Maharashtra State Electricity Distribution Company Limited vs Maharashtra Electricity Regulatory Commission & Anr on 19 August 2026

O R D E R

PER HON’BLE MR. VIRENDER BHAT, JUDICIAL MEMBER

1. In this order we will be considering the request of the appellant seeking withdrawal of this appeal with liberty to file a review petition before the Maharashtra Electricity Regulatory Commission (hereinafter referred to as “the Commission”) and with further liberty to approach this Tribunal again subject to the outcome of the review proceedings.

2. The appellant Maharashtra State Electricity Distribution Company Limited (in short “MSEDCL”) has filed the instant appeal against the common

order dated 24.12.2025 passed by the Commission in case number 233/2024 (filed by the appellant) and case number 218/2025 (filed by 2nd respondent JSW Energy Limited). The appellant had in case number 233/2024 challenged certain invoices raised by the 2nd respondent for the period 01.11.2022 to 30.06.2025 in terms of the Power Purchase Agreement (PPA) dated 23.02.2010 executed between the parties, whereas the 2nd respondent had in case number 218/2025 sought enforcement of the terms of the said PPA dated 23.02.2010.

3. Vide the impugned order, the Commission dismissed the petition filed by the appellant and allowed the petition filed by the 2nd respondent thereby directing the appellant to pay approximately Rs.568/- crores to 2nd respondent towards differential energy charges along with Rs.31.17 crores towards fixed charges as well as the late payment surcharge.

4. We may note that the Ministry of Power, Government of India issued directions under Section 11 of the Electricity Act, 2003 on 05.05.2022 directing all the imported coal based generating stations including the Ratnagiri unit of 2nd respondent to operate at full installed capacity. These directions remain in force from 05.05.2022 to 31.12.2022 and from 16.03.2023 to 30.06.2025. The thermal power plant of 2nd respondent located at Ratnagiri was specifically named and included in these directions

issued by the Ministry of Power from time to time. In the impugned order dated 24.12.2025, the Commission held that these directions issued by the Ministry of Power are not applicable to the Unit-1 of 2nd respondent as it is an intrastate generating station falling under the jurisdiction of Government of Maharashtra for the reason that "appropriate government" for an intrastate station is the State Government and not the Central Government. Based on such finding and observing that since Section 11 Benchmark ECR later on became lower than the PPA tariff, the Commission held 2nd respondent eligible for differential energy charges and accordingly passed directions as noted hereinabove.

5. Along with the appeal, the appellant has filed application bearing IA No.17/2026 seeking interim relief in the nature of stay of the operation of the common order dated 24.12.2025 passed by the Commission. This application was heard by us on 18.03.2026. Upon hearing the learner senior counsel for the appellant on that date, we did not feel inclined to pass any interim order as sought by the appellant, and accordingly, dismissed the application. The said order dated 18.03.2026 was assailed by the appellant before the Hon'ble Supreme Court by way of Civil Appeal No.4682/2026 which was disposed of vide order dated 30.04.2026 with the directions to this Tribunal to rehear the interim application of the appellant and dispose of the same vide a reasoned order in accordance with law.

6. Accordingly, we took up the interim application bearing IA No.17/2026 again for hearing on 18.05.2026.

7. On the subsequent date i.e. 20.05.2026, we heard the learned senior counsel for the appellant, Mr. Mukul Rohatgi, learned Solicitor General, Mr. Tushar Mehta, for the 1st respondent i.e. the Commission and learned senior counsel, Dr. A.M. Singhvi, appearing for 2nd respondent. Learned Solicitor General made a very unusual and unconventional submission that the Commission is willing to reconsider the impugned order upon his advice that the impugned order may not stand judicial scrutiny in this appeal, and therefore, urged us to set aside the impugned order and to remand the case back to the Commission for fresh consideration. However, the learned senior counsel for the 2nd respondent objected to these submissions of the learned solicitor general saying that the 2nd respondent was successful before the Commission and therefore, its rights would be seriously prejudiced in case the impugned order is set aside and remanded to the Commission for a fresh consideration without a proper hearing.

8. Accordingly, we heard the learned senior counsels appearing on behalf of the appellant and 2nd respondent as well as the learned Solicitor General appearing on behalf of the 1st respondent Commission on 15.07.2006 and 27.07.2026 in detail on this aspect.

