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Supreme Court of India

MUNICIPAL CORPORATION OF DELHIversusGAGAN NARANG & ORS. ETC.

Citation
2025 INSC 2
Decided
1 January 2025
Disposal
Appeal(s) allowed

Holding

A local authority like MCD, acting under its statutory duty to implement a waste‑to‑energy project, may invoke Section 63 of the Electricity Act, 2003 and the appropriate commission may adopt the tariff determined by a transparent bidding process.

Summary

The Municipal Corporation of Delhi (MCD) sought approval from the Delhi Electricity Regulatory Commission (DERC) to conduct a tariff‑based competitive bidding for a 28 MW waste‑to‑energy (WTE) project at Narela Bawana, invoking Section 63 of the Electricity Act, 2003. The Waste to Energy Research & Technology Council challenged MCD’s authority, arguing that only distribution licensees or generating companies could file an application under Section 63. The Appellate Tribunal for Electricity (APTEL) set aside DERC’s orders, holding that MCD, as a ‘local authority’, lacked jurisdiction. On appeal, this Court examined the literal meaning of Section 63, its harmony with Section 86(1)(b), and the statutory duties imposed on MCD by the Solid Waste Management Rules, 2016 and the Environment (Protection) Act, 1986. The Court held that the plain reading of Section 63 does not restrict its invocation to discoms or generators and that a local authority performing a statutory waste‑to‑energy function may invoke the provision. Accordingly, the Court quashed the APTEL judgment, affirmed DERC’s tariff approval, and allowed the appeals. The decision underscores a purposive, harmonious construction of the Electricity Act with environmental statutes.

Issues considered

  • Whether a local authority such as the Municipal Corporation of Delhi can file an application under Section 63 of the Electricity Act, 2003 for adoption of tariff.
  • Whether Section 63 is limited to distribution licensees or generating companies.
  • Whether the provisions of the Electricity Act, particularly Sections 63, 86(1)(b), 174 and 175, are consistent with the Solid Waste Management Rules, 2016 and the Environment (Protection) Act, 1986.
  • Whether the Delhi Electricity Regulatory Commission had jurisdiction to approve the tariff for the WTE project.

Legislation cited

Subjects

Municipal Corporation of Delhi (MCD)local authorityCompetitive bidding processDetermination of tariffBid tariffApproval of tariffAppropriate CommissionState CommissionSolid Waste ManagementStatutory obligationsNotice Inviting TenderTariff based bidRequest for Proposal (RfP)Financial BidsTransparent process of biddingWaste to Energy Project at Narela Bawana, DelhiWTE projectProcurement of powerDelhi Electricity Regulatory Commission (DERC)APTELWaste to Energy Research & Technology CouncilTariff PolicyPower Purchase Agreement (PPA)Distribution CompaniesDistribution LicenseeDiscoms or generating companies/generatorsCogenerationgeneration of electricityRenewable energyBidding Evaluation CommitteePlain readingLiteral interpretationJudicial interpretationHarmonious construction

Judgment

                    [2025] 1 S.C.R. 239 : 2025 INSC 2

                     Municipal Corporation of Delhi
                                  v.
                       Gagan Narang & Ors. Etc.
                   (Civil Appeal Nos. 7463-7464 of 2023)
                                02 January 2025
               [B.R. Gavai* and K.V. Viswanathan, JJ.]


                            Issue for Consideration
       Whether the application under Section 63 of the Electricity Act, 2003
       could have been made by the Appellant-MCD, a “local authority”
       within the meaning of Section 2(41) of the Act.

                                    Headnotes†
       Electricity Act, 2003 – ss.63, 86, 2(41), 174, 175 – Determination
       of tariff by bidding process – Functions of the State
       Commission – Solid Waste Management Rules, 2016 – r.15 –
       Appellant, if could issue tariff based bid and Request for
       Proposal (RfP) for setting up the Waste to Energy Project –
       Petition filed by appellant before the Delhi Electricity Regulatory
       Commission (DERC) for approval of the bidding process of
       the Project – Waste to Energy Research & Technology Council
       (WTERT) challenged the authority of the appellant to issue the
       tariff-based bid and the RfP in setting up the Project – DERC
       dismissed the petition of WTERT while allowed that of the
       appellant and approved the bid tariff of Rs.7.38/KWh for the
       project and directed the Distribution Licensee to negotiate the
       terms of the Power Purchase Agreement with the appellant –
       Orders of DERC set aside by APTEL holding that since the
       appellant was neither a distribution licensee nor a generating
       company, it had no jurisdiction to file an application u/s.63
       for adoption of tariff – Challenge to:
       Held: Impugned judgment quashed and set aside – Appellant was
       establishing the Project in order to perform its statutory obligations –
       DERC granted its approval to the tariff with certain conditions after
       taking into consideration all the relevant factors – However, the same
       was upset by APTEL on a hyper-technical ground – Under/s.63, the


* Author
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       Appropriate Commission is entitled to adopt the tariff if such tariff
       has been determined through a transparent process of bidding in
       accordance with the guidelines issued by the Central Government –
       Power of the Commission is notwithstanding anything contained
       in s.62 – A plain reading of s.63 shows that it does not restrict
       its invocation only by Discoms or generating companies – The
       interpretation of APTEL is adding words in s.63 which the legislature
       did not intend to – Further, APTEL could not have read s.63 in
       isolation – s.63 will have to be read in harmony with s.86(1)(b) – The
       legislature intended that the State Commission while exercising its
       powers u/s.63 shall adopt the tariff when it has been determined
       in the bidding process – However, while adopting the same it will
       have to be satisfied that the same is done in a transparent manner
       and as to whether the interests of the generators/Discoms are
       balanced with the interests of the consumers – Reading s.63 in the
       manner as interpreted by the APTEL, would impose unnecessary
       restrictions on the powers and duties of the State Commission
       u/s.86(1)(b) which are of a very wide amplitude – Furthermore,
       there is no inconsistency between the provisions of s.63 and r.15,
       SWM Rules – r.15 enacted under the Environment (Protection) Act,
       1986, mandates the appellant to undertake WTE project – Insofar
       as the WTE projects are concerned, the provisions under the Act
       will have to be read in addition to the provisions u/r.15 and not in
       derogation thereof – Also, s.86(1)(e) r/w r.6.4 of the Tariff Policy
       provide for promoting cogeneration and generation of electricity from
       renewable sources of energy by providing suitable measures for
       connectivity with the grid and sale of electricity from such sources,
       a percentage of the total consumption of electricity in the area of a
       distribution licensee – APTEL also failed to take into consideration
       that the WTE project in question was in the larger public interest
       providing for disposal of the huge quantity of waste generated in the
       city of Delhi – Orders of DERC affirmed – Environment (Protection)
       Act, 1986. [Paras 28, 29, 35, 37, 41, 42, 48, 49, 50, 52, 54-56, 58]

       Interpretation of Statutes – Electricity Act, 2003 – s.63 –
       Interpretation of – Literal interpretation – Courts by judicial
       interpretation not to add, alter, or delete the words when the
       statute upon its plain reading is capable of giving a meaning
       as intended by the legislature:
       Held: When the statute read in a literal manner is capable of
       giving meaning to the provision that the legislation intended to
[2025] 1 S.C.R.                                                             241

      Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


     and does not lead to any absurdity, it is not permissible by judicial
     interpretation to add, alter, or delete any words to such a statute –
     Upon a plain reading of the provisions of s.63, the meaning
     gathered does not result in any absurdity thus, addition of words
     in the statute by judicial interpretation is wholly impermissible.
     [Paras 30, 36]
     Electricity Act, 2003 – s.86 – Duty of the State Commission –
     Discussed.

