The Appellate Tribunal for Electricity (APTEL) has partially allowed a review petition filed by Tata Power Company Limited concerning the interpretation of statutory powers under the Electricity Act, 2003, particularly the referral of electricity sector disputes to arbitration. The judgment was delivered on September 17, 2026, by a bench comprising Judicial Member Virender Bhat and Technical Member Ajay Talegaonkar.
The review petition was filed against APTEL’s earlier judgment dated February 25, 2026. Tata Power argued that the earlier judgment contained a patent error by treating an important conclusion from an earlier coordinate bench ruling in the Damodar Valley Corporation (DVC) case as a “stray sentence.”
In the DVC judgment delivered in August 2024, APTEL had held that non-tariff disputes involving a generating company or distribution licensee do not fall within the scope of Section 79(1)(f) of the Electricity Act and can therefore be referred to arbitration. Tata Power contended that the subsequent judgment had departed from this precedent by limiting the Central Electricity Regulatory Commission’s (CERC) arbitration referral powers to disputes covered under clauses (a) to (d) of Section 79(1).
While considering the review, APTEL examined the scope of review jurisdiction under Order XLVII Rule 1 of the Code of Civil Procedure. The tribunal noted that a review can be entertained only in limited circumstances, including where there is an error apparent on the face of the record. It cannot be used as an appeal to reconsider the entire matter or replace one judicial view with another.
On the substantive issue, APTEL held that its earlier judgment did not contradict the DVC precedent. Instead, it had clarified the scope of the ruling. According to the tribunal, CERC can refer a dispute to arbitration under Section 79(1)(f) only when the dispute falls within matters that the Commission itself has statutory jurisdiction to adjudicate, particularly those connected with clauses (a) to (d) of Section 79(1).
The tribunal further clarified that disputes affecting tariffs or involving core regulatory functions cannot be referred to arbitration. However, non-tariff disputes falling within the Commission’s statutory jurisdiction may be arbitrable. For instance, a valid termination of a power purchase agreement that does not affect tariff-related matters could potentially be referred to arbitration.
APTEL also relied on the Supreme Court’s position in the Hindustan Zinc case, which restricts regulatory commissions from exercising powers beyond their statutory mandate.
However, the tribunal acknowledged that its earlier description of Paragraph 36 of the DVC judgment as a “stray sentence” was incorrect. It held that Paragraph 36 contained the final conclusion of the coordinate bench and was an integral part of the judgment.
APTEL therefore set aside that characterization while rejecting the remaining grounds raised by Tata Power in the review petition.
