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IN THE SUPREME COURT OF INDIA

CIVIL APPELALTE JURISDICTION

CIVIL APPEAL NO. 705 OF 2011 (Arising out of SLP (C) No. 23706 of 2010)

Zuari Cements Ltd. and others   ... Appellants  

Versus

A.P. Power Generation Corporation Ltd. and others    ... Respondents  

WITH

CIVIL APPEAL NO. 706 OF 2011 (Arising out of SLP (C) No. 23881 of 2010)

WITH  CIVIL APPEAL NO. 707 OF 2011

(Arising out of SLP (C) No. 28234 of 2010)

AND  CIVIL APPEAL NO. 708 OF 2011

(Arising out of SLP (C) No. 30805 of 2010)

O R D E R  

Leave granted.

2. Memoranda of Understandings (MOUs) were  

executed between the first respondent - Andhra  

Pradesh  Power  Generation  Corporation  Limited  

and  cement  companies  who  are  the  appellants  

herein for lifting of fly ash from its Thermal  

Plants.  Subsequently  the  first  respondent  

Corporation terminated the MOUs alleging breach

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on  the  the  part  of  the  appellants.  However,  

even  after  such  termination,  the  first  

respondent  permitted  the  cement  companies  to  

take 80% of the fly ash from two Thermal Units.  

3. Subsequently  the  first  respondent  

Corporation  invited  tenders  in  regard  to  the  

sale  of  fly  ash  and  the  cement  companies  

challenged  the  notice  inviting  tenders  by  

filing writ petitions.  The said writ petitions  

are  pending.   The  learned  Single  Judge  had  

passed  an  interim  order  therein  prohibiting  

finalization of tenders, on the ground that the  

appellants had been permitted to receive supply  

of fly ash even after termination of MOUs.  The  

said interim order passed by the learned Single  

Judge was challenged  by the first respondent-

Corporation by filing writ appeals.  A Division  

Bench of the Andhra Pradesh High Court by the  

impugned orders set aside the interim orders of  

the learned Single Judge, with an observation  

that pending finalisation of tenders, the first  

respondent  Corporation  may  consider  supplying  

fly  ash  to  the  writ  petitioners  for  use  in  

their industry.  The effect of the order of the  

Division  Bench  is  that  the  first  respondent-

Corporation is not bound to supply fly ash to

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the appellants.  

4. The  appellants  contend  that  tenders  

could not be issued with respect to supply of  

fly ash from the same units with respect to  

which  the  appellants  have  subsisting  

agreements.

5. When  the  special  leave  petitions  were  

filed by the appellants, this Court initially  

on  27th August,  2010  made  an  ex-parte  order  

directing  interim  stay  of  the  order  of  the  

Division  Bench  for  a  period  of  one  month,  

subject  to  appellants  making  payment  at  the  

rate of Rs.90/- per metric tonne of fly ash to  

the  first  respondent.   Subsequently  in  other  

cases similar orders were passed.   

6. The learned senior counsel appearing on  

behalf of the respondent-Corporation submitted  

that  the  appellants  have  themselves  made  an  

offer of Rs.390/- per metric tonne or more in  

response to the tender notice and, therefore,  

they cannot get fly ash at any lesser rate.

7. Learned  counsel  for  the  appellants  

submitted  that  their  contracts  for  supply  at

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lesser rates are subsisting; that higher offers  

relate to other units; and that distance of the  

thermal  unit  from  their  respective  cement  

factories plays an important role in the price  

offered. Various other grounds are also urged  

by the appellants.   

8. It  is  not  necessary  to  examine  this  

aspect at this stage as the writ petitions are  

still  pending.  Interest  of  justice  would  be  

served  if  a  suitable  interim  arrangement  is  

made for supplies pending the decision in the  

writ petitions.   

9. We,  therefore,  dispose  of  the  appeals  

modifying the interim order already granted by  

directing the continuation of the interim order  

during  the  pendency  of  the  writ  petition,  

subject  to  the  condition  that  the  appellants  

shall make payment for the fly ash taken from  

the respective dates of interim orders of this  

Court  and  for  future  supplies  during  the  

pendency  of  the  writ  petitions,  at  the  

provisional rate of Rs.250/- per metric tonne  

(instead of Rs.90/- per metric tonne) subject  

to final accounting and final decision in the  

pending writ petition.  

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10. If  the  appellants  fail  in  the  writ  

petitions,  they  shall  be  liable  to  pay  the  

difference  in  price  based  upon  the  highest  

offer  received  in  response  to  the  tender  

notice, in regard to the supplies received in  

pursuance of the interim orders, to the first  

respondent with interest on such difference at  

10% per annum from the respective due dates.   

11. Having  regard  to  the  facts  and  

circumstances and continuation of the interim  

arrangement,  we  request  the  learned  Single  

Judge to dispose of the pending writ petitions  

expeditiously,  preferably  within  three  months  

from today.  

      ................J. (R.V. RAVEENDRAN)

      ................J.  (A.K. PATNAIK)

New Delhi January 17, 2011