Indian Thermal Power Ltd. Etc. Etc vs State Of M.P. And Ors

The Supreme Court addressed the validity of Power Purchase Agreements (PPAs) and the establishment of Escrow Accounts under the Madhya Pradesh Electricity Board's policy for private participation in the electricity sector. The Court held that the agreements must ensure adequate security for payment obligations, emphasizing the necessity of maintaining an Escrow Account as stipulated in Article 8 of the PPA. The judgment affirmed the enforceability of the terms agreed upon by the parties, thereby upholding the contractual obligations of the Madhya Pradesh Electricity Board to the Independent Power Producers.