Karnataka High Court upholds validity of Regulation 5.8(vii)(a) of the GNA Regulations, 2022, sets aside Single Judge’s directions permitting CTUIL to process Renewable Power Park Developer’s (RPPD) applications without prior government authorisation

In a common judgment dated 28.08.2026 in Writ Appeal (“W.A.”) No. 1961 of 2025 and seven connected appeals, the Division Bench of the Karnataka High Court has upheld the constitutional validity of Regulation 5.8(vii)(a) of the Central Electricity Regulatory Commission (Connectivity and General Network Access to the Inter-State Transmission System) Regulations, 2022 (“GNA Regulations”), rejecting the challenge raised by M/s Rays Power Infra Limited (“RPIL”) that the provision offends Article 14 of the Constitution of India.

By allowing the appeals filed by Central Transmission Utility of India Limited (“CTUIL”), the Division Bench of the Karnataka High Court has set aside the common order dated 09.09.2025 passed by the Learned Single Judge to the extent it directed CTUIL to restore and reconsider RPIL’s connectivity applications and to reserve transmission capacity in RPIL’s favour at the Tumkur-II and Bellary sub-stations, notwithstanding the absence of the government authorisation mandated under Regulation 5.8(vii)(a).

Brief Background

The concept of a Power Park Developer authorised to seek connectivity to the Inter-State Transmission System (“ISTS”) on behalf of multiple generating stations was introduced by the Fifth Amendment to the Central Electricity Regulatory Commission (Grant of Connectivity, Long-term Access and Medium-term Open Access in inter-State Transmission and related matters) Regulations, 2009, notified on 15.05.2015, confined initially to a Solar Power Park Developer authorised by the Central Government. By the Seventh Amendment notified on 09.01.2019, the expression was widened to ‘Renewable Power Park Developer’ (“RPPD”) and the power to grant authorisation was extended to the State Governments as well. The GNA Regulations, which replaced the 2009 Regulations with effect from 07.06.2022, retained the requirement of governmental authorisation, presently contained in Regulation 5.8(vii)(a), as amended in 2023 and 2024.

RPIL, claiming to be an RPPD, proposed to establish renewable energy parks in Karnataka with connectivity to the ISTS at the Tumkur-II and Bellary pooling sub-stations. When the State Government and Karnataka Renewable Energy Development Limited (“KREDL”) did not act on its request for authorisation, RPIL instituted W.P. No. 21533/2024 and thereafter applied to CTUIL for connectivity without furnishing the authorisation. Treating the absence of authorisation as a “major deficiency” under the amended Regulation 3.5 of the GNA Regulations, CTUIL closed the applications by orders dated 30.08.2024, 02.09.2024 and 09.09.2024. RPIL and its SPVs also instituted Writ Petition (“W.P.”) No. 35002/2024 seeking a time-bound direction to the State Government to grant the authorisation, in the course of which interim orders were passed reserving 890 MW at Tumkur-II and 600 MW at Bellary for the petitioners.

By the common order dated 09.09.2025, the Learned Single Judge partly allowed the writ petitions. Relying on Reliance Energy Limited v. Maharashtra State Road Development Corporation Ltd., (2007) 8 SCC 1, the Learned Single Judge held that RPIL had been denied a level playing field since the GNA Regulations prescribed no timeline for grant of authorisation, extended the interim reservation of capacity and consequently set aside CTUIL’s orders dated 30.08.2024, 02.09.2024, 09.09.2024 and directed CERC and CTUIL to reconsider RPIL’s applications and grant in-principle approval, subject to RPIL eventually obtaining the authorisation. The Learned Single Judge, however, did not specifically strike down or read down Regulation 5.8(vii)(a).

Aggrieved by this common order, CTUIL preferred Writ Appeal contending that the Single Judge could not have issued directions inconsistent with a Regulation whose validity had been left undisturbed.

1. RPPD and Renewable Generators are not similarly placed, no violation of Article 14

Examining the challenge on the touchstone of the settled principles governing judicial review of subordinate legislation, as laid down in Indian Express Newspapers (Bombay) Private Limited v. Union of India, (1985) 1 SCC 641, State of A.P. v. McDowell and Company, (1996) 3 SCC 709, and Shayara Bano v. Union of India, AIR 2017 SC 4609, the Appellate Court held that subordinate legislation can be invalidated only where it is ultra vires the parent statute, unconstitutional, in excess of the delegated power, or manifestly arbitrary, and that a regulation cannot be struck down merely because the Court considers it unwise or capable of improvement.

