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OPG Power Generation Private Limited, Tamilnadu & Others v/s Tamil Nadu Generation & Distribution Corporation Limited., Rep. by its Chairman, Chennai & Others

    W.M.P. Nos. 9387, 9388, 7737, 9103, 9105, 7738, 9532, 9541, 7739, 9530, 9536, 8053, 9593, 9595, 8083 of 2020

    Decided On, 12 June 2020

    At, High Court of Judicature at Madras

    By, THE HONOURABLE MR. JUSTICE R. SUBRAMANIAN

    For the Petitioners: Satish Parasaran, Senior Counsel, R. Parthasarathy, Kumarpal R. Chopra, Rahul Balaji, Advocates. For the Respondents: Arvind Pandian, Additional Advocate General Assisted by M/s. N. Damodaran R. Anilkumar, Advocates.



Judgment Text

(Prayer in W.M.P.No.9387 of 2020 in W.P.No.7737 of 2020: Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to grant an order of interim injunction restraining the respondents herein, their men, agents, servants, subordinates or any other person or persons claiming through them or authorized by them to continue to provide open access to the petitioner under Medium Term Open Access Agreements dated 27.09.2019 and Energy Wheeling Agreements dated 10.05.2019 pending disposal of the instant writ petition.Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to grant an order of interim stay of all further proceedings pursuant to the impugned demand letter dated 06.05.2020 bearing reference Lr. No. SE/CEDC/N/DFC/AO/AAO/HT/FOPG/230KV/D.1722/20 being the demand for Open Access charges for the period of 1st April 2020 to 30th April 2020 in respect to the petitioner's Medium Term Open Access Agreement dated 27.09.2019 for 234.648 MW of power pending disposal of the writ petition.Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to grant an order of interim injunction restraining the respondents herein, their men, agents, servants, subordinates or any other person or persons claiming through them or authorized by them to continue to provide open access to the petitioner under Medium Term Open Access Agreements dated 27.09.2019 and Energy Wheeling Agreements dated 10.05.2019 pending disposal of the instant writ petition.Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to grant an order of interim stay of all further proceedings pursuant to the impugned demand letter dated 07.05.2020 bearing reference Lr. No. SE/CEDC/N/AAO/HT/FOPG Unit 1/F.CPP/D.1725/20 being the demand for Open Access charges for the period of 1st April 2020 to 30th April 2020 in respect to the petitioner's Medium Term Open Access Agreement dated 27.09.2019 for 53.366 MW and proceedings pursuant thereto pending disposal of the writ petition.Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to issue an interim order of stay of the operation of impugned order vide Invoice No.193, dated 17.04.2020 pending disposal of this writ petition.Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to issue an order of injunction forbearing the respondents from raising any demand for the open access charges pertaining to the lock down period from the month of April 2020 until 8th May, 2020 pending disposal of this writ petition.Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to pass an order of stay of the operation of impugned order vide Letter No. SE/CEDC/N/AAO/HT/F.Tulsyan/F.CPP/D 1680 / 20 dated 4.4.2020 in so far as it pertains the period from 25.03.2020-31.03.2020 and consequential impugned demand notice vide Lr No.SE/CEDC/N/AAO HT/F.Tulsyan F.CPP/D 1723/20 dated 06.05.2020, pending disposal of this writ petition.Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to pass an order of injunction restraining the respondents from raising any demand for open access charges pertaining to the lock down period from 9.5.2020 to 31.5.2020 pending disposal of this writ petition.Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to issue an order of injunction restraining the respondents from raising any demand for the open access charges pertaining to the lock down period for the month of April 2020 pending disposal of this writ petition.Writ Miscellaneous Petition is filed under Article 226 of Constitution of India, praying to issue an interim order of stay of the operation of impugned order vide Letter No. Lr.No.SE/CEDC/N/DFC/AO/AAO/HT/F.Kamachi OA/D.1721/20, dated: 05/05/2020 pending disposal of this writ petition.)Common Order:1. Heard Mr. Satish Parasaran, learned Senior Counsel appearing for Mr.Rahul Balaji for the petitioners in WP 7737, 7738 of 2020, Mr Kumarpal R Chopra, learned counsel for the petitioners in WP 7739, 8053 and 8083 of 2020 and Mr. Arvind Pandian, learned Additional Advocate Genaral for M/s.N.Damodharan and V.Anilkumar for the respondents.2. The petitioners all the above writ petitions are engaged in power generation apart from other activities. In the course of their business the petitioners had entered into various agreements with the first respondent for supply of power and also for transmission of the power generated by them to various other consumers. These agreements are called Energy Wheeling Agreements and Medium Term Open Access Agreements. While the Energy Wheeling Agreements deal with supply of power by the petitioners to their consumers the Medium Term Open Access Agreements deal with the usage of the power transmission lines belonging to the respondents for the purposes of transmission of the power generated by the petitioners. As per the agreements the petitioners are liable to pay various charges such as transmission and wheeling charges, scheduling and system operation charges, grid support charges, transmission loss etc. All these charges are fixed irrespective of utilisation of the transmission and distribution infrastructure based on the normal levels of utilisation