NABHA POWER LIMITEDversusPUNJAB STATE POWER CORPORATION LIMITED

                 [2023] 13 S.C.R. 713 : 2023 INSC 883



                            CASE DETAILS

                      NABHA POWER LIMITED
                                     v.
        PUNJAB STATE POWER CORPORATION LIMITED
                   (Civil Appeal No. 2425 of 2023 Etc.)
                           OCTOBER 09, 2023
    [SANJAY KISHAN KAUL, SUDHANSHU DHULIA AND
                ARAVIND KUMAR, JJ.]
                             HEADNOTES
     Issue for consideration: The dispute, pertaining to recovery of
deductions of monthly tariff by the respondent was dealt by the Supreme
Court in Nabha Power Limited (NPL) v. Punjab State Power Corporation
Limited (PSPCL) and Anr. [2017] 14 SCR 301: (2018) 11 SCC 508 dated
05.10.2017, whether same issue has been raised again.
      Cost – Imposition of – After Nabha Power Limited (NPL) v. Punjab
State Power Corporation Limited (PSPCL) and Anr. judgment, the
respondent filed various applications before the Supreme Court – Two
Contempt petitions were also filed by the appellant for the compliance
of the above said judgment – The Contempt Petitions were disposed of
with a direction to the respondent to pay the amount as a result of the
order – Petitions was also filed before the Regulatory Commission – The
submission of the appellant before the Supreme Court was that all the
issues were dealt with earlier in the judgment as well as in the various
applications filed by the respondent:
       Held: When issues were examined, the Court found that the same thing
being raked up again and again only as an endeavour to not make payments,
till in the Contempt proceedings they were compelled to make payment
– The liberty granted by the order dated 09.03.2021 (Second Contempt
petition) cannot be construed to seek refund of the amount paid under the
orders passed by this Court from time to time – What was noticed was that
some aspect was raised which was really in the nature of fresh dispute – The
Court did not preclude the respondents from raising ‘all future disputes’ but
                                    713
714          SUPREME COURT REPORTS                          [2023] 13 S.C.R.


that cannot be to unsettle the effect on the main judgment dated 05.10.2017
abundantly clarified from time to time – Finding themselves helpless in the
face of the Second Contempt and with possibility of serious consequences,
they sought to wriggle out of the consequences arisen by offering to make
payment – The payments were made in terms of the imprimatur granted by
this Court as to the quantum and, thus, what was sought to be done was to
really reopen the same issue – The impugned order has simply maintained
the petition and that would mean another round of litigation, and this is being
continuing since the judgment in 2017 for the last six years – There is no
hesitation in coming to the conclusion that the impugned order, innocuous
as it may seem, is not sustainable and this is yet another endeavour of
the respondent to wriggle out of its obligation under the judgment dated
05.10.2017, repeatedly explained by various orders – In fact, the judgment
dated 05.10.2017 itself dealt with the legal principles for interpretation of
commercial contract exhaustively and those principles were then applied to
the contract in question – The pricing of the coal was found to be the crux
of the problem, which was adjudicated upon – It is this very issue which is
sought to be raked up again – This Court considers to modulate and quantify
the cost in favour of appellants-Nabha Power Limited and Talwandi Sabo
Power Limited at Rs.40.00 lakhs and Rs.25.00 lakhs, respectively. [Paras
20, 21, 22, 23]

       LIST OF CITATIONS AND OTHER REFERENCES

      Nabha Power Limited (NPL) v. Punjab State Power Corporation
Limited (PSPCL) and Anr. (2018) 11 SCC 508 : [2017] 14 SCR 301 –
referred to.
       OTHER CASE DETAILS INCLUDING IMPUGNED
              ORDER AND APPEARANCES
      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2425 of 2023.
     From the Judgment and Order dated 06.04.2022 of the Punjab State
Electricity Regulatory Commission, Chandigarh in PN No.49 of 2021.
      With
      Civil Appeal No. 2426 of 2023.
           NABHA POWER LIMITED v. PUNJAB STATE POWER                        715
                    CORPORATION LIMITED

     Appearances:
      Mukul Rohatgi, Dr. A.M. Singhvi, Parag P. Tripathi, Maninder Singh,
Sr. Advs., Mahesh Agarwal, Anshuman Srivastava, Ankit Prasoon, Avishkar
Singhvi, Nishant Rao, Ms. Priya Dhankar, Varun, Vivek Kumar Singh,
Aditiya, E. C. Agrawala, Ms. Anuradha Dutt, Anish Kapur, Ms. Nikhita
Suri, Ms. Pankhuri Budhiraja, Ms. B. Vijayalakshmi Menon, Advs. for the
Appellant.
     C. Aryama Sundaram, M.G. Ramachandran, Sr. Advs., Anand K.
Ganesan, Nikunj Dayal, Pramod Dayal, Amal Nair, Abhishek Gupta,
Ms. Srishti Khindaria, Ms. Shivani Verma, Aneesh Bajaj, Advs. for the
Respondent.

