In Brief
Uttar Haryana Bijli Vitran Nigam and Gujarat Urja Vikas Nigam appealed a tribunal decision that awarded carrying costs to Adani Power Ltd. following withdrawal of tax exemptions on its coal-fired power plant in a Special Economic Zone. The Supreme Court dismissed the appeals, holding that Article 13.2 of the Power Purchase Agreements contains an explicit restitutionary principle requiring the power generator be restored to the same economic position as if the change in law (withdrawal of exemptions) had not occurred. Since carrying costs flow directly from this contractual restitutionary clause rather than general equity principles, they are permissible. Tariff adjustments apply from the date the exemptions were withdrawn, with compensation determined by the regulatory authority.
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