during normal operation times. The necessity for the petitioners to approach this court arose due to the lockdown imposed in view of prevalence of the pandemic namely COVID19. According to the petitioners they had to shut down their units in view of the lockdown that was imposed from 23rd of March 2020 and they could reopen or restart only from 1st May 2020. Since the respondents demanded the fixed charges under the respective agreements and refused to take into account the fact of nonuser of the facilities or the infrastructure by the petitioners, the petitioners have come up with the above writ petitions seeking the reliefs stated supra.3. Pending the above writ petitions the petitioners also seek interim orders of stay of further proceedings pursuant to the various demands made by the respondents as well as orders of interim injunction restraining the respondents from refusing to provide open access under the respective Medium Term Open Access Agreements and Energy Wheeling Agreements. The petitioners would contend that Clause 13 of the Medium Term Open Access Agreements would apply to the present situation and hence the respondents cannot claim the charges as fixed under the agreements since the petitioners could not carry out the terms of the agreement due to force majeure namely the lockdown imposed by the Government of India and the Government of Tamil Nadu. It would be pertinent to point out at this juncture that there is no dispute regarding the fact that the petitioners have commenced generation and are also utilising the transmission facilities since the lockdown has been partially lifted. It is also not in dispute that the petitioners are paying the necessary charges for the period during which they had generated power and transmitted it using the infrastructure provided by the respondents. The dispute is essentially confined to the period during which there was a lockdown preventing the petitioners from generating and transmitting power.4. The petitioners would further contend that there has been no electricity generation and transmission during the last week of March 2020 and for the whole month of April 2020. Therefore according to the petitioners the respondents are not justified in demanding the charges as the charges are meant for use of the facilities or infrastructure provided by the respondents. Reference is also made to an order of the Tamil Nadu Electricity Regulatory Commission dated 04/05/2020 wherein the said Commission had extended certain concessions to high tension energy consumers in the State of Tamil Nadu.5. The interim prayers are stoutly opposed by the respondents contending that the charges payable are not in the nature of charges for actual user but they are fixed charges payable for maintenance of the facilities irrespective of the user. It is also contended that the present situation namely the lockdown imposed by the respective governments cannot be called force majeure in order to bring it within the ambit of Clause 13 of the Medium Term Open Access Agreements. It is the further contention of the respondents that the order of the Tamil Nadu Electricity Regulatory Commission dated 04/05/2020 has been stayed by the Appellate Tribunal for Electricity on 18/05/2020 in Appeal No:102 of 2020. It is also pointed out that the Madurai bench of this court had refused to grant any interim orders in the writ petitions filed by high tension consumers invoking Rule 6(b) of the Electricity Supply Code which provides for reduction in the percentage of demand charges in certain circumstances including force majeure. Heavy reliance is also placed by the respondents on the order of the Appellate Tribunal for Electricity dated 18/5/2020 and the order of the Madurai bench dated 26/5/2020 in support of their contention.6. Mr Satish Parasaran, learned senior counsel would vehemently contend that Clause 13 of the Medium Term Open Access Agreements read with Regulation 46 of the Grid Connectivity and Intra State Open Access Regulations 2014 would entail the petitioners to claim waiver of the charges payable by them when they were effectively prevented from either generating or transmitting power using the infrastructure provided by the respondents. He would also further contend that neither the orders of the Appellate Tribunal for Electricity nor the Madurai bench of this court would apply to them as they are not consumers. Reliance is also placed by the learned Senior Counsel on the judgement of the Honourable Supreme Court in Northern India Iron and Steel Co -Vs- State of Haryana and another reported in (1976) 2 SCC 877 wherein a three-judge bench of the Honourable Supreme Court has held that there can be a proportionate reduction of the demand charges when the board was not able to supply the full requirement of the consumer under the contract. Mr Satish Parasaran would point out that this decision of the Honourable Supreme Court clearly derails the contention of the learned Additional Advocate General to the effect that these charges which are fixed will have to be paid irrespective of the user of the facilities. Both the counsel have taken me through the orders of the Appellate Tribunal for Electricity and the orders of the Madurai bench. I have considered the rival submissions.7. At the outset it should be pointed out that the entire nation is facing an unprecedented situation because of the viral spread of the pandemic, Covid 19. The fact that the petitioners could not operate their industries between 23rd of March 2020 and 30th of April 2020 is not in dispute. Similarly the fact that the petitioners did not use the facilities during the said period is also not in dispute. The question whether the present situation would amount of force