9. We may note that on 27.07.2026 Mr. Mukul Rohatgi, learned senior counsel appearing for the appellant submitted that the appellant wishes to withdraw the appeal and hence, the same may be dismissed as withdrawn with liberty to the appellant to approach the Commission with a petition for review of the impugned order. This submission on behalf of the appellant was vehemently objected to by Dr. Abhishek Manu Singhvi and Mr. Sanjay Sen, learned senior counsels appearing on behalf of the 2nd respondent. Mr. Tushar Mehta, learned solicitor general reiterated that the impugned order of the Commission needs reconsideration by the Commission and the case may either be remanded back to the Commission for fresh consideration or the appellant may be permitted to withdraw the appeal with liberty, as sought by the appellant.

10. In so far as the prayer on behalf of the appellant seeking permission to withdraw the appeal is concerned, there cannot be any opposition to the same as it is for the appellant to decide whether or not to pursue the appeal before this Tribunal. The only issue which arises for our consideration is whether or not to grant liberty to the appellant for approaching the Commission with a petition for review of the impugned order dated 24.12.2025.

11. Learned senior counsel for the appellant would argue that the impugned order of the Commission is without jurisdiction in so far as the Commission has exercised power akin to judicial review which are unavailable to it under the Electricity Act, 2003 by holding that the direction under Section 11 of the Electricity Act issued by Ministry of Power are inapplicable to intrastate unit of 2nd respondent, and therefore, appellant ought to be granted liberty to invoke the review jurisdiction of the Commission so that the error apparent on the face of record in the impugned order dated 24.12.2025 is rectified. He submitted that withdrawal of appeal with liberty to institute review proceedings before the Commission is a recognized practice before this Tribunal and the on this aspect referred to the order dated 31.10.2023 passed in appeal no.518/2023 (KSEB v. KERC & Ors. and order dated 19.02.2018 passed in appeal no.147/2017 PGCIL v. CERC & Ors. He urged us to allow the prayer of the appellant for withdrawal of the instant appeal with liberty to approach the Commission by way of the review petition and with further liberty to approach this Tribunal again subject to final outcome of the proposed review proceedings.

12. On behalf of 2nd respondent, it was submitted by the learned senior counsels Dr. Singhvi and Mr. Sen that this is an unprecedented case of an adjudicator appearing through a law officer saying that its own order is

wrong, which is unheard of. It is submitted that an adjudicator taking sides with a litigant before itself makes mockery of the objectivity and independence between the stakeholders and the regulators. According to the learned senior counsels, this is an attempt to de-facto have the appeal allowed without adjudication while derailing the proceedings on remand before this Tribunal. On this aspect, reference is made to Airports Economic Regulatory Authority of India v. Delhi International Airport Ltd, 2024(15) SCC

345.

13. It is further argued that an adjudicator like Electricity Regulatory Commission cannot take a stand contrary to its judgment. Reliance, in this regard, is placed on Opto Circuit India Ltd. v. Axis Bank, 2021 (6) SCC 707. It is argued that since in the instant case, substantive and vested rights have come into existence in favour of 2nd respondent by way of the impugned order of the Commission, the appellant has no right to withdraw the appeal with liberty to file a review petition. The learned counsels pointed out that the impugned order of the Commission has even been partially complied with by the appellant and permission to withdraw the appeal with liberty, as sought, at this juncture will destroy the substantive and vested right of the 2nd respondent. It is also submitted that granting such liberty at this stage, when the appellant seriously prosecuted the appeal as well as the interim

application before this Tribunal as well as before Hon'ble Supreme Court, would be contrary to the provisions of Section 114 and Order 47 Rule 1 of Civil Procedure Code, and if permitted, such course would encourage forum shopping.

Our Analysis:

14. While the statutory appellate tribunals like this Tribunal are not strictly bound by the technicalities of the Code of Civil Procedure, however, by virtue of Section 120 of the Electricity Act, 2003, this Tribunal is required to take guidance from the provisions of the Code of Civil Procedure and for various provisions it is vested with same powers as are vested in a Civil Court under the Code of Civil Procedure. Normally, this Tribunal has been applying the underlying principles of justice, equity and fair play as envisaged under the Code of Civil Procedure.

