Supreme Court Refuses To Interfere With P&H HC Ruling In Talwandi Sabo–Punjab Power Arbitration Dispute
Kirit Singhania
18 Feb 2026 2:14 PM IST
The Supreme Court has recently refused to interfere with a Punjab and Haryana High Court decision dismissing a writ petition filed by Vedanta Group company Talwandi Sabo Power Ltd against an arbitral tribunal's order that held part of its claim fell outside the scope of arbitration in its dispute with Punjab State Power Corporation Ltd (PSPCL).
A bench of Justices Sanjay Kumar and K. Vinod Chandran dismissed the special leave petition.
The Court said, “The special leave petition is, accordingly, dismissed, leaving it open to the petitioner, Talwandi Sabo Power Ltd., to take recourse to the remedy referred to in paragraph-13 of the impugned judgment/order in accordance with law.”
The dispute arises from arbitration proceedings between Talwandi Sabo Power and PSPCL under a Power Purchase Agreement dated September 1, 2008. During the proceedings, PSPCL raised a plea under Section 16(3) of the Arbitration and Conciliation Act.
It contended that Talwandi Sabo's claim alleging breach of coal obligation under the PPA had not been referred to arbitration by the Punjab State Electricity Regulatory Commission. It argued that the claim therefore did not fall within the tribunal's mandate.
The arbitral tribunal treated the objection as a preliminary issue and accepted it. It held that the claim relating to alleged breach of coal supply obligations under the PPA had not been referred to the tribunal and was therefore outside its mandate.
Talwandi Sabo challenged the tribunal's order dated July 31, 2025, by filing a petition under Articles 226 and 227 of the Constitution before the High Court. It sought to have the order quashed.
On December 12, 2025, Justice Jasgurpreet Singh Puri dismissed the writ petition. The Court held that once a plea under Section 16(3) of the Act is accepted, an appeal lies under Section 37(2)(a) of the Act.
It held that an effective statutory remedy was available and that writ jurisdiction cannot ordinarily be invoked in such circumstances. The High Court imposed costs of Rs 50 thousand on the company and directed that the amount be deposited with the High Court Legal Services Committee within three months.
For Petitioner: Senior Advocate Dr. S. Muralidhar, Advocates Vishrov Mukerjee, Ninni Susan Thomas, Megha, Pratyush Singh, Damodar Solanki, Garima Adlakha, Karun Sharma, Anupama Ngangom, Rajkumari Divyasana, Advocate-on-Record Pukhrambam Ramesh Kumar.
For Respondent: Senior Advocates Gurminder Singh, Shadan Farasat, Senior Additional Advocate General Maninder Singh, Additional Advocate General Rajat Bhardwaj, Advocate-on-Record Nikunj Dayal, Advocates Anusha Nagarajan, Jatinder Singh Gill, Kaustubh Chaturvedi.