- 1 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF AUGUST, 2025 BEFORE THE HON'BLE MR. JUSTICE R. NATARAJ WRIT PETITION NO. 50941 OF 2016 (GM-RES) BETWEEN: SRI. H.R. SURAPPA REDDY AGED ABOUT 55 YEARS S/O RAMAREDDY R/AT KOTHAKOTE VILLAGE, PARAGODU POST, BAGEPALLI TALUK CHIKKABALLAPUR DISTRICT-562101. …PETITIONER (BY SRI. HEMANTH KUMAR D., ADVOCATE) AND: 1. BANGALORE ELECTRIC SUPPLY COMPANY LIMITED OFFICE OF DMS CORPORATION BANGALORE ELECTRICITY CORPORATION K.R. CIRCLE, BANGALORE - 560001 REPRESENTED BY ITS MANAGING DIRECTOR 2. THE MANAGING DIRECTOR BANGALORE ELECTRICITY CORPORATION K.R. CIRCLE, BANGALORE - 560001 3. KARNATAKA ELECTRICITY REGULATORY COMMISSION, 6TH AND 7TH FLOOR, MAHALAKSHMI CHAMBERS NO.9/2, M.G. ROAD, BANGALORE-560001 REPRESENTED BY ITS SECRETARY Digitally signed by SUMA Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 4. EXECUTIVE ENGINEER C.O. AND M DIVISION BESCOM CHIKKABALLAPUR-562101. …RESPONDENTS (BY SMT. SUMANA NAGANAND, ADVOCATE FOR RESPONDENT NOS.1, 2 AND 4; SRI. D. ASWATHAPPA, ADVOCATE FOR RESPONDENT NO.3) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ENDORSEMENT NO.KERC/S/F-3/VOL-826/16-17/546 DATED 11.05.2016 VIDE ANNEXURE-E ISSUED BY THE RESPONDENT NO.3 AND ETC. THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE R. NATARAJ ORAL ORDER The petitioner has challenged an endorsement bearing No.KERC/S/F-31/Vol-826/16-17 dated 11.05.2016 issued by the respondent No.3, by which it granted time upto 18.09.2016 for designing, engineering, constructing, commissioning and operating the Solar Rooftop Photovoltaic System (henceforth referred to as 'SRTPV System'). The petitioner has also challenged an endorsement bearing No.KERC/S/F-31/Vol- 826/16-17/1409 dated 29.08.2016 issued by the respondent - 3 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 No.3, by which it forwarded the representation of the petitioner to the respondent Nos.1 and 2 for consideration. He has also sought for a writ in the nature of Mandamus to direct the respondents to consider his claim in accordance with the Circular bearing No.ೆ..ಕಂ/-51/2015-16/CYS-58 dated 23.12.2015 issued by the respondent No.1 and the Circular bearing No.BESCOM/BC-51/2015-16/CYS-80 dated 15.03.2016 issued by the respondent No.1 and to grant him one year time for completion of installation of SRTPV unit. He has also sought for a writ in the nature of Mandamus to direct the respondents to consider his case and extend the benefit of the tripartite agreement in order to give effective time for execution of the project. 2. (i) The petitioner contends that the respondent No.1 had issued a Circular dated 23.12.2015 to encourage private players in electricity production by laying solar panels on the rooftop of their buildings. Those who are interested to participate could apply for the same and upon consideration, a Power Purchase Agreement would be executed evidencing the terms of purchase of the power generated. The above Circular - 4 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 also contemplated that the power purchase agreement shall be for a period of one year from the date of execution and construction of building and implantation of electricity and that the units shall be commissioned within one year from the date of the agreement. (ii) The petitioner contends that he opted to install a SRTPV unit and therefore, submitted an application to the respondent No.4 on 01.03.2016. The petitioner submitted a representation to the respondent No.4 contending that he intended to install 1 Megawatt (MW) Solar plant on the roof of the polyhouse, on 5 acres of land. The petitioner informed that the latest patented technology of polyhouse structure design would be assembled and solar panels would be installed on the roof, truss and cross purlins in such a way that the panels serve dual purpose, namely, to produce electricity and also act as roofing sheets. The petitioner gave a timeline for the phases of construction and requested to provide approval for the same. After considering the case of the petitioner, the respondent No.1 approved it and entered into an agreement called the Power Purchase Agreement (PPA) on 18.03.2016. Respondent No.3 approved the PPA entered into by the petitioner with the - 5 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 respondent Nos.1 and 2 after due intimation dated 11.05.2016. The respondent No.3 directed the respondent Nos.1 and 2 to incorporate a condition in the PPA that the rooftop system shall be commissioned within 18.09.2016. The petitioner submitted a representation dated 09.08.2016 to the respondent No.3, appraising that the time given for commissioning the project is one year from the date of PPA, as per the Circular dated 23.12.2015 whereas only three months and twelve days time was given to him for completion