Maharashtra Resco Rooftop Solar Private Limited Vs Bangalore University

MAHARASHTRA RESCO ROOFTOP SOLAR PRIVATE LIMITED A COMPANY REGISTERED UNDER THE COMPANIES ACT, 2013 HAVING ITS REGISTERED OFFICE AT 4^TH FLOOR, NEXITY T30, PLOT NO-9, 10, 10A, 10B, 8B2, SY NO 83/1, HYDERABAD KNOWLEDGE CITY, Digitally signed RAIDURGAM, GACHIBOWLI, by KIRAN KUMAR R K.V RANGAREDDY, Location: HIGH COURT OF KARNATAKA SERI LINGAMPALLY, HYDERABAD-500 032 REPRESENTED BY ITS AUTHORIZED SIGNATORY RAKESH KUMAR VENKATESH

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…PETITIONER

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(BY SMT/MISS AISVARYA CHANDRAN, ADVOCATE FOR SRI. SHRIDHAR PRABHU., ADVOCATE)

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AND:

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BANGALORE UNIVERSITY A BODY ESTABLISHED UNDER THE KARNATAKA STATE UNIVERSITIES ACT 2000 HAVING ITS REGISTERED OFFICE AT JNANA BHARATHI BENGALURU-560 056 REPRESENTED BY ITS VICE CHANCELLOR DR VENUGOPAL

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…RESPONDENT

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(BY SRI. VINEET S. & SARALA V M, ADVOCATE)

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THIS CMP IS FILED UNDER SECTION 11(6) OF ARBITRATION AND CONCILIATION ACT, 1996, PRAYING TO APPOINT AN ARBITRATION PANEL AS PER THE ARBITRATION CLAUSE 17.7(c) OF THE POWER PURCHASE AGREEMENT BEARING NO.KAR/05/MAHRESCO DATED 30^TH JUNE 2018 PRODUCED AS ANNEXURE - A.

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THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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CORAM: HON'BLE MR. JUSTICE ASHOK S.KINAGI

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ORAL ORDER

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This Civil Miscellaneous Petition is filed under section 11(6) of the Arbitration and Conciliation Act, 1996 (for short, ‘ the Act ’) for the appointment of the arbitrators for resolving the disputes between the parties to the petition in terms of clause 17.7 (c) of the Power Purchase Agreement dated 30.06.2018 vide Annexure-A as per the provisions of the Act.

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Brief facts, leading rise to the filing of this petition are as follows:

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The petitioner and respondent entered into a Power Purchase Agreement dated 30.06.2018 for the establishment and operation of roof-top solar power projects of 620 kW capacity under the RESCO model, for a contractual term of twenty-five years.

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Pursuant to the Power Purchase Agreement, the Petitioner has been regularly delivering energy and raising invoices; however, the respondent has

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defaulted in making payments since December 2021 and has withheld dues towards deemed generation since November 2019, amounting to Rs.98,19,882/-.

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Despite several letters bearing No.MRESCO/BU/28062023 dated 28.06.2023, MRRSPL/SECI/BU/080923 dated 8th September 2023, issued by MRESCO/BU/19122023 dated 19.12.2023 and communication bearing reference No.MRSSPL/KAR05/BU/011/024 dated 09.07.2024 requesting compliance of the Power Purchase Agreement, the respondent failed to comply with the obligations stipulated.

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The petitioner, having been left with no alternative on account of the respondent's continued default, invoked arbitration under Article 17.7(c) of the Power Purchase Agreement by issuing a Notice bearing No.NLO/L/2025/24 dated 20.08.2025, proposing the name of the arbitrator. The respondent, vide Letter No.UE/OM/RESCO/620/2025-26 dated 01.09.2025

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which was received by the petitioner on 11.09.2025

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via WhatsApp messenger application, failed to appoint an Arbitrator and stated that a reply to the notice invoking arbitration would be issued only upon submission of a compliance report which is not contemplated in the Power Purchase Agreement. Hence, this petition.

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Heard the arguments of the learned counsel for the petitioner and the learned counsel for respondent.

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Learned counsel for the petitioner submits that pursuant to the power purchase agreement, the dispute arose between the parties to the petition. There exist an arbitration clause and the petitioner invoked the arbitration clause by issuing the arbitration notice. Accordingly, on these grounds, prays to allow the petition.

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Per contra , learned counsel for the respondent submits that the dispute which arose between the

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parties to petition is not arbitral in nature and accordingly prays to dismiss the petition.

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Perused the records and considered the submissions

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of the learned counsel for the parties.

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The point that would arise for consideration is as follows:

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Whether the petitioner has made out a ground to refer the dispute to the arbitration in terms clause 17.7 (c) of the power purchase agreement dated 30.06.2018 vide annexure A as per the provisions of the Act and the Rules?

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It is undisputed that the Petitioner and Respondent entered into a Power Purchase Agreement dated 30.06.2018 for the establishment and operation of rooftop solar power projects. The respondent has defaulted in making payments since December 2021.

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The dispute arose between the parties to the petition. The petitioner invoked the arbitration clause

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by issuing the arbitration notice proposing the name

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of the arbitrator on 20.08.2025.