                              Case Law Cited
     Pune Municipal Corporation v. Sus Road Baner Vikas Manch and
     others [2024] 9 SCR 374 : (2024) 9 SCC 1; Energy Watchdog
     v. Central Electricity Regulatory Commission and others [2017] 3
     SCR 153 : (2017) 14 SCC 80; Punjab State Power Corporation
     Limited and another v. Emta Coal Limited [2021] 11 SCR 772 :
     (2022) 2 SCC 1; Jaipur Vidyut Vitran Nigam Limited and others v.
     MB Power (Madhya Pradesh) Limited and others [2024] 1 SCR
     909 : (2024) 8 SCC 513; Sanjay Ramdas Patil v. Sanjay and
     others [2021] 11 SCR 640 : (2021) 10 SCC 306 – referred to.

                                List of Acts
     Electricity Act, 2003; Solid Waste Management Rules, 2016;
     National Tariff Policy 2016; Environment (Protection) Act, 1986.

                             List of Keywords
     Municipal Corporation of Delhi (MCD); “local authority”; Competitive
     bidding process; Determination of tariff; Bid tariff; Approval of
     tariff; Appropriate Commission; State Commission; Solid Waste
     Management; Statutory obligations; Notice Inviting Tender; Tariff
     based bid; Request for Proposal (RfP); Financial Bids; Transparent
     process of bidding; Waste to Energy Project at Narela Bawana,
     Delhi; WTE project; Procurement of power; Delhi Electricity
     Regulatory Commission (DERC); APTEL; Waste to Energy
     Research & Technology Council; Tariff Policy; Power Purchase
     Agreement (PPA); Distribution Companies; Distribution Licensee;
     Discoms or generating companies/generators; Cogeneration,
     generation of electricity; Sale of electricity; Electricity from
     renewable sources of energy; Bidding Evaluation Committee; Plain
     reading; Literal interpretation; Judicial interpretation; Harmonious
     construction.
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                                  Case Arising From
       CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 7463-7464
       of 2023
       From the Judgment and Order dated 31.08.2023 of the Appellate
       Tribunal for Electricity at New Delhi in DFR Nos. 245 and 247 of 2023

                               Appearances for Parties
       Ramji Srinivasan, Sr. Adv., Ms. Swapna Seshadri, Nikunj Dayal,
       Utkarsh Singh, Ms. Sneha Singh Baghel, Ms. Namrata Saraogi,
       Parth Bhalla, Advs. for the Appellant.
       B.V. Patil, Sr. Adv., Aditya Ranjan, Krishna M. Singh, Anil C Nishani,
       Mrs. Deepti Singh (for M/s. Krishna & Nishani Law Chambers),
       Ms. Ishita Jain, Anand Kumar Shrivastava, Ms. Priya Goyal,
       Ms. Eesha Sharma, Buddy Ranganathan, Dushyant Manocha,
       Ms. Anannya Ghosh, Brian Henry Moses, Ms. Mrinalini Mishra,
       Suresh Chandra Tripathy, Advs. for the Respondents.
       Pukhrambam Ramesh Kumar, Ms. Molshree Bhatnaagar, Deepak
       Thukar, Punyam Bhutani, Advs. for the Impleader.

                       Judgment / Order of the Supreme Court

                                      Judgment

       B.R. Gavai, J.

1.     The present appeals filed under Section 125 of the Electricity Act,
       20031 arise out of the Impugned common final judgment and order
       of the Appellate Tribunal for Electricity at New Delhi2 dated 31st
       August 2023 passed in DFR No. 245 of 2023 and DFR No. 247
       of 2023 which were both filed by the Respondent No. 1 herein-
       Mr. Gagan Narang. The APTEL disposed of the appeals and set
       aside the orders of the Delhi Electricity Regulatory Commission3
       dated 6th and 7th March 2023. Vide the order dated 6th March 2023
       the DERC had dismissed the petition filed by Waste to Energy


1    ‘The Act’ hereinafter
2    ‘APTEL’ hereinafter
3    ‘DERC’ hereinafter
[2025] 1 S.C.R.                                                         243

         Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


       Research & Technology Council4 challenging the authority of the
       Appellant herein - Municipal Corporation of Delhi, 5 to issue the
       tariff-based bid and Request for Proposal6 for setting up the Waste
       to Energy7 project at Narela Bawana, Delhi. Vide order of 7th March
       2023, the DERC had approved the bid tariff of Rs. 7.38/KWh for the
       project and had directed the Distribution Licensee to negotiate the
       terms of the Power Purchase Agreement8 with the Appellant-MCD.
2.     Shorn of details, the facts leading to the present appeals are:
       2.1 The Appellant-MCD organized a meeting with the Distribution
           Licensees in Delhi and other stakeholders on 14th May 2022. It
           was agreed that a tariff-based bidding model may be adopted
           and the details about the same, including the volume of waste,
           total power generation, and other considerations for the proposed
           project were decided. It was further decided that the sale of
           power be distributed amongst the Distribution Licensees as
           per their ‘Renewable Purchase Obligation’. The Appellant was
           authorized to conduct the bidding process as per the regulations
           and requirements of Section 63 of the Act for the proposed
           WTE project. The same was put in writing and was detailed in
           the Minutes of Meeting dated 30th May 2022.
       2.2 The Appellant-MCD, issued the Notice Inviting Tender9 and
           the RfP dated 15th July 2022 whereby the tariff-based bids
           for procurement of power under WTE project for Solid WTE
           Processing Facility with a minimum 28 MW capacity in Narela
           Bawana, New Delhi, for 3000 (+/- 20%) TPD of MSW10 were
           invited. The documents for the same were sent to the DERC
           for its consideration.
       2.3 The DERC, vide letter dated 24th August 2022 directed the
           Appellant-MCD to file a petition for approval of PPA, RfP, etc.
           The letter also contained the details of the petitions filed by


