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2020 (5) TMI 738 - SC - Indian LawsRejection of claim for interest on deemed loan component - HELD THAT:- There is no dispute that the PPA which the parties entered into specifically referred to the notification of 30.03.1992 and further went on to state that for the first Kwh/KW, a plant load factor of 68.5% fixed charges and variable charges were deployed. For generation achieved over and above this by the concerned unit – CLP, an incentive @ 5.75% for every 1% increase over and above the fixed and variable charge payable was agreed to. Significantly, the fixed and variable charges are in consonance with the statutory notification of 30.03.1992 (which was also later amended on 17.01.1994). This much is clear from a plain reading of clause 7.1 of the Schedule VII to the PPA itself. In view of the fact that the notification amended on 06.11.1995 was a statutory one, there cannot be any doubt that it was binding upon the parties - the change of law provision (Clause 6.5 of the PPA) clearly contemplated that any amendment to the prevailing tariff notification (dated 30.03.1992) would bind the parties. Since Note (2) was an amendment, which dealt with the issue of incentive, it cannot now be said that it was inapplicable. The findings of the lower authorities, therefore, are correct; no interference is called for. Whether the GERC and APTEL fell into error in granting restricted refund calculable for the 3 year period prior to Gujarat Urja's application? - HELD THAT:- There was no admission on the part of CLP, at least of the kind, that extended the time for preferring an application for recovery of excess payments. It has been consistently ruled by this court that repeated letters, or exchange of communications, do not extend the period of limitation, provided by law. Payment of interest on deemed equity - HELD THAT:- The parties did not harbor any doubt about the period for which the specified interest was payable on such deemed loan. The rate of interest was fixed; likewise, the date from which payment obligations were to arise, too were known. Also, the date upto which the interest on such deemed loan payments were to be made, was known and fixed. In these circumstances, CLP's claim that the payment of interest for a prior period was outstanding, and constituted Gujarat Urja's liability, is insubstantial. In the present case, the clear agreement between the parties was that interest on the sum of ₹ 53.90 crores was payable for the specified period 01.07.2003 to 31.12.2009.Therefore, CLP's claim that any amount was payable, for any period prior to 01.07.2003, was not tenable. Had CLP wished so, nothing prevented it to claim for it during negotiations and have it included as a term of the contract. Once having settled for a specified sum, on an amount (₹ 53.90 crores) that was only fictionally a loan - and treated as such, for purpose of fixing interest payable, considering the equity infused, in excess of the tariff regulations, the absence of any like item, such as interest for prior period, precludes a claim. But it was really part of the equity component. Therefore, interest was per se not payable, but could be paid in terms of the tariff notification or the agreement. No claim on any other legal or equitable considerations could have been made. Appeal dismissed.
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