Applying this test, the Division Bench held that the distinction drawn between an RPPD and a renewable energy developer is “neither artificial nor illusory”, since an RPPD develops common infrastructure, acquires land, and provides pooling arrangements to facilitate several generating stations within an integrated park, thereby occupying a distinct position in the regulatory framework. The Division Bench held that the requirement of prior government authorisation ensures that only projects recognised by the Appropriate Government are treated as renewable power parks for the purpose of seeking connectivity on behalf of multiple generating stations, a classification resting on an intelligible differentia bearing a rational nexus with the object of orderly development of the transmission network and avoidance of speculative blocking of transmission capacity. The continuity of requirement since 2015, through successive amendments was also held to demonstrate that it forms part of a considered legislative policy rather than an arbitrary stipulation.

2. Learned Single Judge could not direct CTUIL to act contrary to a Regulation whose validity was left undisturbed

The Division Bench held that once Regulation 5.8(vii)(a) was found to be constitutionally valid, its implementation necessarily followed and CTUIL, being the statutory/nodalimplementing authority under Section 38 of the Electricity Act, 2003, with no independent power to waive, relax or ignore a mandatory regulatory requirement could not have been directed to restore and process RPIL’s applications in the absence of the authorisation. The Division Bench observed that although the Single Judge had “consciously declined to strike down or read down” the Regulation, the consequential directions issued nevertheless had the effect of compelling CTUIL to act contrary to it and that such directions, “though equitable in appearance, have the effect of rendering statutory requirements otiose”.

The Division Bench also rejected the contention that CERC ought to have exercised its powers of relaxation and removal of difficulty under Regulations 41 and 42 of the GNA Regulations in RPIL’s favour, noting that RPIL’s representation seeking relaxation had in fact been considered and rejected by CERC by order dated 11.04.2025, and that such enabling powers, vested in the regulator, cannot be exercised by a Court in substitution of the Regulator.

The judgment reaffirms that the requirement of prior government authorisation for a RPPD under Regulation 5.8(vii)(a) of the GNA Regulations rests on a valid and rational classification distinguishing such developers from ordinary renewable energy generators and that courts exercising judicial review cannot, without disturbing the validity of a subordinate regulation, issue directions that have the practical effect of dispensing with its mandatory requirements, while nevertheless flagging the need for the appropriate government to put in place a transparent and time-bound procedure for grant of such authorisation.

APTEL upholds that Delay in Securing Long-Term Access (LTA) is not a valid Force Majeure and therefore, Scheduled Delivery Date under PPA cannot be unilaterally extended

In a judgment dated 03.07.2026 in Appeal No.183 of 2020, the Appellate Tribunal for Electricity (Appellate Tribunal) has dismissed the appeal filed by Maruti Clean Coal and Power Limited (MCCPL), thereby upholding the Order dated 27.11.2019 passed by the Central Electricity Regulatory Commission (Central Commission). The Appellate Tribunal has ruled in favour of the Rajasthan Discoms — Jaipur Vidyut Vitran Nigam Limited, Ajmer Vidyut Vitran Nigam Limited and Jodhpur Vidyut Vitran Nigam Limited and Rajasthan Urja Vikas Nigam Limited (RUVNL), rejecting MCCPL’s claim that the Scheduled Delivery Date (SDD) of 30.11.2016 fixed under the Power Purchase Agreement (PPA) stood revised to 01.04.2017, and that the first contract year for tariff purposes ought to be reckoned from the later date.

1. Delay of Two Years in seeking Long-Term Access cannot be termed as Force Majeure

MCCPL had attributed its inability to supply the full Aggregate Contracted Capacity of 250 MW by the SDD on the non-operationalization of Long-Term Access (LTA)/Medium-Term Open Access (MTOA), and sought to characterise this as a Force Majeure event under the PPA. The Appellate Tribunal rejected this contention. It noted that after submitting a LTA revision request, MCCPL “just adopted a wait and watch approach” and neither sent any reminder to PGCIL/CTU nor made any other effort to ensure that LTA for the full 250 MW was granted expeditiously, following up only on 13.08.2015, after its plant had already achieved Commercial Operation Date. The fresh LTA application, mandated because the change in target region exceeded 100 MW under the Connectivity Regulations, 2009, was filed over two years after the PPA was signed.

The Appellate Tribunal found no merit in MCCPL’s plea that this delay was attributable to “legal uncertainty and procedural ambiguity” on account of the methodology for calculating relinquishement charges pending before the Central Commission. It held that the fifth proviso to Regulation 12(1) of the Connectivity Regulations, 2009 “clearly provided that a fresh LTA application would be required” for a change exceeding 100 MW or a change of region, and the order on relinquishement charges passed by the Central Commission “only elaborates and explains” what the proviso already provided, without effecting any change in the regulatory position. Since Force Majeure grants relief only where the triggering event “could not have been avoided if the affected party had taken reasonable care or complied with prudent utility practices,” the Appellate Tribunal held that MCCPL “neither took reasonable care nor acted prudently” in pursuing its LTA request.