4    ‘WTERT’ hereinafter
5    ‘Appellant-MCD’ hereinafter
6    ‘RfP’ hereinafter
7    ‘WTE’ hereinafter
8    ‘PPA’ hereinafter
9    ‘NIT’ hereinafter
10   ‘Project’ hereinafter
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              South Delhi Municipal Corporation and the East Delhi Waste
              Processing Co. Ltd. seeking similar approvals, which were
              granted by the DERC through separate orders. An evaluation
              committee was also constituted for the evaluation of bids and
              other related issues. The Appellant-MCD issued a notice that
              the bidding process dated 15th July 2022 were closed and a
              new NIT was issued on 21st October 2022 with identical terms
              as the earlier NIT.
       2.4 The WTERT filed a Petition No. 65 of 2022 before the DERC
           inter alia challenging the authority of the Appellant-MCD for
           issuing the tariff-based bid and the RfP in setting up the Project.
           During the pendency of this petition, the bidding process
           was undertaken, and on 14 th November 2022, bids were
           received from M/s JITF Urban Infrastructure Ltd. and M/s JBM
           Renewables Pvt. Ltd. A meeting of the Evaluation committee
           was held, and the documents submitted by the bidders keeping
           in mind the requirement of the RfP document were discussed,
           and on recommendation of the committee, the bids of both the
           bidders were declared to be technically qualified and their bids
           were allowed to be opened. The Regional Centre for Urban &
           Environmental Studies11 calculated the levelized tariff based on
           the RfP and the same was communicated and calculated as:

               Name of the Bidder                          Levelized Tariff
                                                             (Rs/KWh)
               M/s JITF Urban Infrastructure Limited       7.380
               M/s JBM Renewable Pvt. Limited              9.909
       2.5 The Financial Bids were evaluated by the Evaluation Committee
           and its recommendation report dated 26th November 2022 was
           issued. It was stated in the report that in accordance with the
           terms of the RfP, the “Lowest Bidder” for a project was to be
           the qualified bidder and the lowest evaluated levelized tariff
           shall be the selected bidder for the Project. M/s JITF Urban
           Infrastructure Limited was selected to be the lowest bidder with
           a levelized tariff bid of Rs. 7.380/KWh. It was further mentioned
           that a meeting of the Evaluation Committee was held on 6th


11   ‘RCUES’ hereinafter
[2025] 1 S.C.R.                                                              245

        Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


              October 2022 for the consideration of the Financial Model for
              price bid evaluation prepared by RCUES. The representative of
              RCUES presented the financial model and after deliberation, the
              committee reached a consensus on the key assumptions taken
              and had arrived at a levelized tariff of Rs. 6.73/KWh. Since,
              there existed a difference between the tariff according to the
              financial model and the tariff by the lowest bidder, a justification/
              calculation for arriving at the quoted bid was requested from
              M/s JITF Urban Infrastructure Limited, and the same was
              considered by the committee. It was further mentioned, that
              after detailed deliberations, the committee was of the opinion
              that the bids had been received through a competitive bidding
              process and the lowest bid of Rs. 7.380/KWh was arrived at,
              through a competitive and transparent bidding process. It was
              further mentioned that the Appellant-MCD herein has no benefit
              or loss accruing out of this as the power is to be procured by
              the Distribution Companies in accordance with the approval of
              tariff by DERC. The report was then forwarded to the DERC
              as the final approval was to be given by it.
      2.6 Pursuant to the same, the Appellant-MCD filed a Petition No. 72
          of 2022 before the DERC for the approval of the bidding process
          of the Project.
      2.7 The DERC, vide order dated 6th March 2023, dismissed the
          Petition No. 65 filed by WTERT and inter alia held that the
          Appellant-MCD is mandated under the Solid Waste Management
          Rules, 201612 to construct, operate, and maintain the solid waste
          processing facilities. Vide order dated 7th March 2023, the DERC
          in Petition No. 72 filed by the Appellant-MCD herein, approved
          the bid tariff of Rs. 7.38/KWh for the project and directed the
          Distribution Licensee to negotiate terms of the PPA with the
          Appellant-MCD and place a signed copy of the PPA before the
          DERC within three months.
      2.8 Aggrieved, two separate appeals were filed by the Respondent
          No. 1 herein bearing DFR Nos. 245 of 2023 and 247 of 2023
          against the orders dated 7th March 2023 and 6th March 2023
          respectively.


12   ‘SWM Rule 2016’ hereinafter
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       2.9 The APTEL, vide the Impugned common final judgment and
           order dated 31st August 2023 disposed of the appeals and set
           aside both the orders dated 6th and 7th March 2023 passed by
           the DERC on the ground that the DERC lacked jurisdiction to
           entertain and adjudicate upon a petition filed by the Appellant-
           MCD herein.
       2.10 Aggrieved, the present appeals are filed under Section 125 of
            the Electricity Act, 2003.
3.     We have heard Mr. Ramji Srinivasan, learned Senior Counsel
       appearing for the Appellant and Mr. Basava Prabhu Patil, learned
       Senior Counsel appearing for the Respondent No.1, Mr. Krishna M.
       Singh, Ms. Ishita Jain, Mr. Buddy Ranganathan, Mr. Suresh Chandra
       Tripathi, learned counsel appearing for Respondent Nos. 2, 3, 4 &
       5, and 9 respectively and Mr. Pukhrambam Ramesh Kumar, learned
       counsel for the applicant.
4.     Mr. Ramji Srinivasan, learned Senior Counsel appearing for the
       Appellant submits that the APTEL has grossly erred in restricting
       the applicability of Sections 63 and 86(1)(b) of the Act only to the
       distribution licensee13 or generating company insofar as the filing of
       application for adoption of tariff is concerned. He submits that the
       provisions of Section 86(1)(b) of the Act would reveal that a wide
       power is bestowed upon the State Commission to regulate electricity
       purchase and procurement process of Discoms including the price
       at which electricity shall be procured from the generating companies
       or licensees or from other sources.
5.     Learned Senior Counsel further submits that the Appellant-MCD,
       which is a statutory body under the Delhi Municipal Corporation Act,
       has been put under statutory obligation under Rule 15(v)(b) of the
       SWM Rules 2016 to proceed for setting up of the WTE projects. It
       is submitted that this statutory duty has also been recognized by
       this Court in the case of Pune Municipal Corporation v. Sus Road
       Baner Vikas Manch and others.14
6.     The learned Senior Counsel further submits that Rule 6.4(1)(ii)
       and (2) of the National Tariff Policy 2016 mandates Discoms to