of the project, which was not possible. The respondent No.3, without appreciating the difficulties, straightaway issued an endorsement denying the request of the petitioner for one year time from PPA to complete the project. The petitioner contends that as per the Circular issued by the respondent No.1 dated 15.03.2016, a special clause was ordered to be inserted, namely, that 'the SRTPV system shall be designed, engineered, constructed, commissioned and operated by the seller or any other person on his behalf within …….." (iii) The petitioner contends that as per the Circular, all the field officers were directed to ensure that the above clause is invariably inserted in all PPAs executed. The due date was to - 6 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 be within one year from the date of PPA without altering other conditions. Petitioner contends that he has obtained an electricity connection bearing R.R.No.KRP-805 for the purpose of the irrigation pump set and there is no building existing and for the purpose of proposed construction, the materials required for the construction are already procured. The petitioner contends that he wanted to put up a polyhouse and on the roof of it, he intended to install the SRTPV unit. Therefore, he contends that a minimum period of one year was required as contemplated under the Circulars dated 23.12.2015 and 15.03.2016. (iv) The petitioner contends that in respect of another applicant named Mr. Govindaraju, the respondent No.3 had granted one year time from the date of PPA to install the project. The petitioner therefore, contends that he is also entitled to be treated alike and should be granted a year’s time to complete the project. 3. The learned counsel for the petitioner reiterated the above contentions and submitted that the petitioner was granted hardly three months time to complete the project, - 7 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 which is impossible. While in similar cases, the respondent No.3 had granted one year time from the date of the PPA. He invited the attention of the Court to the Circular dated 23.12.2015 and contended that even the respondent Nos.1 and 2 had mentioned that the time for installing, commissioning the SRTPV unit was one year from the date of PPA and therefore, the impugned endorsements issued by the respondent No.3 are liable to be quashed. He also submits that the respondents are liable to be directed to extend the time for installation and commissioning of the SRTPV unit. 4. (i) The petition is opposed by the respondent Nos.1, 2 and 4, who contend that the petition is not maintainable as the petitioner has an effective alternative remedy under Section 86(1)(f) of the Electricity Act, 2003 (henceforth referred to as 'Act of 2003'). It is contended that it is the State Commission, which is empowered under Section 86(1)(b) of the Act of 2003 to regulate electricity purchase, procurement and the price at which electricity is procured through PPAs. Hence, the State Commission is the appropriate forum before which the petitioner ought to have agitated his claims. It is further contended that the petitioner is trying to - 8 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 enforce the agreement in a writ petition and being in the nature of a suit for specific performance, the Court should refrain from interfering in contractual matters. It is further claimed that the writ petition involves disputed questions of fact and the same cannot be decided under Article 226 of the Constitution of India. It is further contended that in W.P.No.41854/2016, this Court had categorically held vide order dated 17.07.2017 that it is the State Commission that has the power to regulate PPAs relating to SRTPV projects, including aspects relating to time given for completion of such projects as Section 86(1)(b) of the Act of 2003 clearly empowers them to do so. A Writ Appeal was filed thereagainst in W.A.No.4719/2017 which was also dismissed and Special Leave Petition No.13111/2019 was preferred which was withdrawn with liberty to avail the remedy of dispute resolution provided in the agreement. Therefore, it is contended that the case on hand is squarely covered by the judgment in the writ petition referred above and therefore, it is prayed that the writ petition be dismissed in limine. (ii) As regards the contentions urged by the petitioner, it is contended that the petitioner had agreed to set up a SRTPV plant as per the Circular of the Government of Karnataka dated - 9 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 10.12.2015, the Circular of the respondent Nos.1 and 2 dated 23.12.2015 and the Consumer guidelines for availing grid connectivity of SRTPV systems in BESCOM. Under the above circulars and guidelines, the petitioner was required to complete