APTEL Orders Interest on Refund in Solar Delay Case, Limits Scope of Review Petition

The Appellate Tribunal for Electricity (APTEL) has delivered an important ruling in a review petition filed by M/s Solaire Surya Urja Private Limited in connection with its solar power projects in Rajasthan. The case involved a dispute with NTPC Limited over liquidated damages imposed due to delays in project completion.

The company, acting as a Special Purpose Vehicle, had been awarded two solar projects of 70 MW each. These projects were originally scheduled to be commissioned by June 1, 2017. However, the timelines could not be met because the State Transmission Utility, Rajasthan Rajya Vidyut Prasaran Nigam Limited (RRVPNL), failed to provide the required transmission infrastructure for power evacuation. Due to this delay, NTPC encashed the company’s performance bank guarantees on September 28, 2018, recovering around INR 7.6 crore as liquidated damages.

Earlier, in its judgment dated February 10, 2025, the Tribunal had ruled in favor of the developer. It clearly stated that a power developer cannot be held responsible for delays caused by external factors such as the absence of transmission facilities. The Tribunal had also ordered NTPC to refund the liquidated damages collected from the company.

Following this, the developer filed a review petition, arguing that two important aspects were not considered in the earlier judgment. These included the payment of carrying costs, which refers to interest on the withheld amount, and compensation for generation losses amounting to nearly INR 16 crore.

The Tribunal examined both claims carefully. On the issue of generation loss, it refused to grant relief. The Bench noted that this argument was not raised during the original appeal proceedings. It emphasized that a review petition cannot be used to introduce new claims that were not presented earlier. The Tribunal reiterated that a review is limited in scope and cannot act as a fresh appeal to reargue the case.

However, the Tribunal accepted the developer’s claim regarding carrying costs. It was observed that NTPC had retained the developer’s money for several years and had therefore benefited unfairly. Referring to legal principles and past rulings of the Supreme Court, the Tribunal stated that when a party is deprived of its funds, it is entitled to interest as a matter of fairness and restitution.

The Bench also acknowledged that the omission of interest in its earlier order was an error that needed correction. As a result, it modified its previous judgment and directed NTPC to refund the INR 7.6 crore along with interest.

The interest will be calculated based on the State Bank of India’s Prime Lending Rate and will apply from the date of encashment in September 2018 until the final payment is made.

This ruling highlights that while procedural lapses may limit certain claims, the fundamental principle of financial fairness and restitution remains protected under the law.