In a major blow to Adani Power and Tata Power over power plants in Gujarat's Mundra, the apex court on Tuesday has set aside an order of the Appellate Tribunal for Electricity (APTEL) that had awarded compensatory tariff to Tata Power and Adani Power.
However, the details of the court's order are yet to come but the compensatory order being set aside shows no sign of relief for Tata Power and Adani Power.
The tribunal, in April last year, had said that the two companies needed to be compensated as the change in Indonesian laws on coal export prices were outside the control of these companies.
Tata Power and Adani Power in their appeal to Aptel had demanded a change in Indonesian regulations in 2010 which was followed to the rise in the cost of imported coal, which both the companies use to run their power plants.
In its response Aptel had ruled in favour of the two companies in April 2016. It said that both the firms needed to be compensated as any change in regulations is not in its control.
However, today the Supreme Court sat aside the order stating that the regulations could only mend if there would be any change in domestic laws.
The latest Supreme Court order has impacted the shares of both the companies.
Shares of Tata Power reversed early gains to fall as much as 6.78 per cent, while Adani Power slumped up to 20 per cent to its lowest since February 21.