In Brief
Monnet Ispat & Energy Ltd., a company operating a 90 MW captive power plant, challenged Rule 3(1)(a)(ii) of the Electricity Rules, 2005, which requires captive generating plants to use at least 51% of their annual electricity output for their own consumption. The company argued the rule was arbitrary and that temporary closures due to unforeseen circumstances should not disqualify the plant's status. The Supreme Court upheld the rule as constitutionally valid, holding that it reasonably implements the statutory requirement that captive plants be set up 'primarily for own use'. The annual calculation basis accommodates temporary closures, and the rule does not constitute impermissible delegation of legislative power. The appeals were dismissed.
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