the SRTPV project within 180 days from the date of execution of the PPA. The same was also the condition of approval given by the respondent No.3. It is contended that the petitioner has acquiesced to complete the SRTPV project as per the above circulars and guidelines. However, the petitioner has failed to commission the project within the stipulated time frame and has preferred the instant writ petition seeking extension of time upto one year to complete the project. The respondent Nos.1, 3 and 4 claim that the petitioner has contended that he falls under the "under construction" category and is entitled to a period of one year for completion of the project. However, it is submitted that the same is untenable as PPA dated 18.03.2016 clearly indicates that the petitioner has given a Revenue Registration No. BPP-1076, and hence the petitioner cannot claim that he falls under the "under construction" category. Once the petitioner has a revenue - 10 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 registration number, it precludes him from claiming that he falls under the "under construction" category. (iii) Further, it is contended that there has been a drastic reduction in the solar tariff in view of the fall in the cost of solar panels. The reduction in tariff is reflected in the various tariff orders passed by the respondent No.3-KERC. It is submitted that KERC vide its order dated 02.05.2016 revised the tariff of Rs.9.56 per unit as determined in its order dated 10.10.2013 to Rs.5.20 per unit. The Commission in the order had clearly stated that projects which are commissioned with delay are not entitled to a tariff of Rs.9.56 per unit as determined under the tariff order dated 10.10.2013. It is further claimed that the Commission vide order dated 18.05.2018 further revised the tariff rates applicable to SRTPV projects. As per the order dated 18.05.2015, the tariff applicable to SRTPV project is Rs.3.56 per unit. Thereafter, KERC has proceeded to re-determine the tariff for SRTPV units with effect from 01.04.2019 onwards and has fixed the tariff of SRTPV plants of 1 kilowatt to 2000 kilowatt at Rs.3.07 (without capital subsidy) and Rs.2.32 per unit (with capital subsidy) and for SRTPV plant of 1 kilowatt to 10 kilowatt for domestic - 11 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 consumers at Rs.3.99 (without capital subsidy) and Rs.2.97 per unit (with capital subsidy). In view of the above, it is contended that the petitioner is trying to overreach the orders dated 02.05.2016, 18.05.2018 and 01.08.2019 passed by the Commission, which is uniformly adopted and implemented in respect of all SRTPV projects. Therefore, it is contended that the petitioner cannot be granted an extension of time and the tariff of Rs.9.56 per unit as the project has not been commissioned till date. It is claimed that the respondents cannot be compelled to pay the earlier tariff for a project which has not yet commenced at any stretch of imagination. (iv) It is claimed that the respondent Nos.1 and 2 had conducted a field inspection of the petitioner's project site on 20.07.2021 and it was found that the petitioner had not commenced any work related to the SRTPV project. It was also found that the said land was used for agricultural purpose with standing crops on it and no construction or standing building existed, which could support a SRTPV system and that the land was not converted for commercial use. Therefore, it is claimed that the petitioner was not entitled for extension of time and the tariff of Rs.9.56 per unit in the absence of executing any - 12 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 work related to the project. The respondent Nos.1, 2 and 4 claim that the petitioner was well aware of the investment required and the approvals required for the SRTPV project and therefore, he could not have entered into the PPA and thereafter seek an extension of time. (v) In so far as the claim of the petitioner based on the time granted to one Mr. Govindraju, it is contended that the terms of the PPA are based on the relevant circulars and guidelines of the Government of Karnataka, KERC and BESCOM prevailing at the time of entering into the PPA and the petitioner cannot claim any extension of time based on the terms of a different PPA. It is also contended that the tripartite agreement relied upon by the petitioner does not help his case as this was not a case involving three parties, but was a bilateral agreement between the petitioner and the respondent Nos.1 and 2/BESCOM. It is also alleged that the petitioner has committed various breaches and violations regarding the execution of the PPA such as commencement of work, as provided under the PPA, violation of relevant circular and guidelines of the Government of Karnataka, KERC, ESCOM, non-conversion of land and lack of requisite approvals. - 13 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 Therefore, it is contended that the petitioner is not entitled to the extension of time to complete the SRTPV project. 