- (1.) Heard Mr. K.V. Viswanathan, learned senior counsel for the appellant and Mr. G. Umapathy for Respondent No.1.
(2.) Appellant is a State Electricity Board. Respondent No.1 had entered into a Power Purchase Agreement (PPA) with the Karnataka Power Transmission Corporation Ltd. (KPTCL) for supply of power by an agreement dated 04.04.2002. Paragraphs 5.1 and 5.2 of the said Agreement are relevant for our purpose, which are as under: "5.1 Monthly Energy Charges: Corporation shall for the Delivered Energy pay, for the first 10 years from the date of signing of Agreement to the Company every month during the period commencing from the Commercial Operation Date on the basis of the base price applicable for the year 1994-95 at the rate of Rs. 2.25 (Rupees Two and twenty five paise) per kilowatt hour (the tariff) for energy delivered to the Corporation at the Meeting Point with an escalation to the Corporation at the Metering Point with an escalation at a rate of 5% per annum over the tariff applicable for the previous year as per guidelines issued by the Ministry of Non-Conventional Energy Sources of the GoI. 5.2 From the 11th year onwards, from the date of signing of Agreement, Corporation shall pay to the Company for the energy delivered at the Meeting Point at a rate agreed by mutual negotiations. In case the Parties do not arrive at a mutual agreement on the tariff, the Company shall be permitted to sell power to third parties and enter into a Wheeling and Banking Agreement with Corporation to sell power through the rates applicable from time to time in addition to banking charges at the rates applicable from time to time as approved by the Commission based on the month and balance of the energy banked."
(3.) Subsequently, by a Supplemental Agreement dated 29.10.2005 entered into between the appellant and Respondent No.1, Paragraphs 5.1 and 5.2 of the Agreement dated 04.04.2002 came to be modified. Under Paragraph 5.1 of the Supplemental Agreement, the rate of tariff was altered providing for a slightly higher tariff for purchase of power from Respondent No.1.;