NDLI: Bses Rajdhani Power Ltd. Vs. Delhi Electricity Regulatory Commission

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	Electricity Act 2003
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Case(s) Referred	Referred Case 0 Referred Case 1 Referred Case 2
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Allowed
Headnote	Electricity Act, 2003 : ss. 2(17), 12, 14, 43, 61, 62 and 64 – Determination of tariff – Exercise of ‘truing up’ – Appellants are distribution licensees, involved in distributing and supplying electricity in their designated areas within the NCT of Delhi – In terms of the 2003 Act, Delhi Electricity Regulatory Commission DERC, regulated the Annual revenue requirement-ARR of the appellants to conduct the licensed business and consequently the tariff to be recovered from the consumers – DERC made disallowances in Tariff orders dated 26.08.2012 for determination of ARR and Tariff for FY 2011-12 and truing up of financials for FY 2008-09 and FY 2009-10 – DERC changed methodology of computation of ARR at the stage of true up – Challenged by the appellants before the appellate tribunal for Electricity – Appellants contented that since privatization, the ARR determined by the DERC was not even sufficient to meet the actual power purchase cost which led to creation of a huge revenue gap; that the DERC in repeated disregard to its statutory regulations and its own statutory advice refused to make periodic increase in the tariff rate, leading to the indebtness of appellants – Findings of DERC confirmed by APTEL – On appeal, held: It is not permissible to amend the tariff order during true up exercise – On the pretext of prudence check and truing up, DERC could not have amended the tariff order – Regulator cannot ‘change the rules after it has begun’ in the ‘truing up exercise’ – Thus, the findings of the DERC, as confirmed by the APTEL in the on issues pertaining to change in methodology in computation of AT&C losses; change in methodology for computation of depreciation; disallowance of salary for FR/SR Structure; and disallowance of Fringe Benefit Tax, are contrary to the order of the original MYT determination Tariff Order dated 23.02.2008 and 28.05.2009, thus, set aside – As regards the disallowance of interest incurred on Consumer Security Deposit retained by DPCL, the appellants are entitled to recover interest on Consumers Security Deposit as held by the DPCL – As regards, reduction in million units in relation to enforcement sale for the purpose of calculation of Aggregate Technical and Commercial losses, pertaining to theft/unauthorized use of electricity, the assessed energy has to be considered as supply by the appellants in the enforcement cases – DERC to consider assessed energy for calculation of enforcement sales and allow the impact of the same along with carrying costs – Thus, the order of the DERC and the judgment of the APTEL impugned herein are set aside.s. 64 – Procedure for tariff order – Amendment of tariff order made u/s. 64 during the ‘truing up’ exercise – Permissibility of – Held: A tariff order is quasi-judicial in nature which becomes final and binding on the parties unless it is amended or revoked u/s. 64(6) or set aside by the appellate authority – ‘Truing up’ stage is not an opportunity for the DERC to rethink de novo on the basic principles, premises and issues involved in the initial projections of the revenue requirement of the licensee – ‘Truing up’ exercise cannot be done to retrospectively change the methodology/principles of tariff determination and re- opening the original tariff determination order thereby setting the tariff determination process to a naught at ‘true-up’ stage – Revision or re-determination of the tariff already determined by DERC on the pretext of prudence check and truing up would amount to amendment of the tariff order, which can be done only as per the provisions of sub-Section (6) of s.64 within the period for which the Tariff Order was applicable – DERC cannot amend the tariff order for the period 01.04.2008 to 31.03.2010 in the guise of ‘true-up’ after the relevant financial year is over and the same is replaced by a subsequent tariff Order – This would amount to a retrospective revision of tariff when the relevant period for such tariff order is already over – Thus, not permissible to amend the tariff order made u/s. 64 during the ‘truing up’ exercise.s. 125 – Appeal to Supreme Court – Exercise of jurisdiction under – Held: Existence of a ‘substantial question of law’ arising from the judgment of the APTEL is sine qua non for exercise of jurisdiction by this Court u/s. 125 – Code of Civil Procedure – s. 100. ‘Truing up’ – Meaning of – Held: ‘Truing up’ is the adjustment of actual amounts incurred by the licensee against the estimated/projected amounts determined under the Annual revenue requirement-ARR.‘Substantial Question of Law’ – Meaning of – Discussed. ‘Appeal’ – Meaning – Discussed.
Judge	Hon'ble Mr. Justice S. Abdul Nazeer
Neutral Citation	2022 INSC 1105
Petitioner	Bses Rajdhani Power Ltd.
Respondent	Delhi Electricity Regulatory Commission
SCR	[2022] 14 S.C.R. 790
Judgement Date	2022-10-18
Case Number	4324

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