06 March 2022, Sunday

2 years ago

Whether Amity University is a generating company or a consumer of electricity should be decided by the arbitrator: Delhi High Court

09 February 2022 | IL & FS Energy Development Co Ltd v. Amity University | Arb P 572 of 2020 | Delhi High Court | 2022 SCC OnLine Del 498

Disagreeing prima facie with the argument that Amity was a generating company under the Electricity Act because of the parties' transaction, the Delhi High Court has allowed the application for the appointment of an arbitrator.

IL&FS installed a solar power plant in the Amity campus. Their agreement envisaged IL&FS would operate the plant for fifteen years and then hand it over to Amity. So, Amity argued that IL&FS was a ‘generating company’ under the Electricity Act since it commissioned the power plant and Amity was the co-owner because it had a stake in it. The argument was run to avoid arbitration because an authority decides the dispute between generating companies under the Electricity Act.

The court examined the terms of the power purchase agreement and was of the prima facie view that Amit was a consumer and not a generating company. It noted that because the point was arguable, the matter should be referred to the arbitrator in any case.

Read the decision here.


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