The Supreme Court held that the Central Electricity Regulatory Commission (CERC) can exercise regulatory powers under Section 79 of the Electricity Act, 2003 to impose compensation for delays, even without specific regulations under Section 178. It clarified that CERC’s orders under Section 79 are appealable to APTEL under Section 111, not through writ petitions unless jurisdictional or constitutional issues arise. The Court emphasized that regulatory gaps can be addressed via Section 79, distinguishing it from legislative rule-making under Section 178. The High Court erred in entertaining the writ petition when an alternative remedy existed.
Facts Of The Case:
The case involved a dispute between Power Grid Corporation of India Ltd. (PGCIL) and Madhya Pradesh Power Transmission Company Ltd. (MPPTCL) over delays in commissioning transmission assets under the Western Region System Strengthening Schemes (WRSS-XIV & WRSS-XVI). PGCIL, responsible for inter-state transmission, completed its work, but MPPTCL delayed constructing downstream intra-state transmission lines, preventing full operationalization. PGCIL approached the Central Electricity Regulatory Commission (CERC) seeking approval for the Commercial Operation Date (COD) under the 2014 Tariff Regulations and demanded compensation for the delay.
The CERC approved the revised COD but refused to condone the delay, holding MPPTCL liable for transmission charges during the delay period. MPPTCL challenged this before the Madhya Pradesh High Court, arguing that CERC lacked jurisdiction to impose compensation absent specific regulations. The High Court admitted the petition, bypassing the statutory remedy of appeal before the APTEL (Appellate Tribunal for Electricity).
The Supreme Court overturned the High Court’s decision, ruling that CERC’s power under Section 79 includes regulatory functions to address such gaps, and writ jurisdiction was improper when an alternative remedy existed under Section 111. The case clarified the distinction between CERC’s adjudicatory (Section 79) and regulatory (Section 178) powers, reinforcing that regulatory orders are appealable, not challengeable via writ petitions unless jurisdictional or constitutional issues arise.
Procedural History:
The case originated when Power Grid Corporation of India Ltd. (PGCIL) filed petitions (No. 311/TT/2018 & 266/TT/2018) before the Central Electricity Regulatory Commission (CERC), seeking approval for the Commercial Operation Date (COD) of transmission assets and compensation for delays caused by Madhya Pradesh Power Transmission Company Ltd. (MPPTCL). The CERC, in its orders dated 21.01.2020 and 27.01.2020, approved the revised COD but held MPPTCL liable for transmission charges during the delay period.
Aggrieved, MPPTCL filed writ petitions (No. 10845/2020 & 9136/2020) before the Madhya Pradesh High Court, challenging CERC’s jurisdiction to impose compensation. The High Court admitted the petitions in February 2021, bypassing the statutory remedy of appeal before the APTEL (Appellate Tribunal for Electricity) under Section 111 of the Electricity Act, 2003.
PGCIL appealed to the Supreme Court (Civil Appeal Nos. 6847-6848 of 2025), arguing that the High Court erred in entertaining the writ petitions when an alternative remedy existed. The Supreme Court, in its judgment dated 15.05.2025, set aside the High Court’s order, ruling that CERC’s decision was regulatory under Section 79 and should have been appealed before APTEL, not challenged via writ jurisdiction. The case reaffirmed the hierarchy of remedies under the Electricity Act.
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Court Observation:
In its judgment, the Supreme Court made several key observations on the regulatory framework under the Electricity Act, 2003. It held that the Central Electricity Regulatory Commission (CERC) exercises dual functions—regulatory (under Section 79) and rule-making (under Section 178)—and clarified that Section 79 empowers CERC to issue case-specific orders, even in the absence of specific regulations. The Court emphasized that CERC’s determination of tariff and compensation for delays falls under its regulatory jurisdiction, not merely adjudicatory functions.
The Bench observed that the High Court wrongly entertained the writ petition when an alternative statutory remedy (appeal to APTEL under Section 111) was available. It reiterated that writ jurisdiction under Article 226 should not bypass statutory appeals, except in cases of jurisdictional error, violation of natural justice, or constitutional challenges (Whirlpool Corp. v. Registrar of Trademarks). The Court also noted that regulatory gaps can be filled by CERC under Section 79, and such orders remain subject to APTEL’s appellate scrutiny, not direct High Court intervention.
Additionally, the judgment highlighted that imposing transmission charges on the defaulting party (MPPTCL) was a valid regulatory measure to prevent consumers from bearing undue costs (Power Grid Corp. v. Punjab State Power Corp.). The Court dismissed MPPTCL’s argument that CERC “rewrote contracts,” holding that regulatory orders under Section 79 operate independently of contractual terms. The ruling reinforced CERC’s authority to ensure efficient power transmission while safeguarding consumer interests
Final Decision & Judgement:
The Supreme Court allowed the appeals filed by Power Grid Corporation of India Ltd. (PGCIL) and set aside the Madhya Pradesh High Court’s order that had admitted MPPTCL’s writ petitions. The apex court held that the High Court erred in entertaining the writ petitions when an alternative statutory remedy of appeal before APTEL under Section 111 of the Electricity Act, 2003 was available. The Court reinstated CERC’s orders dated 21.01.2020 and 27.01.2020, which had approved the revised Commercial Operation Date (COD) and permitted PGCIL to claim compensation from MPPTCL for the delay period.
In its final judgment, the Supreme Court dismissed both writ petitions filed by MPPTCL and upheld CERC’s regulatory authority under Section 79 to impose transmission charges on the defaulting party. The Court clarified that such regulatory decisions must first be challenged before APTEL, and writ jurisdiction should only be invoked in exceptional circumstances. However, the judgment left open the question of MPPTCL’s actual liability for the compensation, stating that this could be properly examined by APTEL if MPPTCL chose to file an appeal. The ruling reinforced the statutory hierarchy of remedies under the Electricity Act while affirming CERC’s power to address regulatory gaps in power transmission disputes.
Case Details:
Case Title:Power Grid Corporation of India Limited vs. Madhya Pradesh Power Transmission Company Limited & Ors. Citation:2025 INSC 697 Appeal Number:Civil Appeal Nos. 6847-6848 of 2025 Date of Judgment:15th May 2025 Bench:Justice J.B. Pardiwala & Justice R. Mahadevan
Download The Judgement Here