13   ‘Discoms’ hereinafter
14   [2024] 9 SCR 374 : (2024) 9 SCC 1
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        Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


      procure 100% of the power produced from all WTE plants either
      through Section 62 (normative tariff process) or through Section 63
      (competitive based mechanism).
7.    It is further submitted that Section 175 of the Act itself provides that
      the provisions of the Act are in addition to and not in derogation of
      any other law for the time being in force. It is, therefore, submitted
      that the mandate for setting up the WTE project by MCD has to be
      read in consonance with the provisions of the Environment (Protection)
      Act, 1986 and the Rules framed thereunder.
8.    It is submitted that for WTE projects, no guidelines have been framed
      by the Central Government for conducting the bidding and accordingly
      the DERC has exercised its powers to regulate under Section 86(1)(b)
      of the Act to approve the bidding process and adopt the tariff. It is
      submitted that this is in tune with the judgment of this Court in the case
      of Energy Watchdog v. Central Electricity Regulatory Commission
      and others,15 wherein this Court has held that in a situation when
      there are no guidelines, then the general regulatory powers under
      Section 79(1)(b) can be exercised by the Commission. It is, therefore,
      submitted that by the same analogy the State Commission can exercise
      such powers in view of Section 86(1)(b) of the Act.
9.    The learned Senior Counsel submits that the APTEL has failed to take
      into consideration the larger issue of public interest. It is submitted
      that WTE project was necessary for processing the unprocessed
      municipal solid waste which is increasing day by day.
10. It is further submitted that the DERC vide its order dated 6th March
    2023 had held that the Appellant-MCD under Rule 15(v) of the
    SWM Rules 2016 was performing its statutory functions to conduct
    the bidding process for the Project and that there is no bar in the
    National Tariff Policy that WTE project cannot be set up under Section
    63 of the Act. It is submitted that on an earlier occasion also the
    DERC has approved the bidding process with regard to Tehkhand
    WTE at Okhla which is under operation and supplying electricity to
    all Delhi Discoms.
11. Mr. Basava Prabhu Patil, learned Senior Counsel appearing for
    the Respondent No.1, on the contrary, submits that the APTEL has


15   [2017] 3 SCR 153 : (2017) 14 SCC 80
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       rightly held that the Appellant-MCD was not entitled to make an
       application for adoption of tariff under Section 63 of the Act. It is
       submitted that the APTEL rightly held that it is only the Discoms or
       generating companies who are entitled to invoke the provisions of
       Section 63 of the Act. The learned Senior Counsel submits that in
       view of Rule 6.4(2) of the National Tariff Policy, 2016, it is exclusively
       for the Ministry of Power to provide a mechanism for adoption of tariff
       for WTE projects. It is, therefore, submitted that the DERC has no
       jurisdiction to entertain the application filed by the present Appellant-
       MCD. He, therefore, prays for the dismissal of the present appeals.
12. The limited question that falls for consideration in the present appeals
    is that, whether the application under Section 63 of the Act could
    have been made by the present Appellant-MCD which is a “local
    authority” within the meaning of Section 2(41) of the Act.
13. For appreciating the rival controversy, it will be necessary to consider
    the nature of the Project which the Appellant-MCD was implementing.
    For the said purpose, it will be relevant to refer to clauses (q) and (v)
    of Rule 15 of the SWM Rules 2016, which read thus:
            “15. Duties and responsibilities of local authorities
            and village panchayats of census towns and urban
            agglomerations.—The local authorities and Panchayats
            shall—
            ***
            (q) transport segregated bio-degradable waste to the
            processing facilities like compost plant, biomethanation
            plant or any such facility. Preference shall be given for
            on site processing of such waste;
            ***
            (v) facilitate construction, operation and maintenance
            of solid waste processing facilities and associated
            infrastructure on their own or with private sector participation
            or through any agency for optimum utilisation or various
            components of solid waste adopting suitable technology
            including the following technologies and adhering to the
            guidelines issued by the Ministry of Urban Development
            from time to time and standards prescribed by the Central
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      Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


           Pollution Control Board. Preference shall be given to
           decentralised processing to minimise transportation cost
           and environmental impacts such as—
           (a) bio-methanation, microbial composting, vermi-
           composting, anaerobic digestion or any other appropriate
           processing for bio-stabilisation of biodegradable waste;
           (b) waste to energy processes including refused derived
           fuel for combustible fraction of waste or supply as feedstock
           to solid waste based power plants or cement kilns;”
14. It could thus be seen that the SWM Rules 2016 require that, while
    making provisions for solid waste disposal, the authorities shall give
    a preference to decentralized processing to minimize transportation
    cost and environmental impacts such as, waste to energy processes
    including refused derived fuel for combustible fraction of waste or
    supply as feedstock to solid waste based power plants or cement
    kilns.
15. It is further to be noted that the “Tariff Policy” notified by the Ministry
    of Power on 28th January 2016 is in compliance with the mandate
    of Section 3 of the Act. It could further be seen that under the said
    “Tariff Policy”, a provision has been made for renewable sources of
    energy generation including Co-generation from renewable energy
    sources. It will be relevant to refer to Rule 6.4 of the said “Tariff
    Policy”, which reads thus:
           “6.4 Renewable sources of energy generation including
           Co-generation from renewable energy sources:
           (1)   Pursuant to provisions of section 86(1)(e) of the Act,
                 the Appropriate Commission shall fix a minimum
                 percentage of the total consumption of electricity in
                 the area of a distribution licensee for purchase of
                 energy from renewable energy sources, taking into
                 account availability of such resources and its impact
                 on retail tariffs. Cost of purchase of renewable energy
                 shall be taken into account while determining tariff by
                 SERCs. Long term growth trajectory of Renewable
                 Purchase Obligations (RPOs) will be prescribed by
                 the Ministry of Power in consultation with MNRE.
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       Provided that cogeneration from sources other than
       renewable sources shall not be excluded from the
       applicability of RPOs.
           (i)    Within the percentage so made applicable,
                  to start with, the SERCs shall also reserve
                  a minimum percentage for purchase of solar
                  energy from the date of notification of this policy
                  which shall be such that it reaches 8% of total
                  consumption of energy, excluding Hydro Power,
                  by March 2022 or as notified by the Central
                  Government from time to time.
           (ii)   Distribution Licensee(s) shall compulsorily
                  procure 100% power produced from all the
                  Waste-to-Energy plants in the State, in the ratio
                  of their procurement of power from all sources
                  including their own, at the tariff determined by
                  the Appropriate Commission under Section 62
                  of the Act.
           (iii) It is desirable that purchase of energy from
                 renewable sources of energy takes place more
                 or less in the same proportion in different States.
                 To achieve this objective in the current scenario
                 of large availability of such resources only in
                 certain parts of the country, an appropriate
                 mechanism such as Renewable Energy
                 Certificate (REC) would need to be promoted.
                 Through such a mechanism, the renewable
                 energy based generation companies can sell
                 the electricity to local distribution licensee at the
                 rates for conventional power and can recover
                 the balance cost by selling certificates to other
                 distribution companies and obligated entities
                 enabling the latter to meet their renewable power
                 purchase obligations. The REC mechanism
                 should also have a solar specific REC.
           (iv) Appropriate Commission may also provide for a
                suitable regulatory framework for encouraging
                such other emerging renewable energy
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      Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


