New Delhi, Feb 8 (PTI) The Supreme Court Tuesday took note of the settlement arrived at between Adani Power (Mundra) Ltd and the Gujarat Urja Vikas Nigam Ltd (GUVNL) and closed the curative plea of the state PSU challenging the apex court’s 2019 verdict upholding the private firm’s termination of a power purchase agreement (PPA).
A five-judge Constitution bench headed by Chief Justice N V Ramana was informed by Attorney General K K Venugopal, appearing for GUVNL, that a settlement has been arrived at between the state PSU and Adani Power (Mundra) Ltd on January 3.
The top law officer said that in view of the settlement, the curative plea be closed and the verdict may be modified accordingly.
“We dispose of the curative petition (of GUVNL) by saying that both parties will be governed by the settlement deed,” ordered the bench which also comprised Justices U U Lalit, D Y Chandrachud, B R Gavai and Surya Kant.
At the outset, Venugopal referred to the settlement and said that the court was required to modify the judgment to the extent that the termination of the PPA by the Adani group firm will not be given effect to.
“Secondly, the court is needed to note that the liberty, which was granted to the Adani Power (Mundra) Ltd to seek compensatory tariff which had led to filing of a claim of around Rs 10,000 crore from us (the PSU) before the CERC, now stands withdrawn and closed due to the settlement,” he said.
“The aspects which hurt the state PSU have been neutralized and therefore both the parties seek to close the case… Please record the settlement and modify the judgment,” Venugopal said.
The counsel for Adani Power also supported the submission of Venugopal and said the private firm would resume supplying electricity to the GUVNL as per the settlement deed once it is recorded by the apex court in its order.
Initially, the bench referred to the legal issues which may come in the way of modifying the judgement while hearing the curative petition.
“Once we have taken up the curative petition, until and unless we interfere with the judgement on the basis of the grounds taken up in the curative petition, how can we modify the judgment,” the CJI said.
Venugopal referred to the extra-ordinary power vested with the top court under Article 142 of the Constitution and said that it empowers the bench to mould the judgement in the interest of justice.
“The top court also has the inherent power under the SC rules…to do the needful,” he said.
The bench then said that the compromise has been entered and the curative plea can be disposed of in terms of the settlement deed.
“We will take the affidavits (of both the parties) on record. We will simply say that the relationship between the parties will be governed by the compromise deed,” the bench suggested. The parties agreed to it.
The bench then proceeded to record that as per the settlement deed entered into between the parties on January 3 it disposed of the curative plea of the Gujarat PSU.
In a significant development on September 17 last year, the bench had decided to hear in an open court the GUVNL’s curative petition which, as per industry estimates, was to pay nearly Rs 10,000 crore compensation to Adani Power.
A three-judge bench in July 2019 had held that the notice of termination of a PPA by the Adani Power to GUVNL in 2009 was legal and valid. It had ordered the Central Electricity Regulatory Commission (CERC) to determine compensatory tariff for the power supplied by Adani Power to the state PSU.
The verdict had said that the court should give effect to the “plain, literal and grammatical” meaning of the clauses used in a contract.
The verdict was assailed by some lawyers and a letter was later written to the CJI that had led to a rare open court hearing on the curative plea of the PSU.
Adani Power (Mundra) Ltd had signed a PPA with GUVNL in 2007 to supply 1,000 MW power from its project located in Korba, Chhattisgarh.
Adani terminated the pact citing lack of coal supply by Gujarat Mineral Development Corporation, claiming that the supply of electricity was conditional to coal supply.
The PPA termination notice was challenged by the GUVNL before the Gujarat Electricity Regulatory Commission which had held the termination as illegal.
The top court had, however, reversed the findings. PTI SJK SA