15. Order 41 of the Code of Civil Procedure which relates to the appeals from original decrees and provides the procedure to be followed by an appellate court in dealing with such appeals, does not have any provision for withdrawal of the appeals, with or without liberty, as sought by the appellant. Therefore, we have to fall back on Order 23 of the Code of Civil Procedure

which relates to withdrawal of suits or abandonment of part of a claim by the plaintiff. We find it apposite to extract the said legal provision hereunder:

“1. Withdrawal of suit or abandonment of part of claim.—

(1) At any time after the institution of a suit, the plaintiff may as against all or any of the defendants abandon his suit or abandon a part of his claim: Provided that where the plaintiff is a minor or other person to whom the provisions contained in rules 1 to 14 of Order XXXII extend, neither the suit nor any part of the claim shall be abandoned without the leave of the Court. ………….

(3) Where the Court is satisfied,—

(a) that a suit must fail by reason of some formal defect, or (b) that there are sufficient grounds for allowing the plaintiff to institute a fresh suit for the subject matter of suit or part of a claim, It may, on such terms as it thinks fit grant the plaintiff permission to withdraw from such suit or such part of the

claim with liberty to institute a fresh suit in respect of the subject-matter of such suit or such part of the claim. ………….. ”

16. While Rule 1(1) of Order 23 does not create any bar upon a plaintiff/appellant from withdrawing the suit/appeal against all or any of the defendants/respondents, Rule 1(3) envisages that the court may grant the plaintiff/appellant permission to withdraw suit/appeal with liberty to institute fresh proceedings in respect of the subject matter of such suit/appeal only if the court is satisfied that: - (a) the suit/appeal must fail by reason of some formal defect; or (b) that there are sufficient grounds for allowing the plaintiff/appellant to institute a fresh suit for the subject matter of the suit/appeal or part of a decree.

17. Therefore, as already noted hereinabove, the appellant is free to withdraw its appeal at any time. No fetters can be placed upon such right of the appellant as appellant is the master of its case and can chose whether or not to prosecute the appeal.

18. The request of the appellant herein for withdrawal of the instant appeal has, thus, to be allowed. However, the question arises whether the liberty, as sought by the appellant, can be granted to it.

19. We may note that permission to reserve liberty is not an absolute right. Such an order must reflect the court’s satisfaction that sufficient and valid legal grounds justifying grant of liberty existed. Courts or tribunals do not grant liberty as a matter of routine. An appellant, seeking liberty, must show a formal defect in the appeal or other sufficient grounds for either approaching a more appropriate statutory authority or the lower court/forum, which has passed impugned order, with a review petition.

20. In the case at hand, it is not the case of the appellant that the appeal suffers from any formal defect. The appellant is seeking liberty to approach the Commission with a petition for review of the impugned order.

21. The case of the appellant, as supported by the Commission itself, is that the impugned order of the Commission is palpably erroneous and therefore, deserves to be reviewed by the Commission. The Commission, through learned Solicitor General, also contends that the impugned order may not stand legal scrutiny by the Tribunal and hence, it is willing to reconsider the same.

22. We feel intrigued by these contentions agitated on behalf of the appellant and echoed by the Commission. By filing the instant statutory appeal under Section 111 of the Electricity Act, 2003 the appellant

consciously chose its remedy against the “erroneous” order of the Commission. In case, the impugned order is erroneous which would not withstand the legal scrutiny by this Tribunal, there was no reason or occasion for the appellant to seek withdrawal of the appeal with liberty to approach the Commission again with a petition for review of the impugned order. The appellant ought to have prosecuted the appeal on merit and demonstrated before this Tribunal that the impugned order is not legally sustainable. Upon being satisfied, this Tribunal would have allowed the appeal and set aside the impugned order. The conduct of the appellant in seeking liberty to file a review petition before the Commission instead of prosecuting the appeal before this Tribunal indicates the attempt of forum shopping by the appellant which can not be permitted.

23. Further, it is to be noted that according to the appellant, the impugned order of the Commission is without jurisdiction and according to the Commission, the impugned order would not stand the legal scrutiny in this Tribunal. Evidently, neither the appellant nor the Commission states that the impugned order suffers any “error apparent on the face of record” warranting review under Order XLVII Rule 1 CPC. Therefore, it is not understandable as to what had made the appellant to withdraw this statutory appeal and seek review of the impugned order before the Commission. Moreover, by filing the instant appeal before this Tribunal, the appellant chose its remedy

against the impugned order and effectively waived off its right to seek a review before the Commission itself. Thus, granting liberty to revert to review proceedings before the Commission now would circumvent the statutory restriction and permit forum shopping.