                      technologies by prescribing separate technology
                      based REC multiplier (i.e. granting higher
                      or lower number of RECs to such emerging
                      technologies for the same level of generation).
                      Similarly, considering the change in prices of
                      renewable energy technologies with passage
                      of time, the Appropriate Commission may
                      prescribe vintage based REC multiplier (i.e.
                      granting higher or lower number of RECs for
                      the same level of generation based on year of
                      commissioning of plant).
           (2)   States shall endeavor to procure power from
                 renewable energy sources through competitive
                 bidding to keep the tariff low, except from the waste to
                 energy plants. Procurement of power by Distribution
                 Licensee from renewable energy sources from
                 projects above the notified capacity, shall be done
                 through competitive bidding process, from the date
                 to be notified by the Central Government.
16. It can thus be seen that clause (1) of Rule 6.4 provides that the
    Appropriate Commission shall fix a minimum percentage of the
    total consumption of electricity in the area of a distribution licensee
    for purchase of energy from renewable energy sources, taking into
    account availability of such resources and its impact on retail tariffs. It
    further provides that the cost of purchase of renewable energy shall
    be taken into account while determining tariff by SERCs and that
    the long-term growth trajectory of Renewable Purchase Obligations
    (RPOs) will be prescribed by the Ministry of Power in consultation
    with Ministry of New and Renewable Energy (MNRE).
17. Certain exceptions have been made to the applicability of the said
    clause. One of the exceptions is that, the Distribution Licensee(s)
    shall compulsorily procure 100% of the power produced from all the
    Waste-to-Energy plants in the State, in the ratio of their procurement
    of power from all sources including their own, at the tariff determined
    by the Appropriate Commission under Section 62 of the Act.
18. It is further to be noted that the following provision has been made
    in SWM Rules 2016:
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              “9. Duties of the Ministry of Power.- The Ministry of
              Power through appropriate mechanisms shall,-
              (a) decide tariff or charges for the power generated from
              the waste to energy plants based on solid waste.
              (b) compulsory purchase power generated from such waste
              to energy plants by distribution company.”
19. It could thus be seen that under the SWM Rules 2016, a duty is cast
    upon the Ministry of Power to decide tariff or charges for the power
    generated from the waste to energy plants based on solid waste
    and compulsory purchase of power generated from such waste to
    energy plants by distribution company.
20. Thus, it is to be noted that the Project, for which bids were invited by
    the Appellant-MCD, was proposed to be set up by the Appellant-MCD
    in pursuance of its statutory obligations under the SWM Rule 2016.
21. A perusal of the record would reveal that the Appellant-MCD issued
    NIT for the competitive tariff bidding process for setting up of the
    Project for procurement of power by Discoms in the NCT of Delhi
    as part of Discom’s Renewal Purchase Obligation.16 The said project
    was on Design, Build, Finance, and Operate basis and was to be
    transferred back to the Appellant-MCD after 25 years.
22. It is further to be noted that after the bid was conducted in consonance
    with the decision taken in the meeting dated 14th May 2022, wherein
    the Discoms authorized the Appellant-MCD to proceed with the same,
    on 3rd August 2022, the bidding documents were sent to the DERC
    for its consideration. Based on the same, the DERC vide letter dated
    24th August 2022 directed the Appellant-MCD to file a Petition for
    adoption of tariff. The DERC, further informed the Appellant-MCD
    about similar petitions filed by East Delhi Processing Limited seeking
    similar approvals.
23. After M/s JITF Urban Infrastructure Ltd. emerged as a L-1 bidder
    at the levelized tariff of Rs.7.380/KWh, the Appellant-MCD filed a
    Petition No. 72 of 2022 before the DERC for adoption of tariff and
    approving the draft PPA. The DERC vide its order dated 7th March
    2022 adopted the tariff of Rs.7.380/KWh and directed the Discoms
    and the successful bidder to renegotiate the terms of the PPA.


16   “RPO” for short
[2025] 1 S.C.R.                                                         253

      Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


24. Insofar as the petition of the WTERT is concerned, the DERC
    specifically rejected the contention of the WTERT to the effect that
    since the Appellant-MCD was not an authorized distribution licensee,
    it cannot float the impugned tender. It was further sought to be
    argued that the Bidding procurement under Section 63 of the Act
    was impermissible in case of ‘waste to energy’ power.
25. The DERC relying on the provisions of Rule 15 of the SWM Rules
    2016 specifically rejected the said contention and held that the
    Appellant-MCD was performing its statutory obligations.
26. While allowing the applications filed by the Respondent No. 1, the
    APTEL interpreted Section 63 of the Act and held that since the
    Appellant-MCD was neither a distribution licensee nor a generating
    company, it had no jurisdiction to file an application under Section 63
    of the Act for adoption of tariff.
27. For appreciating the correctness of the findings of the APTEL, it
    will be apposite to refer to Section 63 of the Act, which reads thus:
           “63. Determination of tariff by bidding process.-
           Notwithstanding anything contained in section 62, the
           Appropriate Commission shall adopt the tariff if such
           tariff has been determined through transparent process
           of bidding in accordance with the guidelines issued by the
           Central Government.”
28. It could thus be seen that under Section 63 of the Act, the Appropriate
    Commission is entitled to adopt the tariff if such tariff has been
    determined through a transparent process of bidding in accordance
    with the guidelines issued by the Central Government.
29. It could be seen that a plain reading of Section 63 of the Act would
    reveal that it does not restrict invoking of the provisions of Section 63
    only to Discoms or generating companies.
30. It is a settled principle of law that the first and foremost principle of
    interpretation is that of literal interpretation. When the statute read
    in a literal manner is capable of giving meaning to the provision that
    the legislation intended to and does not lead to any absurdity, it is
    not permissible by judicial interpretation to add, alter, or delete any
    words to such a statute. Reliance in this respect could be placed
    on the judgment of this Court in the case of Punjab State Power
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       Corporation Limited and another vs. Emta Coal Limited17 wherein
       this Court has observed thus:
             “23. The principle of giving a plain and literal meaning to
             the words in a statute is well-recognised for ages. Though
             there are a number of judgments, we may gainfully refer
             to the judgment of this Court delivered by Das, J. as early
             as 1955 in Jugalkishore Saraf v. Raw Cotton Co. Ltd.
             [Jugalkishore Saraf v. Raw Cotton Co. Ltd. (1955) 1 SCR
             1369 : AIR 1955 SC 376] : (AIR p. 381, para 6)
                     “6. … The cardinal rule of construction of
                     statutes is to read the statute literally, that is
                     by giving to the words used by the legislature
                     their ordinary, natural and grammatical meaning.
                     If, however, such a reading leads to absurdity
                     and the words are susceptible of another
                     meaning the Court may adopt the same. But
                     if no such alternative construction is possible,
                     the Court must adopt the ordinary rule of literal
                     interpretation.”
             24. Though there are various authorities on the said
             subject, we do not wish to burden the present judgment
             by reproducing those. In our considered view, if the words
             used in Section 11 of the said Act are construed in plain
             and literal term, they do not lead to an absurdity and as
             such, the rule of plain and literal interpretation will have
             to be followed. We find that in case the interpretation as
             sought to be placed by Shri Rohatgi is to be accepted, it will
             do complete violence to the language of Section 11 of the
             said Act. If it is held that under Section 11 of the said Act,
             a prior contractor is entitled to continue if his performance
             is found to be satisfactory and if there is nothing against
             him, then it will be providing something in Section 11 of
             the said Act which the statute has not provided for. It will
             also lead to making the words “may elect, to adopt and
             continue” redundant and otiose.



