Tribunal. Of
course such appeal will have to be on a question of law.
In this context the word “any” would mean “all”.
***
26. In the instant case also when a right is conferred on a
person aggrieved to file appeal from “any” order or decision
of the Tribunal, there is no reason, in the absence of a
contrary statutory intent, to give it a restricted meaning.
Therefore, in our judgment in Section 35 of FEMA, any
“order” or “decision” of the Appellate Tribunal would mean
all decisions or orders of the Appellate Tribunal and all such
decisions or orders are, subject to limitation, appealable
to the High Court on a question of law.”
(emphasis supplied)
129. While holding that the word “any” in the context would mean
“all”, this Court in Raj Kumar Shivhare [Raj Kumar Shivhare v.
Directorate of Enforcement, (2010) 4 SCC 772 : (2010) 3 SCC
(Civ) 712] observed that a right of appeal is always conferred
by a statute. It has been held that, while conferring such right,
a statute may impose restrictions, like limitation or pre-deposit
of penalty or it may limit the area of appeal to questions of law
[2024] 1 S.C.R. 961
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
or sometime to substantial questions of law. It has been held
that whenever such limitations are imposed, they are to be
strictly followed. It has been held that in a case where there
is no limitation, the right of appeal cannot be curtailed by this
Court on the basis of an interpretative exercise.
130. Shri P. Chidambaram, learned Senior Counsel relied on
the judgment of this Court in Union of India v. A.B. Shah [Union
of India v. A.B. Shah, (1996) 8 SCC 540 : 1996 SCC (Cri) 688].
In the said case, the High Court was considering an appeal
preferred by the Union of India wherein it had challenged the
acquittal of the accused by the learned trial court, which was
confirmed in appeal by the High Court. The learned trial court
and the High Court had held that the complaint filed was beyond
limitation. This Court reversed the judgments of the learned trial
court and the High Court.
131. This Court while interpreting the expression “at any time”
observed thus : (A.B. Shah case [Union of India v. A.B. Shah,
(1996) 8 SCC 540 : 1996 SCC (Cri) 688], SCC p. 546, para 12)
“12. If we look into Conditions 3 and 6 with the object
and purpose of the Act in mind, it has to be held that
these conditions are not only relatable to what was
required at the commencement of depillaring process,
but the unstowing for the required length must exist
always. The expression “at any time” finding place in
Condition 6 has to mean, in the context in which it has
been used, “at any point of time”, the effect of which is
that the required length must be maintained all the time.
The accomplishment of object of the Act, one of which
is safety in the mines, requires taking of such a view,
especially in the backdrop of repeated mine disasters
which have been taking, off and on, heavy toll of lives
of the miners. It may be pointed out that the word “any”
has a diversity of meaning and in Black›s Law Dictionary
it has been stated that this word may be employed to
indicate “all” or “every”, and its meaning will depend
“upon the context and subject-matter of the statute”. A
reference to what has been stated in Stroud’s Judicial
962 [2024] 1 S.C.R.
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Dictionary, Vol. I, is revealing inasmuch as the import of
the word “any” has been explained from pp. 145 to 153
of the 4th Edn., a perusal of which shows it has different
connotations depending primarily on the subject-matter
of the statute and the context of its use. A Bench of
this Court in LDA v. M.K. Gupta [LDA v. M.K. Gupta,
(1994) 1 SCC 243], gave a very wide meaning to this
word finding place in Section 2(1)(o) of the Consumer
Protection Act, 1986 defining “service”. (See para 4)”
(emphasis supplied)
132. Shri Chidambaram rightly argued that the word “any” will
have to be construed in its context, taking into consideration
the scheme and the purpose of the enactment. There can
be no quarrel with regard to the said proposition. Right from
the judgment of the Constitution Bench of this Court in Chief
Inspector of Mines v. Lala Karam Chand Thapar [Chief Inspector
of Mines v. Lala Karam Chand Thapar, (1962) 1 SCR 9 : AIR
1961 SC 838], the position is clear. What is the meaning which
the legislature intended to give to a particular statutory provision
has to be decided by the Court on a consideration of the context
in which the word(s) appear(s) and in particular, the scheme
and object of the legislation.”