          JUDGMENT / ORDER OF THE SUPREME COURT

                                JUDGMENT
     SANJAY KISHAN KAUL, J.
      1. The dispute, pertaining to recovery of deductions of monthly
tariff by the respondent, gave rise to proceedings under the Electricity Act,
2003 (hereinafter referred to as the ‘said Act’), which travelled from the
Regulatory Commission to the Appellate Tribunal and finally to this Court.
The Supreme Court dealt with the matter in terms of the judgment in Nabha
Power Limited (NPL) v. Punjab State Power Corporation Limited (PSPCL)
and Anr. (2018) 11 SCC 508.
      2. The limited aspect, on which relief was granted by this Court qua
part of the amount, can be summarized as under:
     i.     The Appellant is held entitled to the washing cost of coal, the
            transportation from the mine site via washing of coal to the project
            site inclusive of cost of road transportation for the period where
            it was necessary.
     ii.    The Gross Calorific Value (“GCV”) of the coal would have to be
            taken at the project site.
     iii. The amount payable to the Appellant as the consequences thereof
          be remitted within a period of three months from the date of this
716          SUPREME COURT REPORTS                        [2023] 13 S.C.R.


           order, failing which it would carry interest @ 12 per cent per
           annum (simple interest)
     3. The respondent filed M.A. No.1562/2017 in the aforesaid Civil
Appeal praying for a direction to the State Commission to determine the
amount payable by the respondent as per the aforesaid reported judgment
of 05.10.2017 and grant the respondent reasonable time to make payment.
This Court found no merit in the application in terms of the order dated
15.12.2017 and observed that it was for the respondent to calculate the
amount payable and thereafter disburse the sum due under the judgment,
which must be done within a period of four weeks from the date of the
order.
      4. The next endeavour made by the respondent was through a
Review Petition Civil No.165/2018 seeking review of the order in the
main judgment itself which was also dismissed on 06.02.2018 opining that
having gone through the records there is no error apparent on the face of
the record.
     5. Despite the aforesaid proceedings, the appellant (Nabha Power
Limited) was not paid the amount and, thus, they filed Contempt Petition
no.1277-1278/2018 (referred to as the ‘First Contempt Petition’) aggrieved
by the non-release of payment. This Contempt Petition was tagged with
another Contempt Petition No.1766-1767/2018 filed by Talwandi Sabo
Power Limited, the other appellant in one of the appeals before us. The
orders passed in these Contempt proceedings dated 07.08.2019 and
03.09.2019, respectively, in identical terms, once again dealt with the
controversy. By referring to the main judgment pronounced by this Court
on 05.10.2017, the Bench came to the conclusion that on reading of the
aforesaid, it is made crystal clear by the judgment observed as under:
           “On a reading of the aforesaid, what becomes clear and what
      is made crystal clear by the judgment is the fact that, in the formula,
      both FCOALn and PCVn are costs/ gross calorific value of coal which
      are actual in nature. This being so, when PCVn is spoken of in the
      formula, it makes it clear that what is referred to is the weighted
      average gross calorific value of coal as received at the project site
      on actuals thereof, and that includes total moisture content that is
      measured at the project site. Equally, what is meant in FCOALn in
        NABHA POWER LIMITED v. PUNJAB STATE POWER                          717
       CORPORATION LIMITED [SANJAY KISHAN KAUL, J.]