17   [2021] 11 SCR 772 : (2022) 2 SCC 1
[2025] 1 S.C.R.                                                            255

      Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


           25. It is a settled principle of law that when, upon a plain
           and literal interpretation of the words used in a statute, the
           legislative intent could be gathered, it is not permissible to
           add words to the statute. Equally, such an interpretation
           which would make some terms used in a statute otiose
           or meaningless, has to be avoided. We therefore find
           that if an interpretation as sought to be placed by EMTA
           is to be accepted, the same would be wholly contrary to
           the principle of literal interpretation. There are number of
           authorities in support of the said proposition. However,
           we refrain from referring to them in view of the following
           observations made by this Court in a recent judgment in
           Ajit Mohan v. Delhi Legislative Assembly [Ajit Mohan v.
           Delhi Legislative Assembly (2022) 3 SCC 529 : 2021 SCC
           OnLine SC 456] : (SCC para 240)
                “240. … In our view if the proposition of law
                is not doubted by the Court, it does not need
                a precedent unless asked for. If a question is
                raised about a legal proposition, the judgment
                must be relatable to that proposition — and not
                multiple judgments.”
           As such, the contention in that regard is found to be
           without merit.”
31. Upon a plain reading of Section 63 of the Act, it would reveal that the
    power of the Appropriate Commission thereunder is, notwithstanding
    anything contained in Section 62.
32. It can thus be seen that the intention of the legislature is to empower
    the Appropriate Commission to adopt the tariff if such tariff has been
    determined through a transparent process of bidding in accordance
    with the guidelines issued by the Central Government.
33. The legislative purpose appears to be that when the power is
    being produced through a process of bidding it has to be done in
    a transparent manner. Another requirement is that the same must
    be done in accordance with the guidelines issued by the Central
    Government.
34. This Court in the case of Energy Watchdog (supra) has held that
    when there are no guidelines, then the Central Commission can
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       exercise power under Section 79(1)(b) of the Act. The provisions
       of Section 86(1)(b) of the Act are analogous with Section 79(1)(b)
       of the said Act.
35. A plain reading of Section 63 of the Act would not show that the
    legislature intended to restrict the invocation of the jurisdiction of the
    State Commission only by the Discoms or generating companies. In
    our view, the interpretation as placed by the APTEL is adding words
    in the provisions of Section 63 of the Act which the legislature did
    not intend to.
36. As already stated herein above, when a provision in the statute upon
    its plain reading is capable of giving a meaning to it as intended
    by the legislature, then it will not be permissible for the courts to
    add, alter, or delete the words to the said provision. In any case,
    upon a plain reading of the provisions of Section 63 of the Act, the
    meaning which we gather does not result in any absurdity. In such
    a situation, addition of words in the statute by judicial interpretation
    is wholly impermissible.
37. Apart from that, we are of the view that APTEL could not have read
    the provisions of Section 63 of the Act in isolation. The provisions
    of Section 63 will have to be read in harmony with the provisions of
    Section 86(1)(b) of the Act, which reads thus:
            “86. Functions of the 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;”
38. A perusal of the provision of Section 86(1)(b) of the Act would reveal
    that a duty is cast upon 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.
[2025] 1 S.C.R.                                                         257

        Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


39. It could thus be seen that the duty cast upon the State Commission
    is to regulate:
      (i)    the electricity purchase and procurement process of distribution
             licensees;
      (ii)   the price at which electricity shall be procured from the
             generating companies or licensees, or;
      (iii) from other sources through agreements for purchase of power
            for distribution and supply within the State.
40. The legislative intent behind Section 86(1)(b) of the Act is to empower
    the State Commission to regulate all matters regarding the electricity
    purchase and procurement processes.
41. As held by this Court in the case of Jaipur Vidyut Vitran Nigam
    Limited and others v. MB Power (Madhya Pradesh) Limited
    and others,18 the State Commission is not a mere post office, but
    a duty is cast upon it to balance the interests of consumers on one
    hand and that of generators or Discoms on the other hand. If the
    provisions of Section 63 of the Act are read in harmony with the
    provisions of Section 86(1)(b) of the Act, the legislative intent that
    could be gathered is that the State Commission while exercising its
    powers under Section 63 of the Act shall adopt the tariff when it has
    been determined in the bidding process. However, while adopting
    the same it will have to be satisfied that the same is done in a
    transparent manner. It will also have to be examined as to whether
    the interests of the generators/Discoms on one hand are balanced
    with the interests of the consumers.
42. In our view, reading the Section 63 of the Act in the manner in which
    it has been interpreted by the APTEL, would impose unnecessary
    restrictions on the powers and duties of the State Commission under
    Section 86(1)(b) of the Act, which are of a very wide amplitude.
43. In this respect, we may refer to the judgment of this Court in the
    case of Sanjay Ramdas Patil v. Sanjay and others19 wherein
    this Court after referring to the earlier judgments of this Court has
    observed thus:


