In Brief
Monnet Ispat & Energy Ltd. challenged Rule 3(1)(a)(ii) of the Electricity Rules, 2005, which mandates that captive power plants must consume at least 51% of generated electricity annually for their own use. The company argued the rule was arbitrary and ultra vires and should be struck down or read down when unforeseen circumstances prevented compliance. The Supreme Court upheld the rule as valid, holding that it operationalizes the statutory definition of \"captive generating plant\" (which requires generation primarily for \"his own use\") by providing a quantifiable, reasonable benchmark. The annual calculation reasonably accommodates temporary closures, including force majeure. No excessive delegation occurred; the rule elaborates statutory criteria and promotes the Act's purpose. The appeals were dismissed."
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