2. Commencement of supply “Upto” Aggregate Contracted Capacity does not require the entire quantum of electricity flowing

MCCPL’s case was that the SDD stood fulfilled only when the entire 250 MW commenced flowing, and that part supply of 45 MW alone on 30.11.2016 could not amount to commencement of supply under the PPA. The Appellate Tribunal disagreed, construing Article 4.1.1 and Article 4.2.1(b) together. It held that the expression “upto the Aggregated Contracted Capacity” indicates that “the seller may commence supply of power of any quantum, the maximum limit being the aggregated contracted capacity,” and that it was “not mandatory for the power generator i.e. the seller to supply the entire aggregated contracted capacity of power by the Scheduled Delivery Date i.e. 30.11.2016 in order to constitute commencement of supply of power.”

The Apellate Tribunal noted that MCCPL had itself served the advance preliminary notice (26.09.2016) and final written notice (27.10.2016) under Article 4.1.2 for commencement of supply “w.e.f 30.11.2016 i.e scheduled delivery date,” raised monthly invoices at the tariff payable for the first contract year, which were duly paid, and never conveyed to the Discoms that the SDD should be treated as suspended, split into phases, or held in abeyance pending availability of transmission capacity for the balance 205 MW. On this basis, the AppellateTribunal held that the supply of 45 MW from 30.11.2016 itself constituted “commencement of supply” under Article 4.1.1, and that the first Contract Year commenced from that date.

3. No Force Majeure event affected CTU, LTA was, in Fact, Operationalized ahead of Schedule

The Appellate Tribunal also rejected MCCPL’s reliance on Article 9.2.2, which deems a Force Majeure event affecting CTU/STU to be a Force Majeure event affecting the Seller. It observed that the 23rd Meeting of WR Constituents had recorded that the Champa-Kurukshetra HVDC Phase-I and Phase-II lines, and the Jabalpur-Orai line, were expected to be commissioned only in November 2016/March 2018 and April 2018 respectively, yet MCCPL’s LTA was in fact operationalized on 31.03.2017, “almost one year earlier” than the timeline earlier communicated by PGCIL. In these circumstances, the Appellate Tribunal held, “it cannot be said that there was any force majeure event affecting the PGCIL/CTU for providing transmission access to the appellant.”

4. Deliberate delay in Furnishing the Letter of Credit

The Appellate Tribunal found that even after the Champa-Kurukshetra line achieved Commercial Operation on 24.03.2017 and PGCIL/CTU called upon MCCPL on the same date to furnish a Letter of Credit (LC), MCCPL offered “no justification” for the delay in submitting the LC until 31.03.2017, resulting in commencement of the balance 205 MW supply only from 01.04.2017. The Appellate Tribunal held that this appeared to be a deliberate delay with an “ulterior motive,” observing that had supply commenced on any date between 24.03.2017 and 01.04.2017, the first contract year “would have been merely of a few days,” which MCCPL avoided so as to secure the higher first-contract-year tariff of Rs.1.633/kWh (as against Rs.1.558/kWh for the second Contract Year) for a full twelve-month period. The Appellate Tribunal termed such conduct “not acceptable.”

Conclusion

Holding that neither the delay in operationalization of LTA nor the timing of supply of the balance 205 MW was covered by Force Majeure under the PPA, and that commencement of supply of 45 MW on 30.11.2016 itself marked the beginning of the first contract year, the Appellate Tribunal answered both issues framed for its consideration against MCCPL. Finding no error or infirmity in the Impugned Order, the Appellate Tribunal dismissed Appeal No.183 of 2020, reaffirming that Scheduled Delivery Dates fixed under a PPA cannot be unilaterally shifted by a generator based on its own commercial convenience, and that claims of Force Majeure must be tested strictly against the diligence or lack thereof shown by the party invoking it.

Judgment Link

APTEL rules on Section 79(1)(f) of the Electricity Act, 2003: No Automatic Reference to Arbitration in Composite PPA Disputes

In a landmark judgment dated 25.02.2026, the Appellate Tribunal for Electricity (Appellate Tribunal) has ruled in favour of the Punjab State Power Corporation Limited (PSPCL) and the Haryana Discoms (UHBVNL and DHBVNL, through HPPC), setting aside the order passed by the Central Electricity Regulatory Commission (CERC).

The CERC, in its common order dated 19.11.2025, had directed that the disputes between the procurers and Tata Power Company Limited (TPCL) regarding the short-supply of contracted electricity be mandatorily resolved through arbitration. By allowing Appeal Nos. 371 and 400 of 2025 filed by the Haryana Utilities and PSPCL respectively, the Appellate Tribunal has reaffirmed the exclusive adjudicatory jurisdiction of the Regulatory Commissions over matters impacting public interest and tariff. 