87. From the perusal of the various judgments, which have been referred
to in detail by the Constitution Bench, it will be clear that the words
“all” or “any” will have to be construed in their context taking into
consideration the scheme and purpose of the enactment. What is
the meaning which the legislature intended to give to a particular
statutory provision has to be decided by the Court on a consideration
of the context in which the word(s) appear(s) and in particular, the
scheme and object of the legislation. We have no hesitation to hold
that the word “all” used in clause 5.15 of the Bidding Guidelines, read
with the legislative policy for which the Electricity Act was enacted
and read with Section 86(1)(b) of the Electricity Act, will have to be
construed to be the one including “any”. As such, the contention in
that regard is to be rejected.
88. In any case, applying the principle of literal interpretation, the
evaluation committee/BEC would be entitled to reject only such of
the price bids if it finds that the rates quoted by the bidders are not
[2024] 1 S.C.R. 963
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
aligned to the prevailing market prices. It does not stipulate rejection
of all the bids in the bidding process. For example, if in a bidding
process, which is in accordance with the Bidding Guidelines and is
transparent, 5 bidders emerged. Out of the said bidders, the rates
quoted by only 3 bidders are market aligned and the rates quoted
by rest of the 2 bidders are not market aligned. In accordance with
the Bidding Guidelines, the BEC would be entitled to recommend
acceptance of the bids of the first 3 bidders and reject the bids of
rest of the 2 bidders whose quoted rates/prices are not found to be
market aligned. We, therefore, reject the contention in this behalf.
89. We further find that the Court, while interpreting a particular provision,
will have to apply the principles of purposive construction. The
Constitution Bench of this Court in the case of Vivek Narayan Sharma
(supra) after surveying various judgments on the issue has held thus:
“148. It is thus clear that it is a settled principle that the
modern approach of interpretation is a pragmatic one, and
not pedantic. An interpretation which advances the purpose
of the Act and which ensures its smooth and harmonious
working must be chosen and the other which leads to
absurdity, or confusion, or friction, or contradiction and
conflict between its various provisions, or undermines, or
tends to defeat or destroy the basic scheme and purpose
of the enactment must be eschewed. The primary and
foremost task of the Court in interpreting a statute is to
gather the intention of the legislature, actual or imputed.
Having ascertained the intention, it is the duty of the
Court to strive to so interpret the statute as to promote
or advance the object and purpose of the enactment.
For this purpose, where necessary, the Court may even
depart from the rule that plain words should be interpreted
according to their plain meaning. There need be no meek
and mute submission to the plainness of the language. To
avoid patent injustice, anomaly or absurdity or to avoid
invalidation of a law, the court would be justified in departing
from the so-called golden rule of construction so as to
give effect to the object and purpose of the enactment.
Ascertainment of legislative intent is the basic rule of
statutory construction.”
964 [2024] 1 S.C.R.
Digital Supreme Court Reports
90. It could thus be seen that it is a settled principle that the modern
approach of interpretation is a pragmatic one, and not pedantic. An
interpretation which advances the purpose of the Act and which
ensures its smooth and harmonious working must be chosen and the
other which leads to absurdity, or confusion, or friction, or contradiction
and conflict between its various provisions, or undermines, or tends
to defeat or destroy the basic scheme and purpose of the enactment
must be eschewed.
91. If the contention that clause 5.15 of the Bidding Guidelines will come
into play, which permits the Evaluation Committee to reject “all” price
bids and not “any” one of them is accepted, it will lead to nothing
else than resulting in absurdity. Suppose, if L-1 bidder quotes Rs.3
per unit and L-5 bidder quotes Rs.7 per unit, requirement to reject
the bid of L-1 bidder, whose bid is found market aligned along
with that of L-5 bidder, which is not market aligned, would lead to
an anomalous situation. Could the consumer be deprived of the
electricity to be procured from L-1 at a market aligned price only
because some of the bidders have quoted much higher prices and
are not market aligned. In our view, such an interpretation would
result in defeating one of the main objects of the enactment, i.e.,
protection of the consumer.