18   [2024] 1 SCR 909 : (2024) 8 SCC 513
19   [2021] 11 SCR 640 : (2021) 10 SCC 306
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       “25. In Balasinor Nagrik Coop. Bank Ltd. v. Babubhai
       Shankerlal Pandya [Balasinor Nagrik Coop. Bank Ltd v.
       Babubhai Shankerlal Pandya (1987) 1 SCC 606], this
       Court observed thus : (SCC p. 608, para 4)
           “4. … It is an elementary rule that construction
           of a section is to be made of all parts together.
           It is not permissible to omit any part of it. For,
           the principle that the statute must be read as a
           whole is equally applicable to different parts of
           the same section.”
       26. Again in Mohan Kumar Singhania v. Union of India
       [Mohan Kumar Singhania v. Union of India, 1992 Supp
       (1) SCC 594 : 1992 SCC (L&S) 455], this Court observed
       thus : (SCC p. 624, para 67)
           “67. We think, it is not necessary to proliferate
           this judgment by citing all the judgments and
           extracting the textual passages from the various
           textbooks on the principles of Interpretation of
           Statutes. However, it will suffice to say that
           while interpreting a statute the consideration
           of inconvenience and hardships should be
           avoided and that when the language is clear
           and explicit and the words used are plain
           and unambiguous, we are bound to construe
           them in their ordinary sense with reference to
           other clauses of the Act or the Rules as the
           case may be, so far as possible, to make a
           consistent enactment of the whole statute or
           series of statutes/rules/regulations relating to
           the subject-matter. Added to this, in construing a
           statute, the Court has to ascertain the intention
           of the law-making authority in the backdrop
           of the dominant purpose and the underlying
           intendment of the said statute and that every
           statute is to be interpreted without any violence
           to its language and applied as far as its explicit
           language admits consistent with the established
           rule of interpretation.”
[2025] 1 S.C.R.                                                        259

      Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


           27. In Sultana Begum v. Prem Chand Jain [Sultana Begum
           v. Prem Chand Jain (1997) 1 SCC 373], this Court observed
           thus : (SCC pp. 381-82, para 15)
                “15. On a conspectus of the case-law indicated
                above, the following principles are clearly
                discernible:
                (1) It is the duty of the courts to avoid a head-
                on clash between two sections of the Act and
                to construe the provisions which appear to be
                in conflict with each other in such a manner as
                to harmonise them.
                (2) The provisions of one section of a statute
                cannot be used to defeat the other provisions
                unless the court, in spite of its efforts, finds it
                impossible to effect reconciliation between them.
                (3) It has to be borne in mind by all the courts
                all the time that when there are two conflicting
                provisions in an Act, which cannot be reconciled
                with each other, they should be so interpreted
                that, if possible, effect should be given to both.
                This is the essence of the rule of “harmonious
                construction”.
                (4) The courts have also to keep in mind that
                an interpretation which reduces one of the
                provisions as a “dead letter” or “useless lumber”
                is not harmonious construction.
                (5) To harmonise is not to destroy any statutory
                provision or to render it otiose.”
                                           (emphasis in original)
           28. In Jagdish Singh v. Lt. Governor [Jagdish Singh v. Lt.
           Governor (1997) 4 SCC 435], this Court observed thus :
           (SCC p. 441, para 7)
                “7. … It is a cardinal principle of construction of
                a statute or the statutory rule that efforts should
                be made in construing the different provisions, so
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            that, each provision will have its play and in the
            event of any conflict a harmonious construction
            should be given. Further a statute or a rule
            made thereunder should be read as a whole
            and one provision should be construed with
            reference to the other provision so as to make
            the rule consistent and any construction which
            would bring any inconsistency or repugnancy
            between one provision and the other should
            be avoided. One rule cannot be used to defeat
            another rule in the same rules unless it is
            impossible to effect harmonisation between
            them. The well-known principle of harmonious
            construction is that effect should be given to
            all the provisions, and therefore, this Court has
            held in several cases that a construction that
            reduces one of the provisions to a “dead letter”
            is not a harmonious construction as one part is
            being destroyed and consequently court should
            avoid such a construction.”
       29. In CIT v. Hindustan Bulk Carriers [CIT v. Hindustan
       Bulk Carriers (2003) 3 SCC 57] , this Court observed thus :
       (SCC pp. 73-74, paras 16-21)
            “16. The courts will have to reject that
            construction which will defeat the plain intention
            of the legislature even though there may be
            some inexactitude in the language used. (See
            Salmon v. Duncombe [Salmon v. Duncombe,
            (1886) LR 11 AC 627 (PC) : 55 LJPC 69 : 55
            LT 446] , AC at. 634, Curtis v. Stovin [Curtis v.
            Stovin, (1889) LR 22 QBD 513 (CA) : 58 LJQB
            174 : 60 LT 772] referred to in S. Teja Singh
            case [CIT v. S. Teja Singh, AIR 1959 SC 352 :
            (1959) 35 ITR 408] .)
            17. If the choice is between two interpretations,
            the narrower of which would fail to achieve the
            manifest purpose of the legislation, we should
            avoid a construction which would reduce the
[2025] 1 S.C.R.                                                     261

      Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


                legislation to futility, and should rather accept
                the bolder construction, based on the view that
                Parliament would legislate only for the purpose
                of bringing about an effective result. (See Nokes
                v. Doncaster Amalgamated Collieries Ltd. [Nokes
                v. Doncaster Amalgamated Collieries Ltd., 1940
                AC 1014 : (1940) 3 All ER 549 (HL) : 109 LJKB
                865 : 163 LT 343] referred to in Pye v. Minister
                for Lands for New South Wales [Pye v. Minister
                for Lands for New South Wales, (1954) 1 WLR
                1410 : (1954) 3 All ER 514 (PC)] .) The principles
                indicated in the said cases were reiterated by
                this Court in Mohan Kumar Singhania v. Union
                of India [Mohan Kumar Singhania v. Union of
                India 1992 Supp (1) SCC 594 : 1992 SCC
                (L&S) 455] .
                18. The statute must be read as a whole and
                one provision of the Act should be construed
                with reference to other provisions in the same
                Act so as to make a consistent enactment of
                the whole statute.
                19. The court must ascertain the intention of
                the legislature by directing its attention not
                merely to the clauses to be construed but to
                the entire statute; it must compare the clause
                with other parts of the law and the setting in
                which the clause to be interpreted occurs.
                (See R.S. Raghunath v. State of Karnataka
                [R.S. Raghunath v. State of Karnataka (1992)
                1 SCC 335 : 1992 SCC (L&S) 286] .) Such
                a construction has the merit of avoiding any
                inconsistency or repugnancy either within a
                section or between two different sections or
                provisions of the same statute. It is the duty of
                the court to avoid a head-on clash between two
                sections of the same Act. (See Sultana Begum
                v. Prem Chand Jain [Sultana Begum v. Prem
                Chand Jain (1997) 1 SCC 373] .)
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               20. Whenever it is possible to do so, it must be
               done to construe the provisions which appear
               to conflict so that they harmonise. It should not
               be lightly assumed that Parliament had given
               with one hand what it took away with the other.
               21. The provisions of one section of the statute
               cannot be used to defeat those of another unless
               it is impossible to effect reconciliation between
               them. Thus a construction that reduces one of
               the provisions to a “useless lumber” or “dead
               letter” is not a harmonised construction. To
               harmonise is not to destroy.”
          30. It could thus be seen that it is more than well settled
          that it is the duty of the Court to construe the statute
          as a whole and that one provision of the Act has to be
          construed with reference to other provisions so as to
          make a consistent enactment of the whole statute. It is
          the duty of the Court to avoid a head-on clash between
          two sections and construe the provisions which appear
          to be in conflict with each other in such a manner so as
          to harmonise them. It is further equally settled that while
          interpreting a particular statutory provision, it should not
          result into making the other provision a “useless lumber”
          or a “dead letter”. While construing the provisions, the
          Court will have to ascertain the intention of the law-making
          authority in the backdrop of dominant purpose and the
          underlying intendment of the statute.”
44. We are, therefore, of the considered view that when the provisions
    of Section 63 of the Act are read in harmony with the provisions of
    Section 86(1)(b) of the Act, the powers of the State Commission
    cannot be curtailed by interpreting that the same can be invoked
    only by the Discoms or the generating companies.
45. It will further be relevant to refer to the provisions of Section 174
    and 175 of the Act, which read thus:
          “174. Act to have overriding effect.- Save as otherwise
          provided in section 173, the provisions of this Act shall
          have effect notwithstanding anything inconsistent therewith
[2025] 1 S.C.R.                                                        263

      Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


           contained in any other law for the time being in force or
           in any instrument having effect by virtue of any law other
           than this Act.
           175. Provisions of this Act to be in addition to and not
           in derogation of other laws.- The provisions of this Act
           are in addition to and not in derogation of any other law
           for the time being in force.”
46. A perusal of Section 174 of the Act would reveal that, save as
    otherwise provided in Section 173, the provisions of the Act shall have
    effect notwithstanding anything inconsistent therewith contained in
    any other law for the time being in force or in any instrument having
    effect by virtue of any law other than the Act.
47. Section 175 of the Act provides that the provisions of the said Act
    are in addition to and not in derogation of any other law for the time
    being in force.
48. In our view, there is no inconsistency between the provisions of
    Section 63 of the Act and Rule 15 of the SWM Rules 2016. The
    provisions of Rule 15 of the SWM Rules 2016, which are enacted
    under the Environment (Protection) Act, 1986, mandate the appellant
    to undertake WTE project(s).
49. It can thus be seen that insofar as the WTE projects are concerned,
    the provisions under the Act will have to be read in addition to
    the provisions under Rule 15 of the SWM Rules 2016 and not in
    derogation thereof.
50. Apart from that, Rule 6.4 of the Tariff Policy, which is notified in
    compliance with the mandate of Section 63 of the Act, the distribution
    licensees are mandated to compulsorily procure 100% of the power
    produced from all the WTE plants in the State in the ratio of their
    procurement of power from all sources including their own. Not
    only that, the Appropriate Commission is also required to provide
    suitable regulatory framework for encouraging such other emerging
    renewable energy technologies.
51. It will also be relevant to refer to the provisions of Section 86(1)(e)
    of the Act, which read thus:
           “86. Functions of the State Commission.-(1) The State
           Commission shall discharge the following functions,
           namely:-
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              (a)   ……………………………………………
              (e)   promote cogeneration and generation of electricity
                    from renewable sources of energy by providing
                    suitable measures for connectivity with the grid and
                    sale of electricity from such sources, a percentage
                    of the total consumption of electricity in the area of
                    a distribution licensee;”
52. It can thus be seen that the provisions of Section 86(1)(e) of the
    Act read with Rule 6.4 of the Tariff Policy provide for promoting
    cogeneration and generation of electricity from renewable sources
    of energy by providing suitable measures for connectivity with the
    grid and sale of electricity from such sources, a percentage of the
    total consumption of electricity in the area of a distribution licensee.
53. We are of the considered view that the APTEL has failed to take
    into consideration all these aspects of the matters.
54. In any case, the APTEL has grossly erred in treating the present
    Appellant-MCD as a total stranger. The WTE project was on Design,
    Build, Finance and Operate basis. The ownership of the said Project
    was always to be with the Appellant-MCD and the operation of the
    facility is required to be transferred back to the Appellant-MCD after
    25 years. The reasoning given by the APTEL, that if the application
    of the Appellant-MCD for adoption of tariff was held to be tenable,
    then it would amount to permitting any stranger to apply under
    Section 63 of the Act, is factually not correct. The APTEL failed to
    take into consideration that the Appellant-MCD was establishing the
    said Project in order to perform its statutory obligations. The plain
    reading of Section 63 of the Act would reveal that the Appropriate
    Commission has to adopt the tariff only after being satisfied that such
    a tariff has been determined through a transparent process of bidding
    in accordance with the guidelines issued by the Central Government.
55. The DERC, after taking into consideration all the relevant factors,
    had granted its approval to the tariff with certain conditions. The
    relevant factors which were taken into consideration by the DERC
    while granting the approval were:
       (i)    the mandate of Rule 15 of the SWM Rules 2016;
       (ii)   the financial evaluation report which was sent by the Bidding
              Evaluation Committee;
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         Municipal Corporation of Delhi v. Gagan Narang & Ors. Etc


     (iii) the certificate on the conformity that the bidding process had
           been completed by following the transparent process; and
     (iv) that there was a mandate under the NTP to the effect that the
          entire power generated by the WTE project was to be procured
          by the Discoms.
     However, the same has been upset by the APTEL only on a hyper-
     technical ground.
56. The APTEL also failed to take into consideration that the WTE project
    in question was in the larger public interest thereby providing for
    disposal of the huge quantity of waste generated in the city of Delhi.
57. Since we are inclined to allow the appeals of the appellant on the
    aforesaid grounds, we do not find it necessary to go into the contention
    of the appellant with regard to locus of the Respondent No.1 in filing
    the appeals before the APTEL.
58. In the result, we pass the following order:
     (i)     the appeals are allowed;
     (ii)    the Impugned common final judgment and order of the Appellate
             Tribunal for Electricity at New Delhi dated 31st August 2023
             passed in DFR No. 245 of 2023 and DFR No. 247 of 2023 is
             quashed and set aside;
     (iii) the orders of the Delhi Electricity Regulatory Commission dated
           6th March 2023 in Petition No. 65 of 2022 and 7th March 2023
           in Petition No. 72 of 2022 are affirmed.
59. Pending application(s), if any, shall stand disposed of.

     Result of the case: Appeals allowed.



     †
         Headnotes prepared by: Divya Pandey


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