5. The learned counsel for respondent Nos.1, 2 and 4 reiterated the above contentions and submitted that the petitioner has not even installed the polyhouse and that an inspection of the land shows that it is used for agricultural purposes. She therefore, submits that the petitioner had not done necessary ground work such as, obtaining RR number, installing the polyhouse etc., She therefore, submits that at this point in time, it is not prudent to permit the petitioner to establish SRTPV unit and enable him to supply at Rs.9.56 per unit as the cost of electricity has now substantially reduced and is available at far lesser rates. She also submits that the capital cost of the SRTPV has also come down and submits that if the petitioner is willing to supply electricity at the present rates, these respondents would not have any objection for the extension of time to the petitioner to install the project. 6. (i) The respondent No.3 has also opposed the writ petition. It is contended that initially the focus was on establishment of large scale solar plants. Later, impetus was - 14 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 on small sized plants that could be erected on idle existing rooftops of residential buildings within a short period. Such generation closer to the points of consumption results in avoidance of technical loss and lesser load on the system. The higher cost in establishment of smaller plants was recognized and the respondent No.3 determined a higher tariff as compared to large scale plants whose capital cost would be less because of economy of scale but which takes a longer time for erection and commission. It is claimed that there is a limitation on solar and other renewable power that can be absorbed by the system. Their intermittent nature of generation poses serious challenges in grid maintenance. Their current higher procurement costs limits their share in total power procurement by the distribution companies so as to ensure that the retail tariff to the consumer is within reasonable limits. (ii) The respondent No.3 contended that it has promoted generation by SRTPV by introducing net metering facility that allows consumption of power generated by the existing consumer and injection of surplus into the distribution system for which he would be paid the tariff as determined by the Commission. As per this scheme, the consumer is required - 15 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 to install SRTPV units of reasonable capacity on their rooftops within a short period. The scheme also envisaged that the resultant impact on the distribution system and the finances of the distribution licensee would be minimal. It has contended that it has the exclusive jurisdiction to determine the tariff payable for purchase of energy by distribution licensees. Therefore, any agreement between the distribution licensees and the generators can be subjected to scrutiny by the Commission to ascertain the reasonability and validity of the tariff payable to the generators. It is contended that the Hon'ble Apex Court has recognized this in its decision in All India Power Engineer Federation and others vs. Sasan Power Ltd., and others [(2017) 1 SCC 487]. (iii) In so far as the facts of the present writ petition are concerned, it is admitted that PPA was executed between the petitioner and the respondent Nos.1 and 2 on 18.03.2016 in respect of 1000 KW SRTPV at Kothakote Village, Chikkaballapura District. The PPA was approved by the respondent No.3 on 11.05.2016 subject to incorporation of a clause that the system shall be designed, engineered, constructed, commissioned and operated by the seller within - 16 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 18.09.2016. It is contended that the petitioner had requested it for extension of time for commissioning the SRTPV vide representation dated 09.08.2016. It contended that since SRTPV projects are between the ESCOMs and distribution licensees or private parties, some of the PPA holders were directly approaching it with request for extending the time for commissioning the project. Therefore, it had observed that such request should be addressed to the respective ESCOMs and hence, it forwarded the request of the petitioner to the respondent No.1 for being considered in accordance with law. (iv) It has contended that in the PPA, the preamble stated that "the seller intends to install/has installed a SRTPV system of 1000 KW capacity on the rooftop of the premises situated at Kothakote village connected to electricity service connection bearing R.R.No.BPP-1076 