92. It is needless to state that this Court, time and again, in various
judgments including the one in the case of GMR Warora Energy
Limited (supra) has recognised the requirement of balancing the
consumers’ interest with that of the interest of the generators. It will
not be permissible to take a lopsided view only to protect the interest
of the generators ignoring the consumers’ interest and public interest.
93. We find that the High Court was not justified in entertaining the
petition. The Constitution Bench of this Court in the case of PTC
India Limited (supra) has held that the Electricity Act is an exhaustive
code on all matters concerning electricity. Under the Electricity
Act, all issues dealing with electricity have to be considered by the
authorities constituted under the said Act. As held by the Constitution
Bench of this Court, the State Electricity Commission and the learned
APTEL have ample powers to adjudicate in the matters with regard
to electricity. Not only that, these Tribunals are tribunals consisting of
experts having vast experience in the field of electricity. As such, we
[2024] 1 S.C.R. 965
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
find that the High Court erred in directly entertaining the writ petition
when the respondent No.1, i.e., the writ petitioner before the High
Court had an adequate alternate remedy of approaching the State
Electricity Commission.
94. This Court in the case of Reliance Infrastructure Limited v. State
of Maharashtra and others11 has held that while exercising its power
of judicial review, the Court can step in where a case of manifest
unreasonableness or arbitrariness is made out.
95. In the present case, there is not even an allegation with regard
to that effect. In such circumstances, recourse to a petition under
Article 226 of the Constitution of India in the availability of efficacious
alternate remedy under a statute, which is a complete code in itself,
in our view, was not justified.
96. No doubt that availability of an alternate remedy is not a complete bar
in the exercise of the power of judicial review by the High Courts. But,
recourse to such a remedy would be permissible only if extraordinary
and exceptional circumstances are made out. A reference in this
respect could be made to the judgments of this Court in the cases
of Radha Krishan Industries v. State of Himachal Pradesh and
others12 and South Indian Bank Ltd. and others v. Naveen Mathew
Philip and another13.
97. We may gainfully refer to the observation of this Court in the case
of Radha Krishan Industries (supra), wherein this Court has laid
down certain principles after referring to the earlier judgments:
“24. The High Court has dealt with the maintainability of the
petition under Article 226 of the Constitution. Relying on the
decision of this Court in CCT v. Glaxo Smith Kline Consumer
Health Care Ltd. [CCT v. Glaxo Smith Kline Consumer Health
Care Ltd., (2020) 19 SCC 681 : 2020 SCC OnLine SC 440],
the High Court noted that although it can entertain a petition
under Article 226 of the Constitution, it must not do so when the
11 [2019] 1 SCR 886 : (2019) 3 SCC 352=2019 INSC 63
12 [2021] 3 SCR 406 : (2021) 6 SCC 771=2021 INSC 266
13 [2023] 4 SCR 18 : 2023 SCC OnLine SC 435 =2023 INSC 379
966 [2024] 1 S.C.R.
Digital Supreme Court Reports
aggrieved person has an effective alternate remedy available
in law. However, certain exceptions to this “rule of alternate
remedy” include where, the statutory authority has not acted in
accordance with the provisions of the law or acted in defiance
of the fundamental principles of judicial procedure; or has
resorted to invoke provisions, which are repealed; or where an
order has been passed in violation of the principles of natural
justice. Applying this formulation, the High Court noted that the
appellant has an alternate remedy available under the GST Act
and thus, the petition was not maintainable.
25. In this background, it becomes necessary for this Court, to
dwell on the “rule of alternate remedy” and its judicial exposition.
In Whirlpool Corpn. v. Registrar of Trade Marks [Whirlpool
Corpn. v. Registrar of Trade Marks, (1998) 8 SCC 1], a two-
Judge Bench of this Court after reviewing the case law on this
point, noted : (SCC pp. 9-10, paras 14-15)
“14. The power to issue prerogative writs under Article 226
of the Constitution is plenary in nature and is not limited
by any other provision of the Constitution. This power can
be exercised by the High Court not only for issuing writs
in the nature of habeas corpus, mandamus, prohibition,
quo warranto and certiorari for the enforcement of any
of the Fundamental Rights contained in Part III of the
Constitution but also for “any other purpose”.
