Supreme Court Enforces Contractual Free Power Duties Over Statutory Limit, Giving Primacy to Regulator
In State of Himachal Pradesh Vs. JSW Hydro Energy Ltd., the Supreme Court held that a contractual commitment of supplying 18% free power to the State is not affected by the CERC’s 13% tariff ceiling. The Court made it clear that the cap is valid only for tariff calculations and does not prevail over freely negotiated terms. It underlined regulatory primacy, sole jurisdiction of CERC/APTEL, and declined High Court interference. The ruling protects contractual freedom and regulatory discipline in the electricity industry.