     the formula, is the actual cost of purchase of unwashed coal, which
     would involve the actual grade of unwashed coal that is provided by
     the coal company to PSPCL. This being the case, we are of the view
     that the judgment has to be followed, both in letter and in spirit, by
     working the formula as aforesaid, and consequently, deleting alien
     figures in both numerator and denominator.”
       6. The aforesaid would, thus, show that vide order dated 07.08.2019
the Court made it abundantly clear that the judgment should be followed in
letter and spirit and disposed of the Contempt Petitions with a direction to
pay the amount as a result of the order within a period of eight weeks from
the date of the order. Thus, this endeavour of the respondent to delay and
cause confusion of the amount to be determined for payment also did not
succeed.
      7. The appellant addressed a letter dated 07.10.2019 to the respondent,
highlighting certain contemptuous actions and called upon the respondent
to rectify the computation and pay the dues. Soon thereafter, the respondent
filed M.A. No.2396-97/2019 in the First Contempt Petition seeking
directions from the Court to have the amounts payable to the appellant to be
determined by appropriate authority. The appellant filed Contempt Petition
(C) No.1174-1177/2019 before this Court (referred to as ‘Second Contempt
Petition’).
      8. On 25.11.2019, M.A. No.2396-97/2019 filed by the respondent was
dismissed while granting further twelve weeks’ time to make payment to
the appellant in terms of the judgment dated 05.10.2017.
      9. The next development to be noted is that the respondent filed a
subsequent Petition No.25/2019 under Section 86(1)(a) read with Section
62 of the Electricity Act on 24.12.2019 seeking approval of the Regulatory
Commission for recovery of the amount paid to the appellant in compliance
with the Supreme Court’s order dated 07.08.2019 from the consumers by
proportionately increasing the retail supply tariff of various categories of the
consumers. Soon thereafter, the respondent also filed a reply to the Second
Contempt Petition filed by the appellant.
     10. The Respondent on 14.10.2020 issued a Notice of Dispute to
the appellant under Article 17 read with Article 11.6 and Article 11.7 of
718           SUPREME COURT REPORTS                         [2023] 13 S.C.R.


the Power Purchase Agreement disputing the monthly energy bills and on
15.10.2020 vide I.A. No. 106244 of 2020 the Dispute Notice was sought
to be brought on record before this Court.
      11. The Second Contempt Petition came to be decided on 09.03.2021
opining that the respondent was guilty of contempt by not complying with
the order dated 05.10.2017. In effect, this Court granted an imprimatur to
the calculations of the outstanding dues as understood by the appellant as
on 09.03.2021 and directed the respondent to make payment of the same in
two equated installments on or before 31.03.2021 and 31.05.2021.
    12. In July, 2021, the respondent filed Petition No.49/2021 before the
Regulatory Commission seeking, inter alia:
      i. directions against the Appellant seeking due and correct accounts
      & details of washing of coal;
      ii. coal quality reports etc.;
      iii. refund of principal amount of Rs. 386.80 crores;
      iv. late payment surcharge.
      13. The appellant filed a preliminary objection against the
maintainability of that petition and sought dismissal of the said petition as
being non-maintainable. It is this aspect, which has been adjudicated by the
impugned order dated 06.04.2022, which opined that the petition filed by
the respondent was maintainable as they amounted to fresh disputes as per
the order dated 09.03.2021.
      14. We may now turn to the phraseology used in the order dated
09.03.2021 in the Second Contempt Petition. It sketched out the dispute
and took note of the contentions that there was another endeavour being
made to circumvent the orders passed by the Court. This Court, in a chart
form, referred to the situation pre and post the order in both the appeals and
opined that the Court had little doubt that the order dated 05.10.2017 had not
been complied with. The counsel for the respondent thereafter took some
time to obtain instructions, as noticed in that order, and came back in the
proceedings to state that the respondent will ensure that the order is complied
in toto. It was also noticed that though the stand of the respondent was that
the whole amount stood paid, in the note submitted by them it was admitted
        NABHA POWER LIMITED v. PUNJAB STATE POWER                         719
       CORPORATION LIMITED [SANJAY KISHAN KAUL, J.]