majeure as defined in Regulation 46 of the Intrastate Open Access Regulations 2014 will have to be decided in the main writ petition. I am however of the prima facie view that Clause 13 of the Medium Term Open Access Agreements read with Regulation 46 of the Intra State Open Access Regulations makes it clear that the parties had in fact contemplated some kind of a situation where either of them would not be in a position to comply with the terms of the agreement. The fact that the petitioners could not utilise the infrastructure during the relevant period is not definitely due to any default on their part. It is also not the contention of the respondents that the petitioners had in fact functioned in violation of the lockdown and had used the infrastructure.8. Clause 12 of the energy Wheeling agreement reads as follows:“Both parties shall ensure compliance of the terms and conditions of this agreement. However no party shall be liable for any claim for any loss or damage whatsoever arising out of failure to carry out the terms of this agreement to the extent that such failure is due to force majeure. But any party claiming benefit of this class shall satisfy the other party of the existence of such an event (s);”Clause 13 of the Medium Term Open Access Agreements reads as follows:“Both parties shall ensure compliance of the terms and conditions of this agreement. However no party shall be liable for any claim for any loss or damage whatsoever arising out of failure to carry out the terms of this agreement to the extent that such failure is due to force majeure. But any party claiming benefit of this class shall satisfy the other party of the existence of such an event (s);”Regulation 46 of the intrastate open access regulations reads as follows:“1. Any event which is beyond the control of the parties to the open access agreement which they could not foresee or with a reasonable amount of diligence could not have foreseen or which could not be prevented and which substantially affected the performance by either party such as, but not limited to, the following shall be classified as force majeure events for the purposes of these regulations.-(i) Natural disasters (earthquakes, Hurricane, floods);(ii)Wars, riots or civil commotion is and other upheavals; And(iii) grid/distribution system’s failure not attributable to parties hereto.2. Both the parties to the open access agreement shall ensure compliance of the terms and conditions of the agreement. However, no party shall be liable for any claim for any loss or damage whatsoever arising out of failure to carry out the terms of the open access agreement to the extent that such failure is due to force majeure. But any party claiming the benefit of force majeure shall satisfy the other party to the existence of such event (s)”.9. A reading of the above clauses in the agreements and the Regulations would show that the parties had contemplated a situation where either of them Could be termed as a defaulter due to reasons beyond their control. Therefore I am unable to agree with the contention of Mr Arvind Pandian, learned Senior Counsel appearing for the respondents that the charges payable under these agreements are fixed charges and they are liable to be paid irrespective of the non-user of the infrastructure by the petitioners. He would also strongly rely upon the interim orders passed by the Appellate Tribunal for Electricity,wherein, according to him there is a explicit direction for payment of the amounts demanded. The interim orders of the Appellate Tribunal for Electricity had been passed in appeal against a suo-moto proceeding initiated by the TNERC taking into account a claim made by the high tension consumers. A reading of the orders of the Appellate Tribunal for Electricity make it clear that the Appellate Tribunal for Electricity was more concerned about the jurisdiction of the State Commission and the procedure adopted by the state commission in granting certain reliefs to the high tension consumers. As rightly pointed out by Mr Satish Parasaran learned Senior Counsel appearing for the petitioners they were not parties in the proceedings either before the State Commission or the Appellate Tribunal and as such the interim orders will not be binding on them. Though Mr. Arvind Pandian would concede that this court sitting under Article 226 of the Constitution of India is not bound by the orders of the Appellate Tribunal for Electricity, he would however point out that the Appellate Tribunal for Electricity being a statutory authority entitled to decide certain disputes under the relevant statute, its orders cannot be lightly brushed aside. I am conscious of the fact that the Appllate Tribunal for Electricity has stayed the orders of the state commission granting certain relief to the high tension consumers but at the same time I am unable to accept the contention of Mr Arvind Pandian that the fact that the Appellate Tribunal for Electricity had stayed the orders of the state commission would operate as an embargo for me to consider the claim of the petitioners who are not parties either before the Appellate Tribunal or before the State Commission. The proceedings before the State Commission and the Appellate Tribunal were concerned with the claims of high tension consumers and not with the claims of generators namely the petitioners herein. Further a perusal of the interim orders of the Appellate Tribunal for Electricity would show that the tribunal was more concerned about the jurisdiction of the state commission and the procedure adopted by the state commission. As rightly pointed out by Mr Satish Parasaran learned Senior Counsel appearing for the petitioners if the Appellate Tribunal reaches a conclusion tha

