The Supreme Court has permitted the NGO Energy Watchdog to participate in the proceedings initiated by Jharkhand Bijli Vitran Nigam Ltd. against two companies over alleged unauthorised supply and use of electricity.

A bench of Justice Pamidighantam Sri Narasimha and Justice Alok Aradhe refused to interfere with the interim order passed by the Jharkhand High Court permitting the NGO to participate in the proceedings so that collection and consideration of relevant information could be facilitated. The Court agreed with the High Court's impression that the long-standing complaint by the NGO against the unauthorised supply and use of electricity speaks that all is not well with the inquiry conducted by the Jharkhand Bijli Vitran Nigam Ltd (JBVNL).

An argument was raised by the petitioners-electricity companies challenging the High Court's order that the Electricity Act being an exhaustive code in itself, disentitles any third-party interventions in the proceedings.

Limiting its adjudication over the validity of the High Court's interim order to permit the NGO to participate in the proceedings, the Court refrained from deciding about the question of third-party interventions in the Electricity Act proceedings. It upheld the High Court's interim order regarding the NGO's participation noting that the participation of the NGO “is necessary to bring full facts to the notice of JBVNL through a party other than the petitioners so that an appropriate decision could be reached.”

“…we are of the opinion that facts presented before the High Court by respondent no. 1 Energy Watchdog seem to have given an impression to the High Court that all is not well in the inquiry which is to be conducted by JBVNL against respondent nos. 1 and 2. The High Court has in detail referred to the circumstances in which action was not taken against the petitioners despite a long-standing complaint by respondent nos. 1 and 2 at the right time.”, the Court said.

“We are sure that JBVNL will take its own decision on the basis of material to be placed before Energy Watchdog after due deliberation and caution and shall not convert the direction for oral hearing to that of a Court or Tribunal but a means to collect information to enable it to initiate necessary action.”, the Court added.

The Court, however, clarified that such participation of the NGO could not be treated as conferring upon the NGO the status of a party adjudicating the dispute.

“While we decline to interfere with the interim order passed by the High Court, we make it clear that we have not expressed any opinion on merits of the matter. At the time of final hearing, the High Court will consider all aspects of the matter, including the scope and ambit of third-party intervention in proceedings arising under the Electricity Act.”, the Court said.

Background

The dispute arose from an agreement dated May 17, 2012 between petitioner no. 1 and JBVNL for supply of surplus power generated from its captive power plant to petitioner no. 2. The agreement was subsequently renewed in 2017 and 2023.

Energy Watchdog lodged a complaint on April 15, 2024, alleging that petitioner no. 2 was using electricity generated from the Captive Power Generation Unit without possessing the requisite "captive user" status under Rule 3 of the Electricity Rules, 2005.

The NGO sought action under Section 135 of the Electricity Act and subsequently approached the Jharkhand High Court through a Public Interest Litigation, seeking a declaration that the electricity supply was illegal and unauthorised.

On August 26, 2025, JBVNL issued show cause notices and a demand notice of approximately ₹285 Crore i.e., ₹176.74 crore against petitioner no. 1 and ₹108.17 crore against petitioner no. 2.

Petitioner no. 1 challenged the maintainability of the PIL and objected to Energy Watchdog's participation in the proceedings.

The High Court, however, rejected the objection and permitted Energy Watchdog to participate in the proceedings initiated by JBVNL. Aggrieved, the petitioners-companies moved to the Supreme Court, which resultantly in light of the aforesaid terms have declined to interfere with the High Court's interim order.

Cause Title: M/S. AMALGAM STEELS AND POWER LTD. AND ANR. VERSUS ENERGY WATCHDOG AND ORS.

Citation : 2026 LiveLaw (SC) 896

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Appearance:

For Petitioner(s) :Dr. A.M. Singhvi, Sr. Adv. Mr. Sajan Poovayya, Sr. Adv. Mr. Mahesh Agarwal, Adv. Mr. Gaurav Khanna, Adv. Ms. Madhavi Agrawal, Adv. Mr. Naman Agarwal, Adv. Mr. Palash Maheshwari, Adv. Ms. Raksha Agarwal, Adv. Ms. Sindura N Swamy, Adv. Mr. E. C. Agrawala, AOR

For Respondent(s) :Mr. Prashant Bhushan, Adv. Mr. Vimal Kirti Singh, Adv. Mr. Matrugupta Mishra, Adv. Ms. Neha Rathi, AOR Ms. Akanksha V Ingole, Adv. Mr. Kushagra Kundan, Adv. Mr. Kumar Anurag Singh, Adv. Ms. Tulika Mukherjee, AOR Mr. Zain A. Khan, Adv. Ms. Ekta Bharati, Adv. Mr. Dev Aaryan, Adv. Mr. Mohd. Abran Khan, Adv. Mr. Nishant Kumar, AOR Mr. Apoorva Misra, Adv. Mr. Ashish Kumar, Adv. Mr. Gaurav Prakash Pathak, Adv.