In Brief
The Supreme Court held that Sasan Power's Unit 3 did not validly achieve Commercial Operation Date (COD) on 31 March 2013 as claimed. The Independent Engineer's certificate purporting to certify COD was defective: it showed tested capacity of only 101.38 MW when the PPA required 95% of 620 MW (587 MW). The Court rejected the Appellate Tribunal's finding of a contractual waiver, holding that waiver is an intentional relinquishment of a known right requiring crystal clarity. The procurers' emails accepting de-rated capacity represented a desperate attempt to obtain cheap power, not an unequivocal waiver. Critically, the Court held that any waiver affecting electricity tariffs must account for public interest and consumer welfare, governed by the Electricity Act, 2003, sections 61-63. COD was validly achieved only on 16 August 2013, limiting the benefit of reduced tariffs to one year.
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