15. Under Article 226 of the Constitution, the High Court,
having regard to the facts of the case, has a discretion
to entertain or not to entertain a writ petition. But the
High Court has imposed upon itself certain restrictions
one of which is that if an effective and efficacious
remedy is available, the High Court would not normally
exercise its jurisdiction. But the alternative remedy has
been consistently held by this Court not to operate as
a bar in at least three contingencies, namely, where the
writ petition has been filed for the enforcement of any
of the Fundamental Rights or where there has been a
violation of the principle of natural justice or where the
order or proceedings are wholly without jurisdiction or
[2024] 1 S.C.R. 967
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
the vires of an Act is challenged. There is a plethora
of case-law on this point but to cut down this circle of
forensic whirlpool, we would rely on some old decisions
of the evolutionary era of the constitutional law as they
still hold the field.”
(emphasis supplied)
26. Following the dictum of this Court in Whirlpool [Whirlpool
Corpn. v. Registrar of Trade Marks, (1998) 8 SCC 1], in
Harbanslal Sahnia v. Indian Oil Corpn. Ltd. [Harbanslal Sahnia
v. Indian Oil Corpn. Ltd., (2003) 2 SCC 107], this Court noted
that : (Harbanslal Sahnia case [Harbanslal Sahnia v. Indian Oil
Corpn. Ltd., (2003) 2 SCC 107], SCC p. 110, para 7)
“7. So far as the view taken by the High Court that the remedy
by way of recourse to arbitration clause was available to
the appellants and therefore the writ petition filed by the
appellants was liable to be dismissed is concerned, suffice
it to observe that the rule of exclusion of writ jurisdiction by
availability of an alternative remedy is a rule of discretion
and not one of compulsion. In an appropriate case, in
spite of availability of the alternative remedy, the High
Court may still exercise its writ jurisdiction in at least three
contingencies : (i) where the writ petition seeks enforcement
of any of the fundamental rights; (ii) where there is failure
of principles of natural justice; or (iii) where the orders or
proceedings are wholly without jurisdiction or the vires of
an Act is challenged. (See Whirlpool Corpn. v. Registrar of
Trade Marks [Whirlpool Corpn. v. Registrar of Trade Marks,
(1998) 8 SCC 1] .) The present case attracts applicability
of the first two contingencies. Moreover, as noted, the
appellants’ dealership, which is their bread and butter,
came to be terminated for an irrelevant and non-existent
cause. In such circumstances, we feel that the appellants
should have been allowed relief by the High Court itself
instead of driving them to the need of initiating arbitration
proceedings.”
(emphasis supplied)
968 [2024] 1 S.C.R.
Digital Supreme Court Reports
27. The principles of law which emerge are that:
27.1. The power under Article 226 of the Constitution to
issue writs can be exercised not only for the enforcement of
fundamental rights, but for any other purpose as well.
27.2. The High Court has the discretion not to entertain a writ
petition. One of the restrictions placed on the power of the High
Court is where an effective alternate remedy is available to the
aggrieved person.
27.3. Exceptions to the rule of alternate remedy arise where
: (a) the writ petition has been filed for the enforcement of a
fundamental right protected by Part III of the Constitution; (b)
there has been a violation of the principles of natural justice;
(c) the order or proceedings are wholly without jurisdiction; or
(d) the vires of a legislation is challenged.
27.4. An alternate remedy by itself does not divest the High
Court of its powers under Article 226 of the Constitution in an
appropriate case though ordinarily, a writ petition should not be
entertained when an efficacious alternate remedy is provided
by law.
27.5. When a right is created by a statute, which itself prescribes
the remedy or procedure for enforcing the right or liability, resort
must be had to that particular statutory remedy before invoking
the discretionary remedy under Article 226 of the Constitution.
This rule of exhaustion of statutory remedies is a rule of policy,
convenience and discretion.
27.6. In cases where there are disputed questions of fact, the
High Court may decide to decline jurisdiction in a writ petition.
However, if the High Court is objectively of the view that the
nature of the controversy requires the exercise of its writ
jurisdiction, such a view would not readily be interfered with.