that there were arrears even as per the calculations of the respondent. On
the assurance to pay the amounts, for which imprimatur was given in that
order, the two installments were granted, as prayed for, which would also
include interest or any other component, which would be admissible as per
the contract inter se the parties and there were also the payments for future
charges, which would have to be paid as and when the contractual right
arises in favour of the appellants.
     15. It is paras 13 and 14 of this order, which according to the
respondent, gave cause to the respondent to move a petition before the
Commission, which has resulted in passing the impugned order. Paras 13
and 14 read as under:
     “13. The last aspect which arises for consideration is a plea which
     was sought to be advanced on behalf of the respondents that in their
     perspective, there is some problem arising from the records maintained
     for the GCV unwashed coal and the washed coal as according to them
     the reject worked out more and their apprehension is that unrealistically
     the GCV is being varied to cause larger financial commitments from
     the respondents. What they seek to contend as per the note is that the
     discrepancy in terms of yield loss and quality of washed coal usually
     happens when good quality of coal is diverted under the garb of rejects
     in the washing process which should have been used for generation
     of power and this in turn raises the issue of mismatch of GCV. On
     perusal and calling for certain datas, it is a view of the respondents
     that their apprehension is not without merit. It is thus their submission
     that having found this aspect, the respondents cannot be left remedy
     less as it is a dispute which needs adjudication for which the relevant
     authority is the SERC and they seek to invoke the jurisdiction of the
     forum for the said purpose for which notice has been issued.
     14. We have examined the aforesaid plea and it is our view that insofar
     as the liabilities of the respondents to the appellants arising from the
     judgment are concerned, the matter stands closed in terms of our
     judgment dated 05.10.2017 and orders passed on the applications
     from time to time. What is said to be raised is really in the nature
     of a fresh dispute. If that be the position, we have not precluded the
     respondents from raising all future disputes as we were concerned with
720          SUPREME COURT REPORTS                          [2023] 13 S.C.R.


      adjudication of certain aspects where we accepted part of the claims
      of the appellants and rejected part of the claims of the appellants. In
      our view, it will be for the authority to consider whether any of the
      claims sought to be preferred by the respondents can really be open
      to any fresh adjudication in view of the judgment rendered by us and
      the orders passed by us referred to aforesaid. We make it clear that
      the liberty to approach the SERC arises from the contract itself but
      that certainly cannot open the chapters which have been closed and
      that would be taken care of by the SERC while adjudicating the claim
      now sought to be raised by the respondents.”
       16. The aforesaid order records the plea of the respondents that there
was some problem arising from the record maintained for the GCV (Gross
Calorific Value) unwashed coal and the washed coal as according to them
the reject works out more and their apprehension was that unrealistically
the GCV is being varied to cause larger financial commitments from the
respondents. It appeared form the plea, as submitted in the note in the
Court, that the discrepancy in terms of the yield loss and quality of washed
coal usually happens when good quality of coal was diverted under the
garb of rejects in the washing process, which should have been useful for
generation of power and this in turn resulted in the issue of mismatch of
GCV. The respondents contended that they could not be left remediless as
it is a dispute, which needs adjudication, for which the relevant authority
is the Regulatory Commission.
       17. This Court opined in para 14 unequivocally that the matter arising
from the judgment dated 05.10.2017 and orders passed in the applications
from time to time stood closed. What was sought to be raised was really in
the nature of fresh dispute and “if that be the position” we have not precluded
the respondents from raising “all future disputes” as we were concerned with
the adjudication of certain aspects. It was left to the authority concerned
whether any of the claims, sought to be preferred by respondents, could really
be opened to any fresh adjudication in view of the judgment rendered by this
Court and the orders passed from time to time. It was further clarified that
the liberty to approach the Regulatory Commission arose from the contract
itself but ‘certainly cannot’ open the chapter which had been closed and that
would be taken care of by the Regulatory Commission. The proceeding was
        NABHA POWER LIMITED v. PUNJAB STATE POWER                        721
       CORPORATION LIMITED [SANJAY KISHAN KAUL, J.]