1. Impermissibility of Splitting Causes of Action

One of the central issues in the appeals filed by PSPCL and HPPC was the CERC’s erroneous decision to bifurcate their petitions. Both utilities had sought compensation jointly and severally against TPCL and the Western Regional Load Despatch Centre (WRLDC), a statutory body. PSPCL and HPPC’s grievance was that while TPCL illegally ceased generating and supplying their contracted capacities (475 MW for PSPCL and 380 MW for HPPC), WRLDC failed in its statutory duty under Section 28 of the Electricity Act to ensure proportionate scheduling.

The CERC had attempted to refer the dispute against TPCL to arbitration, while leaving the procurers to file separate petitions against WRLDC.

Relying on the Supreme Court’s rulings in Sukanya Holdings and Vidya Drolia, the Appellate Tribunal held that Section 8 of the Arbitration & Conciliation Act, 1996 does not permit the bifurcation of a cause of action or the splitting of a suit between parties to an arbitration agreement (TPCL) and non-parties (WRLDC). Because WRLDC discharges statutory functions making disputes against it non-arbitrable, and since the monetary claims were joint and several against TPCL and WRLDC. 

2. Strict Compliance with Section 8 of the Arbitration & Conciliation Act, 1996

The Appellate Tribunal also ruled on the procedural mandates of the Arbitration & Conciliation Act, 1996 (the “1996 Act”). The Appellate Tribunal held that the provisions of Section 8(1) of the 1996 Act apply strictly to proceedings before the CERC.

Under Section 8(1), a party seeking to invoke arbitration must apply not later than the date of submitting its first statement on the substance of the dispute. In the present batch of cases, TPCL completely failed to make such an application before filing its reply to the petitions instituted by PSPCL and HPPC. Furthermore, TPCL had even filed its own independent petition before the CERC. The Appellate Tribunal held that non-compliance with the mandatory timeline under Section 8(1) vitiated the CERC’s decision to refer the dispute to arbitration.

3. CERC cannot refer a dispute to Arbitration if it lacks Adjudicatory Jurisdiction

The CERC had held that because the disputes were “non-tariff” contractual breaches, it lacked the jurisdiction to adjudicate them, and was therefore “bound” to refer them to arbitration under the second limb of Section 79(1)(f) of the Electricity Act.

The Appellate Tribunal rejected the CERC’s view that it could refer disputes to arbitration merely because it lacked jurisdiction to adjudicate them holding that the power to refer a dispute to arbitration is not independent of the power to adjudicate. Reaffirming the Hon’ble Supreme Court’s jurisprudence in GUVNL v. Essar, APTEL noted that the word “and” in Section 79(1)(f) must be read as “or”. This grants the CERC the discretion to eitheradjudicate a dispute or refer it to arbitration.

The Appellate Tribunal established that the CERC can only refer those disputes to arbitration which it is legally empowered to adjudicate under clauses (a) to (d) of Section 79(1). If the CERC lacks inherent jurisdiction to adjudicate a dispute, it simultaneously lacks the jurisdiction to refer that very dispute to arbitration.

4. Tariff and Regulatory Disputes are Non-Arbitrable

The Appellate Tribunal reiterated that the Electricity Act is a special enactment designed to protect public interest and consumers. Any dispute that concerns the regulatory functions of the Commission, or impacts the tariff of a generating company (either directly or indirectly), must be exclusively adjudicated by the Regulatory Commissions and cannot be relegated to a private Arbitral Tribunal.

By setting aside the CERC’s order dated 19.11.2025, the Appellate Tribunal has restored all petitions to CERC. The CERC is now directed to examine whether the subject matter of the disputes falls within the ambit of Section 79(1)(b) of the Electricity Act. If the disputes impact tariff or touch upon regulatory functions, the CERC is mandated to adjudicate them itself.

The judgment highlights the statutory limits on arbitral reference under Section 79(1)(f) of the Electricity Act, 2003 and clarifies the interface between the Arbitration and Conciliation Act, 1996 and the Electricity Act, 2003, reinforcing the primacy of regulatory adjudication in statutory disputes.

Judgment Link

Supreme Court’s Ruling on Change in Law Claims: Haryana Discoms vs GMR Kamalanga Energy Limited

What’s the impact of the Supreme Court ruling in favour of Haryana Discoms over GMR’s Change in Law claims? Unravel the legal complexities of this significant judgment here.

Central Electricity Regulatory Commission (‘CERC’) allows Time Over Run and Cost Over Run on account of Changes in Law and Force Majeure Events encountered by POWERGRID NM Transmission.

The Central Electricity Regulatory Commission (CERC) has given a green signal to cost and time overruns in POWERGRID NM Transmission’s project due to changes in law and force majeure events. Read the detailed analysis and insights here.