HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
A.P. Power Coordination Committee and Others v. M/s. Lanco Kondapalli Power Ltd. and Others
Civil Appeal No.6036 of 2012 with Civil Appeal Nos.6061 and 6138 of 2012, 9304 of 2013 and 6835 of 2015
[2015] 12 SCR 447 ·
Income-tax Act, 1961: historical sections 115JB, 115JA, 115J, 2(43) and 5 · Electricity Act, 2003: sections 86(1)(f), 174 and 175 · Limitation Act, 1963: principles underlying section 14 · Power Purchase Agreement: Articles 1.4, 3.8 and 11.4
Sources & disclosures includedDownload original judgment / order
Vikramajit Sen and Shiva Kirti Singh, JJ.; common opinion delivered by Shiva Kirti Singh, J. · Vikramajit Sen, J. · Shiva Kirti Singh, J.
Assessment years: Contractual MAT reimbursement for 2001-2012; no individual income-tax assessment appealed
01 · Facts of the case
Lanco established a 355 MW gas power project under a 31 March 1997 PPA with the former Andhra Pradesh State Electricity Board. Disputes concerned capacity charges and reimbursement of minimum alternate tax for 2001-2012. Article 3.8 required reimbursement of advance income tax attributable to the project, supported by the stipulated accountant's certificate and later assessment adjustments. After arbitration notices and proceedings before the High Court, Lanco approached the Electricity Regulatory Commission. The Commission rejected the earlier claims on limitation; APTEL excluded time spent pursuing arbitration and remanded them. The purchasers disputed both limitation relief and the contention that MAT fell within the PPA's income-tax clause.
Source: Primary report: dispute and PPA
02 · Discussion by the Hon’ble Court
The Court distinguished the Limitation Act's direct application from the limits on the Commission's adjudicatory power. Although the Commission was not a court stricto sensu, the Electricity Act did not enlarge a creditor's right to enforce otherwise time-barred monetary claims. Principles underlying section 14 could nevertheless exclude bona fide pursuit before the wrong forum; exclusion from 8 September 2003 to 18 March 2009 was sustained. On MAT, the Court rejected the suggestion that tax on deemed book-profit income ceased to be income tax merely because sections 115JA/115JB form a special code. It cited Ajanta Pharma on that code and explained that MAT's basic character remained income tax. Article 1.4 contemplated amended law; the specific Article 3.8 reimbursement provision took precedence over the general Article 11.4 change-in-law procedure.
03 · Judicial decision
MAT under section 115JB was covered by Article 3.8 and payable by way of reimbursement when the contractual conditions were satisfied. Withdrawal of an earlier exemption and use of deemed book-profit income did not make it a different kind of tax. The tax had to relate only to project income, with accounts maintained as the agreement required; the judgment did not override those safeguards. The earlier MAT claims were not barred after the allowed exclusion of time. The Commission's limitation constraint was confined to its section 86(1)(f) judicial function, not its administrative or regulatory powers.
04 · Outcome / in whose favour
In favour of Lanco on the contested reimbursement entitlement and limitation exclusion. All five appeals were dismissed without an order as to costs. The APTEL remand survived: capacity-charge correctness still required determination by the Commission, and the 2001-2005 MAT claims required consequential orders. This was not an unrestricted final monetary decree for every bill or interest claim, and not a tax refund ordered against Revenue.
Source: Final disposal
05 · AKHB REVIEW POINT
AKHB analysis: first separate the company's statutory MAT liability from the counterparty's contractual duty to reimburse it. For a comparable claim, retain the exact tax clause, project-only computation, accountant's certificate, payment records and assessment true-up, and test whether a specific tax provision displaces a general change-in-law mechanism. Preserve arbitration notices and the full wrong-forum timeline when invoking exclusion of time; this decision does not abolish limitation for electricity disputes. Use its MAT characterization without importing a present tax rate or treating it as a fresh ruling on Ajanta Pharma's export-profit computation. The PPA wording, tax period and later legal position require separate checking.
Source & verification
Download original judgment / order · Open cited source rendition
Entire 51-page report read, including headnote and authorities at SCR447-457 and the sole judicial opinion, paragraphs 1-39, SCR458-497/PDFpp.12-51.
- All 1970 extracted lines through EOF read; 51-page count and exact 1,608,572-byte primary verified against registered SHA-256. Caption, opinion opening, MAT reasoning and disposal visually inspected on physical pages 1,12,49,50,51. No page lacked extracted text.
- Identity and duplicate comparison found this report used only as bounded later-treatment evidence for Ajanta Pharma, not as standalone coverage of Lanco. That earlier comparison was confined to pages 47-51; this note covers the complete Lanco judgment.
- The primary report's historical MAT account is described as the Court's discussion, not independently certified present statutory text. No later-treatment clearance has been undertaken.
Statutory scope
Historical direct-tax contractual companion: this appeal decides whether section 115JB MAT is income tax reimbursable under this PPA, not a Revenue assessment or a general right to pass tax to customers. The relevant reimbursement periods are 2001-2012.
Later treatment
Source checked 2026-10-14. No comprehensive subsequent-treatment or present-law clearance is claimed. Verify the applicable statutory year, governing PPA and later authorities before reliance.
Page references identify the supplied PDF; paragraph references identify the judgment unless stated otherwise.
Identified source links
- reported judgment — PDF 51 pages
SHA-256: 76b599c95c58d46517851bc767f757cd4d0327e965bf7d9649c6e299e354ca88
Related reviewed notes
AI disclosure & professional disclaimer
This AKHB research note was prepared with AI assistance from the identified primary report. Independent human review is not represented.
General legal and tax research only; not legal or tax advice. Verify the complete judgment, governing statutory version and subsequent treatment before reliance. The AKHB REVIEW POINT is editorial analysis, not the Court's holding. No current-law clearance is claimed.