M/S. DLF POWER LIMITEDversusCENTRAL COALFIELDS LTD. & ANR

                          [2009] 5 S.C.R. 472


A                   MIS. DLF POWER LIMITED                                 i-

                                   II.
              CENTRAL COALFIELDS LTD. & ANR.
                (Civil Appeal No. 3109 of 2006)

                           APRIL 01, 2009
B
       [DR. ARIJIT PASAYAT AND LOKESHWAR SINGH
                       PANTA, JJ.]

        ELECTRICITY ACT, 2003:
c
       Fixing of tariff - Appeals disposed of with the direction
  that in case respondent no. 1 files appeal within four weeks,
  the same shall be considered by the appellate Tribunal in                .,,.__
  accordance with law - All questions left open to be decided          •   '
D on merits without the question of limitation in filing the appeal.

      In the instant appeals filed against the judgment of
  the Appellate Tribunal for Electricity, the Court directed
  for determination of actual capital cost based on the
  formula in the 'Power Purchase Agreement' entered into
E between the parties. Respondent no. 1 in CA No. 3109 of
  2006 stated that the actual capital cost and tariff was
  determined only on the basis of documents supplied by


F
  the appellant without obtaining any comments/inputs
  from respondent no. 1.

      Disposing of the appeals, the Court
                                                                       ~   -
       HELD: Since the complex process of evaluation is
  involved in fixing the tariff and it would be in the interest
  of th-, parties that challenge, if any, to the report is made
G before the prescribed authority. It is, therefore, directed
  that in case CCL files appeal within four weeks, the same
  shall be considered by the Appellate Tribunal in
  accordance with law expeditiously. All questions are left
                                 472
H
~                  DLF POWER LIMITED v. CENTRAL COALFIELDS LTD.                473
                                      &ANR.

                  open to be decided without the question of limitation               A
                  relating to the filing of appeal. CCL shall continue to make
                  the ,payment at the rate a which it has been paying in
                  respect of both Rajrappa and Giddi plants. It is made clear
             .I
                  that by providing interim protection, no express opinion
                  on the merits of the case has been expressed. [Para 6]              B
                  [475-8-D]

                      CIVIL APPELLATE JURISDICTION : Civil Appeal No.
                  3109 of 2006.

                       From the Judgment & Order dated 11.05.2006 of the              c
                  Appellate Tribunal for Electricity, New Delhi in Appeal No. 166
                  of 2005.
·'-.,

;;:pi.   >
                     S. Ganesh, Kamal Budhiraja, Nishant Menon, Sidharth
                  Bawa, Dua Associates and Anip Sachtey for the Appellant.            D
                      Kamlendra Mishra and Shiraj Contractor Patodia for the
 "'               Respondent.

                       The Judgment of the Court was delivered by
                                                                                      E
                       DR. ARIJIT PASAYAT, J.1. These two Civil Appeals are
                   inter related and are, therefore, disposed of by this common
    ;
                  order. Civil Appeal No. 3561 of 2006 has been filed by Central
I                 Coalfields Limited (in short the 'CCL') under Section 125 of the
-        j
                  Electricity Act, 2003 (in short the 'Act') impugning the judgment   F
                  and order dated 11th May, 2006 passed by the Appellate
--<               Tribunal for Electricity, New Delhi (in short the 'Appellate
                  Tribunal') in Appeal No.166 of 2005. The other appeal i.e. Civil
                  Appeal No. 3109 of 2006 has been filed by DLF Power Limited
                  (in short the 'DLF') challenging part of the judgment dated
                                                                                      G
                  11.5.2006 passed by the Appellate Tribunal. By order dated
             >
                  11. 7.2007 this court directed the Cost Accounts Wing of M/s.
                  Ernst & Young to determine the actual capital cost based on
                  the formula in the "Power Purchase Agreement" dated 8.2.1993
                  between CCL and DLF. This Court further directed that the copy

-                                                                                     H
    474       SUPREME COURT REPORTS                 (2009] 5 S.C.R.


A of the report of the Cost Accounts Wing be given to the parties
  and to the Jharkhand State Electricity Regulatory Commission
  (in short the 'State Commission'). It was further directed that
  the State Commission on receipt of the report shall determine
  the tariff as per the terms of the "Power Purchase Agreement"
B between the parties for the two power plants.
        2. CCL's case is that the Cost Adcounts Wing of M/s. Ernst
  & Young only on the basis of the documents supplied by DLF
   have carried out the exercise of determining the actual capital
c cost    of the two power plants without even asking for any
   comments or any inputs from CCL while working out the actual
   capital cost. Grievance is that the report was based solely on
  the basis of the documents supplied by DLF, copies of which
  were also not made available to CCL. Mis. Ernst & Young have                   ....
  determined the capital cost of the two power plants at Giddi at
D Rs.72.34 crores and for Rajrappa determined the actual capital
  cost of Rs.67.45 crores. On receipt of the report from the Cost
  Accounts Wing of M/s. Ernst & Young, State Commission
  determined the tariff cost. The Commission consisted of two
  members; one was the Chairman and the other was the
E Member (Technical). Both of them separately determined the
  tariff for the subsequent year after the first year based on the
  actual capitalization cost supplied by the Cost Accountants. It
  is submitted that the two determinations are at great variance

F
  from each other.                                                      '   ~




        3. It is submitted that the international norms for actual
  capitalization cost for power has not been kept in view. It is
  pointed out that the actual capitalization cost arrived at is
  apparently highly excessive, purportedly based on the inflated
  figures supplied by DLF without supplying copies to CCL.
G
        4. Learned counsel for the appellant CCL submitted that         •
  the basis of tariff fixation is erroneous and in any event a                  ......
  statutory forum is available to question correctness of the report,
  which can be availed.
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 DLF POWER LIMITED v. CENTRAL COALFIELDS LTD.                   475
         & ANR. [DR. ARIJIT PASAYAT, J.]

     5. On the other hand learned counsel for the DLF submitted        A
that M/s Ernst & Young are internationally reputed financial
consultants. There is no substance in the objections raised by
CCL.

     6. We are inclined to accept the submissions of learned
                                                                       8
counsel for the CCL that the complex process of evaluation is
involved in fixing the tariff and it would be in the interest of
parties challenge, if any, to the report is made before the
prescribed authority. That being so, we dispose of the appeals
with the direction that in case CCL files appeal within four weeks     C
from today the same shall be considered by the Appellate
Tribunal in accordance with law. The Appellate Tribunal is
requested to dispose of the appeal on merits within a period
of two months from the date of filing. All questions are left open
to be decided without the question of limitation relating the filing
of appeal. It is stated that CCL is paying Rs.2.07 of KWH for          D
both Rajrappa and Giddi for the second year after
commissioning in July, 2000 for Rajrappa and in April, 2001
for Giddi. CCL shall continue to make the payment. We make
it clear that by providing interim protection we have not
expressed any opinion on the merits of the case.                       E

R.P.                                        Appeals disposed of