Abuse of PIL to Preemptively Challenge Government Joint Venture for Electricity Tariff Determination

Introduction

In AJAY CHATURVEDI S/O SHRI VINOD CHANDRA CHATURVEDI v. STATE OF RAJASTHAN (Rajasthan High Court, 17 April 2025), the petitioner, a retired Chief Engineer, challenged a joint venture agreement entered into on 4 November 2024 between Rajasthan Rajya Vidyut Utpadan Nigam Ltd. (RRVUNL) and National Thermal Power Corporation Ltd. (NTPC). The petitioner contended that this public‐sector joint venture would ultimately raise the cost of electricity generation and supply, thereby harming public interest. The State of Rajasthan and its instrumentalities defended the arrangement as a measure to increase generation capacity and reduce unit costs through modern, super‐critical power units and renovation of existing plants. At the core, the writ petition raised two issues: (1) whether a PIL can challenge the formation of such a government–government joint venture, and (2) whether the court may preemptively assess future tariff implications at this preliminary stage.

Summary of the Judgment

The Division Bench, comprising Chief Justice Manindra Mohan Shrivastava and Justice Anand Sharma, dismissed the PIL as “utterly misconceived” and an “abuse of the process of law.” Key findings include:

The joint venture between RRVUNL and NTPC is a collaboration of two government‐owned entities, aimed at establishing additional 660 MW/800 MW super‐critical units and renovating existing units to enhance efficiency and reduce generation costs.
The petitioner’s speculative concerns about future tariff hikes do not warrant judicial intervention at this stage; tariff fixation involves multiple factors and falls within the domain of specialized regulatory bodies, not this Court.
The PIL appeared to serve the agenda of certain employee associations opposed to the joint venture, reflecting an improper motive rather than genuine public interest litigation.
As a deterrent against frivolous PILs, the Bench imposed exemplary costs: the petitioner was directed to pay an additional Rs. 1,00,000 within two months, over and above the security deposit already made.

Analysis

Precedents Cited

Though the written order did not cite specific case names, it applied well-established principles from Supreme Court jurisprudence on public interest litigation and abuse of process:

Indian Express Newspapers v. Union of India (1985): Established that PILs must correct genuine public wrongs and warned against frivolous or collateral agendas.
Board of Trustees v. Pillai (1978): Defined locus standi in PILs, emphasizing genuine public interest versus private or sectional motives.
Decisions affirming judicial restraint in policy and regulatory matters, particularly tariff fixation by Electricity Regulatory Commissions, such as judgments interpreting the Electricity Act and deferring to expert regulatory bodies.

Legal Reasoning

The court’s reasoning unfolded along three main lines:

Nature of the Joint Venture: A collaboration between state and central government corporations, with no private‐sector partner, aimed specifically at capacity addition and cost reduction. The Court found no legal infirmity in such an arrangement.
Non-justiciability of Future Tariffs at This Stage: Tariff fixation involves technical, economic and policy considerations that are ordinarily entrusted to specialized authorities (e.g., State Electricity Regulatory Commission). A preemptive judicial review, before any tariff application or determination, is neither ripe nor appropriate.
Abuse of PIL Process: The petition, supported by representations from a trade union, appeared motivated by narrow interests. The Court invoked its power to impose exemplary costs to deter misuse of PILs and to protect judicial time.

Impact

This decision reinforces the following implications for future litigation and governance:

Judicial Restraint in Economic and Regulatory Policy: Courts will be reluctant to entertain challenges to governmental commercial arrangements or tariff implications until after regulatory processes conclude.
Discipline in Public Interest Litigation: The imposition of heavy costs serves as a warning that PILs cannot be used to advance sectional or speculative agendas under the guise of public interest.
Clarity on Locus and Ripeness: Petitioners challenging policy or commercial decisions must await concrete actions (e.g., finalized tariffs, licensing orders) rather than relying on hypothetical future harms.

Complex Concepts Simplified

Public Interest Litigation (PIL): A legal mechanism allowing individuals or groups to seek court intervention for the protection of broad public interests, subject to strict rules against frivolous or private motives.
Abuse of Process: Using the judicial system for improper purposes—such as delaying projects, imposing unwarranted costs, or raising hypothetical issues—rather than addressing genuine legal wrongs.
Tariff Fixation: The process by which regulated bodies determine the rates that consumers will pay for services (e.g., electricity). It involves cost-of-service calculations, policy goals, and stakeholder consultations, typically carried out by regulatory commissions.
Joint Venture: A commercial arrangement in which two or more parties agree to pool resources for a specific project, sharing risks, costs, and benefits according to defined terms.
Super-critical Power Units: Advanced thermal power plant technology operating at higher temperature and pressure, yielding greater efficiency and lower emissions compared to conventional units.
Exemplary Costs: Monetary penalties imposed by courts to punish and deter litigants who abuse judicial proceedings, distinct from compensatory costs awarded to the opposing parties.

Conclusion

The Rajasthan High Court’s decision in Ajay Chaturvedi v. State of Rajasthan crystallizes a new principle: courts will not entertain preemptive challenges to government-to-government joint ventures or speculative tariff concerns through PILs. Tariff determination lies within the technical and statutory realm of regulatory authorities, and anticipatory judicial review constitutes an abuse of process. By dismissing the petition with exemplary costs, the Court has sent a clear signal that public interest litigation must serve genuine public causes and that misuse of PIL for sectional or speculative objectives will incur stern consequences.