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.
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