in the same premises under Bagepalli Sub-Division of BESCOM." It contends that it had allowed 180 days time for completion of the project considering the fact that there was electricity installation in the premises and the petitioner had mentioned in his application that there is already an existing structure on which SRTPV plant would be installed and it was not mentioned that the project is - 17 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 under construction. It claims that in the case of one Mr. Govindaraju, one year's time was allowed for installation of SRTPV plant as he had mentioned that he intended to install the SRTPV plant on the new building under construction. (v) It contends that if the SRTPV plant of the petitioner is ready, it has no objection for the ESCOM to receive the power but is subject to tariff fixation for the plant by the Commission. (vi) As regards the Circular dated 15.03.2016 relied upon by the petitioner, it contends that the Circular is applicable only in respect of installation of SRTPV plant on a new proposed building and not on an existing one. It has contended that in respect of installation of new SRTPV project on the premises, the consumer is bound to follow the guidelines/terms issued under the Circular dated 10.12.2016, where one year time is allowed for construction of new structure and getting a new electricity connection. It is claimed that the Circular was withdrawn by the Government of Karnataka by its Notification dated 22.03.2016. It contends that as per the guidelines issued by respondent Nos.1 and 2, - 18 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 the petitioner was required to complete the construction and installation of SRTPV plant within 180 days from the date of PPA. 7. Learned counsel for respondent No.3 also reiterated the above contentions. 8. I have considered the submissions of the learned counsel for the petitioner as well as the learned counsel for the respondent Nos.1, 2 and 4 and learned counsel for respondent No.3. 9. The Technical Feasibility report which is placed on record at Annexure - B shows that the petitioner did not possess an electrical installation. This is evident from what is mentioned in the column "R.R. Number" as "proposed". It is no doubt true that as per the Circular dated 23.12.2015, the petitioner was entitled for one year time for establishment, development, engineering and commissioning of SRTPV from the date of the PPA. However, the respondent No.3 had arbitrarily fixed the time for commissioning and operating the SRTPV by the petitioner within 18.09.2016. It is evident that in similar circumstances, the respondent No.3 had allowed time - 19 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 for completion and commissioning of the project upto one year from the date of PPA in the case of Mr. Govindaraju. When the petitioner himself had informed the respondents that the SRTPV would be placed on the polyhouse that he intended to set up, the respondents must have granted adequate time to do so. It is well-nigh impossible for any agriculturist to establish a polyhouse within three months and therefore, the respondent No.3 had indeed acted arbitrarily in requiring the petitioner to install and commission the SRTPV by 18.09.2016. 10. Be that as it may, as rightly contended by the learned counsel for respondent No.3, the electricity tariff fixed by the respondent No.3 in so far as supplies that may be made by the petitioner was Rs.9.56 per unit and this was based on various factors such as the capital cost of the SRTPV, the interest on investment, the amount of labour and other expense, the return on investment etc., The learned counsel for the petitioner did not dispute the fact that the capital cost of installing a SRTPV has come down in view of the advent of new technology and the scale of production of panels. Therefore, if the petitioner has to be given the benefit of extended time to commission the project, he should also be willing to re- - 20 - HC-KAR NC: 2025:KHC:32234 WP No. 50941 of 2016 negotiate the price. In that context, this Court queried the learned counsel for the petitioner as to whether the petitioner would be willing to supply electricity at the present tariff. Learned counsel for the petitioner after securing instructions submitted that it would not be possible for the petitioner to do so. Therefore, though this Court is of the opinion that the petitioner must have been given sufficient time to establish and commission the SRTPV, which cannot be less than one year from the date of PPA, since the petitioner is not willing to supply electricity at the present tariff, no useful purpose would be served in allowing this petition. 11. Accordingly, the petition is dismissed. Sd/- (R. NATARAJ) JUDGE PMR List No.: 1 Sl No.: 44