In Brief
JSW Hydro Energy Ltd. operated a 1045 MW hydroelectric project under a 1999 Implementation Agreement with Himachal Pradesh requiring 18% free power supply after 12 years from commissioning. When CERC Regulations capped free power at 13% for tariff calculation, JSW sought to limit its obligation to 13%, claiming regulations overrode the contract. The High Court agreed. The Supreme Court reversed, holding that the 13% cap applies only to tariff calculations, not contractual obligations. Since the regulation does not prohibit supply beyond 13%, JSW must honor the contract. The Court also ruled the High Court lacked jurisdiction, as interpretation of regulatory provisions falls exclusively to CERC and the statutory appellate tribunal (APTEL).
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