closed with the hope and a caution to the respondent that there should be
no further occasion for moving an application or revival of the contempt
proceedings otherwise the consequences would be very serious. In the end, it
was further observed that this Court had not expressed a view on the merits
of the dispute now sought to be raised by the respondents as the occasion
for the same had not arisen.
      18. The submission of the respondent was that what had been done was
in pursuance to the liberty granted and all that the Commission had opined
was that it would examine the issue and the judgment of this Court would
not foreclose the examination in view of the order dated 09.03.2021 passed
in Second Contempt Petition. The alleged non-disclosure of information
evidencing the fact of inflating the cost in relation to coal, it was alleged
that though the calorific value of coal of 1500 kilos calorie per kg was the
average mark provided, coal of higher calorific value was taken out as coal
rejects while the coal rejects had to be less than 2200 kilo calories per kg.
The details of the coal rejects were not provided resulting in higher washing
charges and not taking into account the income from the disposal of the
coal rejects. In this context, it was submitted that the washing of the coal
was done by a washing operator of the appellant though it was approved
by the respondent.
      19. The submission of the appellant was that this is the same wine in
a new bottle. All these issues had been dealt with earlier in the judgment as
well as in the various applications filed by the respondent. They referred to
the reply filed in the First Contempt Petition as well as the Second Contempt
Petition and the MAs filed by the respondents. These allegations, inter alia,
were regarding the appellant taking monetary benefit on account of increase
in GCV of washed coal, requirement of reconciliation for making payment,
the same expert opinion to justify alleged increase in GCV and the same
Notice of Dispute issued for the first time by the respondent.
      20. When we examined the issue, we find the same thing being raked
up again and again only as an endeavour to not make payments, till in the
Contempt proceedings they were compelled to make payment. The liberty
granted by the order dated 09.03.2021 cannot be construed to seek refund
of the amount paid under the orders passed by this Court from time to
time. What was noticed was that some aspect was raised which was really
722          SUPREME COURT REPORTS                          [2023] 13 S.C.R.


in the nature of fresh dispute. The Court did not preclude the respondents
from raising ‘all future disputes’ but that cannot be to unsettle the effect
on the main judgment dated 05.10.2017 abundantly clarified from time to
time. Finding themselves helpless in the face of the Second Contempt and
with possibility of serious consequences, they sought to wriggle out of the
consequences arisen by offering to make payment. The future dispute, thus,
must have a reference to a period after the date of the order dated 09.03.2021.
      21. The payments were made in terms of the imprimatur granted by
this Court as to the quantum and, thus, what was sought to be done was to
really reopen the same issue.
       22. We are conscious that the impugned order has simply maintained
the petition and that would mean another round of litigation, and this is
being continuing since the judgment in 2017 for the last six years. Thus, to
say that an innocuous order was passed, would not be a correct position,
this is more so as we have explained what was meant by ‘all future dispute’.
      23. It was submitted that the policy for handling and disposal of
washery rejects stands changed from 2021 and the concept of coal being
washed at an approved washery operator’s site thereafter being shifted to
the site and losses being caused, etc., are no more part of the manner of
implementation of the contract and, thus, would not arise. Coal is now
directly delivered to the project site and washing occurs there. We have,
thus, no hesitation in coming to the conclusion that the impugned order,
innocuous as it may seem, is not sustainable and this is yet another endeavour
of the respondent to wriggle out of its obligation under the judgment dated
05.10.2017, repeatedly explained by various orders. This kind of endeavour
can neither be appreciated nor left without consequences thereof. The dispute
inter se the parties is in the nature of a contractual dispute. Normally, costs
must go with the succeeding party in case of a contractual dispute. This is
more so where one party repeatedly seeks to evade the rigors of the orders.
In fact, the judgment dated 05.10.2017 itself dealt with the legal principles
for interpretation of commercial contract exhaustively and those principles
were then applied to the contract in question. The pricing of the coal was
found to be the crux of the problem, which was adjudicated upon. It is this
very issue which is sought to be raked up again.
        NABHA POWER LIMITED v. PUNJAB STATE POWER                          723
       CORPORATION LIMITED [SANJAY KISHAN KAUL, J.]

      24. We, thus, feel that some example must be set in such cases and the
appeals are liable to be allowed with costs, which were actually incurred by
the appellants. It was the aforesaid, which was the reason for us to call upon
the parties to file the actual bill of costs. The Bills of cost have been filed
by both the appellants, Nabha Power Limited and Talwandi Sabo Power
Limited. There are, however, multiple counsels appearing for the appellant,
Nabha Power Limited, and the total invoice amount is Rs.1,95,80,081/-.
In the case of Talwandi Sahoo Power Limited the total invoice amount is
Rs.1,67,40,563/-. The Bill of cost has also been filed by the respondent and
the total invoice amount is Rs.34,81,500/-.
      25. In view of this nature of fee, we consider to modulate and quantify
the cost in favour of Nabha Power Limited and Talwandi Sabo Power Limited
at Rs.40.00 lakhs and Rs.25.00 lakhs, respectively.
     26. The appeals are allowed and impugned order is set aside with costs
as quantified aforesaid to be paid within 4 weeks.


Headnotes prepared by:                                          Appeals allowed.
Ankit Gyan