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ARTICLE · 03 NOVEMBER 2023

Supreme Court Penalizes Punjab Distribution Licensee For Evading Payments To Generator And Reagitating Settled Issues

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The Supreme Court in its judgment dated October 9, 2023 in Nabha Power Ltd. vs. Punjab State Power Corporation Ltd., deprecated Punjab State Power Corporation Ltd. ("PSPCL")...

IndiaLitigation, Mediation & Arbitration
Poonam Verma Sengupta
Poonam Verma Sengupta
Subham Bhut
Subham Bhut
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The Supreme Court in its judgment dated October 9, 2023 in Nabha Power Ltd. vs. Punjab State Power Corporation Ltd.1, deprecated Punjab State Power Corporation Ltd. ("PSPCL") for its attempts to reagitate settled issues through multiple judicial proceedings and wriggle out of its payment obligations towards the generator. As a result, Supreme Court imposed exemplary costs of INR 65,00,000 (Indian Rupees sixty five lakh)2 on PSPCL.

Background of the dispute and the issues decided by Supreme Court

  1. Dispute arose between Nabha Power Ltd. ("Nabha") and PSPCL due to unilateral deductions made by PSPCL in tariff payments on several attributes of coal pricing including coal washery charges, road transportation cost, third party coal testing charges, consideration of midpoint Gross Calorific Value ("GCV") of coal to calculate energy charges etc.

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