28. These principles have been consistently upheld by this
Court in Chand Ratan v. Durga Prasad [Chand Ratan v. Durga
Prasad, (2003) 5 SCC 399], Babubhai Muljibhai Patel v. Nandlal
Khodidas Barot [Babubhai Muljibhai Patel v. Nandlal Khodidas
Barot, (1974) 2 SCC 706] and Rajasthan SEB v. Union of India
[Rajasthan SEB v. Union of India, (2008) 5 SCC 632] among
other decisions.”
[2024] 1 S.C.R. 969
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
98. This Court has clearly held that when a right is created by a statute,
which itself prescribes the remedy or procedure for enforcing the
right or liability, resort must be had to that particular statutory remedy
before invoking the discretionary remedy under Article 226 of the
Constitution of India.
99. Recently, this Court in the case of M/s South Indian Bank Ltd. &
Ors. (supra) has also taken a similar view.
100. There is another ground on which the High Court ought to have refused
to entertain the petition. The bid of L-7 bidder was returned and the
Bid Bond bank guarantee was also directed not to be extended vide
the communication dated 6th January 2015. The judgment and order
passed by this Court, on which reliance is placed by respondent No.1,
is also delivered on 25th April 2018. However, the respondent No.1
did not take any steps from 6th January 2015 and in any case, from
25th April 2018 till 14th December 2020, on which date the petition
came to be filed before the High Court. No doubt that the petition
need not be dismissed solely on the ground of delay and laches.
However, if petitioner approaches the Court with delay, he has to
satisfy the Court about the justification for delay in approaching the
Court belatedly. In our considered view, the High Court ought not to
have entertained the petition also on the ground of delay and laches.
101. In any case, we find that the High Court was not justified in issuing
the mandamus in the nature which it has issued. This Court in the
case of Air India Ltd. v. Cochin International Airport Ltd. and
others14 has observed thus:
“7. The law relating to award of a contract by the State,
its corporations and bodies acting as instrumentalities
and agencies of the Government has been settled by
the decision of this Court in Ramana Dayaram Shetty v.
International Airport Authority of India [(1979) 3 SCC 489],
Fertilizer Corpn. Kamgar Union (Regd.) v. Union of India
[(1981) 1 SCC 568], CCE v. Dunlop India Ltd. [(1985) 1
SCC 260 : 1985 SCC (Tax) 75], Tata Cellular v. Union of
India [(1994) 6 SCC 651], Ramniklal N. Bhutta v. State of
Maharashtra [(1997) 1 SCC 134] and Raunaq International
14 [2000] 1 SCR 505 : (2000) 2 SCC 617=2000 INSC 39
970 [2024] 1 S.C.R.
Digital Supreme Court Reports
Ltd. v. I.V.R. Construction Ltd. [(1999) 1 SCC 492] The award
of a contract, whether it is by a private party or by a public
body or the State, is essentially a commercial transaction.
In arriving at a commercial decision considerations which
are paramount are commercial considerations. The State
can choose its own method to arrive at a decision. It can
fix its own terms of invitation to tender and that is not open
to judicial scrutiny. It can enter into negotiations before
finally deciding to accept one of the offers made to it.
Price need not always be the sole criterion for awarding
a contract. It is free to grant any relaxation, for bona fide
reasons, if the tender conditions permit such a relaxation.
It may not accept the offer even though it happens to be
the highest or the lowest. But the State, its corporations,
instrumentalities and agencies are bound to adhere to the
norms, standards and procedures laid down by them and
cannot depart from them arbitrarily. Though that decision is
not amenable to judicial review, the court can examine the
decision-making process and interfere if it is found vitiated
by mala fides, unreasonableness and arbitrariness. The
State, its corporations, instrumentalities and agencies have
the public duty to be fair to all concerned. Even when some
defect is found in the decision-making process the court
must exercise its discretionary power under Article 226 with
great caution and should exercise it only in furtherance
of public interest and not merely on the making out of a
legal point. The court should always keep the larger public
interest in mind in order to decide whether its intervention
is called for or not. Only when it comes to a conclusion
that overwhelming public interest requires interference,
the court should intervene.”
102. It could thus be seen that this Court has held that the award of
a contract, whether it is by a private party or by a public body or
the State, is essentially a commercial transaction. In arriving at
a commercial decision, considerations which are paramount are
commercial considerations. It has been held that the State can
choose its own method to arrive at a decision. It can fix its own
terms of invitation to tender and that is not open to judicial scrutiny.
