Adani Power Ltd and Tata Power Company Ltd., slumped Tuesday after the Supreme Court disallowed compensatory tariffs to the companies.
The case was against a 2016 ruling of the Appellate Tribunal for Electricity (Aptel) which held that an unforeseen increase in the cost of coal would be a 'force majeure event' under the power purchase agreements (PPAs) between power generating companies and distributors.
Aptel directed the Central Electricity Regulatory Commission (CERC) to grant relief to Tata and Adani in accordance with the PPAs.
In Jul 2016, the apex court had refused to stay the CERC proceedings determining compensation for increased production costs for power firms.
The court, however, said that CERC's final ruling will be subject to its scrutiny.
The Dec 2016 ruling of the CERC allowed Tata and Adani to charge their customers more to recover the higher costs stemming from an increase in the price of imported coal.
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