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I have perused the arbitration clause incorporated in

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the power purchase agreement dated 30.06.2018 vide Annexure-A, which reads as follows:

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17.7. Governing Law & Jurisdiction

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(a) This Agreement shall be governed by and construed in accordance with the laws of India. The Parties agree that the courts in Bengaluru shall have jurisdiction over any action or proceeding arising under the Agreement. (b) In the event of any Dispute, difference of opinion or dispute or claim arising out of or relating to this Agreement or breach, termination or the invalidity thereof, shall firstly be attempted to be resolved by conciliation. Any Dispute that cannot be settled through conciliation procedure shall be referred to arbitration in accordance with the procedure given below. The Parties agree to comply with the awards resulting from arbitration and waive their rights to any form of appeal insofar as such waiver can validly be made. Cost of conciliation shall be equally shared by both the parties.

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(c) Arbitration Procedure:

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Settlement of Dispute:

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If any dispute of any kind whatsoever arises between Purchaser and Power Producer in connection with or arising

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out of the contract including without prejudice to the generality of the foregoing, any question regarding the existence, validity or termination, the parties shall seek to resolve any such dispute or difference by mutual consent.

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If the parties fail to resolve, such a dispute or difference by mutual consent, within 45 days of its arising, then the dispute shall be referred by either party by giving notice to the other party in writing of its intention to refer to arbitration as hereafter provided regarding matter under dispute. No arbitration proceedings will commence unless such notice is given. Any dispute in respect of which a notice of intention to commence arbitration has been given in accordance with Sub Clause, shall be finally settled by arbitration.

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In case the Contractor (Power Producer) is a Public Sector Enterprise or a Government Department:

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In case the Contractor is a Public Sector Enterprise or a Government Department, the dispute shall be referred for resolution in Permanent Machinery for Arbitration (PMA) of the Department of Public Enterprise, Government of India. Such dispute or difference shall be referred by either party for Arbitration to the sole Arbitrator in the Department of Public Enterprises to be nominated by the Secretary to the Government of India in charge of the Department of Public Enterprises. The award of the Arbitrator shall be binding upon the parties to the dispute, provided,

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however, any party aggrieved by such ward may make a further reference for setting aside or revision of the award to the Law Secretary, Department of Legal Affairs, Ministry of Law & Justice, Government of India. Upon such reference the dispute shall be decided by the Law Secretary or the Special Secretary/Additional Secretary, when so authorized by the Law Secretary, whose decision shall bind the Parties finally and conclusive. The Parties to the dispute will share equally the cost of arbitration as intimated by the Arbitrator.

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In All Other Cases

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In all other cases, any dispute submitted by a party to arbitration shall be heard by an arbitration panel composed of three arbitrators, in accordance with the provisions set forth below.

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The Purchaser and the Power Producer shall each appoint one arbitrator, and these two arbitrators shall jointly appoint a third arbitrator, who shall chair the arbitration panel. If the two arbitrators do not succeed in appointing a third arbitrator within Thirty (30) days after the later of the two arbitrators has been appointed, the third arbitrator shall, at the request of either party, be appointed by the Appointing Authority for third arbitrator which shall be the President, Institution of Engineers.

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If one party fails to appoint its arbitrator within thirty (30) days after the other party has named its arbitrator, the party which has named an arbitrator may

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request the Appointing Authority to appoint the second arbitrator.

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If for any reason an arbitrator is unable to perform its function, the mandate of the Arbitrator shall terminate in accordance with the provisions of Applicable Law as mentioned in Clause (Governing Law) and a substitute shall be appointed in the same manner as the original arbitrator.

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Arbitration proceedings shall be conducted with the Arbitration and Conciliation Act, 1996, as amended from time to time. The venue or arbitration shall be Hyderabad.

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The decision of a majority of the arbitrators (or of the third arbitrator chairing the arbitration panel, if there is no such majority) shall be final and binding and shall be enforceable in any court of competent jurisdiction as decree of the court. The parties thereby waive any objections to or claims of immunity from such enforcement.

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The arbitrator(s) shall give reasoned award.

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Notwithstanding any reference to the arbitration herein, the parties shall continue to perform their respective obligations under the agreement unless they otherwise agree.

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Cost of arbitration shall be equally shared between the Power Producer and Purchaser.

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From the perusal of the arbitration clause, it is clear

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that, all the disputes arising out of the Power Purchase Agreement shall be resolved through arbitration if the mutual settlement fails. Admittedly, initially the petitioner issued a letter for mutual settlement and thereafter invoked the arbitration clause. Admittedly, there is an arbitration clause and the arbitral dispute which arose between the parties to the petition has to be resolved through arbitration.

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Though, the arbitration clause provides for the panel of three arbitrators, learned counsel for the parties jointly submits that instead of tripartite arbitration/ three arbitrators there shall be a sole arbitrator.

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Accordingly, the petitioner has made out a ground to refer the dispute to the arbitration. For the foregoing discussion, I answer the point in the affirmative.

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In view of the above discussion, I proceed to pass the following order:

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ORDER

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(i) This Civil Miscellaneous Petition is allowed .

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(ii) Smt.Premavati Managoli, learned retired District Judge, is nominated as an arbitrator to resolve the dispute between the parties to the petition in terms of Clause 17.7(c) of the Power Purchase Agreement (PPA) dated 30.06.2018 as per the provisions of the Arbitration and Conciliation Act, 1996 and Rules.

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(iii) The Registry is directed to communicate this order to the learned Arbitrator and the Director of the Arbitration and Conciliation Center, Bangalore.

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