It has further been held that the State can enter into negotiations
[2024] 1 S.C.R. 971
Jaipur Vidyut Vitran Nigam Ltd. & Ors. v.
MB Power (Madhya Pradesh) Limited & Ors.
before finally deciding to accept one of the offers made to it. It has
further been held that, price need not always be the sole criterion for
awarding a contract. It has been held that the State may not accept
the offer even though it happens to be the highest or the lowest.
However, the State, its corporations, instrumentalities and agencies
are bound to adhere to the norms, standards and procedures laid
down by them and cannot depart from them arbitrarily. Though that
decision is not amenable to judicial review, the court can examine
the decision-making process and interfere if it is found vitiated by
mala fides, unreasonableness and arbitrariness. It has further been
held that even when some defect has been found in the decision-
making process, the court must exercise its discretionary power
under Article 226 with great caution and should exercise it only in
furtherance of public interest and not merely on the making out of a
legal point. The court should always keep the larger public interest
in mind in order to decide whether its intervention is called for or
not. Only when it comes to a conclusion that overwhelming public
interest requires interference, the court should intervene.
103. As has been held by this Court in the case of Tata Cellular (supra),
the Court is not only concerned with the merits of the decision but
also with the decision-making process. Unless the Court finds that
the decision-making process is vitiated by arbitrariness, mala fides,
irrationality, it will not be permissible for the Court to interfere with
the same.
104. In the present case, the decision-making process, as adopted by the
BEC was totally in conformity with the principles laid down by this
Court from time to time. The BEC after considering the competitive
rates offered in the bidding process in various States came to a
conclusion that the rates quoted by SKS Power (L-5 bidder) were
not market aligned. The said decision has been approved by the
State Commission. Since the decision-making process adopted by
the BEC, which has been approved by the State Commission, was
in accordance with the law laid down by this Court, the same ought
not to have been interfered with by the learned APTEL.
105. In any case, the High Court, by the impugned judgment and order,
could not have issued a mandamus to the instrumentalities of the
State to enter into a contract, which was totally harmful to the public
972 [2024] 1 S.C.R.
Digital Supreme Court Reports
interest. Inasmuch as, if the power/electricity is to be procured by
the procurers at the rates quoted by the respondent No.1-MB Power,
which is even higher than the rates quoted by the SKS Power (L-5
bidder), then the State would have been required to bear financial
burden in thousands of crore rupees, which would have, in turn,
passed on to the consumers. As such, we are of the considered
view that the mandamus issued by the Court is issued by failing
to take into consideration the larger consumers’ interest and the
consequential public interest. We are, therefore, of the view that
the impugned judgment and order passed by the High Court is not
sustainable in law and deserves to be quashed and set aside.
CIVIL APPEAL NO. 6503 OF 2022 AND CIVIL APPEAL NO. 6502
OF 2022
106. The appeals are, therefore, allowed. The impugned judgment and
order of the Division Bench of the High Court of Judicature for
Rajasthan, Bench at Jaipur dated 20th September 2021 in D.B.
Civil Writ Petition No. 14815 of 2020 is quashed and set aside. The
respondent No.1-M.B. Power (Madhya Pradesh) Limited is directed
to pay costs, quantified at Rs.5,00,000/- (Rupees Five Lakh) in each
case to the appellants.
107. Pending applications, if any, shall stand disposed of.
CIVIL APPEAL NO. 4612 OF 2023
108. Since we have already set aside the judgment and order of the
High Court dated 20th September 2021 in D.B. Civil Writ Petition
No.14815 of 2020 and the order impugned in the present appeal
is based on the said order of the High Court dated 20th September
2021, the present appeal is also allowed. The judgment and order
of the learned APTEL dated 1st June 2023 is quashed and set aside.
109. Since we have saddled the costs in Civil Appeal Nos. 6503 of 2022
and 6502 of 2022, there shall be no order as to costs in the present
appeal.
110. Pending applications, if any, shall stand disposed of.
Headnotes prepared by: Divya Pandey Result of the case:
Appeals allowed.
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