ORIENT POWER COMPANY (PRIVATE) LIMITED vs SUI NORTHERN GAS PIPELINES LIMITED award

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ORIENT POWER COMPANY (PRIVATE) LIMITED VS SUI NORTHERN GAS PIPELINES LIMITED award---Unjust enrichment---'Juristic reason' for enrichment---Scope---Gas Supply agreement ('GSa') between a power generation facility ('power company') and distributor of natural gas ('SNGPL')---Dispute over payment for gas after power company refused to take up gas from SNGPL---Question as to whether the award rendered by the arbitrator in favour of SNGPL amounted to unjust enrichment---Held, that although SNGPL was receiving payment for the same amount of gas twice, it needed to be clarified that this was upon failure of the power company to take up the gas, and further, the SNGPL, in any case, was not recovering the same amount, due to the fact that it was redirecting transmission to its domestic consumers, which paid a lower tariff than Independent Power Producers (IPP) like the power company---Furthermore, to allow the power company's claim would mean overlooking the fact that SNGPL was still under an obligation to supply the Make-Up Gas to the power company at any time within the duration stipulated under the GSa, therefore, there was a 'juristic reason' for the enrichment---Further, the power company had failed to prove its deprivation as it was entitled to Make-Up Gas at a later date, which it failed to avail within the stipulated time frame---Furthermore the arbitrator while dismissing the claim of unjust enrichment raised by the power company correctly explained that SNGPL expanded monies to construct the infrastructure to deliver gas to the power company; that SNGPL remained liable to its upstream suppliers even if the power company chose not to take the Take or Pay Quantity but opted to pay instead and to Make Up Gas later; that SNGPL had to bear the responsibility of cutting its losses and find an alternative buyer (even at a lower price) for the Gas not taken by the power company and the likely additional costs of its transmission, distribution and unaccounted for gas---Power company (appellant) had failed to make out a claim for unjust enrichment, and the award rendered by the arbitrator was not disproportionate to the losses suffered by SNGPL---appeal was dismissed.

ORIENT POWER COMPANY (PRIVATE) LIMITED vs SUI NORTHERN GAS PIPELINES LIMITED award — 2021 SCMR 1728 SUPREME-COURT

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