24. The conduct of the appellant post filing of the appeal also deserves consideration. Right since the filing of the appeal, the appellant has been prosecuting it vehemently and pressing its prayer for interim relief. Vide order dated 18.03.2026, we dismissed the application for interim relief. The appellant assailed the said order in the Hon'ble Supreme Court by way of Civil Appeal No.4682/2026 which was disposed of vide order dated 30.04.2026 directing this Tribunal to rehear the parties on the interim application and dispose of the same by a reasoned order in accordance with law. Accordingly, arguments on the interim application were heard on 20.05.2026 and 15.07.2026 during which the learned senior counsel appearing for the appellant made strenuous effort to make out a case for grant of interim order in favour of the appellant. However, towards the conclusion of his arguments on 15.07.2026, learned senior counsel for the appellant sought to withdraw the appeal with liberty to approach the Commission again with a review petition. This prayer was reiterated by the learned senior counsel on 27.07.2026. Such sudden change of heart on the part of the appellant is not understandable. It gives an impression that the

appellant has probably realized lack of merit in its appeal and thus wants to have a second bite at cherry by approaching the Commission with a review petition. Seeking withdrawal of an appeal simply because the appellant realizes that its case before the appellate court is weak does not constitute either a “formal defect” or “sufficient cause” envisaged under Sub-Rule 3 of Rule 1 of Order 23 CPC.

25. We cannot also lose sight of the fact that the impugned order of the Commission, which is also stated to have been partially complied with by the appellant, has created a vested right in favour of the 2nd respondent. More importantly, the Hon'ble Supreme Court also while passing the order dated 30.04.2026 in appellant’s Civil Appeal No.4682/2026, has directed the appellant to pay a sum of Rs.250 crores to the 2nd respondent as an interim measure. Therefore, allowing the appellant to withdraw the appeal with liberty to approach the Commission again with a review petition, would nullify the rights created in favour of the 2nd respondent by the impugned order of the Commission as well as by the above noted order dated 30.04.2026 of the Hon'ble Supreme Court and would force the 2nd respondent to relitigate the entire matter from the scratch before the Commission thereby causing it severe financial as well as procedural prejudice which is impermissible in law.

26. In Rakesh Bhatia & Ors. v. Pramod Sharma & Ors. 2009 (112) DRJ 143, the Hon'ble Delhi High Court has very clearly held that if the appellate court feels that the appellant had at an initial stage only of the appeal opted or agreed to apply for review, the appellate court would grant such liberty but if the time of the appellate court has been taken in attempting to persuade the court in admitting the appeal or to issue the notice thereafter and only after availing to do so withdrawal is sought, the appellate court may decline to grant such liberty to apply for review. In the instant case, not only has the appellant vigorously pursued the appeal and made strenuous attempts to persuade this Tribunal to pass interim order in its favour but also approached the Hon'ble Supreme Court when this Tribunal declined to pass interim orders in its favour and dismissed the interim application. The appellant not only consumed the time of this Tribunal on various dates, as noted hereinabove, in arguing the application for interim relief but also consumed the time of the Hon'ble Supreme Court in Civil Appeal No.4682/2026. Therefore, viewed from this angle also, this is not a fit case where liberty ought to be granted to the appellant to file a review petition before the Commission.

27. In so far as the submission of learned Solicitor General to the effect that the Commission is willing to reconsider the impugned order as, upon his advice, the same would not stand scrutiny by this Tribunal, is concerned we

note that apart from making such oral submission the learned Solicitor General did not make any attempt to take us through the impugned order to demonstrate why the same appears to him to be erroneous and would not stand scrutiny by this Tribunal. We are afraid that we cannot set aside an order of the Commission and remand the case back to the Commission for reconsideration merely on the asking of the Commission without gaining satisfaction that such submission is made bonafide and upon sound legal basis. Since no such endeavour has been made on behalf of the Commission to explain the infirmity in the impugned order which would require reconsideration by the Commission, apart from the bald oral submissions made by learned Solicitor General, we are unable to countenance these submissions of the learned Solicitor General.

28. Considering the above discussion, request of the appellant for liberty to approach the Commission by way of a review petition is hereby declined.

29. The appeal is dismissed as withdrawn. All pending applications also stand disposed of accordingly.

Pronounced in the open court on this the 19th day of August, 2026.

(Virender Bhat) Judicial Member

(Seema Gupta) Officiating Chairperson

REPORTABLE / NON-REPORTABLE

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