The Supreme Court of India has dismissed a batch of Special Leave Petitions filed by wind power companies from Andhra Pradesh, thereby upholding the rights of lenders, including PTC India Financial Services Ltd. (PFS), to recover outstanding dues from defaulting borrowers.
The borrowers had argued that disputes with state discoms (APSPDCL) under their Power Purchase Agreements justified their loan defaults and that their accounts should not be classified as Non-Performing Assets (NPAs). Earlier, interim orders of the Andhra Pradesh High Court had restrained lenders from declaring these accounts as NPAs or taking coercive recovery measures.
However, a Single Judge vacated these interim orders in July 2025, a decision upheld by a Division Bench, affirming that lenders being third parties to the PPAs cannot be denied their right to recover dues. The borrowers challenged this ruling before the Supreme Court.
On 16 September 2025, a Bench of Justices J.B. Pardiwala and K.V. Viswanathan refused to interfere with the High Court’s order, dismissing the petitions. The Court underscored that lenders cannot be made to suffer losses due to disputes between borrowers and third parties, thereby affirming the principle that defaulting accounts can be classified as NPAs and enforced against, independent of pending claims elsewhere
Appearances:
Petitioners: Mrs. Vibha Datta Makhija, Sr. Adv.; Mr. Shariq Ahmed, Adv.; Mr. Talha Abdul Rahman, Adv.; Mr. Tariq Ahmed, Adv.; Mr. Uday Bhatia, Adv.; Mr. M Shaz Khan, Adv.; Ms. Nehaol Venkateshwaran, Adv.; Mr. Vinay Vats, Adv.; M/s. Ahmadi Law Offices, AOR
Respondents: Mr. Amarjit Singh Bedi, AOR;Mr. Varun Chandiok, Adv.; Ms. Riya Seth, Adv.; Mr. Gaganpreet Sandhu, Adv.; Ms. Anubhi Goyal,Adv.
Mr. S. Niranjan Reddy, Sr. Adv.; Mr. Sidharth Sethi, AOR; Ms. Shreya Sircar, Adv.; Mr. Deepank Anand, Adv.; Ms. Rajeshwari, Adv.
Mr. Yelamanchili Shiva Santosh Kumar, Adv.; Mr. Rudrajit Ghosh, Adv.; Mr. Avi Leuna, Adv.; Ms. Khyati Chhabra, Adv.; Mr. Satish Kumar Shukla, Adv.; Mr. Tarun Gupta, AOR