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t the state commission has no jurisdiction to grant the relief that it had granted to high tension consumers within the scope of section 86 of the Electricity Act, it goes without saying that the Appellate Tribunal for Electricity would also suffer from the same vice of want of jurisdiction. Then again the core issue as to whether prevailing situation is a force majeure or not would be left undecided. As already pointed out I am of the prima facie opinion that the present situation would qualify to be a force majeure within Regulation 46 extracted supra.10. In the light of the admitted facts it is clear that the petitioners have not used the infrastructure provided for the period between 25th of March 2020 and 30th of April 2020. The question whether these charges are payable or not and the fact that the petitioners were prevented from using the infrastructure by force majeure will have to be decided after a complete examination of the pleadings of the partiesand the lawrelating to Force majeure. In the interregnum, I find that the petitioners should at least be favoured with the limited relief as they, like other persons, also have suffered monetarily due to the unforeseen lockdown imposed because of the pandemic Covid 19. I am therefore of the considered view that the petitioners are entitled to an order of injunction restraining the respondents from demanding and collecting the charges payable under the Energy Wheeling Agreements and the Medium Term Open Access Agreements for the period from 25th of March 2020 and 30th of April 2020 only pending disposal of the above writ petitions. There will also be an order of interim stay of the demand notices confined to the period stated supra. Since the pleadings are complete registry is directed to post the above writ petitions for final hearing soon after the commencement of physical hearings in courts.
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