Supreme Court Decides “what It Means for Future Agreements” : Lead Partner Liable for Full Payment in Power Project Dispute
The Supreme Court upheld the doctrine of privity of contract, ruling that Brua Hydrowatt Pvt. Ltd. (BHP) was solely liable for transmission bay costs under its agreement with HP Power Transmission Corporation (HPPTC), despite internal arrangements with third parties. The Court held that non-signatories (Respondent Nos. 2 & 3) could not be bound by the contract, reversing APTEL’s order. The judgment reaffirmed that contractual obligations apply only to parties to the agreement, unless explicitly extended.
Facts Of The Case:
The dispute arose between HP Power Transmission Corporation Ltd. (HPPTC) and M/s Brua Hydrowatt Pvt. Ltd. (BHP) over the liability for construction and maintenance costs of a 66kV power transmission bay at Urni, Himachal Pradesh. BHP, along with two other power com...